1. IntroductionCar companies such as GM Holden, Toyota and Ford decided to close their factories in Australia and move to another country. The automotive industry is one of the crucial economic phenomena of the 20th century and remains vitally important today. In other words, the global automotive industry has played an important economic role (Wynn-Williams, 2009, p. 2). Today it is one of the largest industries in the world, the industry of industries (Drucker, 1972, p. 176). It can be noted that there is a fairly broad consensus among automotive industry observers on a large number of issues. The sector has had difficulty adapting to recent challenges and is no longer highly regarded by capital markets. The slowdown in car sales in more mature markets such as North America and Western Europe is accompanied by much faster growth in sales in relatively third world countries such as China and India. Accordingly, this assignment first describes the Australian automotive market and operations in Australia, and then highlights both challenges and opportunities in China, a potential automotive market, in order to suggest a way for Holden to enter the Chinese market. The assignment aims to investigate China's competitive advantages and how China could attract many foreign automotive companies in the short term. The assignment also uses a range of journals, books, reports and internet sources to gain a deeper understanding of the Australian and Chinese automotive contexts.2. Operations in Australia2.1. Factors that have changed the competitive landscape in the automotive industry First, the automotive industry is in the decline period of its life cycle (Whytcross, March 2014) where… half the paper… has to pay the depreciation and rent as ownership of the facility. Therefore, the automotive industry was affected by the decrease in sales volume. Next, there are some impacts on competitiveness due to the high Australian dollar, such as significantly increasing import penetration, because vehicles imported from Australia will be priced lower than locally manufactured vehicles and make exports more expensive in the global market. In other words, much cheaper imports have flooded the Australian market. Indeed, the lack of competitiveness of local producers has led to a decline in sales volume (Whytcross, March 2014). Therefore, based on strategic trade theory, local companies such as GM Holden, Toyota and Ford do not have a competitive advantage. Because the main idea of ​​the theory is that trade policies can increase the national welfare level at a given time