Seeing the recent Beijing International Auto Show, are you also completely attracted by those new energy models? Foreign fuel vehicles seem to have drifted away, and emerging forces are occupying the automotive field at an astonishing speed. However, while these new forces are attracting attention, the export performance of traditional car companies has secretly climbed to an astonishing height. Chery and SAIC exported an incredible 937,000 and 1,208,000 units respectively last year.
All this stems from a fact that cannot be ignored - China, with its own scale advantage and roll king style, is shining in low-cost manufacturing after technological breakthroughs. From solar energy to automobiles, from chips to 5G, Chinese companies' continuous investment in technology and cost advantages in the industrial chain are making us quickly become one of the world's industrial giants.
When it comes to China's low-cost manufacturing capacity, we have to start with solar photovoltaics. Last year, the production cost of photovoltaic modules in China was only US$0.15 per watt, a full 42 percent lower than that of the United States and Europe! Deutsche Welle reluctantly reported that the United States and Europe could no longer compete with China. Our 80% of the world's manufacturing capacity, combined with soaring domestic demand, has allowed China to add almost twice as much PV capacity in 2023 as the US and EU.
Analysis of industrial advantages: In the past, Europe, the United States, Japan and South Korea dominated the market by virtue of their technological leadership, and they took full advantage of high profits. The high prices of telecommunications equipment, automobiles, aircraft, shield machines and other industries are unaffordable. But now, after China has made breakthroughs in many fields such as chips, 5G, and new energy vehicles, profits have been quickly wiped out. The product profits of memory chip giants such as Samsung and Micron have plummeted, and after the low-end is firmly won by us, we can only barely maintain it.
In the past, we relied on "eating bones and drinking soup" to make a living, but once there is a breakthrough, China's low-cost advantage can be greatly discounted and quickly occupy the market. Take the automotive industry as an example, in the past, state-owned enterprises were afraid that private enterprises would impact their profits, so far there have been technological breakthroughs and localized substitutions. This is also the key to Chery and SAIC's prosperity. The U.S. denies free trade and slams the table on 5G and new energy vehicles, which is a sign of China's growing advantage.
The battle for industrial dominance: China is striding towards the ultimate goal of becoming an industrial superpower with a steady and unstoppable attitude. With the exception of a few sectors such as semiconductor equipment and commercial aircraft engines, international giants in other manufacturing sectors are gradually losing their dominance.
The driving force for this change is first and foremost due to the continuous investment of Chinese enterprises in key technologies. In the past, we were blocked by foreign technology for a long time, and we could only survive in the low-end field with the thinnest profits. However, once a breakthrough is achieved, it can quickly crush the high profits of foreign-funded enterprises by relying on China's unique scale effect and industrial chain advantages.
For example, after making a breakthrough in the field of memory chips, our low-cost products had a huge impact on giants such as Samsung and Micron, and their profits were hit hard in an instant. A similar situation also occurs in emerging fields such as 5G communication equipment and new energy vehicles. In the past, foreign monopolies used to set prices high, but now the entry of Chinese counterparts has finally caused the price level in these fields to fall back to the ground.
In this process, foreign companies are not sitting still. For the old tricks such as technological blockade and industrial containment, they naturally used all their resources again. But the good news is that as China's manufacturing industry grows, these practices will become more and more unavailable.
Now that the United States has begun to openly deny free trade and launch violent attacks on 5G communication equipment, new energy vehicles and other areas where China is in a dominant position, we can see that the pain caused by the change of the global industrial pattern has slowly surfaced.
This will ultimately be the final struggle of the transition period. The night of the past will eventually be driven away by the power of this shareholder and usher in a new dawn. In the future, Made in China will continue to penetrate and expand into more fields with its unparalleled cost advantage, until it completely dominates the global industrial map!