China Needs Talent for the Auto Industry

By: EW News Desk Team   Date: 19 July 2011

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EW News Desk Team

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EconomyWatch, News Desk Team

 

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19 July 2011

China may be the world’s largest auto market; but despite its rapid growth in the past two year, the country still lags behind Germany, Japan and the United States in terms of technology, development environment, innovation and talents, according to Fu Yuwu, vice chairman with the Society of Automotive Engineers of China.

Speaking at the eighth China Changchun International Auto Expo, Fu identified the lack of talent in China as the main roadblock for the continued advancement of the country’s auto industry.

“The root cause of all the other three weaknesses (technology, development environment, innovation) is the talent shortage,” said Fu, as quoted in the China Daily. “The world's largest auto market has to solve the problem in order to transform from a big auto manufacturer to a strong one.”

Similarly, Zhang Xiaoyu, executive vice president of China Machinery Industry Federation, told the China Daily at the 2011 International Forum on Advanced Vehicle Technologies and Integration – held on the sidelines of the Auto Expo – that independent innovation had been sorely lacking in the industry.

“The auto industry never lacks market and capital. What it urgently needs is technology, but the key to acquire the technology is the talent that masters the technology," said Zhang.

“That's why we hold the VTI 2011 during the auto expo this year, through which we hope to promote inter-industry technological exchanges."

Zhang noted that while Chinese auto sales are likely to increase from 18.06 million vehicles last year to 20 million units this year, this was not enough for the auto industry to achieve sustainable growth and competitive advantage.

“We only have the superiority of scale without any technological strength," said Zhang.

The Chinese auto industry experienced a major slowdown in sales for the first half of the year – caused primarily by the removal of government incentives, the implementation of purchase limits in some Chinese cities and rising oil prices. From 2009 to 2010, China’s auto sales experienced growth of 50 percent and 30 percent respectively, compared to the 3.25 percent increase seen in the first half of 2011.

Local Chinese auto manufacturers, in particular, were badly affected as consumers turned to foreign brands for better quality and performance. Zhang warned these companies that they should no rely on government policies to enable their survival.

"Industry restructuring is inevitable. Products and enterprises that fail to withstand the test of the market should be weeded out," Zhang said, adding that policy support should only be limited to technological research such as in the component sector.


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