Executive Summary

In 1991 the Chinese government published its eighth five-year plan (1991–1995), which designated the automotive industry as a "pillar industry" that would drive the economy in the twenty-first century. Accordingly, in its most recent five-year plan for the Chinese automotive industry (2001–2005), the government stated that its immediate goal is to produce over 1 million cars a year.

At present, China has relatively few motor vehicles per capita, and, of the cars on its highways, few are privately owned. In 2001 China had 18 million vehicles, of which 5 million were cars. If China’s number of motor vehicles per capita were comparable to the world average, its fleet would have to total 160 million, with 10 million new and replacement vehicles acquired each year.

The 2001–2005 plan for the automotive industry calls for its massive restructuring—from 118 individual manufacturers to 3 large automotive groups and from several hundred parts suppliers to 5–10 large supplier groups. The industry also is encouraged to produce, independently of foreign manufacturers, a Chinese economy car, utilizing a 1.3-liter engine and meeting Chinese emissions and fuel economy standards, that could be purchased for less than RMB80,000 ($9,800). Investments in highways, oil and gas pipelines, and other transportation infrastructure are expected to accompany the expansion of car ownership.

Assuming continued economic growth, it is highly likely that China’s vehicle fleet will grow rapidly. Although such a rapid growth will bring many benefits to China, it also will present its social, environmental, and economic systems with serious challenges.

In mid-1999 representatives of the Chinese Academy of Engineering (CAE) visited the U.S. National Research Council (NRC) to explore the prospects for collaboration between the two institutions on a study of the future of the personal car in China. The study was to suggest strategies for developing a Chinese national car, as described in China’s five-year plan for the automotive industry, and the role of such a car in the national transportation system. It would take into account China’s social development, opportunities for cooperation between government and industry, and the impact of a large increase in the number of private cars on sustainable development. The study also was to examine the various options that might be available to mitigate problems such as increased congestion, pollution, and energy consumption. In 2001 the study committee, composed of an equal number of Chinese and American experts, began work.

View paper at The National Academies Press