After China joined WTO, abolishment of compulsory technology transfer and tendency of independence of MNCs make MNCs keep a firm hand on technology transfer. How to promote MNCs to transfer technology to developing countries? This paper constructs the game model of differentiated duopoly and proposes that the competition between MNCS will promote technology transfer in theory. Based on the case of automobile industry in China, the paper proposes that two MNCs at least should be introduced and we should spur the competition between MNCs to promote technology transfer.