From The Wall Street Journal:
China’s economic planners are waving a yellow flag at the nation’s auto industry, warning that growth in car makers’ production capacity is outstripping demand and calling for limits on further expansion.
Passenger-car sales have been increasing at a torrid rate, making China the world’s second-largest vehicle market by unit sales after the U.S. But car companies, rushing to cash in on the growth, have been adding assembly lines at an even faster rate, the planners said.
In a statement Tuesday, the National Development and Reform Commission, which sets China’s industrial policy, said overcapacity is threatening the auto industry’s health and laid out guidelines to rein in growth.[Full Text]
