Foreign Company's Direct Investment's Spillover Effect On Chinese Local Automobile OEMs

The spillover effect brought by foreign direct investment is always a hot topic in academic studies.Depending on the interaction between invest country and host countries,the effects of technical spillover are different.For this topic,the studies in different countries and regions show different results.Since the reform and open-up,our automobile industry implement the “exchange the market for technology” strategy,since then huge amount of foreign investment are attracted.After 30 years of development,local OEMs developed rapidly,and step by step take the market share of joint ventures.This paper combine the related data analyze the spillover effect on foreign direct investment on local OEMs,so that can provide suggestions for the better development of local OEMs.This paper first reviews the spillover theory development,and introduces the international and domestic studies through spillover's existence;spillover tunnels and affect factors these 3 aspects.And then introduces the research viewpoints of the strategy “exchange market for technology”.After that introduces the way how spillover from FDI affect Chinese local OEMs,and explain the current situation of Chinese local OEMs.This paper also shows the difference between Chinese local OEMs and joint ventures,and the problems during the development of Chinese local OEMs.In addition,the paper presents the empirical studies on local OEMs,shows that the spillover has effect but less than the strategy expected.After that also use ChangAn Automobile as a study sample,analyze the successful experience and the problems,also with co-integration analysis,shows the effect on single company.At the end of this part,with a survey for employees of Chinese local OEMs,a similar result is shown from the survey.Base on above research,in last paragraph shows the suggestions are provided both on company level and government level,in order to develop Chinese local OEMs in a better way.