What is the Chinese national goal? For the many decades since Deng Xiaoping, economic advancement has been the highest priority. Under Xi Jinping, things are different, even if it is not always so clearly stated. His agenda is dominated by what is known as “security” in political jargon: strengthening the armed forces, secret services and police, and independence in the energy and economy sectors. All this improves the ability to endure a real conflict, analyzes Christiane Kuehl. Security trumps everything.
Logically, this leads to a second question: What is the goal of the People’s Liberation Army? Before Xi Jinping took office, it had a defensive focus: It was supposed to offer potential attackers a viable deterrent. Today it is different, reports Michael Radunski from an event of the Global China Conversations of the IfW Kiel. The primary objective is now the conquest of Taiwan. This fits logically with Xi’s increasingly offensive policy.
On the offensive is also state-owned company SAIC, albeit in a much more positive area. With the MG4, it offers customers an excellently designed EV; at least that’s what the testers from the German Automobile Association (ADAC) say. It is also cheaper than the competition from VW. So the SAIC offensive is not such positive news for Volkswagen.
Military and territorial security has always been part of China’s “core interests”. This was recently demonstrated in the skies over the Americas, where several units of what appears to be a larger fleet of spy balloons appeared. As is well known, the USA shot down one of them. For a long time, Beijing has also been modernizing its armed forces with an annually growing military budget – always with an eye on Taiwan, the South China Sea and the regional supremacy of the USA.
Under head of state and party leader Xi Jinping, however, national security is now permeating all political domains for the first time. “In the past ten years, Xi Jinping has made national security a key issue,” Merics researchers Katja Drinhausen and Helena Legarda wrote in a recent study.
In 2013, Xi, who had just taken office, established a National Security Commission modeled after the US National Security Council. In 2014, Xi presented his concept of “Comprehensive National Security”. It encompasses 16 security fields, ranging from political, military and economic security to biosecurity, technology and space security.
“The signature of the Xi era is a potent mix of self-confidence and paranoia on the part of the party when it comes to national security,” Drinhausen and Legarda assess. On the one hand, the Chinese leadership is worried that internal and external forces could undermine its power. At the same time, they are convinced that China’s political system is more stable and superior to any other.
Xi underpinned the entire endeavor with a plethora of laws, starting with an overarching National Security Law. In 2014, security laws to counter cyberattacks, terrorism, foreign sanctions or espionage followed, as well as laws on data security, dealing with foreign NGOs – and finally, in 2020, the infamous National Security Law for Hong Kong, which effectively abolished its free society.
In his speech at the CP Party Congress in October 2022, Xi mentioned the word “security” (安全) dozens of times. For example, he stressed the importance of national security and control over China’s supply of food, energy and industrial goods. “National security is the bedrock of national rejuvenation,” Xi said. It would also serve social stability.
Under Xi’s predecessors Jiang Zemin and Hu Jintao, economic development still enjoyed priority. Xi shifted the focus: “The new mantra is ‘integrating development and security’ (统筹发展和安全), as reiterated in policy documents since late 2019 and in the current 14th Five-Year Plan (2021-25),” Drinhausen and Legarda write. This sounds like equivalence. But in reality, the concept favors security. Thus, the bureaucracy would have to consider the issue at every level of decision-making processes.
According to Drinhausen and Legarda, China uses “a broad and highly ambiguous definition of national security, often intertwined with broader national and development interests”. Mobilization campaigns around the issue “put officials and citizens in a state of constant defensive alert and have a strong anti-foreign tone.”
“Ideology trumps the economy” was the title of the European Chamber of Commerce in China’s September 2022 position paper, expressing frustration over this development. “For private companies, national security is omnipresent in this new era,” the Merics study also noted. For example, earlier approvals for projects could be revoked. There are no real legal means to challenge measures or to refuse to cooperate with the security authorities. Drinhausen and Legarda recommend that EU companies adapt well to the changed framework conditions.
Xi reacted to the geopolitical conflicts with his “Global Security Initiative” (GSI), which he presented at the Bo’ao Forum for Asia in Hainan in April 2022. The GSI will provide a framework of principles for global affairs and diplomacy that can make the world a safer place, Xi said at the time. So far, the GSI hardly contains any details. In general, it aims to promote a China-led solution to international security issues.
Beijing is dragging partner states of the New Silk Road Initiative into the GSI. China also used its UN Security Council presidency in August 2022 to further link the GSI to UN ideas on collective security, scholars Courtney Fung and Shing-hon Lam said in a December paper for Australia’s Lowy Institute. In the context of the GSI, China’s policymakers and diplomats refer to security issues in the broadest sense – including food, climate, supply chains, the internet, trade and energy, for example – according to a Nikkei Asia report.
The GSI is a “clear attempt” to impose Beijing’s state-centered security concept on the world, Drinhausen and Legarda conclude. “China is neither willing nor able to replace the US as a global security guarantor,” they say. “But Beijing’s ability to advance its policy approaches by leveraging its economic weight and global discontent with the West should not be underestimated.”
In the overall picture, Xi’s policy renders China more capable of dealing with conflicts. Greater economic and technical independence enables it to better weather sanctions and pressure from the West. Well-informed intelligence services provide the necessary intelligence to assess the situation.
And last but not least, the army is also growing stronger thanks to modern armament. This includes modern J-20 stealth jets, China’s only ones that can compete with the USA’s F-35s. The new aircraft carrier “Fujian” is expected to leave for sea trials before the end of this year. The “Fujian”, along with the “USS Gerald R. Ford”, is only one of two carriers in the world equipped with electromagnetic catapults for launching fighter jets.
Sarah Kirchberger leaves no room for doubt. “The current status quo around Taiwan is extremely fragile,” the renowned China expert said at the Global China Conversations of the Kiel Institute for the World Economy (IfW) on Thursday. The topic is Tensions Over Taiwan: What’s the Current Situation and What Challenges Arise for Businesses and the Economy? – and Kirchberger quickly makes clear how much the situation around the island off the coast of China has recently come to a head.
Before 2016, there were hardly any tensions, there was almost a kind of honeymoon between China and Taiwan, says the Head of Strategic Development in Asia-Pacific at the Institute for Security Policy at Kiel University. But then Donald Trump came to power in the USA and Tsai Ing-wen in Taiwan – and nothing was the same anymore.
China responded to Tsai’s stronger emphasis on Taiwanese identity with massive armament, fierce threats and a clear plan: Taiwan should be unified with mainland China by 2049 at the latest. At least that is what China’s state and party leader Xi Jinping wants.
But where does this focus on Taiwan come from, that even a cool-headed tactician like Xi sets himself a fixed date? Apart from national pathos, political chauvinism and historical references, there are also tangible geostrategic and military reasons, according to Kirchberger.
Taiwan belongs to the so-called First Island Chain – and acts like a dividing wall between China and the open Pacific. To the west of Taiwan, the sea is much shallower – an average of 18 meters in the Bohai Sea, 44 meters in the Yellow Sea. To the east of Taiwan, on the other hand, it quickly drops several thousand meters.
This makes the entire area directly off the Chinese coast relatively unsuitable for deeper submarine operations and thus indirectly also for China’s nuclear deterrent. “China’s problem is that its ships cannot leave the First Island Chain undetected because of the existing surveillance,” Kirchberger explains. With Taiwan under Chinese control, this serious strategic problem would be solved.
“This is another reason why the conquest of Taiwan is essentially the primary mission of the Chinese People’s Liberation Army,” Sarah Kirchberger said firmly at the IfW’s Global China Conversations on Thursday. The China expert sums up: “As fragile as the current status quo around Taiwan may be – it is the best condition to prevent a war.” Only to add: “It is only China that is trying to change the current status quo.”
Chen Shin-Horng then spoke about the economic importance of Taiwan for the West, but also for China. The Vice President of the Chung-Hua Institution for Economic Research (CIER) in Taipei made it clear that Taiwan is “a hidden center of global innovation”. “Taiwan is the only source of the most advanced semiconductors currently available,” Chen said.
Since the United States has recently imposed strict sanctions on China concerning various technology components, the People’s Republic is under enormous pressure in this so important future sector. “The US sanctions basically render China unable to catch up in chips and chiplets.”
This is also because of Taiwan’s highly successful company TSMC. The Taiwan Semiconductor Manufacturing Company is one of the world’s leading semiconductor manufacturers and the world’s largest independent contract manufacturer of semiconductor products. TSMC produces 13 million chips of 12 nanometers (nm) size every year. But Taiwan also has a big lead in high-performance areas of only 8 nm and 6 nm. Taiwan is also currently gaining a competitive edge in chiplets – i.e. the tiniest chips with only 1-2 nm: corresponding factories are nearing completion.
To put this in perspective: Despite the US chip offensive, factories in the US state of Arizona will not be operational until 2024 (for 5nm chips) and 2025 (for 3nm chips), according to Chen. “TSMC is extraordinary,” says Chen, adding: “But also a luxury, after all, such a company also needs a very advanced environment, with infrastructure, properly trained workers, raw materials and much more.”
At the end, Chen also gave Europe a hint. TSMC’s revenue for chip orders from the EU amounted to only 3.1 percent in 2021. So there is still a lot of potential for cooperation between Europe and Taiwan in one of the most important sectors.
China’s cars have only truly arrived in Germany when they are tested by the German Automobile Club (ADAC) or the Auto-Bild magazine and even pass benchmark tests. The MG4 EV from Shanghai-based carmaker SAIC is currently in this demanding test environment. In terms of size and price, its logical rival is Volkswagen’s ID.3. In the ADAC test against VW’s ID.3, the MG4 already performs surprisingly well. In all disciplines, the MG4 can compete easily.
Customers, meanwhile, were already aware of the car before the test. SAIC’s MG4 was the most successful China EV in Germany last year, with around 10,000 vehicles sold. In terms of registrations, it is ahead of Alfa Romeo and Subaru, despite being on the market for less than two years.
“The MG4 wants to become a true people’s car with better technology at a lower price,” the ADAC testers think. The Chinese competition has arrived in the land of car manufacturers. Interestingly, the state-owned company SAIC is one of VW’s production partners in China.
The MG4 could be the first of a whole series of Chinese NEVs to be successfully tested and introduced to customers. The letter combination MG and the logo are familiar to many drivers in Germany. After all, MG is a traditional British brand that was sold to China in 2005. But SAIC does not hide the car’s Chinese roots; it even uses them to its benefit.
And rightly so. In South Korea’s case, many customers did not care where the car came from, but what it could do. This helped the rise of the Kia and Hyundai brands and, long before that, the Japanese manufacturers. But lousy test scores do massive harm.
Legendary here is the Jiangling Landwind 2005, which was given a devastating verdict by Auto-Bild: “The most dangerous car in the world?” Never in 20 years had a car crashed so badly in an ADAC crash test. In 2013, the next generation of Chinese cars also failed to stand up to the critical eye of Auto-Bild. The verdict back then was “We are horrified”. The title was: “This is how bad China’s cars are”. At that time, the testers still had to travel to China.
Four years later, the test results were already more differentiated: Most of the tested vehicles “impressed this time with their modern design, good quality and modern technology”. However, the flaws could not be ignored. For example, the “inharmonious tuning of the chassis, steering and drive components”. Here, there was “simply a lack of experience”.
Tests with Chinese participants will from now on be commonplace, with better results than in the past. Because companies like BYD, NIO, Ora, or Lynk are venturing onto the German market this year, sometimes with several models at once. And the chances are high that the Chinese manufacturers will adapt better and better to the German market, at ever lower prices.
Today, China’s best-selling EV MG4 even passes the tough comparison with the ID.3. The Chinese competitor is no NIO or BYD, which experts would have expected to be the first to achieve this success. But SAIC, although a state-owned enterprise, is one of the 70 largest companies in the world’s global Fortune 500. The group employs 25,000 people. With 5.3 million cars sold, SAIC has been number one in China for 17 years. Of these, a good one million are EVs (growth of 46 percent in 2022), to which the sensational sales figures of the tiny EV Wuling have contributed a great deal. SAIC already exported more than one million vehicles, with growth of almost 50 percent last year.
According to estimates by Global Data, SAIC will be ranked third globally for EVs in 2023 behind the US company Tesla (1.6 million) and the Chinese manufacturer BYD (1.56 million) with one million cars sold – even ahead of VW with 880,000. Also thanks to SAIC, Chinese car manufacturers had a market share of over 50 percent in China for the first time in 2022. German car manufacturers only had a market share of 19 percent.
The ADAC already calls the exterior design of the MG4 “aggressive”, while it considers the VW design to be “dull”: “The design is so distinctive, unlike anything Chinese manufacturers have ever done before”. The interior is “clean” but not yet “optimal”.
The ADAC testers even found the MG’s handling, something that is far more important in Germany than in China, to be “very pleasant“. Although there are numerous driving assistance systems, they do not seem “really perfected yet”, at least in the pre-production model.
The range is also impressive: 360 to 380 kilometers with a 64-kWh battery, which can be charged from 10 to 80 percent in 35 minutes. It also comes with a seven-year or 150,000-kilometer warranty. The base price includes a better standard configuration than the ID.3, although the MG4 is over 4,000 euros cheaper. “If image, dealership network and residual value were not also factors influencing the purchase, there would no longer be many good reasons for the VW ID.3 given the price advantage of the Chinese,” the ADAC concludes.
The reviews from Auto-Bild are even better. They want to give the two cars “gut feeling tests” and not just compare the bare specs. This is particularly hard on the Chinese. “The MG looks more dynamic,” is the first impression. It is also seven centimeters longer than the ID.3. Nevertheless, rear-seat passengers have more space in the ID.3, and the trunk capacity is 100 liters bigger. However, unlike the MG4, it has an annoying edge.
The interior, however, sees a clear winner: “The Chinese feels better than the German. Its surface materials seem of higher quality, more refined.” A facelift this spring is supposed to remedy this drawback at VW. What is not good, however, is that VW already has to run after the Chinese. They are not waiting for VW but will improve on their part.
Auto-Bild’s verdict is quite sobering for VW and also a bit of a Zeitenwende: “Have the Chinese just copied what they have coming off the production line? No, they even did a few things better with the MG4 than VW did with the ID.3.”
Recently, there was another test surprise: The Austrian automobile club OeAMTC and the Norwegian automobile club NAF tested 29 EVs in Norway at temperatures as low as minus 19 degrees: The Maxus Euniq6 SUV, also from SAIC, performed best with a cold-related range loss of only ten percent.
Making an effort and standing up for her cause is something Haifen Nan learned at an early age. She grew up in a small village near the southern Chinese city of Wenzhou; her parents had spent their own childhood in severe poverty and wanted their children to have it better. “My father always said, ‘Everything you own can be lost.’ But no one can rob you of what you have in your head; with that, you can build a good life anywhere,” Nan recalls.
She studied hard, graduated with top grades and was supposed to study law at her parents’ wishes. “My father had four dream jobs for his children: lawyer, doctor, teacher and engineer,” Nan says. “Because I was especially good at humanities, law was the only option for me – but dry texts bored me.” Instead, she wanted to become a travel journalist, to see the world and go on adventures. Nan studied journalism at Nanjing University and moved to the German state of North Rhine-Westphalia during her master’s degree, where she participated in a new exchange program. Her interest in new media research was already piqued. The dream of travel journalism faded away.
She stayed in Germany, met her husband, and is currently writing her thesis in Heidelberg on Chinese media and the transformation of identity. “My research is like a lifelong self-reflection,” Nan says.
Between 2011 and 2014, Haifen Nan returned to China. In Beijing, she started to set up a communication channel on Weibo for the Bosch Foundation. In parallel, she introduced her knowledge to various China programs that promote exchange between German and Chinese journalists. For this reason, she has been active at the Deutsch-Chinesisches Mediennetzwerk e.V. since 2012, where she now holds the position of deputy chair.
Alongside her work, Nan advises companies and associations on German-Chinese cooperation. “And on the side, I write articles for Chinese media at night,” she says with a smile. But she is serious, Nan is a busy woman.
What motivates her in all her endeavors: social exchange and international understanding. “Against the backdrop of global challenges such as social polarization, migration and climate change, multilateral cooperation is becoming increasingly important,” says Nan. She sees her home country in a special role in this. China is incredibly important for peace and the prosperity of people around the world, she says – and it would be impossible to stop climate change without China.
In the end, Nan did become a lawyer in a way, a fighter for international exchange, a border crosser, as she calls herself. Are her parents proud of her today? Nan doesn’t really know either. “Many traditional Chinese parents like mine, hardly express their feelings to their children. But I’m happy with myself, that’s the most important thing.” Svenja Napp
If China can do it, we can do the same, YouTubers Josh & Archie decided. “We flew a spy balloon over Chinese airspace!” More precisely, they sent the balloon flying over the embassy of the People’s Republic in London, as this screenshot from the YouTube clip shows. They bought weather balloons on eBay for the stunt, “Made in China” of course, and a “spy camera,” as the YouTubers explained. During the overflight, the camera filmed the windows of the embassy and a security guard on the roof – intelligence information that Josh & Archie’s 1.45 million subscribers got to see on YouTube.
What is the Chinese national goal? For the many decades since Deng Xiaoping, economic advancement has been the highest priority. Under Xi Jinping, things are different, even if it is not always so clearly stated. His agenda is dominated by what is known as “security” in political jargon: strengthening the armed forces, secret services and police, and independence in the energy and economy sectors. All this improves the ability to endure a real conflict, analyzes Christiane Kuehl. Security trumps everything.
Logically, this leads to a second question: What is the goal of the People’s Liberation Army? Before Xi Jinping took office, it had a defensive focus: It was supposed to offer potential attackers a viable deterrent. Today it is different, reports Michael Radunski from an event of the Global China Conversations of the IfW Kiel. The primary objective is now the conquest of Taiwan. This fits logically with Xi’s increasingly offensive policy.
On the offensive is also state-owned company SAIC, albeit in a much more positive area. With the MG4, it offers customers an excellently designed EV; at least that’s what the testers from the German Automobile Association (ADAC) say. It is also cheaper than the competition from VW. So the SAIC offensive is not such positive news for Volkswagen.
Military and territorial security has always been part of China’s “core interests”. This was recently demonstrated in the skies over the Americas, where several units of what appears to be a larger fleet of spy balloons appeared. As is well known, the USA shot down one of them. For a long time, Beijing has also been modernizing its armed forces with an annually growing military budget – always with an eye on Taiwan, the South China Sea and the regional supremacy of the USA.
Under head of state and party leader Xi Jinping, however, national security is now permeating all political domains for the first time. “In the past ten years, Xi Jinping has made national security a key issue,” Merics researchers Katja Drinhausen and Helena Legarda wrote in a recent study.
In 2013, Xi, who had just taken office, established a National Security Commission modeled after the US National Security Council. In 2014, Xi presented his concept of “Comprehensive National Security”. It encompasses 16 security fields, ranging from political, military and economic security to biosecurity, technology and space security.
“The signature of the Xi era is a potent mix of self-confidence and paranoia on the part of the party when it comes to national security,” Drinhausen and Legarda assess. On the one hand, the Chinese leadership is worried that internal and external forces could undermine its power. At the same time, they are convinced that China’s political system is more stable and superior to any other.
Xi underpinned the entire endeavor with a plethora of laws, starting with an overarching National Security Law. In 2014, security laws to counter cyberattacks, terrorism, foreign sanctions or espionage followed, as well as laws on data security, dealing with foreign NGOs – and finally, in 2020, the infamous National Security Law for Hong Kong, which effectively abolished its free society.
In his speech at the CP Party Congress in October 2022, Xi mentioned the word “security” (安全) dozens of times. For example, he stressed the importance of national security and control over China’s supply of food, energy and industrial goods. “National security is the bedrock of national rejuvenation,” Xi said. It would also serve social stability.
Under Xi’s predecessors Jiang Zemin and Hu Jintao, economic development still enjoyed priority. Xi shifted the focus: “The new mantra is ‘integrating development and security’ (统筹发展和安全), as reiterated in policy documents since late 2019 and in the current 14th Five-Year Plan (2021-25),” Drinhausen and Legarda write. This sounds like equivalence. But in reality, the concept favors security. Thus, the bureaucracy would have to consider the issue at every level of decision-making processes.
According to Drinhausen and Legarda, China uses “a broad and highly ambiguous definition of national security, often intertwined with broader national and development interests”. Mobilization campaigns around the issue “put officials and citizens in a state of constant defensive alert and have a strong anti-foreign tone.”
“Ideology trumps the economy” was the title of the European Chamber of Commerce in China’s September 2022 position paper, expressing frustration over this development. “For private companies, national security is omnipresent in this new era,” the Merics study also noted. For example, earlier approvals for projects could be revoked. There are no real legal means to challenge measures or to refuse to cooperate with the security authorities. Drinhausen and Legarda recommend that EU companies adapt well to the changed framework conditions.
Xi reacted to the geopolitical conflicts with his “Global Security Initiative” (GSI), which he presented at the Bo’ao Forum for Asia in Hainan in April 2022. The GSI will provide a framework of principles for global affairs and diplomacy that can make the world a safer place, Xi said at the time. So far, the GSI hardly contains any details. In general, it aims to promote a China-led solution to international security issues.
Beijing is dragging partner states of the New Silk Road Initiative into the GSI. China also used its UN Security Council presidency in August 2022 to further link the GSI to UN ideas on collective security, scholars Courtney Fung and Shing-hon Lam said in a December paper for Australia’s Lowy Institute. In the context of the GSI, China’s policymakers and diplomats refer to security issues in the broadest sense – including food, climate, supply chains, the internet, trade and energy, for example – according to a Nikkei Asia report.
The GSI is a “clear attempt” to impose Beijing’s state-centered security concept on the world, Drinhausen and Legarda conclude. “China is neither willing nor able to replace the US as a global security guarantor,” they say. “But Beijing’s ability to advance its policy approaches by leveraging its economic weight and global discontent with the West should not be underestimated.”
In the overall picture, Xi’s policy renders China more capable of dealing with conflicts. Greater economic and technical independence enables it to better weather sanctions and pressure from the West. Well-informed intelligence services provide the necessary intelligence to assess the situation.
And last but not least, the army is also growing stronger thanks to modern armament. This includes modern J-20 stealth jets, China’s only ones that can compete with the USA’s F-35s. The new aircraft carrier “Fujian” is expected to leave for sea trials before the end of this year. The “Fujian”, along with the “USS Gerald R. Ford”, is only one of two carriers in the world equipped with electromagnetic catapults for launching fighter jets.
Sarah Kirchberger leaves no room for doubt. “The current status quo around Taiwan is extremely fragile,” the renowned China expert said at the Global China Conversations of the Kiel Institute for the World Economy (IfW) on Thursday. The topic is Tensions Over Taiwan: What’s the Current Situation and What Challenges Arise for Businesses and the Economy? – and Kirchberger quickly makes clear how much the situation around the island off the coast of China has recently come to a head.
Before 2016, there were hardly any tensions, there was almost a kind of honeymoon between China and Taiwan, says the Head of Strategic Development in Asia-Pacific at the Institute for Security Policy at Kiel University. But then Donald Trump came to power in the USA and Tsai Ing-wen in Taiwan – and nothing was the same anymore.
China responded to Tsai’s stronger emphasis on Taiwanese identity with massive armament, fierce threats and a clear plan: Taiwan should be unified with mainland China by 2049 at the latest. At least that is what China’s state and party leader Xi Jinping wants.
But where does this focus on Taiwan come from, that even a cool-headed tactician like Xi sets himself a fixed date? Apart from national pathos, political chauvinism and historical references, there are also tangible geostrategic and military reasons, according to Kirchberger.
Taiwan belongs to the so-called First Island Chain – and acts like a dividing wall between China and the open Pacific. To the west of Taiwan, the sea is much shallower – an average of 18 meters in the Bohai Sea, 44 meters in the Yellow Sea. To the east of Taiwan, on the other hand, it quickly drops several thousand meters.
This makes the entire area directly off the Chinese coast relatively unsuitable for deeper submarine operations and thus indirectly also for China’s nuclear deterrent. “China’s problem is that its ships cannot leave the First Island Chain undetected because of the existing surveillance,” Kirchberger explains. With Taiwan under Chinese control, this serious strategic problem would be solved.
“This is another reason why the conquest of Taiwan is essentially the primary mission of the Chinese People’s Liberation Army,” Sarah Kirchberger said firmly at the IfW’s Global China Conversations on Thursday. The China expert sums up: “As fragile as the current status quo around Taiwan may be – it is the best condition to prevent a war.” Only to add: “It is only China that is trying to change the current status quo.”
Chen Shin-Horng then spoke about the economic importance of Taiwan for the West, but also for China. The Vice President of the Chung-Hua Institution for Economic Research (CIER) in Taipei made it clear that Taiwan is “a hidden center of global innovation”. “Taiwan is the only source of the most advanced semiconductors currently available,” Chen said.
Since the United States has recently imposed strict sanctions on China concerning various technology components, the People’s Republic is under enormous pressure in this so important future sector. “The US sanctions basically render China unable to catch up in chips and chiplets.”
This is also because of Taiwan’s highly successful company TSMC. The Taiwan Semiconductor Manufacturing Company is one of the world’s leading semiconductor manufacturers and the world’s largest independent contract manufacturer of semiconductor products. TSMC produces 13 million chips of 12 nanometers (nm) size every year. But Taiwan also has a big lead in high-performance areas of only 8 nm and 6 nm. Taiwan is also currently gaining a competitive edge in chiplets – i.e. the tiniest chips with only 1-2 nm: corresponding factories are nearing completion.
To put this in perspective: Despite the US chip offensive, factories in the US state of Arizona will not be operational until 2024 (for 5nm chips) and 2025 (for 3nm chips), according to Chen. “TSMC is extraordinary,” says Chen, adding: “But also a luxury, after all, such a company also needs a very advanced environment, with infrastructure, properly trained workers, raw materials and much more.”
At the end, Chen also gave Europe a hint. TSMC’s revenue for chip orders from the EU amounted to only 3.1 percent in 2021. So there is still a lot of potential for cooperation between Europe and Taiwan in one of the most important sectors.
China’s cars have only truly arrived in Germany when they are tested by the German Automobile Club (ADAC) or the Auto-Bild magazine and even pass benchmark tests. The MG4 EV from Shanghai-based carmaker SAIC is currently in this demanding test environment. In terms of size and price, its logical rival is Volkswagen’s ID.3. In the ADAC test against VW’s ID.3, the MG4 already performs surprisingly well. In all disciplines, the MG4 can compete easily.
Customers, meanwhile, were already aware of the car before the test. SAIC’s MG4 was the most successful China EV in Germany last year, with around 10,000 vehicles sold. In terms of registrations, it is ahead of Alfa Romeo and Subaru, despite being on the market for less than two years.
“The MG4 wants to become a true people’s car with better technology at a lower price,” the ADAC testers think. The Chinese competition has arrived in the land of car manufacturers. Interestingly, the state-owned company SAIC is one of VW’s production partners in China.
The MG4 could be the first of a whole series of Chinese NEVs to be successfully tested and introduced to customers. The letter combination MG and the logo are familiar to many drivers in Germany. After all, MG is a traditional British brand that was sold to China in 2005. But SAIC does not hide the car’s Chinese roots; it even uses them to its benefit.
And rightly so. In South Korea’s case, many customers did not care where the car came from, but what it could do. This helped the rise of the Kia and Hyundai brands and, long before that, the Japanese manufacturers. But lousy test scores do massive harm.
Legendary here is the Jiangling Landwind 2005, which was given a devastating verdict by Auto-Bild: “The most dangerous car in the world?” Never in 20 years had a car crashed so badly in an ADAC crash test. In 2013, the next generation of Chinese cars also failed to stand up to the critical eye of Auto-Bild. The verdict back then was “We are horrified”. The title was: “This is how bad China’s cars are”. At that time, the testers still had to travel to China.
Four years later, the test results were already more differentiated: Most of the tested vehicles “impressed this time with their modern design, good quality and modern technology”. However, the flaws could not be ignored. For example, the “inharmonious tuning of the chassis, steering and drive components”. Here, there was “simply a lack of experience”.
Tests with Chinese participants will from now on be commonplace, with better results than in the past. Because companies like BYD, NIO, Ora, or Lynk are venturing onto the German market this year, sometimes with several models at once. And the chances are high that the Chinese manufacturers will adapt better and better to the German market, at ever lower prices.
Today, China’s best-selling EV MG4 even passes the tough comparison with the ID.3. The Chinese competitor is no NIO or BYD, which experts would have expected to be the first to achieve this success. But SAIC, although a state-owned enterprise, is one of the 70 largest companies in the world’s global Fortune 500. The group employs 25,000 people. With 5.3 million cars sold, SAIC has been number one in China for 17 years. Of these, a good one million are EVs (growth of 46 percent in 2022), to which the sensational sales figures of the tiny EV Wuling have contributed a great deal. SAIC already exported more than one million vehicles, with growth of almost 50 percent last year.
According to estimates by Global Data, SAIC will be ranked third globally for EVs in 2023 behind the US company Tesla (1.6 million) and the Chinese manufacturer BYD (1.56 million) with one million cars sold – even ahead of VW with 880,000. Also thanks to SAIC, Chinese car manufacturers had a market share of over 50 percent in China for the first time in 2022. German car manufacturers only had a market share of 19 percent.
The ADAC already calls the exterior design of the MG4 “aggressive”, while it considers the VW design to be “dull”: “The design is so distinctive, unlike anything Chinese manufacturers have ever done before”. The interior is “clean” but not yet “optimal”.
The ADAC testers even found the MG’s handling, something that is far more important in Germany than in China, to be “very pleasant“. Although there are numerous driving assistance systems, they do not seem “really perfected yet”, at least in the pre-production model.
The range is also impressive: 360 to 380 kilometers with a 64-kWh battery, which can be charged from 10 to 80 percent in 35 minutes. It also comes with a seven-year or 150,000-kilometer warranty. The base price includes a better standard configuration than the ID.3, although the MG4 is over 4,000 euros cheaper. “If image, dealership network and residual value were not also factors influencing the purchase, there would no longer be many good reasons for the VW ID.3 given the price advantage of the Chinese,” the ADAC concludes.
The reviews from Auto-Bild are even better. They want to give the two cars “gut feeling tests” and not just compare the bare specs. This is particularly hard on the Chinese. “The MG looks more dynamic,” is the first impression. It is also seven centimeters longer than the ID.3. Nevertheless, rear-seat passengers have more space in the ID.3, and the trunk capacity is 100 liters bigger. However, unlike the MG4, it has an annoying edge.
The interior, however, sees a clear winner: “The Chinese feels better than the German. Its surface materials seem of higher quality, more refined.” A facelift this spring is supposed to remedy this drawback at VW. What is not good, however, is that VW already has to run after the Chinese. They are not waiting for VW but will improve on their part.
Auto-Bild’s verdict is quite sobering for VW and also a bit of a Zeitenwende: “Have the Chinese just copied what they have coming off the production line? No, they even did a few things better with the MG4 than VW did with the ID.3.”
Recently, there was another test surprise: The Austrian automobile club OeAMTC and the Norwegian automobile club NAF tested 29 EVs in Norway at temperatures as low as minus 19 degrees: The Maxus Euniq6 SUV, also from SAIC, performed best with a cold-related range loss of only ten percent.
Making an effort and standing up for her cause is something Haifen Nan learned at an early age. She grew up in a small village near the southern Chinese city of Wenzhou; her parents had spent their own childhood in severe poverty and wanted their children to have it better. “My father always said, ‘Everything you own can be lost.’ But no one can rob you of what you have in your head; with that, you can build a good life anywhere,” Nan recalls.
She studied hard, graduated with top grades and was supposed to study law at her parents’ wishes. “My father had four dream jobs for his children: lawyer, doctor, teacher and engineer,” Nan says. “Because I was especially good at humanities, law was the only option for me – but dry texts bored me.” Instead, she wanted to become a travel journalist, to see the world and go on adventures. Nan studied journalism at Nanjing University and moved to the German state of North Rhine-Westphalia during her master’s degree, where she participated in a new exchange program. Her interest in new media research was already piqued. The dream of travel journalism faded away.
She stayed in Germany, met her husband, and is currently writing her thesis in Heidelberg on Chinese media and the transformation of identity. “My research is like a lifelong self-reflection,” Nan says.
Between 2011 and 2014, Haifen Nan returned to China. In Beijing, she started to set up a communication channel on Weibo for the Bosch Foundation. In parallel, she introduced her knowledge to various China programs that promote exchange between German and Chinese journalists. For this reason, she has been active at the Deutsch-Chinesisches Mediennetzwerk e.V. since 2012, where she now holds the position of deputy chair.
Alongside her work, Nan advises companies and associations on German-Chinese cooperation. “And on the side, I write articles for Chinese media at night,” she says with a smile. But she is serious, Nan is a busy woman.
What motivates her in all her endeavors: social exchange and international understanding. “Against the backdrop of global challenges such as social polarization, migration and climate change, multilateral cooperation is becoming increasingly important,” says Nan. She sees her home country in a special role in this. China is incredibly important for peace and the prosperity of people around the world, she says – and it would be impossible to stop climate change without China.
In the end, Nan did become a lawyer in a way, a fighter for international exchange, a border crosser, as she calls herself. Are her parents proud of her today? Nan doesn’t really know either. “Many traditional Chinese parents like mine, hardly express their feelings to their children. But I’m happy with myself, that’s the most important thing.” Svenja Napp
If China can do it, we can do the same, YouTubers Josh & Archie decided. “We flew a spy balloon over Chinese airspace!” More precisely, they sent the balloon flying over the embassy of the People’s Republic in London, as this screenshot from the YouTube clip shows. They bought weather balloons on eBay for the stunt, “Made in China” of course, and a “spy camera,” as the YouTubers explained. During the overflight, the camera filmed the windows of the embassy and a security guard on the roof – intelligence information that Josh & Archie’s 1.45 million subscribers got to see on YouTube.
