At a glance: The Ministry of Transport and the Ministry of Science and Technology (MOST) published a blueprint to spur on innovation in transport over the period 2021–2035. The government intends to enhance basic research and fully integrate cutting edge technologies into the transport system. The top priority tasks presented in the plan are:
- Improve infrastructure construction and maintenance, including in areas like super-long span bridges, submerged floating tunnels, and high-speed/heavy-duty railways
- Enhance the domestic production in key transport equipment, for example through research into power transmission systems
- Develop indigenous core components such as high-power ship turbochargers and automotive-grade chips
- Accelerate the adoption of smart technology to enhance transport efficiency, passenger safety and logistics quality
MERICS comment: The policy lays out clear ambitions for manufacturing in China’s transport industries. Beijing has previously leveraged industrial policy to successfully develop several mobility sectors, from new energy vehicles (NEVs) to commercial ships. The government now aspires to move into higher-value segments, such as intelligent connected vehicles (ICVs), cruise ships, large civil aircraft and heavy-duty helicopters. Support for research into new technologies related to ultra-high-speed commercial aircraft and trains, and even flying cars, suggests policymakers aim to gain a first-mover advantage in these emerging fields.
Foreign firms continue to play an important role in the development of these industries, either as a supplier of core components, like in aerospace, or as a driver of innovation. For instance Rolls Royce and Mercedes-Benz recently established new research and development (R&D) centers in China related to turbine engines and automated driving respectively. While foreign companies may benefit from the local innovation system, they struggle to access public funding and grants for R&D issued by the Chinese government.
Initially, China’s efforts to develop national champions in new segments will assist local players to gain domestic market share. But the ultimate goal will be to develop these into export industries. Beijing has previously achieved this with companies like CRRC and CRSC in high-speed rail and is now making headway in NEV exports through companies such as Nio and SAIC motors. This will increase competition for foreign firms in third markets.
Article: Medium and Long-Term Plan for the Development of Science and Technology Innovation in Transport (2021-2035) (交通运输部 科学技术部关于印发《交通领域科技创新中长期发展规划纲要（2021—2035年）》的通知) (Link)
Issuing bodies: MOT, MOST
Date: March 25, 2022