China buses & coaches industry develops very fast and the output increases every year. However, some small- and medium-sized enterprises (SMEs) still face many challenges. For example, they are weak in research and development. A majority of local products are labor-intensive and low value-added and key high-tech components depend on import. Due to fund shortage and lack of research strength, many small bus manufacturers just compete for low-end markets. Roughly 70 percent of the companies' products are very much alike, which results in cutthroat competition.

With China's access to the World Trade Organization, limits on import and export of vehicles and components are being cut or lifted, and more overseas investment is flowing into China. How to face this challenge? These small bus manufacturers will write their answers in the market.