Reference News Network on December 3** The United States "Wall Street **" published an article entitled "Western car companies are learning from China's successful experience in Xi electric vehicles" on November 29, the author is Yoko Wata. The following is an excerpt from the article:
At one of China's electric vehicle hubs, Volkswagen Group engineers are looking to the country's automotive industry to learn how to speed up production and beat off local competitors in the world's largest car market.
The German automaker has long dominated the Chinese market, but its market share in China continues to decline as the country's automotive industry transitions to electrification. Volkswagen is now trying to solve the problem of how to compete with China's emerging automakers, who are able to launch high-performing, people-friendly and highly intelligent electric vehicles in a third of the time it takes Volkswagen.
Nissan is also trying to speed up car production by applying the skills it learned from a Chinese joint venture. Toyota is bringing in engineers from its Chinese partners to better develop electric vehicles and smart cars.
These initiatives highlight a major shift. In the past, China struggled to match the West in terms of engines and drivetrains, let alone master Western technology, but now Western companies need to learn from China Xi.
This shift will not only affect the Chinese auto market, but will also have an impact on the home turf of foreign manufacturers. China's EV manufacturing methods, vendors, and digital technologies are likely to trickle into foreign automakers.
The United States has set high tariffs to ward off the potential impact of cheaper and sleeker Chinese electric vehicles, and the European Union is also investigating Chinese subsidies for electric vehicle manufacturers.
Ralph Brandstedt, head of Volkswagen Group China, said that in the past, Volkswagen developed cars in Europe and introduced them to China after making some adjustments. Now, this approach is no longer viable, because in the electrified and more intelligent Chinese market, consumer requirements are very different.
Some multinational automakers have begun to withdraw from their operations in China or readjust their strategies. For Volkswagen, the withdrawal from China is not on the agenda. China is Volkswagen's largest market, accounting for about 40 percent of the company's car sales.
Brandstedt said it would take Volkswagen nearly four years to bring a new product to market, while Chinese automakers would do so in about two and a half years. Now, he said, Volkswagen aims to shorten the car development cycle to about two and a half years.
Achieving this goal will require a series of measures, some of which are borrowed from China's approach. One of the measures is to source more parts from local Chinese companies that are moving quickly, rather than relying on German companies. Volkswagen said that sourcing these products from Chinese companies will shorten the development cycle by about 30 percent and reduce costs by 20 to 40 percent, from displays and systems to power batteries and headlights.
Volkswagen executives said that in the past four years or so, China's top manufacturers have improved significantly in terms of quality, durability and technology.
Nissan is also trying to speed up the pace and reverse the decline in sales. The company has learned some lessons from Venucia, a local joint venture brand launched in partnership with Dongfeng Motor, one of which is how to speed up vehicle testing.
Traditionally, Nissan waits months to complete some molds before they can be used to build test vehicles, a person familiar with the matter said. Now in China, the Japanese automaker is switching to prototype molds. A Nissan spokesperson said the company acknowledged that its joint venture in China is already strong and that any testing will meet Nissan's global standards.
Toyota has shifted the focus of its China R&D center to electric vehicles and smart cars, and has brought in more engineers from its joint ventures in China to participate in the project.
Like Volkswagen, Toyota also said in July this year that it would purchase parts from local ** dealers, and is revising parts design and upgrading production and manufacturing technology to reduce the cost of smart electric vehicles.
Bill Lasso, CEO of Motuo Business Consulting, said many foreign brands are lagging behind in China's product cycles because they failed to prepare for the EV boom that will emerge around 2020 and will take years to catch up.