As influenced by climatic conditions earlier this year, the air quality of the city proper had been over standard for many times. To improve such situations, the entity members of the supervising team for the “Blue Sky Action” took effective actions to control and stabilize the air quality. These actions include: first, cooperated with municipal departments to carry out “Dust Pollution Control for 100 Days in Spring and Winter”. Eight departments, including Chongqing Municipal Commission of Urban-Rural Development, Chongqing Municipal Administration Commission and Chongqing Administration of Land Resources and Housing, were divided into three teams to control the dusts from construction, roads and house demolition. In addition, strict punishment was conducted. Second, coordinated the Weather Modification Office of Chongqing Meteorological Bureau for “Blue Sky Action” rain enhancement operations. By May, 13 rain enhancement operations had been carried out. Antiaircraft guns had been operated for 206 times and 824 person/times were involved; 8,468 cloud-seeding ammunitions were used; 161 rocket/times were used, and 644 person/times were involved; and 878 rocket ammunitions were used. Third, cooperated the comprehensive regulation of urban environment in the city proper. The supervising teams for the “Blue Sky Action” supervise the dust pollution sources in routine examination and submit the Blue Sky Program Supervision Briefing to Chongqing Municipal Comprehensive Environment Regulating Office. And then the office will supervise the correction of and punish the entities accountable. By doing this, good interaction between problem discovery and solving is realized. Fourth, established trial demonstrations of dust control. Chongqing Municipal Environmental Protection Bureau, according to the “Blue Sky Action” implementation plan in the city proper, started to establish trial demonstrations of dust control. Such trial demonstrations include dust control model streets in Yuzhong District, Nan’an District and New North Zone. The general air quality of the city proper will be improved by starting to control the air quality in these demonstrations.

According to the municipal party committee’s and the municipal government’s requirements on this year’s economic construction, i.e. “To speed-up and promote, to overcome difficulties and make progresses and to make all-around efforts”, the 2010 key projects feature “six increases”.

Firstly, focus on key projects and increase the number of large projects. 32 projects are worth RMB 10 billion in all, for instance, Shanghai-Chengdu expressway, Yubei-Wanzhou intercity railway, Rail Transit Line 1 project, forestation project, main urban zone public housing, MDI, etc. There are 25 projects worth RMB 5-10 billion and 28 projects worth RMB 3-5 billion. This case is unprecedented.

Secondly, focus on people’s livelihood and increase the “five Chongqings” project (i.e. eco Chongqing, accessible Chongqing, livable Chongqing, safe Chongqing and health Chongqing). A fund estimated to be RMB 250 billion is invested for construction of “five Chongqings”, wherein 180 projects in all are treated as key projects during the construction management and will obtain an annual investment estimated to be RMB 120 billion which accounts for 65% of the annual investment for the key projects. There are 60 projects for “livable Chongqing” construction, with an annual investment of RMB 36 billion. The main urban zone public housing with a total area of 5 million m2 is underway. Dangerous and old houses with a total area of 1.56 million m2 in the main urban zone are dismantled. The all-around environment reconstruction along the arterial traffics is underway. As for the “accessible Chongqing” construction, there are 100 projects related to the construction of access roads leading to other provinces and the roads within the city, with a total annual investment of RMB 70 billion. When it comes to the “eco Chongqing” construction, a total area of 5 million m2 has been forested, with a total annual investment of RMB 12 billion. There are 17 projects contributing to “safe Chongqing” and “health Chongqing”, a total annual investment of RMB 2 billion.

Thirdly, focus on the opening both to China and to other countries, and increase the number of key investment-attracting projects. The number of the key investment-attracting projects amounts to 100, with a total investment of RMB 410 billion. Where: there are 13 projects whose investment is more than RMB 10 billion, which is 5 more than the number in 2009. The laptop project involving Hp, Foxconn, Quanta, Inventec, Cisco, etc. spotlights the key projects. The foreign investment is made use of. Hongkong investment used to play a major role, but now, the investment comes from Hongkong, Macao, Taiwan, Europe, U.S., Japan, South Korea, etc. The investment from both home and abroad is used for the industrial, real estate, financial and other applications, instead of mainly for the industrial application.

Fourthly, focus on the balanced urban and rural development and increase the number of urban and rural projects. The urban infrastructure construction is the key in Chongqing’s second ring age, including the Rail Line 1, 2, 3 and 6, aviation hubs, the north section of airport-dedicated expressway, Hongyan Village Bridge, etc. There is an increase in the number of projects outside the main urban zone in comparison with the previous years, accounting for more than 50% of the total project number. Such projects as the park area infrastructure construction in Wanzhou, Fuling, Qianjiang, Changshou and other places, the agriculture industrialization in Tongnan, Hechuan, Jiangjin, Wulong and other places and the water infrastructure construction in Yunyang, Zhongxian, Shizhu, etc. are involved in the key project list.

Fifthly, focus on the change of the development mode and increase the structural adjustment projects. As for the industrial restructuring, the innovative and high technology projects and the low-carbon emission projects are given priority. The industrial projects are selected on a basis of the “6+1″ mainstay industry system. The upgrading of the industrial structure is promoted. The annual investment in the industrial projects accounts for approximately 30% of the total investment to the key projects, up by 5% in comparison with last year. As for the adjustment of the service industry structure, the development of the financial industry is highlighted. The Jiangbeizui Financial City (phase 1), Chongqing World Financial Centre, International Development Financial Town, etc. are in the key project list. Great importance is attached to the opening-up level. The Cuntan Work Zone Phase 2 and 3, Xiyong Comprehensive Bonded Zone and other infrastructure projects are in the key project list.

Sixthly, focus on the sustainable development and increase the number of key preliminary projects promoted. Key preliminary projects related to the “Twelfth Five-Year Plan” and “New Liangjiang” construction are given great impetus. A series of key projects is proceeded in 2010, such as Ankang-Zhangjiajie railway, Qianjiang-Zhangjiajie railway, the river-side expressway from the main urban zone to Wanzhou, Xiaonanhai hydropower station, Wansheng’s coalification of 1 million tones of dimethyl ether, etc. The “Twelfth Five-Year Plan” key project base is formed by planning the Chongqing projects according to such strategic programs as “West Delta”, Chengdu-Chongqing economic zone, comprehensive supplementary reforms in urban and rural areas, etc. The reserve fund invested to the key projects amounts to RMB 2 trillion.

To further promote the key projects, the 2010 city-level key projects will be managed according to the levels.

100 especially important projects are further selected from the Chongqing key project list, wherein, 10 most important projects are under the leadership of the Chongqing municipal government, and the other 90 projects are taken charge of by relevant municipal departments, thus forming a “10+90″ key project responsibility system. The “10+90″ system is also adopted in the key preliminary projects. As for the projects led by the municipal government, the municipal government conducts separate leading according to different tasks, with main chiefs from relevant departments in charge of the execution. As for the projects led by relevant municipal authorities, the leaders from the leading departments are the first persons in charge. As for the key projects promoted by district and county governments, relevant departments must provide guidance for the promotion in the district and county work, and the districts and counties monthly submit the documents on the implemneting progress of the key and preliminary projects. In this way, a key project implementing system is formed, i.e. “monthly report of project implementing progress, quarterly study and resolution of project problems and yearly goal assessment of department work”.

Competing to Be the Detroit of China

While many foreign investors and industry experts are familiar with the development of China’s auto industry in Shanghai’s Anting District, cars are also a pillar of Chongqing’s economy. According to city government statistics from 2006, Chongqing’s automobile industry (including vehicles and parts) realized a value of RMB 133.1 billion, an increase of 35.4% compared same period in the previous year and accounting for 31.7% of the city’s total GDP. During the same period, the sector produced 791,000 vehicles (including motorcycles), which amounts to an increase of 17.3% compared to the same period during the previous year. Sales volume during the period was 789,000 units – an increase of 14.9%. As a percentage of the total output of China’s auto industry, Chongqing’s output accounted for 11% which makes the city the fourth largest producer of automobiles in the country.

The range of vehicles produced in Chongqing runs from simple motorcycles, to modern passenger cars, to heavy industrial vehicles.

Missing Out on Hummer

Perhaps the greatest publicity for Chongqing’s auto industry has come from one of it’s failures – the now abandoned bid by Sichuan Tengzhong Heavy Industrial Machinery Corp to purchase the Hummer brand of sports utility vehicles from General Motors of the US. While the proposed sale was officially pronounced dead by GM during February 2010, the nearly one year of media attention that the attempted purchase of the iconic brand brought to Chongqing has done much to highlight the ascendance of Chongqing’s auto industry as a national, if not quite yet international, player.

ChangAn Dominates the Market

Despite the attention that Tengzhong seized during the last year, the industry in Chongqing is still very much dominated by ChangAn. Long known for the inexpensive minivans that are the ubiquitous choice of delivery companies and small businesses across the country, the company is active in all vehicle sectors in the city.

In February this year the company announced plans to raise as much as RMB 4 billion through a public stock offering to update its small vehicle technology and improve its in-house R&D. While the sale has yet to be implemented, the prospect of the growth that this extra spending could drive has many enterprises scrambling to secure contracts to supply components and services for ChangAn’s impending expansion.

Goals for the Future

While the industry has already taken significant strides, it is not only ChangAn that has big plans for the future. According to statistics from the Chongqing Foreign Trade and Economic Relations Commission, by the end of this year the sales volume of cars and motorcycles produced in Chongqing will reach 1,500,000 units, including 1,200,000 passenger cars. This production is estimated to account for 15% of the nation’s total output for the year. Total revenue from these sales are expected to reach RMB 135 billion.

Further down the road, by 2020 vehicle production is expected to reach 2,600,000 units, generating revenue of RMB 200 billion. Beyond increasing production, the government has also put in place incentives which are encouraging producers to enhance their research and development of new technology, particularly in the areas of clean energy and energy efficient vehicles. The overall goal is to attain an industry that can rely 80% on domestically developed technology.

In 2006 the city had 261 sized auto parts enterprises (with annual sales revenue over RMB 5mln). of which 42 enterprises generated sales revenue over RMB 100 million. and more than 200 enterprises obtained TS16949 Certification. The production volume of 28 species of automobile parts such as camshafts, transmission, bearings and brakes ranked among the top three across the country.

Active Foreign Investment

As the local auto industry has grown, many international industry leaders have set up production in the area. According to figures from the Chongqing government, paid-up foreign direct investment in the city’s auto industry already totals more than RMB 7 billion.

Among the auto part manufacturers who have already established operations in Chongqing are Visteon, TRW, Johnson Controls, LEAR, Delphi and Cummins from the US; DENSO and Exedy from Japan; and Mahler, Siemens VDO, GKN, and GITI from Europe. The products from these companies are not only supplying the domestic market, but also are producing for export worldwide.

Where the Leading Players Are

As one of China’s four provincial-level metropolises (along with Shanghai, Beijing, Tianjin) Chongqing covers an area of more than 82,300 square kilometres and is officially home to more than 28 million people. So just setting up in Chongqing does not guarantee that your company will be in close proximity to your suppliers or customers.

For the automotive sector, there are a number of areas around the city which have become home to important industry clusters.

Northern Chongqing

Taking the automobile industry town in the Northern New Area as the centre, it is driven by the complete vehicle enterprises such as the ChangAn Group, the Heavy Vehicle Group, LiFan cars, AnKai bus and the Chongqing Bus corporation, and supported by the auto parts enterprises including ChaoLi Electric, Yujiang Die Casting, Qinchuan Electromechanical, Johnson YanFeng, YanFeng Visteon, ChangAn Lear, TSK Cable, Teleflex auto parts, ZhongYi shock absorbers, Qijiang Gear, UAES and Caff vehicle acessories. It mainly covers part of Jiangbei District, the Airport Industrial Park, and part of the Northern New Area Economic Development Zone. The northern industry complex is one of he largest industrial clusters in Chongqing Municipality, and has formed a 10-kilometer “Auto Town” integrating automobile production, research and development, trade and tourism functions. It is the center of the future automobile industry in Chongqing.

Leading Industrial Zones in Northern Chongqing

Chongqing Northern New District Industrial Zone

Although it is the newest district in Chongqing, Chongqing New North Zone (CNNZ) plays a leading role in the city’s auto industry. Since it was established in 2003 this 135 square kilometre economic and technological development zone is rapidly becoming a centre for modern industry. The zone emphasises building a new community based around high tech industry and modern infrastructure.

Industries Encouraged

Automobile Production/Assembly, Biotechnology/Pharmaceuticals, Electronics Assembly & Manufacturing, Heavy Industry, Instruments & Industrial Equipment Production, Medical Equipment and Supplies

Chongqing Tongliang Industrial Park

Another relative newcomer, Chongqing Tongliang Industrial Park was approved and established by the Chongqing Municipal Government in 2002 as a municipal-level development zone. The park is located in Tongliang County, which is situated in the northwest of Chongqing. Tongliang County, 41 km and 65 km away from Chongqing’s downtown areas and Jiangbei International Airport respectively. The park is served by both the Chongqing-Suining Freeway and China National Highway 319 which traverse the county from east to west.

Industries Encouraged

Automobile Production/Assembly, Building/Construction Materials, Electronics Assembly & Manufacturing, Food/Beverage Processing, Garment and Textiles Production, Heavy Industry, Instruments & Industrial Equipment Production, Medical Equipment and Supplies

Western Chongqing

As home to Qingling, Tiema and other vehicle producers, western Chongqing has also attracted important auto part and component suppliers such as Cummins, Mahler Piston, Loncin, JiaLing, JianShe, HuanSong, JinGuan Technology,, YuAn, and Chongqing Fuel Injection Equipment. The area includes Jiulong Industrial Park and Shapingba District. Dominant auto-related sectors in the area include the production of light trucks, heavy-duty trucks and auto parts.

Leading Industrial Zones in Western Chongqing

Chongqing Jiulong Industrial Zone

Jiulong Industrial Zone has established automobiles, motorcycles, precision machinery, modern printing, new materials, IT, steel and stone processing as its major industries. Approximately 400 enterprises have already been established in the zone, including large international companies such as Yamaha, BMW, Black & Decker, ABB and Tsubaki.

The motorcycle manufacturer Chongqing Loncin Industrial Group, has announced plans to launch a RMB 5.2 billion joint venture with BMW to build an engine producing facility in Chongqing Jiulong Industrial Zone. The facility is expected to commence operations in 2013, and realize an annual industrial output of RMB 13 billion.

Industries Encouraged

Electronics Assembly & Manufacturing, Automobile Production/Assembly, Food/Beverage Processing, Instruments & Industrial Equipment Production, Raw Material Processing, Heavy Industry

Chongqing Shuangqiao Industrial Zone

This industrial zone in western Chongqing specialises in heavy-duty vehicle and auto parts manufacturing. Major manufacturers in Shuangqiao Industrial Zone include Chongqing Yunhe Automobile Manufacturing Co. which has invested RMB 140 million in for a heavy-vehicle and auto parts facility. The zone is also home too Double Coin Holdings RMB 3 billion tire production facility. To date the zone has attracted more than forty companies who have established more than 60 facilities.

Industries Encouraged

Electronics Assembly & Manufacturing, Chemicals Production and Processing, Automobile Production/Assembly, Instruments & Industrial Equipment Production, Heavy Industry

Southern Chongqing

Development of the auto industry in southern Chongqing has been driven by enterprises such as ChangAn Suzuki, and DaJiang Group and the vehicle modification company DIMA. In addition, the area has attracted parts suppliers such as ZongShen, Taiwan Toyo, ChangJiang Electric and other famous brands. The area consists of Ba’Nan District, part of both NanAn Economic Development Zone, and ChaYuan New Area.

Chongqing Chayuan Industrial Zone

Situated in Nan’an District, between the first ring road and the second ring road of the city, Chongqing Chayuan Industrial Zone is 12 km away from Chongqing Railway station, 32 km from Jiangbei International Airport and 15 km from the container terminal. The zone has established electronic information and equipment manufacturing as its pillar industries. Currently, there are approximately 100 enterprises in total located in the park including Chongqing Chongyou Information Technology (Group) and Chongqing Dima Industry.

Chongqing Dima Industry specialises in manufacturing high-tech specialized vehicles and achieved sales revenues and net profits of RMB 692 million and 105 million respectively in 2007. The company ranks among the top 50 industrial enterprises in Chongqing.

Industries Encouraged

Automobile Production/Assembly, Electronics Assembly & Manufacturing, Heavy Industry, Medical Equipment and Supplies, Telecommunications Equipment

Outlook For the Future

With all of this activity around Chongqing’s auto industry there is certain to be a lot of activity at Auto Chongqing 2010 and even more action for the city’s automotive enterprises.

Special thanks goes to Maxxelli Real Estate of Chongqing for providing extensive research for the story. You may find out more about Maxxelli and about opportunities in Chongqing’s industrial real estate industry at www.maxxelli.net

It was reported that China has published annual ranking lists of cities’ competitiveness since 2005, of which Chongqing ranked 38th in 2005, 43rd in 2006, 38th in 2007, 33rd in 2008 and 42nd in 2009.

The annual ranking list of cities competitiveness mainly examines six factors, namely growth rate of gross domestic product (GDP), per capita GDP, cost for development, disposable income per capita and so on.

Source: Chongqing Government

Mainly, the increased CPI is the result of higher prices, caused by an increased consumer demand over the period of Spring Festival. This assumption is reinforced by the fact that goods like Food, Liquor and Tobacco witness a price rise over 3%, while prices for entertainment and education, only rose by 2.1%.

Chongqing telecommunication industry –

Investment guide: overall investment guide –

Chongqing light industries –

Chongqing logistics industry –

Chongqing chemical industry –