China, Europe see burgeoning potential for EV industrial cooperation
The auto industry is never a sole-player game
  ·  2023-09-06  ·   Source: Xinhua News Agency

"Shenxing," a fast-charging lithium iron phosphate (LFP) battery made by China's EV battery maker Contemporary Amperex Technology Co., Ltd. (CATL), is displayed during the press preview of the 2023 International Motor Show (IAA) in Munich, Germany, September 4

The 2023 International Motor Show (IAA), one of the world's largest mobility trade fairs, opened in the southern German city of Munich on September 5, with German and Chinese exhibitors in the limelight.

At the six-day event are some 70 Chinese firms, the second largest number after the German participants. Under the motto of "Experience Connected Mobility" of this year's IAA, Chinese carmakers are rolling out more chances and choices for local partners and customers in Europe.

Growing together

"Everybody here at the IAA is so excited to have so many Chinese brands here. We could see how they realize this digital revolution in products. Chinese brands are here to really keep a picture of the world of mobility, which also reinforces the international aspect of the IAA name," said Peter Fintl, vice president of technology and innovation at Capgemini Engineering.

Before the official opening of the IAA MOBILITY, carmakers and suppliers, half of which came from outside Germany, showcased their latest innovations at dozens of press conferences on September 4. China's EV battery maker Contemporary Amperex Technology Co., Ltd. (CATL) presented a new lithium iron phosphate (LFP) battery named "Shenxing," which can power 400 km of driving range with a 10-minute charge.

The new technology aims to provide lower-cost vehicle batteries and make fast-charging technologies more affordable to consumers, said CATL cell design engineer Gao Pengfei.

"We hope this battery could become a new standard for the industry," Gao said, adding that European EV manufacturers have been interested in CATL's new technologies, which could enhance their competitiveness in this rapidly developing industry.

"European manufacturers look forward to our competitive supplies," he said. "It's win-win cooperation."

ZF Group, a hidden champion in the auto supply industry, has opened three plants and four R&D centers in China, a sign of its growing presence in the country.

The company has noticed the continuous growth of the Chinese automotive market, especially the increasing penetration of new energy vehicles, said Graciana Petersen, head of Strategy & Transformation at ZF Group, at a meeting on September 4.

"It's not just a matter of quantity. It's also a matter of quality," she said, adding that Chinese consumers are having notably high standards and expectations for the safest and most intelligent components and systems in their cars.

"So we of course want to grow with our Chinese customers and partners. We are fully aware of the strength and rapid technological advancement of the Chinese automotive industry, and we are prepared to collaborate and grow together," Petersen said.

Embracing competition

Oliver Zipse, chairman of the Board of Management of BMW AG, said in a recent interview with Xinhua that it is impossible to decouple from China because China is important in terms of raw materials, manufacturing competence and its size of economy.

"China is BMW's largest market, and we are very connected and involved in the Chinese market," Zipse said.

Speaking of Chinese automakers, Zipse believed that "we have to embrace competition."

Chen Yudong, president of Bosch China, said that there is a growing trend among Chinese automotive brands entering the European market, presenting both opportunities and challenges. As a global company, Bosch has established a robust international business presence and network.

"We are open to supporting our customers' business development wherever there is a market need and an established business presence," he said.

China is the largest market in the world for Bosch Group. The long-term localization strategy and competent local workforce in China have laid a solid foundation for the development of Bosch's businesses in the country. Bosch will continue to invest in the China market to meet the growing demand from China customers.

Oliver Blume, CEO of Volkswagen Group, said in a recent interview with Xinhua that Volkswagen has "a clear focus on China." As the biggest carmaker in China, he believed that Volkswagen is successful in China and has partners who show a strong commitment.

China will also play a big role for Volkswagen in the future. "We are heavily committed to our investments. Our commitment is underlined by our own activities, and we are also building close partnerships," he said.

"We will combine our experience, our knowledge with new technologies being developed in China. This combination will make us so special. We have our heritage, and we will integrate these new technologies into our well-known products," the Volkswagen CEO said.

Win-win cooperation

The auto industry is never a sole-player game, especially when it faces historic changes, such as the debut of electric vehicles.

ZF Group CEO Holger Klein told Xinhua that China holds a crucial position within the ZF Group, as its development isn't solely focused on the Chinese market, but also contributes significantly to the global expansion of ZF's business.

He said that the scale effect, necessary for the development of the auto industry, should not only be supported by China's large volume, but also allow Chinese-developed technologies to go global.

He was impressed by the dynamic Chinese market because it has a much younger customer group and the Chinese consumers are very open to innovation.

"That's why we very much enjoy offering them the latest innovation in China and developing it with our Chinese colleagues together because they are close to the market, they understand the customers' needs. And that's how we drive innovation," he said.

Fintl reckoned that in terms of rapid progress in electric vehicles, battery size, cost, or overall efficiency, many Chinese brands have really been the ones to set the pace.

CATL became a supplier to BMW soon after its founding in 2011. The battery giant has cooperated with companies including Volkswagen, Mercedes-Benz, and PSA ever since.

CATL has followed the standards and needs of clients since the early days of such cooperation. However, "this is a real fast-developing industry," Gao said, noting that the company then realized that such standards could no longer match the fast evolving technologies of this industry.

"We started to try exploring new standards and break through the existing bottleneck," he said.

Blume considered it a "good opportunity" to exchange engineers between Volkswagen and XPENG.

"For me, it's always important to have a win-win situation when you make partnerships, and that's what we used to do with our joint venture partners, FAW and SAIC, in the past. In the future, with XPENG or in our joint venture with Horizon Robotics, there will also be the positivity in these partnerships," he said.

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