Auto Shanghai 2015 – around 30 suppliers at the German pavilion
Statement delivered by Matthias Wissmann, President of the German Association of the Automotive Industry (VDA), at the VDA’s press conference at the Auto Shanghai 2015, on Monday, April 20, 2015
Ladies and Gentlemen,
I have pleasure in welcoming you most warmly to our press conference here at the German pavilion at the Auto Shanghai. Once again we have been able to bring together around 30 German suppliers as exhibitors at our country’s pavilion – which equals the number we had two years ago. To add to this, some major supply companies from Germany are here with their own exhibition stands. The high level of expertise and the strong drive for innovation in the German automotive supply industry are very much in evidence at this trade show.
The joint pavilion is being supported by the German Federal Ministry for Economic Affairs and Energy. At this point we wish to thank the AUMA (Association of the German Trade Fair Industry), the trade show company IMAG and Consul General Rothen for their excellent cooperation.
The German Association of the Automotive Industry (VDA) is headquartered in Berlin and has more than 600 members. One special feature of the VDA setting it apart from similar associations around the world is that we unite both the vehicle manufacturers and their suppliers under one roof. The suppliers number more than 500 firms, which makes them the largest group within the VDA.
Last year the German auto manufacturers produced over 14.9 million passenger cars worldwide, a good 9.3 million of them at sites outside Germany. Our output therefore accounts for around one fifth of total global passenger car production.
German OEMs and suppliers have their own production facilities in more than 70 countries around the globe. In all they have over 2,000 production and assembly facilities in countries other than Germany. Of these, roughly 240 German suppliers’ sites are located here in China. In addition, there are the numerous production plants of our manufacturers.
Passenger car market in China approaches the 20 million mark
The Chinese passenger car market has developed very dynamically during recent years. In 2013 it overtook the US market that continues to be important to us. And in 2014 China recorded a rise of 12.7 percent to 18.4 million units.
And 2015 also got off to a lively start. In the first quarter passenger car sales climbed more than 11 percent as compared with the same period last year, rising to 5 million new cars. In March alone, sales increased by 12 percent to around 1.75 million units. SUV models are in especially great demand. For 2015 as a whole we expect – now assuming a far higher starting figure – a growth rate of at least 6 percent and a volume of 19.5 million new cars. This means that China will increase its lead on the US market (16.7 million light vehicles) to 2.8 million units, and the difference between China and Western Europe (12.3 million passenger cars) will amount to 7.2 million new cars.
Future growth rates may well tend to stay more in single figures, but the Chinese market will doubtless remain the world’s most significant one. Keen demand for individual mobility will continue to be driven by the emerging middle class that is becoming more and more the target group for the vehicle manufacturers. The demand for cars in this huge country is by no means structurally covered, especially in medium-sized cities and in the west of the country. The level of car ownership now stands at 52 passenger cars per 1,000 inhabitants. By comparison, Germany has just over 540 cars per 1,000 inhabitants.
German manufacturers have greatly increased their passenger car sales in China
The German group brands have kept up with the high speed of developments and in 2014 they sold 3.9 million new cars (+16.3 percent), all of which were built in China. So they have grown faster than the market itself. A medium-term view really shows how the trend has taken off: compared with 2010 (2.0 million), sales by German group brands here have almost doubled, and in comparison with 2008 (1.0 million) they have in fact nearly quadrupled.
Our market share comes to 23 percent (Jan. to Feb. of 2015), and for 2014 overall it was 21.2 percent. This means that just over one new car in five sold in China bears a German group badge. But of course many other carmakers are also benefiting from the dynamic development of this market.
The major segments in the production portfolio of German OEMs in China are those up to the medium segment, along with off-road vehicles. The most important segment over 2014 as a whole was the compact class, making up 52 percent. If we count small cars (5 percent) and the medium segment (19 percent) too, we find that three quarters of all autos produced in China by German group brands are in these segments.
Since the global total number of passenger cars exported to China has not been recorded to date, we issue separate figures for our car exports from Germany to China: they rose by 13 percent in 2014 to reach a good 274,000. However, one may assume a tendency toward a slow decline in the export figures, as local production is growing. Added to this there are the CKD vehicles, whose share of value-added in Germany is falling below the 60-percent mark, and which are included the figures for foreign production and therefore no longer appear in the export statistics. In the first two months of the current year, the German passenger car manufacturers exported 39,800 vehicles from domestic production to China (-6.7 percent).
Value of exports rises by one fifth
In 2014 China’s proportion of total exports by German auto makers came to 6 percent (17 percent went to NAFTA, and 51 percent to Western Europe). Most of these vehicles were models in the luxury segment, the upper medium segment, and sports and off-road vehicles. Seven out of ten cars exported are in these groups; and one third of exports (32 percent) are luxury segment vehicles. The value of passenger car exports to China rose by one fifth in 2014 to 12.4 billion euros. In terms of value this country is therefore the third largest destination market for passenger cars from Germany, after the US and the UK.
German suppliers are also successful in China
The German suppliers, too, hugely increased the value of their exports to China in 2014: they rose by 18 percent to 10.2 billion euros. The value of imports also rose – reaching 1.0 million euros (+11 percent). German suppliers have supported and enabled our car manufacturers’ expansion right from the outset. They were present here at an early stage. All the major German suppliers are active in China. Over recent years more medium-sized companies have also arrived. Their customers include – alongside the German brands – international and Chinese vehicle manufacturers. The number of production plants of German suppliers in China has increased by one fifth during the last two years. German suppliers have continued to create jobs here. The size of their workforce has climbed by a good 15 percent since 2013 to exceed 80,000 in total.
Ladies and Gentlemen,
The following firms are displaying their products and innovations at the German pavilion: Anvis Group; Berger Holding GmbH; Boge Rubber & Plastics Group; Bühler Motor GmbH; Carcoustics International GmbH; Dörken MKS-Systeme GmbH & Co. KG; Dr. Schneider Kunststoffwerke GmbH; Formel D GmbH; Fraenkische Pipe-Systems Co. Ltd.; Gentherm Automotive Systems (China) Ltd.; Hirschvogel Holding GmbH; iwis motorsysteme GmbH & Co. KG; Jaeger Poway Automotive systems (shenzhen) Ltd.; Kapolnek GmbH; Kiekert AG; Kirchhoff Automotive GmbH; KSPG AG; Mapco Autotechnik GmbH; Mercedes-Benz Powertrain; MS Motorservice Deutschland GmbH; Mubea Automotive Components Co. Ltd.; Nidec GPM GmbH; peiker acustic GmbH & Co. KG; Pierburg GmbH; PWO High-Tech Metal Components Co. Ltd.; Scherdel GmbH; Seeger-Orbis GmbH; and Sonderhoff (Suzhou) Sealing Systems Co. Ltd.
We regard this strong German presence as an indication of the clear desire of our companies in the VDA to further expand their activities here, on the world’s largest passenger car market. The conditions for doing so are good: China is still growing – and German quality obviously goes down very well with the Chinese customers.
Electric Mobility in China with German know-how
Ladies and Gentlemen, I am delighted that electric mobility is making progress in China. Of course the absolute sales figures are still relatively low. But the growth rates are all the more impressive. At the end of 2014 over 100,000 electric vehicles (plug-in hybrids and pure battery-electric vehicles) were on the roads in this country.
A key contribution to this development comes from the “Sino-German Electric Vehicle Charging Project.” In July 2014 this pilot project was prominently presented and supported by German Federal Chancellor Merkel and Miao Wei, the Chinese Minister for Industry and Information Technology, in Beijing. It focuses in particular on the scientific preparations for various forms of charging infrastructure for electric vehicles, which are being tested by users in real-life conditions in private, semi-public and public settings. The goal is to demonstrate at a basic level which challenges electric mobility faces in day-to-day use, and how the charging infrastructure in particular can be improved.
The backers of the project are the German manufacturers Audi, BMW, Daimler and Volkswagen, the VDA, Chinese manufacturers and the German Federal Ministry for Economic Affairs and Energy, plus the National Development and Reform Commission of the People’s Republic of China (NDRC). Initial results show that rapid establishment of the charging infrastructure is crucial to the ramp-up of electric mobility – and this is the view held in Germany, too.
Outlook: the 66th IAA Cars in Frankfurt am Main
Ladies and Gentlemen, the Auto Shanghai is one of the most exciting automotive trade shows in the Asian region. And I look forward to seeing you again at the 66th International Motor Show (IAA) Cars. The IAA Cars is organized by the VDA and will open its doors in Frankfurt am Main, Germany, in September. The foremost topics will be – alongside further progress in improving vehicle efficiency – electric mobility, CO2 reduction and lightweight construction, and especially “connected and automated driving.” We expect a large number of world premieres at the IAA.
The international press is also very welcome to the IAA. Please note the dates of the 66th IAA Cars in Frankfurt: it will take place from September 17 to 27, 2015, and the Press Days will be on September 15 and 16. The IAA slogan will be “Mobility connects.” You can find all further information online, at: www.iaa.de.
But back to the Auto Shanghai: I wish all of us a successful trade show!
Thank you very much.
For detailed portraits of the exhibiting companies at the German pavilion, please visit: