At the beginning of 2022, the automotive industry ushered in a new policy east wind.
On New Year's Day 2022, the Regional Comprehensive Economic Partnership (RCEP) officially entered into force. Subsequently, according to the news released on the website of the Ministry of Commerce, on January 24, the Ministry of Commerce and other six departments jointly issued the "Guiding Opinions on High-Quality Implementation (RCEP)", which aims to guide localities, industries and enterprises to adapt to a more open environment in the regional market, seize the opportunities brought by RCEP, and promote high-quality economic development.
RCEP is a regional comprehensive economic partnership agreement jointly formulated by 10 ASEAN countries and 15 countries in China, Japan, South Korea, Australia and New Zealand, as early as 2012, the agreement was formally proposed and launched related negotiations, which lasted 8 years, in 2020, 15 countries finally agreed to sign RCEP, which means that the world's largest free trade area was officially born.
What does RCEP mean for the automotive industry?
The content of the RCEP agreement covers many fields such as trade in goods, trade in services, investment and economic and technical cooperation, and the goal is very clear, that is, to reach a comprehensive and mutually beneficial regional free trade agreement among member countries, strengthen economic cooperation between each other, broaden and deepen economic integration, and thus promote regional economic growth.
The first is the impact on the import and export of automobiles.
Subdivided into the automotive sector, the sales data released by the China Automobile Association shows that China's automobile export volume exceeded 2 million vehicles (2.015 million units) for the first time in 2021, doubling from 2020. Among them, ASEAN, like Central Africa and South America, is the main export area of Chinese automobiles.
According to the relevant regulations, after the RCEP agreement came into force, more than 90% of the trade in goods in the region finally achieved zero tariffs. This also means that the auto products between member countries will be free trade to a large extent, and the domestic auto import and export business will have a great boost effect.
Not only the whole vehicle, but also the import and export business of the auto parts industry will be fully accelerated after the implementation of RCEP. According to the information released by the General Administration of Customs, after the implementation of the RCEP, the mainland has reduced the import tariff of about 65% of auto parts, which is undoubtedly a major positive for automobile manufacturers who need to import parts from RCEP member countries.
RCEP will make Chinese brands more competitive
RCEP will further accelerate the circulation of auto parts between member countries, Japan, South Korea is a member of the RCEP, but also the world's major auto parts suppliers, RCEP after the entry into force, from Japan, South Korea and other countries imported to the domestic auto parts costs, will benefit from tariff concessions and more price advantages.
In addition, in terms of overseas layout, RCEP can further clear the way for Chinese brands.
Finding a breakthrough in a relatively mature market is undoubtedly very difficult, and it will obviously be more effective to tilt resources to ASEAN, Australia, New Zealand and other regions where the automotive industry is relatively weak, especially with RCEP, the preferred destination for overseas layout will become more clear.
At present, among the top vehicle companies in terms of domestic export volume, RCEP member countries have actually laid a good market foundation.
SAIC motor has overseas bases in Thailand and Indonesia, and Australia and New Zealand are the main overseas marketing service outlets; Chery regards Indonesia, Thailand and Malaysia as strategic hubs for future overseas layout; Great Wall Motors has acquired GM's Rayong plant in Thailand and built a KD plant in Malaysia; Geely Automobile recently announced that it will join hands with Renault to enter the Korean market and will use Renault-Samsung's Busan plant to produce models in South Korea in the future. In addition, Geely Automobile has also acquired the Proton brand in Malaysia and built a vehicle and powertrain manufacturing plant in Malaysia.
On the whole, many RCEP member countries are a vital part of the overseas layout of Chinese car companies, and the arrival of RCEP will make the operation and development of Chinese car companies in these countries more smooth. Cui Dongshu, secretary general of the Association, said in an interview that after the RCEP takes effect, it can provide a good comprehensive guarantee for Chinese car companies to go to sea, which is more conducive to the localization development of car companies in the local area.
Xiaoxiang Morning News reporter Hu Xiong
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