China's Auto Industry Independent Innovation

In1886, Karl Benz invented the automobile, which led to the beginningof the glory of global automobile civilization, and almost all theindustrial countries had developed auto industry as pillar industry tosupport national economy. In twenty-first Century, there is no doubt thatauto industry is still the one of the most important standards to evaluatenational economic and technological development level. In this paper,Schunmpeter’s innovation theory has been used as the research basis todo in-depth analysis of the theory and its affecting factors; This articleuses the independent innovation of Chinese automobile industry as theresearch object, applying the empirical analysis method, andcomprehensively analyzes the status of independent innovation Chineseautomobile industry, clearly points out its current problems such as lackof government policy guidance and support, low industrial concentration,shortage of talented people, too much reliance on foreign technology, andthe absence of brand popularity etc., and it also indicate the causes ofthose problems. Combining historical and empirical analysis methodstogether, the article compares the development paths of automobileindustry in Japan and Korea. Both countries’ automobile industry facedthe dilemmas similar to China’s, but they gradually improved to advancedstage of independent innovation. In this case, both governments use"visible hands", including government protection, government-ledinnovation system construction, competition encouragement and otherpolicies such as supporting large automobile group to expand theinternational market, in order to realize the goal of innovation ofgovernment policy in different stages of development of automobileindustry. What’s more, this article summarizes the advantages anddisadvantages during the transformation process, for example, theirinnovation experience of reliable quality, low cost, fuel-saving, and thedevelopment of industrial clusters; The negative example is the world famous Toyota recall case due to their excessive cost reduction. Base onthe factors influence the independent innovation of China’s automobileindustry and the AHP method from the macroscopic angle, this articleestablishes the innovation index system of Chinese automobile industry.The index is measured from three dimensions, which are environment,resource input and output, and the time span of the index is from2005to2012. Through empirical analysis, the article verifies the reliabilityof the measurement index system and explores the China automobile industryindependent innovation system construction policies from the macroscopicangle. Also, by using the AHP method from the microscopic angle, thisarticle constructs the index system of independent innovation Chinaautomobile enterprises from two dimensions of innovation resources inputand output measurement system, which refers the Great Wall automobile datafrom2008to2010as resource to study the enterprise innovation indextest, and through the empirical analysis to verify the reliability ofmeasurement index system in order to explore the path of independentinnovation and Chinese automobile enterprises from the microscopic pointof view. This article also analyzes different strategies of re-innovationfrom absorption and independent innovation by using standard analysis andgame analysis. Chinese government must give guidance for the independentinnovation, and give reasonable fiscal subsidies for those automobileenterprises. Last but not least, this article proposes suggestions tostrengthen Chinese automobile industry independent innovation abilityfrom the macro prospective, and indicates the fact that Chinese automobileenterprises should apply contingency theory to choose their owninnovation path from the micro prospective.