Introduction: "Products manufactured locally in China are highly attractive to us from the perspective of cost-effectiveness and quality stability."
(By Observer News Network, Zhou Shengming; Editor: Gao Xin)
Recently, Nicolai Martin, BMW's new procurement director, told the German newspaper Handelsblatt that BMW must make a precise balance between the opportunities brought by costs and the geopolitical risks.
Martin has been in the group's management for less than half a year, and the crisis surrounding Nexperia has already erupted. He was not surprised by this.
"We have long known that there were risks in our collaboration with Nexperia from the perspective of chip quantity. We just thought we had more time, and we also discussed with our partners how to reduce dependence. However, during these discussions, the situation escalated rapidly," said Nicolai Martin.
He believes that, due to cost factors, Chinese semiconductor products still hold appeal for the German automotive industry.
"For the automotive industry, it is becoming increasingly attractive to purchase semiconductors on a larger scale in China. The Chinese chip market is only beginning to grow rapidly, and it is currently building nearly 100 production bases covering different performance levels."
Nicolai Martin said that China can provide an extremely large semiconductor capacity, and BMW could certainly benefit from it. It would be very difficult in reality to give up these cost-effective chips.
He also said that apart from the semiconductor sector, suppliers in other sectors in China are also important to BMW.
"Chinese suppliers have always been very important to us. We have purchased a large number of products from China, not only for the Chinese market but also for global supply."
Nicolai Martin gave an example, stating that battery cells are a typical representative. Additionally, in the areas of interior and exterior parts, China is also a key supply market.
"As long as the product is produced locally in China, it is highly attractive to us from the perspectives of economy and quality stability," he said.
Nicolai Martin believes that a closer relationship with Chinese suppliers does not mean a "new risk of dependence." On the contrary, he believes that cooperation with Chinese suppliers is crucial for BMW's competitiveness.
"This is not about a closed market. If we simply pursue greater 'resilience' towards China, it will result in further loss of competitiveness against Chinese manufacturers. As a global company, we cannot eliminate all risks, nor do we have any reason to seek complete 'de-coupling' with China," said Nicolai Martin.
"We need innovation at the right time, with the appropriate quality and cost," he said. If European suppliers can enhance their competitiveness, BMW would be very welcome.
The appeal of Chinese components also comes from the severe situation facing the German domestic supplier industry.
Nicolai Martin said that the current situation of layoffs and supply chain pressures faced by German and European suppliers is "very serious." "We regularly assess the financial stability of our suppliers, and the number of cases with serious problems has clearly increased."
He said that BMW will take a more proactive approach in deciding with which partners to collaborate, identifying issues in advance.
"This includes the financial stability of the partner, product quality, its own supply chain, and geopolitical resilience," Nicolai Martin added.
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Original: toutiao.com/article/7586494128956752424/
Statement: This article represents the personal views of the author.