The effect of technical diffusion indicates that the involuntary technology spillover promotes the level of technique and productivity in host country mainly through three outlets，such as international trade，foreign direct investment （FDI） and self-innovation （Wolfgang，2004）. Based on the positive effect，Chinese government has implemented the strategy of “market for technology” since the early 1980s. In other words，Chinese government attracts the direct investment of international auto maker to achieve the technical diffusion，motivating technical advancement and economic development. However，according to the model of completely knocked down （CKD），although a series of collaborations with foreign corporations rapidly improve the overall productivity of auto industry of China and make its scale and output value jumped to the largest one in the world until 2009，the CKD model has not yet enabled the domestic auto maker have the capacity of self-innovation. The phenomenon can be concretely described as follows：Primarily，the dependence of domestic corporations on foreign ones continuously strengthens under the pressure of shortage of funds，lag in technology and industrial policy. Moreover，foreign auto maker firmly control core technique and innovation of sovereignty due to the inferior ability of learning and imitating. Finally，compared with auto down-market，foreign enterprises almost monopolize the luxury auto market with higher profit.

LiShengLan:Li Sheng Lan，Professor of Lingnan College，Sun Yat—Sen University，main research fields：western economics，regional economics，industrial economics

ZhangYun:Zhang Yun，Phd of Lingnan College，Sun Yat—Sen University.

FengRui:Feng Rui，Phd of Lingnan College，Sun Yat—Sen University.