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Chinese autos looking to meet global demand

Market proximity, geopolitical stress, trade frictions lead to more offshore vehicle production

By LIU YUKUN | China Daily | Updated: 2024-05-31 09:41
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Visitors check out SW products during a machine expo in Shanghai in April 2018. [Photo provided to China Daily]

"Global consumers favor Chinese NEVs because they fill supply gaps in certain regions, which is driven purely by market demand. China's NEV development provides technical support and policy references for the development of NEVs globally, contributing to worldwide green development," he said.

Norbert Wiest, general manager of SW China, the Chinese branch of German machine tool maker SW, said, "It is logical for China's car industry to go global."

Wiest said: "In industrial history, every rapidly expanding and influential economy has ventured onto the global stage. For instance, Japan extended its reach globally during the growth of its automotive industry. Although Japan faced initial hurdles, it succeeded in its second attempt due to enhanced performance, technological advancements and cost reductions achieved through mass production — an experience similar to that of China. Additionally, German OEMs achieved considerable success by exporting parts to China."

He added that the competitive pricing of Chinese NEVs and auto parts manufacturers is driven by technological progress and large-scale production, pointing out that long-term market strategies and excellent services play crucial roles in their international success.

"Many of SW's customers in China are Tier-1 suppliers that directly serve OEMs. Their primary motivation for overseas expansion includes following global customers like Tesla into Europe and North America. These innovative companies have also contributed to global technological advancements in the electric vehicle sector, benefiting various entities in the supply chain," Wiest said.

Wiest said SW's Hungary branch saw a business boom in the past two years, largely due to orders from Chinese auto parts makers establishing production bases there.

"It's a win-win process. Our business with Chinese customers also experienced remarkable expansion."

Last year, about 40 percent of SW's global income came from Chinese orders.

SW Group isn't the only foreign company to benefit from China's rapid NEV development. EMAG Group, another German machine tool manufacturer, said it will further tap opportunities from China's evolving NEV market with several million euros of investment over the next three to five years.

"China is playing an increasingly significant role in supporting EMAG's global structure. We are confident in further collaboration with Chinese customers as they expand globally," said Markus Clement, global CEO of EMAG Group.

"EMAG is poised to support its Chinese partners not only within China, but also across international markets, including Europe and emerging regions like Southeast Asia," Clement said.

The remarks came after Chinese automakers, a downstream industry of machine tool manufacturing, are facing critical challenges including the European Union's anti-subsidy investigation into Chinese-made EVs.

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