·The exit mechanism of the auto industry will limit the time to the "zombie enterprise"

According to the Voice of China News and Newspaper Summary, in July 2012, the Ministry of Industry and Information Technology decided to establish an exit mechanism for the automobile industry. On October 17, 2013, the Ministry of Industry and Information Technology issued an announcement to 48 domestic auto companies that could not maintain normal production and operation. Production qualifications will be suspended if the relevant assessment is not passed within two years. There is still one month away from the limit, what is going to be called a "zombie company"?
According to the notice of the Ministry of Industry and Information Technology, “the company that cannot maintain normal production and operation” means that “the annual sales volume is zero or very small for two consecutive years, which stipulates that there are less than 1,000 passenger cars, less than 50 large and medium-sized passenger cars, and less light passenger vehicles. There are less than 50 vehicles in medium and medium-duty trucks and less than 500 trucks in light-duty trucks. For brands that have been offline for many minutes, such persuasion standards are too low. The names of these 48 car companies are rarely known, such as: Jilin Tongtian Automobile Co., Ltd., Shijiazhuang Zhongbo Automobile Co., Ltd., Fushun Jinxin Bus Co., Ltd., Yangzhou Xinya Vehicle Co., Ltd., etc. The common feature is the distinctive geographical area. Perhaps only locals have had the privilege of seeing the products they produce. In the view of Jia Xinguang, a senior expert in the automotive industry, it is imperative to persuade such a company.
Jia Xinguang: The number of Chinese auto factories is huge. Even the more than 2,000 modified factories have caused a very chaotic industrial order. It has not been adjusted for many years. One of the problems is that there is no exit mechanism.
How do these "zombie companies" survive? Li Yang, a senior commentator in the automotive industry, believes that what makes them survive is their qualifications.
Li Yang: A lot of semi-dead and zero-volume, zero-volume automakers exist in large numbers. It is qualified, and this qualification is 'shell resource', which is rented in various ways. Such a regulation issued by the Ministry of Industry and Information Technology is precisely to eliminate such a partial monopoly, and at the same time make many so-called 'shell resources' become worthless.

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