Scholz’s trip to China has so far been primarily about one thing: the economic relationship. German car manufacturers want to compete with Chinese competitors. Withdrawing is not an option.
The CEOs of Mercedes-Benz and BMW are accompanying Chancellor Olaf Scholz, who is meeting President Xi Jinping in Beijing today, on his trip to China. Both want to expand their involvement in China and warn of a trade dispute. They do not support the punitive measures currently being examined by the EU Commission against Chinese electric car manufacturers due to dumping and overcapacity and instead emphasize this in an interview shortly before the government talks begin tagesschau.de: They want to compete with the competition from China.
“Fair and, above all, free world trade is very important, drives innovation, drives growth. What we cannot use, as an export nation, are increasing trade barriers,” warns Ola Källenius, CEO of Mercedes-Benz. “We should work on it, in the spirit of the WTO to reduce barriers to trade.”
“We don’t feel threatened by Chinese manufacturers”
BMW boss Oliver Zipse also emphasizes: “We don’t feel threatened by Chinese manufacturers. We have manufacturers in Europe from all over the world and we have always done very well in the competition. And this time too, we shouldn’t exaggerate our fear ahead of foreign manufacturers. We are confident that we are competitive.”
When asked whether tariffs on Chinese electric cars would not better protect German manufacturers, Källenius replied: “The best protection is to be competitive.” If you start putting up barriers to trade, it will lead in the wrong direction. “We have seen, especially over the last 30 years, the dismantling of restrictions and the expansion of fair and free trade, which has led to economic growth. So we shouldn’t go in the other direction now.”
Maintain and expand relationships
Both hope that Chancellor Scholz will provide support for expanding economic relations with China. “The Federal Republic has grown well together with China over the last many, many years and that also creates jobs in Germany. That means maintaining but also expanding this very important economic relationship, that would be the goal,” said Källenius.
“We are expanding our position in China,” he emphasizes when asked about the German government’s desire to “de-risk” the German economy from China. “China is the largest automobile market in the world. We are a leading premium manufacturer and have grown strongly and have a strong presence here in China. Withdrawing from such a large market is not an alternative.”
Global Business model
The BMW boss sees it similarly. “There will be no green deal in Europe without China,” says Zipse. It is also important to emphasize that Germany has a global business model. His expectation of the federal government: “That they recognize that the business model of BMW, but also of the German economy, is global – and the trip serves to underline that again.”