German firms eye China's electric vehicle sector

author: FutureCar Staff    

German enterprises are increasingly investing in China's new energy vehicle (NEV) industry to take advantage of the market potential in the country with a population of 1.4 billion. This year, China has experienced a significant increase in the production and sales of NEVs, with output up 40 percent and sales up 41.7 percent compared to the previous year. Hefei, the capital of Anhui Province, is a hub for NEV enterprises, housing companies like Volkswagen Anhui, NIO, and BYD, and employing around 100,000 people.

Hefei is striving to become a major NEV industrial cluster in China and even the world. Volkswagen Anhui, for example, is Volkswagen Group's first majority-owned joint venture for all-electric vehicles in China. With a planned investment of 23.1 billion yuan, the German carmaker is building a new NEV hub in Hefei, covering R&D, manufacturing, sales, and services. The government has provided preferential policies to support the project and attract talented individuals.

Volkswagen Anhui is also collaborating with Hefei University and the local government to cultivate skilled NEV professionals. The establishment of Volkswagen College aims to bring a German dual education framework into Chinese vocational institutions and higher education to nurture talents for the industry's long-term growth. Volkswagen Group has also reached an agreement to acquire a 4.99-percent stake in Chinese NEV startup Xpeng and co-develop two NEV models for the Chinese market.

Continental AG, another German company, is also expanding its presence in Hefei. The company's President of the Tire Division recently visited Hefei to discuss further cooperation. They agreed to accelerate the construction of the fourth phase of the tire factory, expand production, and plan follow-up projects in auto electronics and R&D centers. Continental AG has been operating in Hefei since 2011, achieving significant output and value.

German enterprises, including Volkswagen and Continental, are increasingly interested in investing in Anhui. The China-Germany Friendship Association has facilitated visits and discussions between well-known companies from both countries to promote cooperation in the NEV industry, vocational education, and youth exchanges. Germany, as a world-renowned automobile manufacturer, stands to benefit from and contribute to the collaboration with China in terms of market access, technology innovation, and talent cultivation.

China has been Germany's largest trading partner for seven years, with over 5,000 German companies active in China and over 2,500 Chinese companies active in Germany. The China-Germany Friendship Association will continue to play a matchmaking role in further promoting cooperation between German enterprises and Anhui in various aspects.

FutureCar Staff