economy - Car export expectations scaled down


China as a major exporter of cars becomes more and more an illusion, writes Reuters from Shanghai.
Foreign manufacturers and their supplies have been scrambling to get their act together since China embarked into a car craze, shortly after the country entered the World Trade Organization (WTO). While the domestic market might not be enough to justify the dozens of billions of US dollars worth of investments, manufacturers have also kept an eye on the possible export market, although the car industry worldwide suffers from a gigantic overcapacity at this stage.
China has now scaled back the official goal to export 40 percent of its domestic car production to a mere 'aspiration' and tariffs are expected to stay in place.
China-produced cars still cost about 30 percent more, says the article, because of the high tariffs on components that have to be imported. On top of that are car prices high because to the high margin for producers, despite price cuts in the past two years, making the market very interesting at this stage, but more troublesome in the middle-long range.