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International News From the Field: China

Has the Chinese economy finally bottomed out? Are signs of stabilization an indication of a turnaround? Are there still opportunities in the automotive industry? For more industry intel and other tidbits, read on.
Oct 17, 2023

According to the Chinese National Statistics Bureau, China’s manufacturing PMI increased to 50.2 in September, up 0.5 from August, beating market forecasts of 50 points. This marks the first growth in factory activity since March amid recent stimulus from Beijing to bolster economic recovery.

The PMI of large enterprises was 51.6 in September, up 0.8 from August. The PMI of medium-sized enterprises was 49.6, the same as the previous month, while the PMI of small enterprises was 48, up 0.3 from the previous month. Two of the major five sub-indices of PMI indicated improvement trends. The production index was 52.7, up 0.8 from August, indicating an acceleration of production expansion in the manufacturing sector, and the index of new orders was 50.5, up 0.3 from the previous month.

China’s automotive industry is one of the highlights of the manufacturing industry. From January to September, China's automobile production and sales reached 21.08 million units and 21.07 million units, showing year-over-year growths of 7.3% and 7.8%, respectively. Furthermore, from January to September, the production and sales of new energy vehicles reached 6.31 million units and 6.28 million units, showing YOY growths of 33.7% and 37.5%. In September, the production and sales of new energy vehicles reached 879,000 units and 904,000 units, showing YOY growths of 16.1% and 27.7%. China’s automotive exports from January to September reached 3.39 million units, showing 60% growth YOY, and in September, exports reached 444,000 units, with 9% growth month over month and 47.7% growth YOY.

A few recently announced projects and investment news items are listed below.

  • Geely will invest $685 million to produce smart steering devices with an annual output of 1.2 million units in Hangzhou.

  • BYD plans to invest $1.65 billion for its second phase project to produce auto parts, with an annual output of 400,000 units (involving stamping, welding, coating, interior, and exterior). Plans are to produce 27.12 million units of plastic injection parts and 1.5 million pieces of coating units of light cover in Zhengzhou.

  • Ningbo V-Shine Auto Parts will invest $95.89 million to produce propeller shaft assemblies for EVs in Ningbo.

  • The Ningbo Bay Area Development Group announced an investment of $152.45 million to produce parts for EVs, with an annual output of 10 million kits in Ningbo.

  • Shanghai Huaxiang Hezhen Auto Parts will invest $110 million to build an R&D center and produce automotive electronics in Shanghai.

  • Zhejiang Senxing Auto Parts will invest $305 million to produce vehicle body control systems with an annual capacity of 6.5 million kits.

  • Leekr Technology will invest $17.12 million to produce automotive chassis-by-wire for EVs with an annual capacity of 1 million units in Taicang.

  • Weifang Huatong Zhonglian Technology will invest $69.86 million to purchase a robotic welding line, high-speed punch machine, and multistamping machine to produce automotive parts with an annual capacity of 380,000 kits in Weifang City.

  • Huzhou Yifeng Automobile Aluminum will invest $135 million to manufacture giga-casting aluminum chassis parts with an annual capacity of 1 million units in Huzhou.

  • Shandong Xin Zhong Hong New Energy announced an investment of $71 million to produce automotive air conditioning systems with an annual capacity of 1 million units in Jining, Shandong.

For more information, please contact Fred Qian at fredqian@AMTchina.org.

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Author
Fred Qian
General Manager - Shanghai Technology and Service Center of AMT
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