Tuesday, July 23, 2024

Beijing is consolidating its superiority over Germany in the electric car industry

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A few days ago, the news of relatively young Chinese company BYD’s advance on long-standing “Volkswagen” in electric car sales in “Uncle Mao’s” country, a major global shake-up in the sector. Currently considered as one of the strongest areas of industrial competition globally. It is known that China is the number one producer of electric cars in the world. According to statistics website Statista, Beijing’s production of all types of electric cars is expected to reach more than 13 million cars, followed by Germany with more than 4.4 million cars. [وتبقى “تيسلا” Tesla الأميركية أكبر شركة مفردة منتجة لذلك النوع من السيارات]. This did not prevent the international media from paying more attention to the news related to the Chinese company “BYD” and the German “Volkswagen”.

The strength of that Chinese strike was not limited to that “YBD” established in 1995, which did not enter the automotive industry until 2003. It is noteworthy that the company itself is considered a giant in manufacturing. Rechargeable batteries, including cell phones. In the ten years since its inception, the company has produced half of the world’s cellular batteries, and is the world’s fourth largest producer of all types of rechargeable batteries. To be clear, rechargeable batteries are the focal point of the electric vehicle industry, including hybrids that use fossil fuels in addition to their battery power. In other words, according to a popular metaphor, Chinese progress did not come like a thunderbolt from a clear sky, but based on BYD’s experience in the basic energy field of driving electric vehicles, which means that its progress will continue. the future.

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In addition, it is difficult not to pay attention to an important fold of fierce competition globally in the electric vehicle sector represented by electronic chips. Slowly and then quickly, these smart gadgets have entered the entire motor transport sector. For technical reasons that are difficult to explain on these lines, electronic chips are more important in electric vehicles than they are in fossil fuel-powered vehicles.

It is not surprising that the image of a fierce struggle for Taiwan, embracing the world’s most sophisticated and intelligent maker of electronic chips, Taiwan Semiconductor Manufacturing Co., comes to mind. Do these data mean that this advanced smart industry will fuel a clash in Taiwan, especially between the Chinese and American giants? Is the opposite happening in the sense that the industries associated with the advanced information and communication revolution are leading to easing that tension and making it less of a competition for money and brains? What about the role of technology transfer in that field? What if China transfers the technologies of the “Taiwan Semiconductor Manufacturing Company” to its territory in one way or another? Probably the questions about these things will multiply endlessly.

Racing at the speed of light

In a prime example of global media interest in news of BYD’s advance over Volkswagen in the Chinese market for electric cars, French newspaper Le Monde devoted a long article to explaining the significance of the event. Under the heading “German auto industry stagnates before China”, the French article began to deal with the news with the opinion expressed by Wolfgang Porsche, a member of the supervisory board of “Volkswagen” and the grandson of the famous German. Ferdinand Porsche was the industrialist who invented the concept of the “people’s car” in 1937 when he created the car popularly known as the “Beetle” with the support of Nazi leader Adolf Hitler.

According to Porsche, Volkswagen’s announcement that it will step back from the lead in electric cars in China in the first quarter of 2023 and BYD’s move to first place creates a historic watershed. Porsche also insisted that the German company has never been richer than it is now, as its business was valued at 280 billion euros and its revenue was estimated at 22.5 billion euros last year.

On the other hand, the German company looked like a nightmare, carried by sales figures for electric cars in China, and slipped from the top spot it had occupied for the past two decades. To add insult to injury, BYD didn’t enter the automotive industry until 2003.

This leads to the attention of another flaw not addressed in Le Monde’s article, namely that the Chinese company is engineering and designing electric vehicles on its own with the support of Chinese state agencies.

In a related context, the “Le Monde” article noted that “BYD” was able to produce electric cars with improved quality and acceptable prices that cost much less than those produced by “Volkswagen”.

Perhaps this shows another dimension in the electric vehicle industry, which is represented in the final price of the product when it reaches the consumer. Intuitively, affordable prices are set for a wide range of people.

So, do these things happen in global markets? Will Chinese electric cars become more popular thanks to their cheap prices and competitiveness in quality, similar to what happened to Chinese industrial daily goods? Perhaps this is an open question that stands the test of time.

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In the same context, the “Le Monde” article pointed out that “Volkswagen” relies heavily on China, as it sells four out of every ten electric cars it produces.

As a complement, the article saw that the same phenomenon carries a message for all German car makers, including Mercedes and BMW. China is considered the number one market for sales of all types of vehicles. As the article sarcastically puts it, makers of conventionally fueled vehicles are starting to “get a dinosaur look” in the ever-changing Chinese market. This year, at the Shanghai Auto Show, German automakers, which have traditionally dominated the Chinese market, felt they were being left behind by good and cheap vehicles produced by local companies, including electrics.

According to the same article, alarming figures for German automakers, electric cars account for a quarter of new sales of those products in China. Mercedes, BMW, Audi and Volkswagen only have five percent of the electric car market in China.

Finally, as the article says, “Let’s talk about a new era.”

Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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