Research On Market Structure Of China Automotive Industry

Market structure refers to the competitive relations among enterprises in one industry. Therelations determine the type of market structure and are affected by the number and scale ofenterprises, product differentiation and barriers of in and out. Auto industry has been deemed to atypical oligopoly market by industrialists and theorists because of the traits that includesignificant economies of scale, extensive correlation, higher barriers and so on.Market structure of Chinese auto industry has been optimized after reform and open andaccessing WTO, but there are still some problems such as lower scale level, numerous smallenterprises, higher vertical integration, unreasonable structure of products and brands, losingefficacy about barriers of in and out and so an. And it still do not belong to the type of marketstructure of oligopoly.First, author estimated the real condition on overall and segment car market with the datainclude output, sales, the number of firms from1996to2012. The overall auto market structurepresents the low level of monopoly, while the passenger car market also presents the low level ofmonopoly besides crossover car market. But the market of commercial vehicles and itssegmentation markets present higher level of oligopoly. Secondly, as a comparison, the paperanalysis the situation and the trend of market structure of the global auto industry. Again, bydiscussing the main factors that affect the type of market structure, we found out the problemsand reasons for the lower level on market structure of Chinese auto industry. Finally, with thedirection of oligopoly type of market structure, we put forward the related countermeasures ofoptimization.