The automobile industry is now seen by many Chinese citizens as one of the country's fastest-growing industrial pillars. It helps drive local economic development with a steadily increasing slice of the nation's gross domestic product, provides employment for 17 million people and serves as an effective tool to boost domestic consumption.

Within just a few years the industry has turned into the world's third largest in terms of annual volume of production, behind the United States and Japan, and has won the patronage of millions of individual consumers. Statistics from the National Bureau of Statistics indicate that by the end of 2006, altogether 22 million private cars had hit the road nationwide, accounting for almost 60 percent of all vehicles across China. And the prospects for the industry are even more promising. China's rapid development of a robust economy, including a booming private sector, and rising incomes of both urban and rural residents, means sales of private vehicles are bound to continue to experience electric growth in the foreseeable future. According to a recent estimate made by the Chinese State Information Center, the total number of private cars in China will reach more than 100 million units by 2009.

The desire to own a car has given rise to the emergence of the country's homegrown brands, utilizing self-developed core technologies and indigenous technical know-how, such as Geely, Chery and Brilliance. And although 90 percent of the vehicles are either produced under the umbrella of foreign brands or simply imported from abroad, local car makers are running at full steam to snatch their share of the market. The China Automobile Industry Association has disclosed that sales of indigenous brands reached 1 million units last year, more than 25 percent of the total market share, with exports posting a record high of 340,000 units, doubling the volume of 2005.

While the fast-growing industry is being widely hailed for its positive contribution to the national economy, automobiles, as in so many other countries, are nonetheless looked upon as both a blessing and a curse. Not only have they brought convenience and a change in lifestyle to local consumers, but they have also caused environmental pollution, traffic congestion and excessive fuel consumption. These problems have become bottlenecks for the industry's future pattern of growth, and have created much controversy within society. Some have proposed imposing restrictions on the industry's growth; others have advocated the development of more fuel-efficient vehicles and greater use of public transport, all in the name of ensuring a cleaner environment and reducing dependency on energy resources. The Shanghai Municipal Government has adopted a quota system through which a limited number of car registration plates are auctioned at regular intervals to curb the number of local private cars, but the policy is obviously not applauded by all.

The Chinese auto industry needs to be further developed to serve its dual mission of stimulating the economy and boosting consumption, but it has to be steered onto the right course, otherwise, it may create more harm than good to consumers and the nation as a whole.