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Chinese, foreign auto industries share opportunities brought by new energy through cooperation

November 24, 2022


Abstract : The new energy vehicle (NEV) industry has become one of the most representative industries highlighting that an open Chinese market is in line with the world in development, as Chinese auto companies are seeking overseas cooperation in the sector while foreign auto companies are expanding presence in the Chinese NEV market.

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This photo taken on July 4, 2022 shows a workshop of the Volkswagen Anhui MEB (Modular Electric Drive Matrix) plant under construction in the Hefei area of the pilot free trade zone (FTZ) in east China's Anhui Province. (Xinhua)

BEIJING, Nov. 24 (Xinhua) -- The new energy vehicle (NEV) industry has become one of the most representative industries highlighting that an open Chinese market is in line with the world in development, as Chinese auto companies are seeking overseas cooperation in the sector while foreign auto companies are expanding presence in the Chinese NEV market.

-- Dividends of openness attract foreign auto companies

China is the world's largest single market for electric vehicles, and also an important part for Volkswagen Group in its global business that cannot be ignored, said Erwin Gabardi, CEO of Volkswagen Anhui, the first joint venture of Volkswagen Group in China that focuses on the research and development (R&D) and manufacturing of NEVs.

According to him, Volkswagen Anhui plans to officially put into production its first NEV model in China by the end of 2023.

Data showed that China's production and sales of NEVs have been in the first place worldwide for seven consecutive years since 2015. In 2018, China has lifted restrictions on foreign ownership of NEVs. Tesla, the first wholly foreign-owned vehicle manufacturing company in China, completed factory construction, production and product delivery in Shanghai in just one year.

Eyeing the large market size plus institutional opening-up and other dividends, more and more foreign auto companies are expanding presence in China in a faster manner.

In June this year, BMW Group officially opened its third vehicle plant in Shenyang, northeast China's Liaoning Province. In the same month, the Audi FAW NEV project, launched by German automaker Audi and China's leading automaker First Automotive Works (FAW) with a planned investment of over 30 billion yuan, officially started in Changchun, capital city of northeast China's Jilin Province.

In September this year, Chinese battery producer Contemporary Amperex Technology Co., Limited (CATL) and BMW Group announced a long-term agreement, and CATL will supply cylindrical batteries for BMW Group's pure electric models from 2025. Prior to this, BMW Group signed a memorandum of cooperation with Chinese steelmaker HBIS Group, and the Shenyang production base of BMW Group will gradually use the low-carbon automobile steel of HBIS Group from the middle of 2023.

-- Chinese NEVs see expanding global market

While foreign auto companies are tapping into the Chinese market, Chinese NEVs are also witnessing speedy entry into overseas markets.

According to data released by the China Association of Automobile Manufacturers (CAAM), from January to October this year, auto companies in China exported 2.456 million autos, up 54.1 percent year on year, with the figure in October hitting a record high, standing at 337,000, up 46 percent year on year. The export of NEVs in October reached 109,000, registering a month-on-month growth of 1.2 times and a year-on-year growth of 81.2 percent.

Chinese electric vehicle (EV) maker NIO has built a plant in Hungary, which is its first overseas plant, and announced that the plant would be put into operation in September this year. The plant, covers an area of about 10,000 square meters, will mainly produce battery swap stations for electric vehicles.

NIO plans to build 20 battery swap stations in Europe by the end of 2022, and the figure is expected to hit 120 by the end of 2023.

Chinese automaker BYD has signed an agreement with a local company in Thailand, and its first overseas passenger car factory which is wholly invested by itself will start operation in 2024, with an annual production capacity of 150,000 electric passenger cars. Cars produced in the factory will be mainly sold to the Thai market with radiation to ASEAN countries and beyond.

BYD has also announced a cooperation agreement with auto rental company SIXT, and it will provide the European market with NEV rental services to jointly promote the electric transformation of the auto rental market with SIXT and help with carbon reductions worldwide.

According to the agreement, SIXT will purchase at least 100,000 NEVs from BYD in the next six years, and BYD will help SIXT achieve its green goal of making the proportion of electric fleet reach 70 to 90 percent before 2030.

-- China is becoming a global automotive innovation center

With the continuous upgrading of China's automobile market, more and more international automobile brands regard China as the most important market in the world. NEVs and intelligent connected vehicles which represent the future development direction of the automobile industry are developing fast in China, attracting international auto giants to increase innovation and R&D efforts.

China is growing into a global automotive innovation center.

Chinese companies and consumers have been keen on emerging technologies, said Qualcomm China chairman Frank Meng, adding that he believes Qualcomm will help more related Chinese enterprises with innovation in the era of intelligent connected vehicles and help them enter the international market.

It has become a firm consensus of global auto companies to invest in China, be optimistic about the Chinese market, and cooperate with Chinese auto partners for mutual benefits and win-win results.

Volkswagen Anhui is constantly expanding the R&D team and rapidly adjusting the R&D strategy to carry out innovative R&D specifically for Chinese consumers, noted Erwin Gabardi.

As a world's leading premium car manufacturer, BMW Group has full confidence in the strength and resilience of China's supply chain, said Jochen Goller, president and CEO of BMW Group Region China.

(Edited by Gu Shanshan with Xinhua Silk Road, gushanshan.1987@163.com) 

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Keyword: NEV B&R Weekly Chinese market

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