【正文】 nd able to finance their own premises and growth.Contracting out something as fundamental as product manufacture always raises the specter of creating your own petition. Companies that adopt the assetlight strategy naturally hope that the manufacturers they nurture won 抰 eventually beat them at their own game. Although little is certain in business, global car brands can find much to allay their concerns. In the car industry, it is skills in design, brand marketing, and distribution, as well as a very few key ponents, notably highperformance engines, that help panies earn their petitive position. Their profits flow from sales, service, finance, and leasing. Outsourcing assembly doesn 抰 force panies to transfer their skills in any of these key areas, nor should it put such advantages at risk, which is why panies like Cisco Systems, HewlettPackard, and IBM feel secure in outsourcing the manufacture of most of their highend hardware systems.MAKING IT HAPPENContracting out production isn 抰 altogether novel for global carmakers: Valmet, in Finland, makes some Porsche Boxsters。1 / 10Global carmakers could manage their costs and capital in China—and gain a strategic option for their global operations—by contracting out the manufacture of whole vehicles to Chinese panies.PAUL GAO The McKinsey Quarterly, 2022 Number 1Faced with the prospect of stagnant global sales over the next five years, the world 抯 biggest carmakers are jockeying for a share of one of the few buoyant national markets. China 抯 domestic car sales, growing at more than 10 percent annually, will probably account for 15 percent of global growth over the next five years. So far, global automakers have pursued successful jointventure strategies by investing heavily in assembly plants operated by Chinese partners. But as petition in China heats up, a new tack may be needed in the quest for profitable market share.An assetlight strategy would have the major auto panies concentrate on what they do best—developing products and brands—while contracting out not just ponent supply but also the whole assembly process to Chinese automakers that can capitalize on petitive cost structures. Although scaling back capital investment in such a healthy market might seem bold, outsourcing manufacturing is neither unmon in other industries nor entirely unprecedented in this one. Moreover, the nature of the Chinese auto industry and market makes outsourcing particularly attractive. Outsourcing might also help Chinese automakers take their first steps to being a global manufacturing resource. But if the strategy is to work, global carmakers must build up the skills of these Chinese partners, which in turn must embrace contract manufacturing as a more profitable path to creating a globally petitive industry than launching their own brands.COMPETITION IS ABOUT TO HEAT UPWith sales of millionplus units in 2022, China buys more fourwheeled vehicles than all but six other national markets, yet its passenger car market is still in the early stages of growth. Indeed China, with only 600,000 car sales a year, has fewer than 10 passenger cars on the road per 1,000 people, pared with 250 in Taiwan and more than 500 in Germany and the United States. But demand—promoted by better roads, new sales and distribution channels, the deregulation of the auto market, and China 抯 entry into the World Trade Organization (WTO)—will increase as the country 抯 economy continues to grow (Exhibit 1).2 / 10The dominant production and sales joint ventures between global and local panies have the best position for meeting that demand. Only 15 years after Volkswagen entered the market, more than half of the passenger cars sold in China roll out of VW 抯 Changchun and Shanghai joint ventures. Other foreign joint ventures account for nearly all the rest—a further 43 percent (Exhibit 2). In the shadow of these foreign alliances, 20 domestic carmakers share just 3 percent of the market.3 / 10As global panies focus more and more on China, local manufacturers will do well to hold even that meager share。 Ford Motor has set up the pany 抯 first passenger car joint venture