Exclusive: Global automakers wary of China certification shift

Mon Feb 1, 2016 4:19pm EST
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By Norihiko Shirouzu

BEIJING (Reuters) - Some global automakers are worried that China is pushing its weight around as the world's biggest car market - by enforcing its own, often outdated, vehicle certification standards on foreign cars.

China previously allowed global brands to sell cars without local certification in many cases, as long they were approved under international standards. Chinese rules essentially apply older standards to features such as bumper strength, brake performance and the size and positioning of lamps and mirrors.

Global car makers say the move to enforce local standards more rigorously highlights the unpredictability of doing business in China, is a step back in technology and could mean costly re-designs and delayed new car launches.

In one instance, Chinese regulators made an issue of the position of a Nissan Motor (7201.T: Quote) car's fog lamps - something that has since impacted other automakers, people with knowledge of the matter said.

Shifting a lamp by a few centimeters can mean re-designing exterior body panels, investing in stamping dies and lighting assemblies, and delaying planned launches by more than a year, said people close to the Japanese Automotive Manufacturers Association (JAMA).

"It's an inconvenient and sudden departure from the status quo," said an executive at a leading international automaker. "We're essentially being asked to redo some aspects of new vehicles in China using outdated standards. This may cost us critical time and money."

To be sure, compliance won't break the bank, but car makers are concerned they may be sacrificing technical advances as China's standards can lag global norms by as much as a decade.

"They can enforce whatever standards they want. The question is: are those standards high enough to protect consumers," said Yale Zhang, head of Shanghai-based consultancy Automotive Foresight. "People think China does not have proper standards and that's why the car quality here is lower."   Continued...

A ring road is congested with traffic in Beijing, China, in this November 18, 2015 file photo. REUTERS/Kim Kyung-Hoon/Files