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German Carmakers Look to China For Relief

DW Staff 22/04/09April 22, 2009

For a long time, auto shows in China were ridiculed by the general public. Chinese carmakers regularly presented cars which just looked too much like Western models to be their own developments. Now, however, Chinese carmakers are being seen as potential rescuers of Western companies in times of crisis. German CEOs at this year's auto show in Shanghai seem to be especially optimistic.

https://p.dw.com/p/LsRE
There is speculation about whether a Chinese carmaker will rescue ailing German carmaker Opel
There is speculation about whether a Chinese carmaker will rescue ailing German carmaker OpelImage: AP

As Chinese carmakers unveil their latest models, ranging from compacts and electric cars to luxury sedans, the burning question right now in Shanghai seems to be: Is a Chinese company going to rescue Opel, Germany's ailing carmaker owned by General Motors?

One name in particular keeps cropping up -- Geely, China’s biggest private car manufacturer, which is based in the port town of Ningbo.

But Geely CEO, Li Shufu, ruled out this option:”We only want to make our own cars. We don’t have any other big plans. We’re just concentrating on Geely."

There is also speculation that other Chinese carmakers could be potential rescuers -- FAW and SAIC for instance -- both joint venture partners of Volkswagen. But neither company has said anything to this effect openly.

Because of its partnership with US carmaker General Motors, SAIC already has a model which uses Opel technology.

Cooperating with Chinese carmakers is not ruled out by German firms

Other German carmakers don’t seem to have any qualms about envisaging possible partnerships with Chinese companies. "There has been some general interest for quite some time now. But we will see if it actually leads to results. At the moment, we’re very well positioned thanks to our newest investor but I don’t want to rule anything out,” said Daimler CEO Dieter Zetsche.

In March of this year, an investment fund based in Abu Dhabi became Daimler’s largest shareholder, with a 9 percent stake. Although Zetsche refused to name any potential Chinese investors, he said that there had been negotiations, which were not yet over.

He added that Mercedes was doing extremely well in China despite the global financial crisis: “The first three months got off to an extremely good start -- 30 percent higher than in the same time period last year. This is where we sell the most S-class cars in the world.”

Not even China's new taxes on luxury cars with three to four litres of cubic capacity were able to put a damper on the optimism -- even if they make the German luxury car one third more expensive.

China is the world’s only growing market

In the premium car sector, Audi came out tops in 2008, selling 120,000 cars -- an increase of 17 percent, explained Audi CEO, Rupert Stadler.

"China is one of the growing markets -- as opposed to many other markets in the world. The Chinese government’s programmes are stimulating demand and business. That’s a great help. As the leading premium make, we can draw many advantages from this."

China’s leading carmakers are now gearing up to enter the world market. They are changing their strategies and revamping their marketing departments so they too can make their mark on an industry that is already highly competitive with 40 leading brands world-wide.

Experts say that China could soon catch up but for now the question still remains: Which, if any, Chinese carmaker is going to rescue Opel?