“What are the reasons for reassessing your China strategy?” This is one of the questions that the VDMA asked the 304 participants in a survey among mechanical engineers.
According to a survey, many German mechanical engineering companies are currently reconsidering their China strategy. In a survey by the industry association VDMA, almost half (45 percent) of the 304 participating member companies stated this. The main reasons for this are a difficult local business situation, the worsening of geopolitical tensions and the pressure on Chinese companies to prefer local suppliers and products, said the Association of German Mechanical and Plant Engineering (VDMA) in Frankfurt.
“We are observing a significant increase in the competitiveness of local companies due to increased quality and technology of the products, but also increased industrial policy interventions by the state,” explained VDMA foreign trade expert Ulrich Ackermann. One starting point could be diversification of sales markets and supply chains, among other things: “For many companies, this currently means a stronger focus on the US market and – in addition to China – possibly examining additional opportunities in India, for example.”
However, according to the survey, 86 percent of the VDMA member companies surveyed in Germany and China still have confidence in the Chinese market. According to this, 42 percent want to expand their activities in the country in the near future, 25 percent are undecided.