New BMW Great Wall Joint Venture is preparing for growth

About the BMW Great Wall Joint Venture – China as biggest growth driver for BMW

Out of 2 million cars delivered to BMW customers in 2017, 560.000 cars were sold to China. This is more than the next two biggest markets (DE and USA) combined. The Mini brand sales increased by 15% (compared to 3.2% worldwide) in China. The new BMW Great Wall Joint Venture will continue to fuel this impressive growth.

Given the significance of China to the BMW brand, it is easy to say that

The future of mobility is autonomous and electric AND will be shaped by Chinese technology and Chinese customer preferences.

 

BMW testing autonomous driving technology near Munich

BMW testing autonomous driving technology near Munich in early 2018

 

It’s deal time – Premier Li Keqiang is on historic Germany trip

Chinese premier Li Keqiang is visiting Germany these days and a lot of important deals are made. One of the most interesting ones is definitely the new joint venture (JV) of BMW with Great Wall. This is already the 2nd joint venture for BMW in China, the other one being with Brilliance (recently extended).

Here are the facts:

  • A new joint venture (JV) named Spotlight Automotive Ltd. with Chinese car manufacturer Great Wall Motor Company Limited.
  • Great Wall is China’s largest SUV and pickup manufacturer.  At present, Great Wall owns 4 brands, namely HAVAL, Great Wall, WEY and ORA, all of which reached more than one million vehicles sales in 2016 and 2017.  They recently introduced their own premium car brand, called WEY  (http://www.gwm-global.com). 
  • The joint venture’s aim is to produce ELECTRIC Minis for China. With production based in Jiangsu Province, the JV has an estimated standard production of 160,000 vehicles initially and a potential increase of annual production capacity depending on its future production plan.
  • In the JV 50 % of shares are held by both parties and a total investment of 5.1 billion RMB (approx. USD 780 million) was announced.
  • The Board of Directors consists of six members, in which the chairman is appointed by GWM and the Vice Chairman by BMW, serving for four years.

 

BMW Great Wall Joint Venture

The luxury brand “WEY” of Great Wall Motor Company

BMW Great Wall Joint Venture

The affordable SUV brand HAVAL of Great Wall – Haval H6 sport shown in the picture

 

Links and sources:

 

If you would like to read my posts, please add me on LinkedIn or add me on WeChat. I write and speak about innovation and China’s digital ecosystem.

About: I am Dr. Thomas Reinbacher an independent adviser and freelance consultant based in Germany and China. In the past I was: engagement manager at McKinsey and Company; Computer scientist (PhD, Graduated sub-auspiciis presidentis ); visiting scientist NASA Ames Research Center at Silicon Valley. I lived, studied (ZheJiang University 浙江大学) and worked for about 3 years in China (NanJing, HangZhou, BeiJing), and I am fluent in Mandarin.

Disclaimer: This article on BMW Great Wall Joint Venture is provided as is and reflect my personal opinions.

The Chinese mega brands sponsoring the 2018 FIFA World Cup

Germany, Brazil, Portugal, Switzerland, South Korea, Japan out. China IN big time. For the first time, Chinese brands sponsoring world cup on a large scale.

China, despite the countries investments in building up a professional and competitive soccer league, did not qualify for the 2018 world cup. But guess what, China is IN big time as sponsors for the FIFA world cup tournament.

If you have been watching the 2018 World Cup you must have noticed the Chinese sponsorship that FIFA received. 4 out of 12 main sponsors are Chinese. As some of these brands remain largely unknown to the public outside of China (believe me this will change quickly), I think it is valuable to reveal the story behind this companies. So let’s get started and get to know the Chinese brands sponsoring World Cup!

Chinese Brands Sponsoring World Cup

 

Wanda Group – 万达集团

The world’s biggest private property developer and owner of the world’s largest cinema chain “Wanda cinema”. 130.000 employees, 40 bn USD revenue, headquarters in Beijing. Wanda’s scale is just impressive. The Wanda Group owns 6000 movie screens and owns 21.5 million square meters of space. To put this in perspective let us have a look at the largest square in the world, the Tiananmen (天安门广场) square in Beijing is about 444,000 square meters and accommodates 1 million people. Wanda owns about 50 such squares of developed properties! Wanda’s founder Wang Jianlin, with a net worth of 30 bn USD one of the richest men in Asia, is a fanatic football fan. It is thus not surprising that he secured a 20% ownership of Atlético Madrid and an exclusive deal with the DFB (Deutscher Fussball Bund). http://www.wanda-group.com

2018 world cup china sponsoring wanda group

 

Hisense – 海信集团

Hisense is a real household name in China because of its long standing history as a major appliance and electronics manufacturer. Fridges, washing machines, air condition, and most importantly TVs are what Hisense is about. Market leader for 13 years with a dual strategy. Hisense is both selling directly under the brand Hisense but also as OEM. Chances that parts of your TV are coming from Hisense are high. Hisense is the global number 3 when it comes to producing televisions. Already a huge sponsor in the Euro 2016, Hisense was the first Chinese sponsor of such an event. The company also installed the biggest video cube in Europe in the Schalke 04 arena. On the innovation side, Hisense is one of the leaders inpioneering laser TV’s – with Amazon Alexa/Google Assistant on board. http://www.hisense.com

 

2018 world cup china sponsoring hisense

 

Vivo – 维沃移动通信有限公司

Vivo is one of the big 4 Chinese smartphone players. The others beeing Huawei, Oppo, Xiaomi. Together they are totaling to about 70% of all smartphone shipments in China. Sorry Apple! Founded only in 2009, Vivo made it into the top 10 smartphone makers already in 2015. Vivo’s parent company BKK Electronics is also running OPPO, another smartphone giant emerging from China. Interestingly, BKK started their commercial success with a device called “步步高复读机“, which is a special-purpose cassette player. It had the ability to listen to an English teacher sentence by sentence. Also students can record themselves repeating the sentence and thus comparing themselves with the teacher. According to a very reliable source (my Chinese wife), literally everyone had this in school in the 90s. Back to Vivo now. Operating in 100 countries already, Vivo recently entered Pakistan and Nepal with their entry level phones. The low end phones are definitely their cash-cows, one example being the VivoY71, retailing for about EUR 130. Vivo’s recent claim of fame is the incredible good looking Vivo Nex which is incorporating a lot of top-notch tech advancements. The Nex is the first smartphone with no bezels, no notch, and a selfie camera that pops up from the case only if you need it. http://www.vivo.com

 

2018 world cup china sponsoring vivo

 

Mengniu Dairy – 蒙牛

Mengniu Dairy is a privately owned company and a large manufacturer and distributor of dairy products and ice cream in China. Based in Inner Mongolia, employing about 30,000 people with an annual turnover of about 2 bn USD. Typical products are milk and yogurt. Mengniu is famous for it’s high profile advertising campaigns – one time advertising “special milk for China’s astronauts” after launching Shenzhou 5 and Shenzhou 6 spacecraft. Danone, is holding a minority stake in Mengniu of 9.9% where COFCO (biggest state-owned food company in China) acts as the majority stakeholder. http://www.mengniuir.com

2018 world cup china sponsoring mengniu

Chinese Brands Sponsoring World Cup – What is the takeaway of this?

In the 2014 World cup there was only 1 Chinese company (Yingli solar) participating in sponsorship. Today we have Wanda, Vivo, Mengniu and Hisense entering the global stage for advertising with their commitments for the FIFA 2018 world cup. China is producing a new league of mega-brands right now that will soon play on the international stage. In every industry, in every location. 14 Chinese Brands already made it into the Top100 of the 2018 BrandZ study.

The sponsorship we see today is just the beginning. I believe that this will be a wake-up call for some, since these new mega-brands will eventually enter your markets and sell to your customers. Most important it is real opportunity to enter new partnerships and collaborations with Chinese players eager to develop their business abroad to unlock new markets together.

Thanks for reading about Chinese Brands Sponsoring World Cup, Thomas.

If you would like to read my posts, please add me on LinkedIn or add me on WeChat. I write and speak about innovation and China’s digital ecosystem.

About: I am Dr. Thomas Reinbacher an independent adviser and freelance consultant based in Germany and China. In the past I was: engagement manager at McKinsey and Company; Computer scientist (PhD, Graduated sub-auspiciis presidentis ); visiting scientist NASA Ames Research Center at Silicon Valley. I lived, studied (ZheJiang University 浙江大学) and worked for about 3 years in China (NanJing, HangZhou, BeiJing), and I am fluent in Mandarin.

Disclaimer: This article on Chinese Brands Sponsoring World Cup is provided as is and reflect my personal opinions.

Talk at World Manufacturing Convention (WMC) 2018 in Hefei China – Made in China 2025

I will give a talk on “Let the Industry 4.0 experts talk – A revolution from Germany to unleash your people’s full potential” at the 2018 World Manufacturing Convention in Hefei China on May 25 2018. I think this is a perfect opportunity to share some insights about China’s ambitious Made in China 2025 program and the convention itself.

What is the World Manufacturing Convention (WMC)?

The World Manufacturing Convention 2018 (WMC) takes place at May 24-26 at the Hefei Binhu International Exhibition & Convention Center in Anhui Province. The convention brings together around 2,000 participants from international and Chinese manufacturing corporations. This will include both large corporate but also many small and medium-sized enterprises (SMEs). The conference organizers expect more than 200 Fortune 500 companies and other advanced foreign manufacturers to attend, making it one of the largest smart manufacturing conventions globally – another major one being Hannover Messe in Germany.

What is Made in China 2025?

Manufacturing is undergoing a fundamental revolution worldwide. Manufacturing itself has to become ‘smarter’, relying on technology such as the internet, cloud computing and big data. In China, Premier Li Keqiang and his cabinet put forward the grand plan of “Made in China 2025 (中国制造2025)” for the first time in the Government Work Report in March 2015.

This plan was further approved by the State Council of China. It is often described as an “initiative to comprehensively upgrade Chinese industry” directly inspired by the German efforts on Industry 4.0. The overall goal is to move China up in the value chain. The plan involves roughly 5 pillars:

  • 质量为先 – Quality first
  • 创新驱动 – Innovation
  • 绿色发展 – Green development
  • 结构优化 – Structural optimization
  • 人才为本 – Human capital / Talent orientation

The Made in China 20205 plan highlights 10 priority sectors: 1) New advanced information technology 2) Automated machine tools & robotics 3) Aerospace and aeronautical equipment 4) Maritime equipment and high-tech shipping 5) Modern rail transport equipment 6) New-energy vehicles and equipment 7) Power equipment 8) Agricultural equipment 9) New materials as well as 10) Biopharma and advanced medical products.

What was my talk about?

While a lot of effort in Industry 4.0 and Made in China 2025 is put into upgrading machinery equipment my talk made the point that upgrading machinery is easy but the real game changer questions is: How will you educate your employees to be ready for Made in China 2025 and Industry 4.0? Because that is the hard part.

Made in China 2025 Framework, prepared for World Manufacturing Convention 2018

 

If you have an interest in this topic, I would be happy to catch up please see http://dr-reinbacher.com/dr-reinbacher/ on how to contact me.

Some impressions of the talk and the World Manufacturing Convention

About the author:

Dr. Thomas Reinbacher is a computer scientist and management consultant and works as independent adviser in Munich and Beijing. If you want to work with me please find me on http://dr-reinbacher.com/