Shanghai and private industry will be spending around 50 billion
yuan (US$6.3 billion) to turn Anting, an auto manufacturing town in
northwestern Shanghai, into China's Detroit.
The huge construction project began Friday with a batch of programs
including building some auxiliary transport infrastructure, the
Shanghai Automotive Industry Quality Testing Research Institute,
the Tongji Automobile College and a novel city-level used car
trading center. These efforts will cost a combined US$301 million
(2.5 billion yuan).
It
will take five to 10 years to shape Anting, where Shanghai
Volkswagen is located, into one of China's leading automaking
centers. The goal includes having the area feature auto-related
manufacturing, exhibition space, trading ability and tourist
services.
The 68-square-kilometre auto town eventually will feature a
first-class racetrack suitable for the Formula One world
championship circuit. China has little experience hosting such top
auto racing tournaments because it lacks proper facilities.
Volkswagen's imprint will be all over the area, with a motif
similar to the company's base in Wolfsburg, Germany.
Of
the expected 50 billion yuan investment in the project, about half
will come from foreign investors, said Cheng Guang, deputy director
of the Shanghai Municipal Development Planning Commission.
The Anting project is necessary to boost the city's pillar auto
industry, Cheng said. This is a reasonable response to China's
coming entry into the World Trade Organization (WTO), which will
pit the domestic auto industry against tougher global players,
analysts said.
Shanghai Volkswagen now makes 250,000 Santanas and Passats
annually, and Anting is now home to a growing number of automobile
component plants.
"Our attention will focus not only on auto manufacturing but other
related areas, like services and trading,'' Cheng noted.
By
2010, Cheng predicted, Anting's annual trade volume could hit US$36
billion (300 billion yuan).
The prediction echoes other analysts' forecasts for China's sedan
purchases to triple by the end of 2010, with big cities like
Beijing and Shanghai seeing surging demand for cars.
So
far, more than 20 global auto firms have shown interest in being
involved in Anting's proposed trading zone, said Zhang Lichun,
general manager of the Shanghai Autotown International Development
Co Ltd, one of a group of newly established firms working on the
project.
Domestic auto manufacturers such as Changchun-based First
Automotive Works will play an active role in the huge project,
Cheng said.
Despite the highly anticipated plan, some analysts cautioned that
it is a government-orchestrated move and not an industry-based
effort. It will take time to see how tenants attract the necessary
investment and bring in a market-driven management style, they
said.
(China
Daily 09/28/2001)