Chinese, German car companies boost cooperation amid industry shift

Chinese and German auto companies on Friday explored ways to boost cooperation amid profound global transformation and fierce industry competition.

The 10th German-Chinese Automotive Congress was held in Wolfsburg, Germany, on Friday, attended by some 600 representatives from China and Germany.

The automotive industry, including its suppliers and technology sectors, is undergoing one of the biggest and most rapid transformation processes in its history, according to Olaf Lies, minister-president of Lower Saxony state.

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A wide range of factors are driving this transformation, including electrification, vehicle digitalisation, artificial intelligence in manufacturing and in vehicles themselves, and autonomous driving, Lies said, adding that the congress sends a strong signal that cooperation between Germany and China should be deepened.

In the auto industry’s current climate, it is very important that German and Chinese companies maintain dialogue and establish reliable and solid partnerships, said Thomas Schmall, CEO of Volkswagen Group Technology.

Meanwhile, Liu Minqiang, director-general of the Investment Promotion Agency of the Chinese Ministry of Commerce (MOFCOM), said competition is not detrimental to the automotive industry as transformation accelerates.

Rather, it helps upgrade the industry and plays a positive role in providing customers with better products and services, Liu added, urging companies to focus on improving their technologies, products and services.

Lin Dong, China’s consul general in Hamburg, added that cooperation between Chinese and German auto companies has now gone beyond the conventional domain of complete vehicle production, expanding to areas including batteries, intelligent connection and technological innovations.

The Automotive Congress was held in the wake of the International Suppliers Fair, which kicked off in Wolfsburg on Tuesday. A total of 45 Chinese automotive suppliers were present at the fair.

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The economic and trade cooperation and exchange conference between China’s Hunan Province and Germany, which also took place on Friday, coincided with the German-Chinese Automotive Congress.

Representatives of the German automotive industry have responded positively to delegates from central China’s Hunan Province.

On the sidelines of the meeting, Gundula Henkel, a board member of the German-Chinese Association Saxony-Anhalt, leaned in with a candid smile, holding a notebook filled with scribbled notes.

As the presentations unfolded, Henkel found her view shifting fast and was deeply impressed by China’s development momentum. People can see “how cleverly (China’s) local strengths are paired with the right industries,” she remarked. “It’s a real eye-opener.”

Liu Suyue, deputy director of the Hunan Provincial Department of Commerce, summarized Hunan’s advantages as a favorable destination for German investment as “5C”: cost, consumer base, a whole supply-chain cluster, a talent base of colleges and a convenient environment.

Liu said:

“We are ready to work with you, and I believe our sincerity can bridge the distance from the Xiang River to the Rhine.”

Germany is home to several well-known companies from Hunan Province, including the Sany Group.

A Chinese multinational heavy equipment manufacturer, Sany Group acquired Putzmeister, one of the world’s leading construction equipment companies, in 2012.

Michael Bose, chairman of the board at automotive BerlinBrandenburg e.V., also attended the meeting.

“I am pleased that we have the opportunity today to engage with Hunan-and specifically with its representatives, as well as potentially later with Sany Group to discuss vehicles and automotive technologies,” he said.

As the chairman of a German association representing companies from the special-purpose vehicle manufacturing sector, Bose is well aware that the German companies “currently have a very strong interest in, and are actively seeking contacts within, the electric vehicle industry, particularly regarding heavy trucks and heavy machinery in relation to China.”

As a major manufacturing province in China, Hunan boasts a solid foundation in the automotive industry. These industrial capabilities not only provide enterprises with supporting supply chains and opportunities for market expansion, but also create ample room for China-Germany cooperation on new technologies and products, Liu Minqiang, the MOFCOM official, said in a speech at the meeting.

“By aligning Hunan’s promotion meeting with the Sino-German Automotive Congress today, our objective is to deepen the German community’s understanding of Hunan,” Liu Minqiang said.

Uwe Fritsch, member relations specialist at automotiveland.nrw, an automotive industry cluster in the German state of North Rhine-Westphalia, also highlighted the importance of closer exchanges between China and Germany.

“As Lower Saxony’s Minister-President Olaf Lies has also pointed out, what we need is greater cooperation – and in both directions,” Fritsch said. “This means not only closer economic collaboration between German and Chinese companies but also, equally importantly in the current climate, greater mutual understanding and dialogue.”

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