Until 2017, Chinese automotive policy required that a foreign carmaker must form a joint-venture with a Chinese carmaker if the former plans to produce vehicles in the country, with the Chinese carmaker owning 51% of the joint venture. However, since 2017, the Chinese government had indicated that it would liberalize foreign control in the automotive sector, allowing full ownership by foreign companies.[8]
In 2017, Tesla was allowed to set up a plant in Shanghai city, making it the first foreign automaker to open a wholly owned factory in China.[9] In 2022, BMW and Volkswagen had acquired 75% stake in their joint ventures, which enables them to have the majority control of its Chinese joint ventures.
Before 2017, foreign automotive companies establishing joint ventures in China had to adhere to two requirements.
The ownership ratio for foreign manufacturers in joint ventures in China was not allowed to exceed 50%, with the common scenario being a 51:49 ownership ratio between the Chinese and foreign partners.
The maximum of only two joint ventures could be established.[11]
Since 2017, the Chinese government had indicated that it would liberalize foreign control in the automotive sector, allowing full ownership by foreign companies. Volkswagen, for example, has already established two joint ventures (being FAW, SAIC) since 1980s, established its third joint venture VW-JAC.
Below is a list of major car company joint ventures ever existed in mainland China (truck and coach JVs not included). Early 1980s-90s CKD assembly agreements are not included as the production numbers are typically negligible compared to later JV efforts. Technology transfer agreements to domestic brands are also not included.
Current and defunct joint venture manufacturer in Mainland China
Due to the limited market size, automotive manufacturers in Taiwan have relatively small-scale operations. The majority of major manufacturers engage in contract manufacturing for foreign car brands from Japan and the US. Only a few manufactures, like Yulon and China Motor, have their own brands.