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f+h Intralogistics 4/2016

f+h Intralogistics 4/2016

How the VDMA is

How the VDMA is supporting German companies in China RUBRIK NEWS AND MARKETS The German Engineering Federation VDMA in China represents the interests of over 3,100 mechanical engineering manufacturers from Europe. More than one fifth of their member companies are already active in China. In 2004, influential VDMA (German Engineering Federation) member companies in Europe made the decision to establish two representative offices in China: one in Beijing and one in Shanghai. Unlike the automotive industry, the market access for European mechanical engineering manufacturers in China is not limited but of course can be challenging. A team of 14 dedicated engineers, market experts and public relations specialists cater for the following areas: Agriculture Machinery, Building Materials Machinery, Construction Machinery, Fluid Power Technology, Foreign Trade, Food & Packaging Machinery, Machine Tools, Metallurgy, Mining Machinery, Norms & Standards, Plastics & Rubber Machinery, Power Transmission Engineering, Robotics & Automation, Textile Machinery and Woodworking Machinery. The remit of the federation VDMA China has three pillar activities: to represent the interests of the machinery industry, to provide professional services and to organize exclusive member events. The federation represents the economic and technical interests of member companies in China among ministries and government institutions. To do so, they close- ly monitor the overall political and economic developments as well as the market access conditions in the country. Position papers reflecting the needs of the industry and market reports showing the market potentials and overall developments will be compiled frequently. Another aspect is the support of individual VDMA member company interests, e.g. at opening ceremonies or ground breaking events. Furthermore VDMA is available for consultation to individual member companies and is offering a professional service portfolio, which includes technical standards, market access information, matchmaking, trade fair observation & participation and many more. Important for the VDMA member companies abroad is the network and the platform which they offer for certain machinery sectors and for all interested member companies. Every year, the representative office facilitate about fifty regular events and round table meetings in China with a focus on topics, which are one hundred percent related to mechanical engineering. The most important topics at the moment Actually China is the second most important customer market for European and German mechanical engineering manufacturers. From 2011 to 2015, the share of machinery exports from Germany to China accounted for over 20 percent of total China imports. From January to June 2016, German equipment manufacturers delivered equipment worth a value of 6.91 billion Euros to China. Another aspect is Chinese outbound investment in Europe with the aim to serve the European market and above all to improve competitiveness. This clearly causes some threat but it also might bear a positive momentum as it will make the discrepancy between the Chinese and European investment conditions and market ac- f+h Intralogistics 4/2016

cess regulations even more clear and ideally leads to a more fair and balanced approach in the near future. With view to the recent economic development in China in 2015, VDMA member companies are coping with a less growing customer market. Chinese customers have problems obtaining financing for their projects and investments. China is still an attractive market for machinery manufacturers. The development of infrastructure projects – especially in the China western provinces – still provides sales opportunities. So does the continuous up-scaling of major industry sectors, e.g. food and beverage industry. Other chances are in the China Eastern provinces, where VDMA member companies offering automation and sensors currently can sell their solutions. The business chances clearly outweigh the challenges. But companies entering this market should be well-informed and well-prepared for regional differences on local level. Shift to higher product quality China is still an attractive market for machinery manufacturers Claudia Barkowsky, Chief Representative, VDMA Beijing Representative Office China is on the path of upgrading its manufacturing “from big to strong”. This has been set as a clear goal in the Made in China 2025 directive. Production facilities will put emphasize on increasing the quality of their products. With view to mechanical engineering, there are several tens of thousands of Chinese small and mediumsized manufacturers in the market. But most of them produce machines and equipment for the low-level segment, also labelled “good enough” segment. There has been a shift towards the middlemarket segment. For those Chinese manufacturers, who wish to engage manufacturing in even higher-level segments, they need to invest into their production value chain. Selected Chinese manufacturers are now also actively searching for global partners to enter third-world markets. The China government has put a clear focus on this “going out” strategy and the next decade will bring more Chinese competitors onto the global business platform. Photographs: VDMA www.vdma.org Here you see our fastest stacker crane in action We call it “dynamic warehousing“. DAMBACH Lagersysteme GmbH & Co. KG, Hardrain 1, D-76476 Bischweier, Germany Phone +49 (0) 72 22 9660-0, info@dambach-lagersysteme.de www.dambach-lagersysteme.de Dambach-Englisch.indd 160927_RBG_CH_185x130.indd 1 1 27.09.2016 26.09.16 15:35:41 20:43 f+h Intralogistics 4/2016