Notice from the three ministries on the issuance of the 'Medium and Long-term Development Plan for the Automotive Industry'

People's governments of provinces, autonomous regions, and municipalities directly under the central government, Xinjiang Production and Construction Corps, relevant ministries and commissions of the State Council, and directly affiliated institutions:

The "Medium- and Long-Term Development Plan for the Automobile Industry" has been approved by the State Council and is now issued to you. Please implement it seriously.

Ministry of Industry and Information Technology National Development and Reform Commission Ministry of Science and Technology April 6, 2017 Medium- and Long-Term Development Plan for the Automobile Industry

The automobile industry is an important force driving a new round of technological revolution and industrial transformation, a crucial support for building a strong manufacturing country, and an important pillar of the national economy. The healthy and sustainable development of the automobile industry is related to the daily travel of the people, the smooth circulation of social resources, and the comprehensive leap of ecological civilization. Currently, technologies such as new generation information communication, new energy, and new materials are accelerating their integration with the automobile industry, leading to profound changes in the industrial ecosystem and a complete reshaping of the competitive landscape. China's automobile industry has entered a strategic opportunity period for transformation and upgrading, moving from large to strong. This development plan is formulated to implement the strategic deployment of the Party Central Committee and the State Council regarding building a strong manufacturing country and promoting the construction of an automobile power.

I. Current Development Status and Challenges (1) Significant achievements in the development of China's automobile industry.

Since entering the new century, China's automobile industry has developed rapidly, forming a complete industrial system with a wide variety of products. The research and development capabilities for complete vehicles have significantly strengthened, energy conservation and emission reduction effects have been remarkable, quality levels have steadily improved, Chinese brands have rapidly grown, and international development capabilities have gradually enhanced. In particular, in recent years, certain competitive advantages have been formed in sub-markets such as commercial vehicles and sport utility vehicles. The development of new energy vehicles has made significant progress, moving from a nurturing phase to a growth phase. In 2016, China's automobile production and sales exceeded 28 million units, ranking first in the world for eight consecutive years, with sales of Chinese brand vehicles accounting for about 50%, significantly increasing market recognition.

The continuous growth of the automobile industry has strengthened its position and role in the national economy, making outstanding contributions to promoting economic growth, enhancing social employment, and improving people's well-being. The tax revenue from automobile-related industries has consistently accounted for over 10% of national tax revenue for many years; employment in this sector has also exceeded 10% of urban employment nationwide; automobile sales have accounted for over 10% of national retail sales.

At the same time, the problem of China's automobile industry being large but not strong remains prominent. This is reflected in insufficient mastery of key core technologies, shortcomings in the industrial chain, an innovation system that still needs improvement, slow progress in building international brands, urgent need to enhance corporate strength, emerging risks of overcapacity, and safety performance issues in commercial vehicles. The enormous number of vehicles brings increasingly prominent issues related to energy consumption, environmental protection, and transportation. (2) Major changes are facing the development situation of the automobile industry.

Product forms and production methods are undergoing deep changes. With continuous breakthroughs in energy revolution and new materials as well as new generation information technology, automotive products are accelerating their development towards new energy sources, lightweight designs, intelligence, and connectivity. Automobiles are transforming from mere transportation tools into large mobile intelligent terminals, energy storage units, and digital spaces where passengers, vehicles, goods, operating platforms, and infrastructure achieve intelligent interconnection and data sharing. The production methods are evolving towards an intelligent manufacturing system characterized by full interconnectivity and collaboration; upstream and downstream relationships within industries are becoming closer; production resources are achieving efficient global allocation; research and manufacturing efficiency is significantly improving; personalized custom production models are becoming a trend.

Emerging demands and business models are accelerating their emergence. The deep integration of the internet with automobiles has fully released demands for safe driving experiences, convenient travel options, mobile office solutions, local services, entertainment leisure activities etc., making user experience an important factor influencing automobile consumption. The guiding role of internet social circles on consumption is gradually strengthening; diverse characteristics of consumer demand are becoming increasingly evident; the proportion of aging populations and new generation users continues to rise; shared mobility and personalized services have become major directions.

The industrial structure and ecological system are undergoing profound adjustments. Developed countries in the automotive sector have proposed industrial upgrade strategies one after another to accelerate innovation in industries as well as integrated development. Developing countries are also speeding up their layouts by leveraging advantages such as cost and market opportunities to actively undertake international industrial transfers. China is deepening reforms comprehensively while accelerating its internationalization process within the automotive industry. Industrial boundaries are becoming increasingly blurred as emerging technology companies like those in internet sectors enter into automotive industries en masse. Traditional enterprises are merging with emerging companies for cooperative development; value chains, supply chains, innovation chains are undergoing profound changes; global automotive industry ecosystems are being reshaped. (3) There is a good foundation and favorable conditions for building a strong automotive nation.

New energy vehicles (NEVs) and intelligent connected vehicles (ICVs) are expected to become breakthrough points for seizing opportunities for rapid development. Currently, China's NEV technology level has significantly improved; its industrial scale is rapidly expanding; its industrial chain is becoming increasingly complete. The strength of information technology industries supporting automotive intelligence and connectivity continues to grow; internet industries hold certain advantages globally; international discourse power regarding technologies and standards in information communication fields has greatly increased; Beidou satellite navigation system is about to achieve global networking.

The enormous potential with rich market demand provides continuous momentum for industrial development as well as upward space. With accelerated progress in new-type industrialization and urbanization alongside developments in overseas emerging automotive markets, China's automobile production will continue to maintain steady growth—expected to reach around 30 million units by 2020 and around 35 million units by 2025. The scale of aftermarkets such as maintenance services, financial insurance services as well as used car markets will expand rapidly. At the same time differentiated diversified consumer demands will drive enterprises towards innovation across multiple dimensions including technology products services standards etc., seizing opportunities for development in emerging fields.

The implementation of strong manufacturing country strategies along with "Belt & Road" initiatives provide important support as well as developmental opportunities for industrial growth. The promotion implementation of intelligent manufacturing will strongly drive industrial transformation upgrades while gradually solidifying common technological foundations through strengthening industrial capabilities; "Belt & Road" initiatives will make overseas developmental channels smoother while facilitating market exploration along these routes—automobile industries will collaborate with other advantageous sectors to accelerate mechanisms for global layout as well as international development.

To build a strong automotive nation it is essential to seize current rare strategic opportunities actively respond to challenges strengthen overall planning enhance innovation-driven approaches promote cross-border integration improve institutional mechanisms drive structural adjustments along with transformation upgrades.

(1) Guiding Ideology.

Deeply implement the spirit from the Party's Eighteenth National Congress along with Third Fourth Fifth Sixth Plenary Sessions firmly establish as well as implement innovative coordinated green open shared developmental concepts promote mass entrepreneurship mass innovation advance supply-side structural reforms within automotive industries regulate total volume optimize structure foster collaborative innovations while transitioning towards upgrades—strengthening legal construction while promoting collaborative innovations both within industries as well as externally optimize environments for industrial developments; using NEVs along with ICVs as breakthrough points leading transformations upgrades within industries; focusing on strengthening Chinese brand automobiles cultivating internationally competitive enterprise groups; leveraging "Belt & Road" initiatives pushing forward global layouts along with internationalization within industrial systems—regulating total volume optimizing environments enhancing quality creating brands promoting transformations increasing benefits driving developments within automotive industries transitioning from scale-speed types towards quality-efficiency types achieving transitions from being a major automotive nation towards becoming a strong automotive nation.

(2) Basic Principles.

Innovation-driven key breakthroughs. Deeply implement innovation-driven development strategies deploying innovation chains around value chains allocating resource chains around innovation chains improving collaborative innovation systems among government industry academia research application advancing innovations across technology management systems models comprehensively enhancing innovative capabilities achieving breakthroughs in key areas along critical links.

Collaborative development win-win cooperation. Accelerate integrated design manufacturing service processes achieving network collaboration throughout product life cycles innovate cooperation models between complete vehicle manufacturers along with parts suppliers advancing collaborative developments across entire industrial chains guiding information communication energy transportation materials environmental protection sectors deeply integrating them with automotive industries constructing new types of industrial ecosystems.

Market-led, government-guided. Give full play to the decisive role of the market in resource allocation and the guiding role of government macro-control, improve legal system construction, adhere to quality first, clarify legal responsibilities, standardize industrial development order, highlight the main position of enterprises, encourage mergers and reorganizations, optimize industrial layout, and promote the development of characteristic advantageous industrial clusters.

Open and inclusive, competitive and cooperative development. Optimize investment and product access management, deepen open cooperation, and create a good market environment that is unified, open, and orderly competitive. Encourage advantageous enterprises to firmly establish an international development concept, make comprehensive use of two types of resources and two markets, actively layout overseas, and accelerate integration into the global market.

(3) Planning objectives.

Strive to enter the ranks of world automotive powers after ten years of continuous efforts.

——Significant breakthroughs in key technologies. The industrial innovation system continues to improve, and the innovation capability of enterprises is significantly enhanced. Energy-saving technologies such as power systems, efficient transmission systems, and automotive electronics reach international advanced levels; key core technologies such as power batteries and drive motors are at the international leading level. By 2020, cultivate several new energy vehicle enterprises that enter the world's top ten, with intelligent connected vehicles developing in sync with international standards; by 2025, the influence and market share of backbone enterprises in new energy vehicles will further increase globally, and intelligent connected vehicles will enter the world's advanced ranks.

——The entire industrial chain achieves safety and controllability. Break through the shortcomings in advanced automotive electronics such as vehicle sensors and onboard chips, as well as lightweight new materials and high-end manufacturing equipment; cultivate internationally competitive parts suppliers to form a complete industrial system from components to complete vehicles. By 2020, form several automotive parts enterprise groups with a scale exceeding 100 billion; possess strong international competitive advantages in some key core technology fields; by 2025, form several automotive parts enterprise groups that enter the global top ten.

——Comprehensive development of Chinese brand automobiles. The quality of Chinese brand automobile products has significantly improved; brand recognition, product reputation, and international influence have been significantly enhanced; strong internationally competitive enterprises and brands have been formed; their position in global industrial division of labor and value chains has been significantly improved; global innovation leadership capabilities have been formed in the field of new energy vehicles. By 2020, create several world-renowned automobile brands; significantly improve the safety performance of commercial vehicles; by 2025, several Chinese brand automobile enterprises' production and sales will enter the world's top ten.

——A new type of industrial ecosystem is basically formed. Complete integrated intelligent transformation in R&D design, production manufacturing, logistics distribution, marketing, and customer service; achieve intelligent interconnection and data sharing among people, vehicles, and environmental facilities; form a new type of smart ecological system for automobiles that integrates with new generation information technology, intelligent transportation, energy, environmental protection, etc. By 2020, significantly enhance the level of intelligence; the proportion of the automotive aftermarket and service industry in the value chain reaches over 45%. By 2025, fully achieve intelligence in key areas; the proportion of the automotive aftermarket and service industry in the value chain reaches over 55%.

——International development capabilities are significantly enhanced. Make comprehensive use of both international and domestic resources to form diversified and deep cooperation models from technology to capital, marketing, branding etc.; significantly enhance enterprises' international operational capabilities. By 2020, Chinese brand automobiles gradually achieve exports to developed countries; by 2025, further enhance the global influence of Chinese brand automobiles.

——Significantly improve green development levels. The energy-saving environmental protection level and recycling rate of automobiles continue to improve. By 2020, average fuel consumption for new passenger cars drops to 5.0 liters/100 kilometers; fuel consumption for energy-saving vehicles drops below 4.5 liters/100 kilometers; commercial vehicles approach international advanced levels; implement National VI emission standards; energy consumption for new energy vehicles is at an internationally advanced level; automobile recycling rate reaches 95%; by 2025, average fuel consumption for new passenger cars drops to 4.0 liters/100 kilometers; commercial vehicles reach international leading levels; emissions reach international advanced levels; energy consumption for new energy vehicles is at an internationally leading level; actual recycling rate for automobiles reaches international advanced levels.

III. Key Tasks

(1) Improve innovation system and enhance autonomous development motivation.

Insist on enhancing innovation capability as a central link to improve industrial competitiveness; adhere to an innovation-driven development orientation; improve innovation system construction; strengthen core technology breakthroughs; enhance platform service capabilities; increase autonomous development motivation.

1. Improve innovation system. Strengthen top-level design and dynamic evaluation; establish a coordinated innovation mechanism covering related industries with departmental coordination. Improve a technology innovation system led by enterprises with market orientation that combines production, education, research and application; establish a matrix-based R&D capability layout and cross-industry collaborative platform; promote mass entrepreneurship and innovation to form systematic technological innovation capabilities. Fully leverage enterprises' main position in technological innovation; support high-level enterprise technology center construction. Encourage enterprises, research institutes, universities etc., as innovative entities to allocate innovative resources around the industrial chain to establish manufacturing innovation centers in areas such as power batteries and intelligent connected vehicles. Relying on automotive industry joint funds etc., promote innovative elements to gather flow towards high-end industries and advantageous enterprises.

2. Strengthen core technology breakthroughs. Release implementation plans for energy-saving vehicles and new energy vehicles as well as intelligent connected vehicle technology roadmaps that clarify short-term, medium-term, and long-term goals. Guide innovative entities to collaborate on breakthroughs in whole vehicle and component system integration, powertrains, lightweighting, advanced automotive electronics, autonomous driving systems, modular development manufacturing of key components chips as well as onboard operating systems etc., increasing effective supply of basic common technologies. Strengthen R&D on fuel cell vehicles and intelligent connected vehicle technologies while supporting integration and application of related technologies such as car sharing and intelligent transportation. 3. Enhance supporting platform service capabilities. Promote construction of industry support platforms such as technical standards testing evaluation infrastructure international cooperation etc.; improve technical standard systems for complete vehicles and components forming systematic service capabilities supporting industrial development. Enhance certification inspection testing capabilities while promoting establishment of automotive development databases engineering data centers patent databases providing open sharing services for innovative knowledge engineering data for enterprises. Focus on supporting industry chain service-oriented enterprises with good foundations strong innovation capabilities good growth potential.

(2) Strengthen basic capabilities to connect industrial chain systems.

The industrial foundation and advanced equipment are important supports for building an automotive power country. Solidify a safe controllable automotive parts foundation while vigorously developing advanced manufacturing equipment enhancing collaborative integration capabilities across the entire industrial chain.

1. Solidify component matching systems. Relying on industrial foundation strengthening projects concentrate advantageous resources to prioritize developing core key components such as automatic transmissions engine electronic control systems focusing on breaking through generalization modularization bottlenecks issues. Guide industry-leading backbone enterprises to unite with research institutes universities etc., forming industry technology innovation alliances accelerating cultivation of component platform R&D advanced manufacturing information support capabilities. Guide component enterprises towards high-end group-based international development promote voluntary product certification encourage innovative component industry cluster development creating a safe controllable component matching system.

2. Develop advanced automotive materials and manufacturing equipment. Relying on national science and technology plans (special projects, funds, etc.), guide the automotive industry to strengthen cooperation with related industries such as raw materials, and collaboratively carry out industrialization and mass application research on high-strength steel, aluminum alloy high vacuum die casting, semi-solid and powder metallurgy forming parts, accelerate the application of magnesium alloys and rare earth magnesium (aluminum) alloys, and expand the application range of high-performance engineering plastic parts and composite materials. Encourage industry enterprises to strengthen key component manufacturing technology breakthroughs for high-strength lightweight car bodies, key assemblies and their precision components, motors, and electric drive systems, and carry out integrated innovation and engineering applications of advanced manufacturing equipment for complete vehicles, key assemblies, and components. Promote the research and development and promotion of advanced high-end manufacturing equipment such as safe and controllable digital development, high-end CNC machine tools, inspection detection, and automated logistics. Accelerate the deep application of intelligent manufacturing support technologies such as 3D printing, virtual and augmented reality, the Internet of Things, big data, cloud computing, robotics, and their application systems in automotive manufacturing equipment.

3. Promote coordinated and efficient development across the entire industrial chain. Build a new type of "complete vehicle - component" cooperative relationship, explore and optimize the cost-sharing and benefit-sharing cooperation mechanism of industrial technology innovation alliances, encourage backbone enterprises in complete vehicles to deeply cooperate with advantageous component enterprises in R&D, procurement, etc., and establish a safe and controllable supporting system for key components. Promote the improvement of national science and technology plan (special projects, funds, etc.) project selection orientation, establish assessment indicators for key component industrialization and "complete vehicle - component" supporting projects, encourage collaborative development between complete vehicle and component enterprises. Carry out joint breakthroughs in key components and weak links in the "four basics", promote intelligent transformation upgrades of enterprises, and facilitate coordinated development across the entire industrial chain. Column 2 Key Breakthrough Project for Key Components Support advantageous characteristic component enterprises to grow stronger and larger, cultivate leading component enterprises with international competitiveness. Addressing industrial shortcomings, support advantageous enterprises to carry out joint breakthroughs in government-industry-university-research applications, focusing on breaking through engineering and industrialization bottlenecks in power batteries, automotive sensors, onboard chips, electronic control systems, lightweight materials, etc., encourage the development of advanced models such as modular supply and high value-added knowledge-intensive high-end components. By 2020, form several automotive component enterprise groups with strong international competitiveness in some key core technology fields; by 2025, form several automotive component enterprise groups with output value scale entering the top ten globally.

(3) Breakthrough key areas to lead industrial transformation and upgrading.

Vigorously develop advanced automotive technologies to form a reasonable tiered industrial pattern of new energy vehicles, intelligent connected vehicles, and advanced energy-saving vehicles as well as a complete industrial support system to lead the transformation and upgrading of the automotive industry.

1. New Energy Vehicles

Accelerate the R&D and industrialization of new energy vehicle technologies. Utilize corporate investment, social capital, national science and technology plans (special projects, funds, etc.) to organize collaborative breakthroughs among enterprises, universities, research institutes, etc., focusing on six innovation chains: power batteries and battery management systems; motor drives and power electronics assemblies; intelligent technologies for electric vehicles; fuel cell power systems; plug-in/extended range hybrid systems; and pure electric power systems.

Implement a power battery upgrade project. Fully leverage platforms such as power battery innovation centers and power battery industry innovation alliances to carry out joint breakthroughs in key materials for power batteries, single cells, battery management systems, etc., accelerating revolutionary breakthroughs in power batteries.

Increase efforts to promote the application of new energy vehicles. Gradually increase the proportion of new energy vehicles used in public service areas while expanding the scale of new energy vehicle applications in private sectors. Accelerate the construction of charging infrastructure to build a convenient, efficient, moderately advanced charging network system. Improve the support policy system for promoting new energy vehicle applications—especially in usage—from encouraging purchases to facilitating use; establish a long-term mechanism to promote the development of new energy vehicles; guide production enterprises to continuously improve the production-sales ratio of new energy vehicles. Continuously improve the standard system for new energy vehicles; raise entry thresholds for production enterprises and products; strengthen factory safety performance testing; enhance supervision over new energy vehicle production; establish a sound policy system for classification registration management of new energy vehicles including traffic management, tax insurance policies, vehicle maintenance policies, second-hand vehicle management policies. Gradually expand the pilot demonstration scope for fuel cell vehicles. Column 3 New Energy Vehicle R&D and Promotion Project Master key technologies such as drive motors and control systems; electromechanical coupling devices; range-extended engines; support technological breakthroughs across the entire industry chain for power batteries and fuel cells to achieve revolutionary breakthroughs that significantly enhance integrated control levels for new energy vehicles while encouraging enterprises to develop advanced applicable new energy vehicle products. Build a convenient, efficient charging network system that is moderately advanced; establish a safety monitoring platform for new energy vehicles; improve support policy systems for promoting new energy vehicle applications. By 2020, annual production-sales of new energy vehicles will reach 2 million units; single-cell specific energy of power batteries will reach over 300 watt-hours/kilogram with a target of achieving 350 watt-hours/kilogram; system specific energy will aim to reach 260 watt-hours/kilogram with costs reduced to below 1 yuan/watt-hour. By 2025, new energy vehicles will account for over 20% of automobile production-sales with specific energy of power battery systems reaching 350 watt-hours/kilogram.

2. Intelligent Connected Vehicles

Increase efforts on key technology breakthroughs for intelligent connected vehicles. Fully leverage roles played by intelligent connected vehicle alliances and automotive industry joint funds to continuously improve cross-industry collaborative innovation mechanisms focusing on tackling core technologies such as environmental perception; intelligent decision-making; collaborative control; promote R&D and industrialization applications for sensors; onboard terminals; operating systems. Research to determine communication frequencies for China's intelligent connected vehicles; issue relevant protocol standards to regulate data exchange formats between vehicles and platforms as well as protocols; formulate technical standards related to interfaces between onboard intelligent devices and vehicles as well as vehicle network security.

Carry out demonstration promotion for intelligent connected vehicles. Establish testing evaluation systems while progressively advancing demonstration applications for intelligent connected vehicles step by step while steadily expanding pilot scopes. Build testing environments within demonstration zones along with corresponding data collection analysis management monitoring platforms focused on validating product performance for intelligent connected vehicles while establishing information exchange mechanisms between intelligent connected vehicles with internet networks; IoT networks; smart traffic networks; smart grids; smart city infrastructures while exploring innovative development models suitable for China's national conditions that involve multi-field interactions. Accelerate progress on building legal frameworks around intelligent connected vehicles clarifying safety responsibility definitions along with network security guarantees.

Column 4 Intelligent Connected Vehicle Promotion Project Promote technological innovations around intelligent connected vehicles focusing on driving key component R&D while supporting core technology developments related to sensors; control chips; Beidou high-precision positioning systems; onboard terminals; operating systems along with their industrialization efforts. Organize application pilots along with demonstrations while improving testing evaluation frameworks alongside legal regulatory frameworks. By 2020: DA (Driving Assistance), PA (Partial Automation), CA (Conditional Automation) system installation rates in new cars exceed 50%; connected driving assistance system installation rates reach 10% meeting smart traffic city construction needs. By 2025: DA/PA/CA installation rates in new cars reach 80%, among which PA/CA level cars reach an installation rate of 25%, marking entry into markets for highly automated or fully automated cars.

3. Energy-Saving Vehicles

Increase the research and promotion of automotive energy-saving and environmental protection technologies. Promote the research and development of advanced fuel vehicles, hybrid vehicles, and alternative fuel vehicles, breaking through key technologies such as vehicle lightweighting, hybrid power, efficient internal combustion engines, advanced transmissions, idle start-stop systems, advanced electronics, aerodynamic optimization, and exhaust treatment devices. Continuously improve fuel consumption and environmental standards for vehicles, and strengthen market supervision of energy-saving and emission-reducing measures for medium and heavy commercial vehicles. Improve the promotion mechanism for energy-saving vehicles by guiding the research and consumption of lightweight and compact passenger cars through fuel consumption limits, labeling standards, and tax incentives. Encourage regions rich in resources like natural gas and biomass to develop alternative fuel vehicles, allowing vehicles to be labeled as dual-fuel at the factory, conducting pilot projects and promoting applications to facilitate diversified development of automotive energy. Column 5 Advanced Energy-Saving and Environmental Protection Vehicle Technology Improvement Project Relying on existing funding channels, establish a joint tackling platform as required, focusing on overcoming energy-saving and environmental protection technologies for passenger cars such as advanced engines, hybrid power, advanced electronics, as well as key technologies for commercial vehicles like high-pressure common rail injection systems, cost-effective hybrid powertrains, and efficient exhaust treatment devices. Through tax incentives like vehicle and vessel tax reductions for energy-saving vehicles and automobile consumption tax policies, guide and encourage the consumption of small-displacement energy-saving passenger cars. By 2020, the average fuel consumption of new passenger cars should reach 5 liters per 100 kilometers, with the application rate of energy-saving technologies like idle start-stop exceeding 50%; by 2025, the average fuel consumption of new passenger cars should be reduced by 20% compared to 2020, with widespread application of energy-saving technologies like idle start-stop.

(4) Accelerate cross-industry integration to build a new industrial ecosystem.

Adhere to cross-industry integration and open development, focusing on deep integration of the internet with the automotive industry to accelerate smart manufacturing, promote diversified mobility services, facilitate green development throughout the automotive product lifecycle, and build a new intelligent ecological system characterized by ubiquitous connectivity, collaborative efficiency, dynamic perception, and intelligent decision-making.

1. Vigorously promote smart manufacturing. Advance the construction of digital factories, smart factories, and intelligent factories by integrating raw material supply chains, vehicle manufacturing production chains, and automotive sales service chains to achieve mass customized production. Guide enterprises to promote the application of digitalization and intelligence systems in R&D design, production manufacturing, logistics distribution, marketing, after-sales service, and enterprise management. Focus on overcoming key technologies such as specialized automotive manufacturing equipment, processes, software, etc., to build a demonstration platform for integrated design, manufacturing, and service that can be widely promoted. Promote the establishment of a collaborative management system that spans the entire product lifecycle while advancing design visualization, manufacturing digitization, remote service capabilities to meet personalized consumer demands and enhance quality and efficiency.

2. Accelerate the development of the automotive aftermarket and service industry. Guide automotive enterprises to actively collaborate with information technology, communication technology, electronics, and internet industry companies to fully utilize advanced technologies such as cloud computing and big data to explore diverse user needs in work, life, and entertainment. Innovate mobility and service models to extend the industrial chain backward and elevate the value chain upward while expanding a networked ecosystem that includes transportation logistics, shared mobility services, user interaction, information utilization elements. Promote automotive enterprises' transition towards service-oriented production models from product-centered development to customer-centered development while supporting enterprises in shifting from providing products to offering comprehensive solutions. Encourage the development of aftermarket services such as automotive finance, used cars, maintenance services, car rentals while promoting synchronous development of third-party logistics services like e-commerce and RV camps.

(5) Enhance quality brands to create internationally leading enterprises.

Adhere to quality construction and brand building as fundamental requirements for enhancing industrial competitiveness; strictly control quality; strengthen brand cultivation; promote enterprise reform; cultivate leading enterprises with international competitiveness.

1. Enhance quality control capabilities. Promote automotive enterprises to strengthen their capabilities in technology R&D, quality assurance, cost control, marketing services etc., enhancing comprehensive product competitiveness. Guide automotive enterprises to strengthen reliability design along with testing and verification technology development applications while constructing a quality management closed-loop system that includes early planning stages through mid-term supervision to after-sales feedback; establish and improve product quality standard systems; enhance quality responsibility guarantee mechanisms; leverage high-tech services in certification inspection testing; improve quality control throughout the entire lifecycle.

2. Strengthen brand cultivation. Raise awareness of brand cultivation; guide enterprises in implementing brand strategies; solidify the competitive foundation for Chinese branded automobiles; enhance cultural connotation design and promotion work for Chinese automobile brands; increase brand value. Promote establishing organizations and mechanisms that facilitate Chinese automobile brand building while fully utilizing opportunities from international industrial cooperation or major events to promote Chinese automobile brands. Guide industry organizations in researching a quality brand evaluation system suitable for China's automotive industry characteristics while actively promoting the establishment of an international new order for automobile brand evaluation.

3. Stimulate corporate vitality. Improve internal governance and regulatory mechanisms for state-owned enterprises; accelerate establishing incentive constraints mechanisms compatible with market economy regarding operational decision-making processes including personnel selection use performance assessment income distribution etc.; implement national enterprise assessment where R&D investment is proportionally converted into profits. Steadily advance mixed-ownership reform through market-oriented methods achieving cooperation between state-owned enterprises with other non-public enterprises in terms of capacity channels investment financing etc.; fully leverage social supervision mechanisms while implementing government investment accountability systems guiding private capital emerging technology companies etc., into the automotive field legally.

4. Build leading enterprises. Support advantageous and characteristic enterprises to grow stronger and become leading automotive companies with strong international competitiveness, actively cultivate component manufacturers, chain repair enterprises, and automotive consulting service companies with technological innovation advantages to grow into 'little giants'. Support enterprises in leading domestic and international orderly restructuring, mergers and acquisitions, and strategic cooperation, encouraging international development. Encourage cooperation models within the automotive industry chain as well as cross-industry cooperation in capital, technology, capacity, and brand, supporting advantageous enterprises to strengthen alliances through mutual shareholding and strategic alliances, continuously enhancing industry concentration. Column 7 Automotive Quality Brand Construction Project Establish and improve the mechanism for cultivating and developing Chinese automotive quality brands, encourage industry organizations to establish and promote a Chinese automotive brand evaluation standard system, carry out professional evaluations of automotive brand value, and guide industry enterprises to strengthen brand cultivation; encourage advantageous enterprises to acquire internationally renowned automotive brands and companies to implement leapfrog development in brand cultivation. By 2020, the R&D expenditure of key automotive enterprises will account for about 4% of operating income, the average failure rate of new cars will decrease by 30% compared to 2015, forming several world-renowned automotive brands; by 2025, the R&D expenditure of key automotive enterprises will account for about 6% of operating income, the average failure rate of new cars from key enterprises will reach the same level as international first-line brands, and several Chinese brand automotive enterprises' production and sales will enter the world's top ten.

(6) Deepen open cooperation and enhance international development capabilities.

Insist on taking international development as an important guarantee for the sustainable development of the automotive industry, improve the service guarantee system, enhance international operational capabilities, strengthen international cooperation, and accelerate the integration of China's automotive industry into the global market. 1. Accelerate the pace of 'going out'. Guide automotive enterprises to establish a strategic concept for international development and formulate international development strategies. Utilize multilateral and bilateral cooperation and high-level dialogue mechanisms to facilitate agreements on overall frameworks for industrial cooperation and supporting policies. Deepen reforms in overseas investment management and establish a 'green channel' for international cooperation in the automotive industry. Seize opportunities such as the 'Belt and Road' initiative and international capacity cooperation to intensify efforts to explore international markets. Encourage advantageous enterprises to choose differentiated development paths, gradually shifting from export trade to deep cooperation models in investment, technology, management, etc., achieving coordinated 'going out' in products, services, technology, and standards. Support complete vehicle manufacturers in collaboration with component manufacturers to select key development regions for building automotive industrial parks, forming a scientific layout and interconnected industrial pattern. Promote collaboration between Chinese brand automobiles and international engineering projects 'going out together'.

2. Improve the international service system. Encourage industry organizations to promote the establishment of an overseas development alliance for the automotive industry, focusing on cultivating systematic service capabilities in areas such as policies and regulations, intellectual property rights, and certification. Integrate domestic and foreign resources to promote industry enterprises to independently establish overseas development funds for the automotive industry in collaboration with relevant national and regional governments and social capital, creating a multi-dimensional market-oriented funding guarantee system. Encourage banking financial institutions to establish credit management and loan review systems suitable for overseas development of automotive enterprises based on principles of commercial sustainability, accelerating the establishment of a multi-level overseas investment guarantee system for the automotive industry. Promote cross-border service system construction by domestic financial and insurance institutions, exploring automobile financing leasing and related insurance businesses overseas. Increase research on standards, certification, inspection supervision systems in developed countries especially those along the 'Belt and Road', effectively breaking down international trade barriers. Integrate domestic resources to promote exchanges and cooperation between Chinese and foreign government automobile quality safety supervision systems, improving supervision management for various trade methods such as parallel imports.

3. Enhance international operational capabilities. Fully leverage existing policies' guiding role to encourage and support enterprises in conducting multinational cooperation; make full use of international advantageous resources to establish R&D centers; promote industrial cooperation shifting from mainly processing manufacturing stages to high-end stages such as collaborative R&D, marketing, brand cultivation along the industrial chain. Promote enterprise brand internationalization construction; encourage multiple investment entities to jointly build shared international marketing channels; innovate marketing models; create independent distribution brands. Strengthen exchanges and cooperation with relevant international institutions and organizations in the automotive industry; encourage intermediary organizations within the industry to actively organize key enterprises, higher education institutions etc., together with international organizations to apply for global environmental funds or other green development application demonstration projects; build intelligent demonstration zones utilizing renewable energy distributedly for new energy vehicles; explore commercial promotion models that deeply integrate new energy vehicles with renewable energy sources and smart grids.

4. Improve levels of international cooperation. Continue expanding openness; encourage utilizing foreign capital as well as introducing relevant advanced technologies and high-end talents; strengthen strategic cooperation with foreign enterprises; comprehensively enhance levels of cooperation. Strengthen policy guidance; promote joint development of joint venture brands with Chinese brands; jointly explore both international and domestic markets. Encourage joint venture companies to increase R&D investment; improve localization ratio of developed vehicle models. Encourage joint venture companies to strengthen technology and talent exchanges with domestic companies. Column 8 Overseas Development Project Based on multilateral high-level cooperation mechanisms, promote reaching strategic framework agreements for automotive industry cooperation. Encourage key enterprises to deepen international cooperation by establishing automotive industrial parks in key countries while engaging in international capacity cooperation; promote Chinese brand commercial vehicles 'going out together' with international engineering projects. Guide forming an external cooperation alliance for the automotive industry to enhance overseas development service capabilities of automotive enterprises. By 2020, Chinese brand automobiles will significantly increase their influence in overseas markets achieving bulk exports to developed country markets; by 2025, market share of Chinese brand automobiles internationally will greatly increase achieving a global development layout.

DeepReform the management system of the automotive industry deeply; strengthen legal management; establish a legalized, intensive, internationalized management system suitable for China's national conditions and industrial development laws. Research and formulate relevant regulations on motor vehicle production management; clarify responsibilities among production enterprises, government bodies etc.; establish a robust punitive compensation system as well as an enterprise exit mechanism. Improve random sampling inspection systems for vehicle products; vigorously investigate illegal production sales behaviors. Gradually improve investment project management by implementing pre-approval systems for motor vehicle production enterprises & products; during which environmental information disclosure standards monitoring & vehicle maintenance information disclosure & production consistency verification systems are established; post-event defect product recall & environmental recall systems form a 'three-in-one' management system simplifying pre-approval while strengthening monitoring during & after events.

(2) Increase financial support.

Relying on various industrial investment funds such as joint funds for the automotive industry etc., support implementation of major projects including innovation center construction among others. Through national science & technology plans (special projects & funds etc.), comprehensively support research & development of cutting-edge technologies & common key technologies. With innovation & green energy saving as orientation encourage industry enterprises to increase R&D investments while fully implementing pilot programs for VAT reform while enforcing tax policies such as consumption tax & vehicle purchase tax etc.

(3) Strengthen standard system construction.

Fully leverage the foundational and guiding role of standards, promote the coordinated development of government-led and market-driven standards, and establish an automotive standard system that is suitable for China's national conditions and aligns with international standards. Improve mandatory standards in areas such as automotive safety, energy conservation, and environmental protection, and establish a mechanism for evaluating the effectiveness of standard implementation. Focus on vehicle safety and performance evaluation, as well as infrastructure, to optimize and improve the new energy vehicle standard system. Strengthen the construction of intelligent connected vehicle standard systems with an emphasis on functional safety and cybersecurity. Improve the energy-saving vehicle standard system with a focus on lightweight manufacturing, intelligent manufacturing, typical testing conditions, and advanced energy-saving technologies. Strengthen the construction and implementation of commercial vehicle standards with a focus on inherent safety, energy efficiency, and strict adherence to standards. Conduct research on comprehensive standards in key areas, leveraging the important role of enterprises in standard formulation. Encourage enterprises to actively adopt international standards and promote the alignment of automotive-related standards and regulations with international practices. Actively participate in international standard formulation, play the role of standardization organizations, promote advantageous and characteristic technology standards to become international standards, and enhance China's voice and influence in international standard formulation. Strengthen the construction of certification inspection and testing systems, and improve certification and accreditation management models.

(4) Strengthen talent team support.

Strengthen the overall planning and classified guidance for automotive talent team construction, conduct special research on automotive talent training and management models, improve the talent evaluation system, enhance talent incentive mechanisms, optimize talent mobility mechanisms, improve the talent ecological environment, and build a talent system with international competitiveness. Strengthen the construction of automotive disciplines and majors, reform innovative talent training models in colleges, enhance vocational education and skills training, establish a flow channel between general education and vocational education, focus on cultivating leading technology talents, entrepreneurs, and other urgently needed composite talents, expand the training of skilled craftsmen and senior technicians. Promote the spirit of craftsmanship, advance modern apprenticeship systems, support enterprises in implementing order-based training and internship models to achieve precise alignment between training and industry needs. Establish recognition systems for leading technology talents in science and technology as well as craftsmen in major automotive countries. Build professional platforms for matching supply and demand for automotive industry talents, interactive communication, growth services, etc., construct and improve various talent databases to guide reasonable talent mobility and targeted training. Implement proactive open and effective talent introduction policies to promote international talent cultivation.

(5) Improve the industrial development environment.

Focus on improving the energy-saving, environmental protection, safety, and intelligence levels of automotive products; improve road traffic safety regulations and standards; establish a mechanism for in-depth investigation and research on road traffic accidents; legally hold production modification enterprises accountable for quality issues in accident vehicles. Accelerate research to formulate guiding opinions for regulating low-speed electric vehicles to address illegal production and sales issues at their source. Strengthen pollution prevention for motor vehicles; scientifically formulate and strictly enforce motor vehicle emission standards and fuel standards; establish a system for automobile exhaust detection and maintenance; encourage the use of clean automotive energy; promote energy-saving environmentally friendly vehicle models; use market-oriented methods to promote the elimination of old high-emission vehicles. Enhance the foresight and scientific nature of urban planning and traffic layout; reasonably construct urban roads, parking lots, gas stations, charging stations (piles), etc.; vigorously build a modern comprehensive transportation service system that is safe, convenient, efficient, green, and intelligent. Promote the development of car-sharing economies to comprehensively improve automobile usage efficiency.

(6) Leverage the role of industry organizations.

Utilize industry organizations' familiarity with the industry and proximity to enterprises to provide two-way services for government and industry. Industry organizations should strengthen capacity building in data statistics, achievement identification, inspection testing, standard formulation, etc., to improve service levels for industry enterprise development. Industry organizations should closely track industrial development dynamics, conduct special research studies to timely reflect enterprise demands, fully play their role as a bridge connecting enterprises with government. Encourage industry organizations to improve public service platforms; coordinate the establishment of industry exchange platforms as well as cross-border collaboration platforms; conduct joint technological breakthroughs; promote advanced management models; cultivate automotive technology talents. Industry organizations should improve work systems to enhance industry quality; strengthen self-discipline within the industry; resist disorderly competition and vicious competition.

V. Planning Implementation

All regions and departments must fully recognize the significant importance of promoting the transformation and upgrading of the automotive industry from large to strong; strengthen organizational leadership; improve work mechanisms; reinforce departmental collaboration; form a development synergy. Each department should develop work plans based on its functions to detail policy measures. Each region should study specific implementation plans based on local realities to ensure that all tasks are implemented effectively. The Ministry of Industry and Information Technology should work with relevant departments to strengthen tracking analysis and supervision guidance; conduct annual inspections and effectiveness evaluations; make necessary adjustments to target tasks in a timely manner. Research should be conducted to establish a national-level think tank for automotive industry development to address major issues related to industrial development foresight and strategy while providing consulting evaluations for major decisions.