From April 14 to 16, German Chancellor Olaf Scholz paid an official visit to China. This is Scholz's second visit to China since he took office as German chancellor, and it has been less than a year and a half since his last visit. According to German media, as during Scholz's first visit to China, German companies are competing for seats in the accompanying delegation to China. The German economic delegation accompanying the visit to China included executives from Mercedes-Benz, BMW, Bayer, thyssenkrupp, Siemens and other companies. Industry insiders generally believe that the cooperation in the automotive industry is a model and benchmark for Sino-German cooperation. Under the tide of transformation and upgrading, the cooperation between China and Germany in the automotive industry will be further extended and expanded, and it is expected to continue to achieve win-win results in technology, market, talent, management, supply chain, innovation chain and other aspects.
Scholz's delegation to China
The automotive field is "heavy"
Industry insiders believe that the enthusiastic signing up of German companies to visit China reflects their firm confidence in the Chinese market. In Scholz's delegation to China, the automotive field is still "heavy", including BMW Group Chairman Zipzer, Mercedes-Benz Group Chairman Kang Linsong, and many German car company executives.
"This year marks the 10th anniversary of the establishment of the all-round strategic partnership between Germany and China, and I am deeply honored to accompany Chancellor Scholz on his visit to China again. The BMW Group has been rooted in China for 30 years and has benefited from free trade between Germany and China and China's high-level opening-up policy. We are confident in the prospects of the Chinese market and are determined to continue to invest in China and make a greater contribution to deepening German-Chinese cooperation. Zipzer said.
Kang Linsong also said: "I am very honored to accompany Chancellor Scholz on his visit to China. We welcome China's continued high-level opening-up and optimism about the development potential of the Chinese market. China plays an important role in Mercedes-Benz's global strategy, not only as our largest single market, but also as one of the world's largest Mercedes-Benz production sites and technology innovation centers. ”
Judging from the itinerary, the first stop of Scholz's visit to China was Chongqing. Here, he visited Bosch Hydrogen Power Systems (Chongqing) Co., Ltd. The company is a joint venture between the Bosch Group of Germany and the Qingling Motors Group, and is an important base for Bosch's electrification strategy. In addition, many important German manufacturing companies have been deployed in Chongqing, in addition to Bosch, BASF, Continental, etc.
The second stop of Scholz's visit to China was Shanghai. In recent years, Sino-German economic and trade cooperation and exchanges have been implemented in many regions of Shanghai, and many German companies have been increasing their investment in China. Mercedes-Benz, for example, will officially open its new R&D center in Shanghai in April.
On April 16, the German Federal Minister for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV) Steffi Lemke led a delegation to visit the BMW Group's R&D Center in Beijing, China, where they listened to BMW's experience in China's circular economy.
The transformation of electrification and intelligence is accelerating
German automakers have increased their investment in China
At present, German companies invest in China in a wide range of fields, including automobiles, machinery, chemicals, finance, medical care, environmental protection, etc., mainly in the fields of automobiles and machinery. According to a recent report released by the German Institute for Economic Research, the total amount of German direct investment in China will reach 11.9 billion euros in 2023, an increase of 4.3% over the previous year and a record high. In 2023, German investment in China accounted for 10.3 percent of Germany's total overseas investment, the highest level since 2014.
In recent years, the Chinese market has become the largest single market for many German automakers, and it is also an important contributor to their profits. More importantly, from electrification to intelligence, China's new energy vehicle industry is heading to a new highland. In order to keep up with the transformation of the automotive industry, German automakers are determined to increase their investment in the Chinese market.
At its earnings conference in early March, the Volkswagen Group said it would continue to focus on investing in the Chinese market, new products, battery business, and platforms for pure electric vehicles and gasoline models. In addition, Volkswagen Group has acquired a 4.99% stake in Xpeng Motors, and the two companies will jointly develop two B-segment pure electric intelligent connected vehicles for the Chinese market, which are scheduled to be launched in 2026. To this end, on April 11, the Volkswagen Group announced an additional EUR 2.5 billion investment in its production and innovation center in Hefei to further strengthen its local R&D capabilities.
Mercedes-Benz is also increasing its investment in electrification and intelligence. At the beginning of March this year, the 5 millionth localized Mercedes-Benz car successfully rolled off the assembly line at Beijing Benz. At the Beijing Auto Show in late April, Mercedes-Benz will unveil a number of world premieres and launch models. "In the future, we will continue to invest in China, strengthen cooperation with Chinese partners, vigorously promote electrification and digital transformation, and continue to contribute to Sino-German economic and trade cooperation. Kang Linsong emphasized.
According to the financial report released by the BMW Group not long ago, in 2023, the capital expenditure of the BMW Group in terms of plants, equipment and fixed assets will reach 8.836 billion euros, a year-on-year increase of 8.5%. Among them, investment in China is an important part, mainly including the sixth generation of power battery projects and the upgrading of the existing plant of the Shenyang production base, the former with a total investment of 10 billion yuan, and the main building has been completed. "China is the future and the BMW Group's largest market in the world. Our continued success in China is inseparable from the continued growth and development of our footprint in China. Zipzer also reaffirmed the BMW Group's commitment to the Chinese market.
In addition to vehicle manufacturers, German parts companies also continue to increase investment in the Chinese market. For example, Bosch has invested about 1 billion euros in Suzhou to build a R&D and manufacturing base for core components of new energy vehicles and autonomous driving, the first phase of which will be completed by the middle of this year, and ZF plans to increase the proportion of revenue in the Asia-Pacific region, mainly China, to 30% by 2030.
"The German market welcomes Chinese cars"
Chinese automakers accelerate their "going global"
While German companies are increasing their investment in the Chinese market, Chinese companies have also accelerated their "going overseas" in recent years and accelerated their layout in Germany and other European countries. Many vehicle companies such as BYD, SAIC, Great Wall, and NIO have not only brought electric vehicle products to Europe, but also established local R&D centers and carried out charging facilities construction. In addition to the user experience center, NIO has also set up a design center and an innovation center in Germany, and the new European Intelligent Driving Technology Center was also launched near Berlin on April 8.
On April 15, Scholz said during his visit to China that the German market welcomes Chinese cars. According to Michael Schumann, chairman of the German Federal Association for Economic Development and Foreign Trade, Chinese car companies have not only effectively enhanced their brand image and market influence, but also made important contributions to the transformation of the German automotive industry by continuously improving their localized R&D capabilities and providing pioneering technical solutions for European users.
As early as 2018, Chinese power battery giant CATL announced the construction of a factory in Germany, which will be officially put into operation in early 2023 to supply batteries to European car companies, including BMW. At the first quarter earnings conference on April 15, CATL said: "There have been short-term demand fluctuations in the European market recently, but the global trend of electrification has been very clear, and ultimately it needs to be driven by marketization." With the increase in the volume of new generation electric vehicles of European automakers, the improvement of product competitiveness, the promotion of cost-effective lithium-ion batteries, and the gradual improvement of infrastructure, we are confident in the demand of the European market. ”
In addition to CATL, SVOLT and Gotion Hi-Tech are also building factories in Germany to support the electrification transformation of European car companies. Among them, Gotion Hi-Tech's Göttingen plant in Germany, which is the company's first overseas battery plant, will be put into operation in September 2023. On the day of production, Gotion Hi-Tech also signed cooperation agreements with BASF, ABB, Dutch electric bus manufacturer Ebusco, Spanish parts manufacturer Ficosa and other enterprises, covering battery materials and product development, vehicle and energy storage product supply, etc., so as to carry out the layout of the industrial chain. SVOLT also has a battery plant in Germany and has received nearly 90GWh of battery orders from the BMW Group in Europe.
Green development is not a one-man approach
Mutually beneficial cooperation has reached a new level
Scholz's visit to China highlights the determination of China and Germany to deepen cooperation and common development, and also witnesses that China's door to opening up is opening wider and wider. Scholz's visit to China and the "luxury lineup" of the delegation show that there is great potential for Sino-German cooperation in the field of green transformation. As Zipzer said, "Green development is not a one-man approach, but requires everyone to move forward side by side." Germany and China share this common belief, and green development is a new opportunity for further cooperation between the two sides. ”
On April 15, Scholz said in a speech at Tongji University in Shanghai that he supports the EU to open up the auto market and open and fair competition with Chinese automobiles. Scholz also pointed out that when Japanese and South Korean cars entered Europe, people were worried that Japanese and Korean cars would conquer the European market, but "this did not happen."
On the eve of Scholz's visit to China, the German Association of the Automotive Industry (VDA) spoke out against the European Union's tariffs on electric vehicles imported from China. The association warned that the European Commission's measure could trigger a trade conflict and threaten jobs in Germany. "Economic and trade relations with China provide a lot of employment opportunities in Germany. Our business is in the process of transforming with record funding, in part from China, a core sales market. VDA Chairman Hildegard Müller noted that "countervailing measures, such as additional tariffs, do not solve the problems of the European and German automotive industries." Conversely, the import tariffs envisaged by the European Commission could quickly have a negative impact if they lead to a trade conflict. ”
In fact, after the European Commission announced in October last year that it would launch a countervailing investigation into electric vehicles made in China, a number of German auto industry executives, including Zipzer, Kang Linson, and Volkswagen Group CEO Blume, expressed opposition to trade protectionism and called for all parties to reduce trade barriers as much as possible. "Increased competition in the auto industry will help European automakers produce better cars, and protectionism is going down the wrong path. Kang Linsong said.
Text: Zhang Dongmei Editor: Wan Ying Layout: Zhao Fangting
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