At the end of the year and the beginning of the year, many multinational companies have successively released financial reports announcing their performance in the Chinese market, affirming the important position of the Chinese market in their global business map. At the same time, some Western institutions and ** frequently sing about the decline of China's economy, and even encourage multinational companies to "leave with profits". This is a huge "temperature difference" with the business activities and actual feelings of multinational enterprises in China.
Is it profitable to do business in China? Do most multinationals plan to take profits, or do they continue to dig deeper? Why is the international business community opposed to "decoupling"? With these questions, let's go all.
Don't give up market opportunities
China is not only a key market, but also an important fertile ground for talent and innovation, which is critical to the global competitiveness of U.S. companies. Tamson Tansen, chairman of the American Chamber of Commerce in China, said in a report recently released by the agency. According to the report, in 2024, about half of the surveyed companies will maintain the same scale of investment in China, and nearly 40% plan to increase capital in China.
Judging from this report, American companies in China do not believe the claims of some Western** people who question China's economic growth potential. Xinhua News Agency reporters interviewed and learned that last year, many American companies such as Honeywell and Corning made positive progress in a number of Chinese businesses.
Recently released financial reports show that multinational companies are optimistic about the Chinese market on a solid basis, and China's attractiveness as an investment destination has not changed. In fiscal year 2023, L'Oréal and Bosch Group's sales in China will both increase by more than 5%, and Apple's revenue in Greater China will account for about one-fifth of the company's total revenue. Starbucks also achieved good growth in the first quarter of fiscal 2024, adding 169 net new stores in Chinese mainland.
Yum China, which owns well-known catering brands such as KFC and Pizza Hut, recently announced that the company's total revenue last year increased by 15% over the previous year; The net new stores were 1,697, exceeding the annual net new store target. Yum China's Chief Executive Officer, Qu Cuirong, said that the company is very optimistic about the vast growth opportunities in the Chinese market, and will continue to expand its target markets in the future to meet the needs of these regions brought about by the long-term consumption upgrade, and deeply rooted in China.
Procter & Gamble's chairman and chief executive officer, James Mouren, said at the first meeting to announce the earnings report that his recent visit to China and the experience of meeting with local employees and consumers made him believe that the company has the opportunity to continue to expand its business in China in the next few years.
Sergi Basco, a Spanish economist and associate professor of economics at the University of Barcelona, said that China, as a market with ample domestic demand, is a huge attraction for European companies. As domestic demand expands due to increased consumption, more foreign companies will enter the Chinese market.
Like a fish drinking water, it knows its own warmth and coldness. "While some Western institutions and ** are racking their brains to "fix words" to discredit China's economy, the global business community is converging on China, busy creating cooperation opportunities and capturing market opportunities.
Reluctance to grow opportunities
China is not only an important market for the Bosch Group, but also an innovation and R&D base. Xu Daquan, President of Bosch China, recently told Xinhua News Agency that the intelligent mobility business is the main growth engine of the Bosch Group's business in China. The Bosch Group has nearly 580,000 employees, performance maintained steady growth. The Fortune 500 company said it will continue to invest in China to enhance its manufacturing and R&D capabilities.
For multinational companies, China has a superior innovation environment and talent pool. In addition, the continuous iteration of business application scenarios, the developed digital economy and active market competition have brought unique growth opportunities to multinational companies.
In McDonald's China's restaurant warehouse, staff only need to wave the mobile terminal in their hands, scan the electronic tag of the goods packaging, complete the inventory work, and transmit the data in real time through cloud computing and data engine.
McDonald's China CEO Zhang Jiayin told Xinhua News Agency that McDonald's China is currently leading the McDonald's global market in new store development, digital transformation and delivery business. This is due to the digital transformation of enterprises to embrace China's business model.
In recent years, China has continued to promote green and low-carbon transformation and vigorously develop new energy industries. The rapid growth of the export scale of foreign trade products such as electric manned vehicles, lithium-ion batteries and solar batteries provides growth opportunities based on innovation and competition for many multinational enterprises.
Tetsuro Honma, global vice president of Panasonic Holding Group, said that while China maintains its status as a manufacturing power, it is gradually becoming a big consumer and a big innovation country. The fiercely competitive Chinese market has become an ideal training ground for sharpening the competitiveness of foreign-funded enterprises. This kind of competition brings growth opportunities that no company is willing to give up.
In 2023, the Volkswagen Group will locate its largest R&D center outside the German headquarters in Hefei. Volkswagen Group China's Chairman and CEO Bratt said that Volkswagen is fully integrating into China's industrial ecosystem. In a dynamic market environment, rapid development is the key to maintaining competitiveness.
McKinsey China's chairman Ni Yili told reporters that in terms of market size, consumption capacity and innovation potential, there are almost no other regions in the world that can replace the Chinese market. For companies, the Chinese market can inspire the consumer sector and become an innovation base for them.
Do not give up the advantages of the first chain
China is the only country that has all the industrial categories in the United Nations Industrial Classification, has a super-large market and is in the stage of rapid release of demand, and the strong first-chain advantage makes many multinational companies unable to give up.
The Chinese market is difficult to replace. The McKinsey Global Institute of the United States pointed out in a recent report that although the current global restrictions have increased, China's advantages in the global chain cannot be truly replaced.
In the ** chain of Apple in the United States, China is one of its important production bases. At the first China International ** Chain Promotion Expo held in November last year, Apple wrote on the display board of its booth: "151 of Apple's 200 major ** merchants are produced in China. ”
This slogan reveals China's pivotal position in the global ** chain from one side, and also shows that the price of "decoupling" from China is really an "unbearable burden" for enterprises.
A car rolls off the assembly line in less than 40 seconds! For Tesla, an American electric car maker, the Shanghai Gigafactory has become a global export hub and is one of the most efficient in its peers. Also located in Shanghai, Tesla's first energy storage gigafactory project outside the United States is also scheduled to start production this year.
Tesla's Shanghai Gigafactory can achieve such high efficiency, which is inseparable from the deep integration of the enterprise with China's leading chain. Tao Lin, vice president of Tesla, said.
A number of experts from the Deutsche Bundesbank recently wrote that in the long run, leaving China will bring significant commercial and economic costs to German companies. German companies will miss out on China, the "main sales market", and many of the best chains can only be restructured at the expense of efficiency.
*:Xinhua.