Is this Schultz's visit to China, or is it a group of entrepreneurs who take Schultz to China?
On the topic of the German Chancellor's visit to China, Chinese netizens and European media, although they are 8,000 kilometers apart, have reached a high degree of spiritual resonance. As the itinerary was completed as planned, the German delegation also observed Bosch's factories and new technology applications in China, BMW's R&D center in Beijing, the top three countries in the European Union, and the political and business leaders of Germany, respectively, released their attitudes towards the Chinese market, especially the automobile industry, through words and actions.
There is an adage in the field of politics and business, don't look at what you say, look at what you actually do. From 1979 to 2019, Germany has already provided more than 10 billion euros in funds to China, and now as more hot money comes in, the relationship is getting deeper and deeper.
So the situation has become, although the EU is preparing matters on the carbon footprint of power batteries and countervailing investigations, entrepreneurs with hot money in their hands voted with their wallets. The delegation's first stop was Chongqing, where they observed the related businesses of Bosch Holdings, with a particular focus on hydrogen power. BMW Group Chairman Zipzer and Mercedes-Benz Group Chairman Kang Linsong both announced that they will continue to invest firmly in China. BMW's investment in China in 2022 alone is 3.297 billion euros, nearly 43% of global investment. Mercedes-Benz expanded its plant in Beijing and introduced a heavy-duty truck business that had been pending for a long time. 3 days before the prime minister landed, on April 11, the official announcement of the capital increase of Volkswagen Anhui and Volkswagen Xiaopeng's business amounted to 2.5 billion euros, equivalent to more than 19 billion yuan.
At the end of the trip, the speech ended, the communication was completed, the views were reached, the conclusion was very direct, and the Sino-German automobile industry initially reached the intention of deep binding. And this is not sudden, after all, as early as the beginning of this year, the relevant team of the German automotive industry has visited China to discuss how the Chinese supply chain can help German new energy vehicles reduce costs.
Behind the two-way rush, China's new energy vehicles have initially become?
As for the reason for the in-depth cooperation, it is also on the bright side, Germany and China are highly bound in the field of industry and commerce, Germany maintains a leading position in the traditional automobile industry, and China has taken the lead in the field of intelligent new energy vehicles.
There is a set of data, which is as follows. China has won the first place in the global new energy vehicle production capacity for 9 consecutive years, and the production and sales volume in 2023 will exceed 60% of the world's total, and 65% of the global new energy vehicle production capacity will come from China. In the lithium battery industry, China will account for 73.8% of global shipments in 2023. As for the fine processing of lithium, as of 2022, Chinese companies control 72% of the world's production capacity.
In other words, if you want to quickly complete the transformation and promotion of new energy vehicles, it is difficult to avoid Chinese elements on a global scale. For example, taking Musk's world's richest man as an example, after the establishment of the Shanghai factory, the Chinese factory achieved cost reduction, profit increase, feeding back to the world, and explosive production, which finally stimulated the capital market to facilitate Tesla to complete the trillion-dollar market value in only 11 years.
Of course, in addition to Germany, more European countries have also begun to swing in the face of the new global environment. For example, Italy, which has withdrawn from the Belt and Road Initiative, has just held a bilateral high-level economic forum with China before Germany's visit to China. The decision to strengthen more economic cooperation with China was also revealed by France. The top leaders of Germany and France have publicly called for a rebalancing of trade relations between the EU and China.
Looking at a series of new moves in the auto industry, Italy's Industry Minister Adolfo Urso kicked off in April, and Italy is in talks with Tesla and three Chinese automakers to attract at least one Chinese car company to invest in factories to meet the country's planned goal of producing 1.3 million cars a year. According to foreign media reports, the three Chinese car companies are BYD, Chery and Great Wall Motor.
In addition, Italy is not the only one that is interested in Chinese car manufacturers. Because on April 9, the Spanish government and the local engineering group EV Motors began to blow the news, Chery Automobile is about to reach an agreement with the Spanish government, and then officially sign the agreement for Chery's production in Barcelona.
With more than 80% of the world's modules and more than 95% of silicon wafers coming from China, there are cases of photovoltaics in the past, and Europe's concerns about new energy vehicles are not unreasonable.
However, the world is obviously not black and white, business still has to be done, cooperation still needs to be increased, but more details and rules must be studied clearly, and then market games are carried out according to competitiveness.
The ultimate logic is clear, the way to become strong is to learn from the strongest model of our time. Of course, China's new energy vehicle industry is naturally only a preliminary foothold, low cost, large output is a significant feature, and there is still a distance from high-precision. For example, in terms of high-computing power chips, Geely, BYD, Wei Xiaoli, and technology companies are all in the layout, which is a latecomer.
For example, Xpeng began to launch its self-developed chip in 2021, and there is no movement yet; Weilai announced Yang Jian (LiDAR main control chip) in 2023, but it will only be seen in the delivery of ET9 in 2025; At present, this field has been dominated by NVIDIA, and the DRIVE Thor chip that is expected to appear in 2025 is expected to pull the computing power to 2000 TFLOPS.
Even in the short term, there is no need to discuss whether the self-developed chips of Chinese car companies/technology companies can catch up, because on the one hand, there is no choice under sanctions, and on the other hand, many companies' plans are based on tapping the maximum potential of Nvidia chips and then selling them to car companies to achieve profitability.
Other areas involved include that some high-end technologies of electric drive are not yet available to Chinese car companies, such as BMW and Mercedes-Benz can win relevant technical awards with eDrive and YASA motors respectively, Huawei's Driveone, Xiaomi's V8S motors, etc., either have not yet been honored, or have not yet been produced on the car. So in essence, the current leadership of China's new energy vehicles is about two points, one is that the power battery is indeed a monster level, and local companies in Europe and the United States even have little ability to chase. Second, because of the earlier transformation, car companies and suppliers have more cost preemption advantages.
Germany changes its thinking, leaving the problem to Japan, France, the United States and South Korea?
In the long run, increase investment, translate the final direct effect of the new actions of the three major German car companies, that is, the configuration of German cars will become higher, the intelligence will become better, the battery life will be longer, and most importantly, the cost will decline and the price of the car will fall, so that it will not be possible to achieve high sales by selling cars at a loss as now.
And this series of solutions is also easy to understand, that is, to embrace Chinese suppliers, start-up teams, in short, to embrace China's new energy vehicle ecosystem. Power batteries from a simple procurement relationship, into a shareholding relationship, the cost difference between the two is naturally different, BYD is a typical good example.
The reason why it can directly start a new energy price war through the launch of the glory version this year is that it is the sales champion and has brand influence. More critically, lithium carbonate, a key raw material for power batteries, will be reduced in price from the second half of 2023.
The procurement relationship between most car companies and power battery factories is to determine and lock the price and quantity. Even if the cost and price of power batteries fall, it will only be in the next cycle to have substantial cost reduction qualifications, such as most car companies that cooperate with CATL. Of course, car companies can use their own cash reserves to reduce prices in advance, but the market is always fluctuating, after all, no one can be sure that the price of battery raw materials will rise in the next stage, and whether battery factories will change their faces again.
And the pressure of competition will always come, and German cars will keep up with the footsteps of Chinese brands and begin to roll inward, and there is even hope that the volume will be even stronger. Therefore, the pressure has also come to the Japanese, American, French, and Korean systems. The situation is also very clear, and now there is a choice to make, whether to keep up with the Chinese and German brands and start rolling, or to use the traditional system to be tough, or to be ready to leave.
However, different companies have different attitudes and ways of changing, and the new situation is as follows:
1. Toyota, although the old president Akio Toyoda has publicly stated many times that pure electric and new energy are no play, but the company's actions are not small at all. In the Chinese market, specifically, in terms of electric R&D and products, it deeply embraces the two partners of GAC and BYD, and no longer hesitates to be intelligent, and directly connects with Huawei. It is foreseeable that there are still many bugs and variables to be solved in the process and effect, such as the effect of intelligent driving may only reach the mainstream level in 2023, but the overall trend is that the competition of new energy vehicles in China is no longer hidden and does not want to give up;
2. Honda, basically the same frequency as Toyota in terms of attitude, although it did not announce a new strategic cooperation, but on April 16, it directly issued a new brand Ye. Although the word is used in electric vehicles to somewhat lack a proper understanding of China's contemporary Internet culture, Honda is not prepared to give up. As for the solution, it is HMCT that has been developed and promoted by Guandao and Lingpai before. Localized R&D is carried out directly according to the needs of China's auto market, and there is no doubt that the product strength is better than that of the previous oil-to-electric products.
3. Nissan, it proposed the transformation time earlier, but the more troublesome point is that the time has passed more than half a year, and the current movement is not big, and there will be such expressions at the Beijing Auto Show;
4. Although the market share of Korean and French is not large, there is a big difference in attitude towards the market. What the South Korean system is doing is throwing money and selling new cars, but the French department has begun to think about changing paths, such as engaging in new joint ventures. The actions of the Korean system are actually similar to those of the German system, which also happened in 2022, when BAIC and Hyundai increased their capital by 6 billion yuan to Beijing Hyundai, and the new car plans for this year and next year will continue, and they are also launching new Tucson, Shengda, and electric vehicles.
As for French cars, the pace of new car planning of DPCA has begun to slow down, and in addition to not seeing more new models with combat effectiveness, SPA's parent company Stellantis directly invested in Leap, which is equivalent to looking at new partners in the competition in China's new energy market.
In the above categories, the Japanese system is acceptable, and even slightly exceeds expectations, the Korean system does not stop, and the outcome of the French system is unknown. Compared with the above-mentioned companies, in fact, the pressure on the United States will be significantly greater. After all, there are many areas where strategic cooperation with Chinese companies can have an impact, so the immediate consequence is that there is very little room for use.
At present, the American brands in the Chinese market are Tesla, SAIC-GM, Ford, Lincoln, and Jeep. Although Tesla has recently encountered sales pressure and began to lay off employees, it is still a technical benchmark in many angles, and it also shows an attitude and behavior with high expectations for the Chinese market as a whole. SAIC-GM, although new cars continue to be introduced, Honda does not use the Autonen platform jointly developed with it, in fact, it also shows that there is room for continuous improvement in the competitiveness of technology in China. In addition, the entire SAIC-GM R&D center is mainly in the hands of GM Pan Asia, which is indeed in line with China's new consumer demand to a certain extent, but in essence, it still follows the previous rhythm, so the progress is relatively limited. In addition, it is Ford and Lincoln, according to their recent official plans, using their current gasoline-electric hybrid as a plug-in hybrid is a main line.
Write at the end:
In fact, by analyzing the new round of planning and actions of several car companies, the conclusion is very clear that in the face of the Chinese market, there are differences between global car companies. It is not only the mining space for sales and profits, but also the best soil for the company's own technological progress and catering to new trends. However, while most companies are adjusting, there are also many companies that basically maintain the logic of 10 years ago, that is, they use their global development and reserves to slowly cater to the Chinese market.
The results are unknown, but the trends speak for themselves.
For example, the Volkswagen CMP platform is likely to brew a new plug-in hybrid car with a price of 100,000 yuan and the size of Lavida, which is basically the same as BYD and Changan. But what can be expected is that car companies that are too slow or don't want to change will wake up after being beaten or fall silent.