Comment by maxglute

And just like the west, local gov they'll cut teachers wages before strategic industries. Debt crisis = local gov forced to deleverage because central gov chose to kneecap land finance, central gov can via many instruments find arrangement to prop up a player. Nvm these companies from tier1 GZ, SH, JS manufacture hubs with GDP the size of g20 economies, if someone wants nio and xpeng around and give them local robotaxi / fleet contracts to grift in perpetuity, or keep their self driving stack and consolidate manufacture and pawn off after market to someone else, they can. Keep in mind current auto involution = large players bleeding at rates where they still have ~10+ years of operational runway, these are too big to fail but cheap enough to bail size companies. Hence what is unlikely to happen, just like how other sovereigns fighting to keep their surviving legacy auto alive, is to let strategic auto die off in ether like mom and pop coffee shop. Except sovereign balance sheets (>100% debt to GDP) are in general much worse than tier1 PRC (<100% debt to GDP) even with squeezed land finance, aka western countries propping up western auto is a much harder lift than PRC local gov propping up local auto.