Chinese factories of foreign businesses offer clues to China's allure for foreign investment. Many foreign companies have expanded their presence in China, a major driver of global economic growth, to weather through a hard time of complicated global economic and trade situations.
China's determination for wide-ranging opening-up, seen through the window of Shanghai, can provide good opportunities for the business growth of multinational companies in China and even the world.
SHANGHAI, Oct. 26 (Xinhua) -- The second China International Import Expo (CIIE) scheduled for early next month in Shanghai is definitely not an event that many overseas businesses will miss. With over 3,600 participants in last year's expo, the enthusiasm remained strong this year.
The CIIE provides a platform for these companies to seek the great potential of the Chinese market while helping them better understand the needs of Chinese customers.
A huge sign of the China International Import Expo (CIIE) is seen at the National Exhibition and Convention Center in Shanghai, east China, Oct. 25, 2019. (Xinhua/Ding Ting)
Many foreign businesses, CIIE participants or none-participants, have already expanded their presence in the world's second-largest economy, setting up manufacturing bases, regional headquarters, and research and development centers.
They are actively tapping the market in China, a major driver of global economic growth, to weather through a hard time of complicated global economic and trade situations.
TESLA GIGAFACTORY
Tesla's gigafactory in Shanghai, which took less than 10 months to build, is already producing full vehicles on a trial basis ahead of schedule.
"China is by far the largest market for mid-sized premium sedans. With the Model 3 priced on par with gasoline powered mid-sized sedans, we believe China could become the biggest market for Model 3," the U.S. electric carmaker said in its earnings report this week.
Tesla had a fantastic year in China since it bought a plot of land for its gigafactory in Lingang of Shanghai in mid October last year. The factory, the largest foreign-invested manufacturing project in Shanghai with an investment of 50 billion yuan (7 billion U.S. dollars) and a designed annual production capacity of 500,000 units, broke ground in January.
Tesla CEO Elon Musk said in August that he was "astounded" by the progress in the building of the gigafactory and had never seen anything go so fast in his life before. "I really think China is the future," he said.
The robust demand for new energy vehicles (NEVs) in the world's largest auto market was behind Tesla's investment in China. Despite sluggish sales in the broader automobile market, China saw NEV sales rise 20.8 percent year on year to 872,000 units in the January-September period.
File photo taken on April 17, 2019 shows visitors viewing a Tesla SUV during the 18th Shanghai International Automobile Industry Exhibition in Shanghai, east China. (Xinhua/Fang Zhe)
China is Tesla's largest market outside the United States, with sales jumping 41.8 percent year on year to 1.47 billion U.S. dollars in the first half of this year, according to Tesla.
China is transiting to a more balanced endogenous growth model from an export-oriented model, said Cheng Shi, head of research and chief economist of ICBC International Holdings Ltd.
For businesses, the growth resilience and structural opportunities in the era of high-quality growth are much more expected, said Cheng.
ABB SMART FACTORY
Swiss tech giant ABB, which moved the global headquarters of its robotics business to Shanghai in 2006, began the construction of a 150-million-U.S.-dollar robotics manufacturing and research facility in Kangqiao of Shanghai last month.
Photo taken on Sept. 12, 2019 shows the groundbreaking ceremony of ABB Robotics Factory of the Future in Shanghai, east China. (Xinhua/Fang Zhe)
The new facility, expected to be put into operation in 2021, is designed to be the most advanced, automated and flexible factory in the robotics industry worldwide, utilizing the latest manufacturing processes -- a cutting-edge center where robots make robots.
The investment came as ABB raised bets on the industrial upgrading of the manufacturing sector in China, the world's largest robotics market, and at a time when intelligent manufacturing has become a new popular destination for foreign investment. China has rolled out policies to encourage more foreign investment in high-end, intelligent and green manufacturing sectors.
China is moving from a large manufacturing country to a manufacturing powerhouse, offering a vast market for ABB's robotics and automated solutions. Meanwhile, China's booming artificial intelligence (AI) development could offer a lift to ABB's robotics business.
Sami Atiya, president of ABB Group's Robotics and Motion Division, said ABB's robotics product line will be doubled in terms of both scope and depth in the next few years.
This means that ABB needs a new factory with bigger capacity to produce more types of robots to meet ever changing markets and technological trends, Atiya said in an interview.
Visitors view welding robots during the 2019 China International Industry Fair in east China's Shanghai, Sept. 17, 2019. (Xinhua/Fang Zhe)
ABB has invested more than 2.4 billion U.S. dollars in China, now its second-largest market, since 1992, and has a total workforce of over 18,000 in the country.
AKZONOBEL 'COLORFUL FACTORY'
AkzoNobel, a Netherlands-based supplier of paints, coatings and specialty chemicals, entered the Chinese market in the early 1980s and has set up 15 production bases in the country, its biggest single market.
"We know well that if we seek to win the global market, we should first win the Chinese market," said Mark Kwok, president of AkzoNobel China/North Asia.
Apart from further investment on production expansion and research and development, AkzoNobel is also penetrating the neighborhoods by using color paints to change living environment for Chinese residents, said Kwok.
AkzoNobel, which itself has colorful office buildings for its research and development center in Shanghai, has provided customized environmentally-friendly solutions for old neighborhood renovation in Songjiang District of Shanghai.
By 2018, it had helped renovate 2.83 million square meters of old neighborhoods with colorful paints, adding some color and vitality to the old urban areas in Songjiang.
Kwok said through the window of Shanghai, he can see China's determination for wide-ranging opening-up, which can provide good opportunities for the business growth of multinational companies in China and even the world.
(Reporting by He Xinrong, You Zhixin, Zhou Rui, Li Baojie; Video reporters: Sun Qing, You Zhixin, Zhou Rui, Chen Jie; Video editor: Zheng Xin) ■
