China excludes foreign brands from 2012 official vehicle purchase list

Article by Anita Panait, on February 28, 2012

China has released an initial list of vehicle brands that government officials could only buy in 2012. In a statement posted on its Web site, the Ministry of Industry and Information Technology said the list includes 412 domestic models and brands from Chinese companies including BYD Co. and Geely Automobile Holdings Ltd.

Notably absent from the 2012 purchase list were foreign brands, although five alternative-energy vehicle brands were included.  The latest list shows China’s determination to favor its local automotive industry against foreign brands like Mercedes Benz and Audi, which have been the traditional choices for government cars. 

The Ministry of Industry and Information Technology, however, did not specify whether the purchase list encompasses vehicles used by all government bodies, including the senior posts. The list is seen as compliance to rules that China issued in November 2011 on vehicle procurement by government and Communist Party agencies. The rules were drafted to regulate official car purchases and hike transparency of the procedure. 

China imposes these rules as part of the government’s efforts to slash administrative costs, save energy and reduce pollution.

Under the rules, vehicles used for official purposes, such as tax collection and criminal investigation, should have an engine capacity of not more than 1.8 liters and should be priced at 180,000 yuan ($28,571) or less. The rules also state that purchases could only be made from carmakers that have spent no less than three percent of their core revenue on research and development in the past two years.

Topics: china

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