Supply Chain Act + Bankruptcy trend for EV builders • China.Table

German Supply Chain Act gets off to a tame start
EV manufacturers closing up shop one by one
FDP delegation ends Taiwan trip
Customs inspects workers at CATL in Thuringia
‘Wolf warrior’ Zhao Lijian transferred to new role
Taiwan officer confesses to cooperation with NATO
US Congress creates committee focused on competing with China
APA takes position in debate on China strategy
Profile: Hamburg’s bridge builder Timm Rohweder

Dear reader,

The clamor for the introduction of a German Supply Chain Act was great. Between 2019 and 2021, the then CSU Development Minister Gerd Mueller got it off the ground. It has been in force since Jan. 1 and most German companies seem to be prepared. We take a closer look at the first effects of the new regulation.

Some companies currently have to consider whether importing from China is worthwhile if they have to hire special software or even a human rights officer. However, most companies have no problems meeting the requirements. This is the result of a survey by the Chamber of Foreign Trade in Beijing. But perhaps the excitement is only postponed. Because the Supply Chain Act at the EU level is in the making and is expected to be much stricter.

Many EV manufacturers in China are worried. Many of them will not live to see their vehicles ready for the market – or they are already out of the picture. The state-subsidized EV market, with more than 300 suppliers at last count, is consolidating, as Christian Domke Seidel reports in his Feature. This is good news for German automakers.

Have a great Thursday!

Your
Felix Lee

Feature

German Supply Chain Act gets off to a tame start

Clean goods from China? Container Terminal Altenwerder CTA at the Port of Hamburg.

The new Supply Chain Act came into force at the turn of the year. Large companies will be under greater obligation to comply with human rights and environmental requirements. This primarily affects German companies that do business in and with China. But most of them are prepared.

By
Felix Lee

So far, the anger about the new Supply Chain Act has been limited and only one person in the German public is upset about the law: Wu Ken, the Chinese ambassador. China will not interfere in Germany’s legislation, he said in an interview with Handelsblatt. “But politicizing economic and trade issues distorts the principles of the market economy.”

The ambassador of the People’s Republic apparently sees the new law, which obliges companies in Germany to comply with human rights standards and requirements against environmental pollution in their supply chains, as a targeted attack on China. Some countries would use such a law “to make a fuss about the internal affairs of other states,” the ambassador raged. His country would take all necessary measures “to consistently protect the legitimate rights and interests of its companies,” the ambassador said, without, however, providing details.

There is probably a reason why the excitement – apart from that of the Chinese ambassador – has so far been limited: The Supply Chain Act is quite tame in its implementation.

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