Automotive industry goes on hunt for skilled workers in China

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Shanghai, SuzhouHolger Klein has to repeat himself several times until his announcement reaches the audience. "We want to hire 1,000 new engineers in China," said ZF Friedrichshafen board member last month in Shanghai, talking to fellow journalists from Germany.

With 28 million vehicles sold, China was the world's largest auto sales market in 2018 despite the weakening economy. For the German car makers and suppliers, the country is not just a sales gold mine. It also plays an increasingly central role in the research and development of new technologies.

ZF is in the trend with the new hires. Other German companies also falter. In the mobility solutions category alone, Bosch has increased the number of researchers and developers employed in China from 2100 to 5600 over the past five years.

In addition to 38 production sites, the Stuttgart-based company now operates 27 research centers in China. With around 60,000 employees, China is Bosch's second largest location. "The future of mobility needs inventors, not inhibitors. Of that, China is producing more and more, "says Bosch CEO Stefan Hartung.

That's what Volkswagen sees. CEO Herbert Diess announced in January that his group wanted to build more research and development (R & D) in China and cooperate with local technology companies: "In the future, we want to develop automotive technology for the global market with Chinese companies."

Already last year, Audi announced its intention to employ around 650 researchers in Beijing and the eastern Chinese city of Wuxi, which are mainly dedicated to autonomous and networked driving. In order to remain globally competitive, talent has to be sought in China. Europe lacks "some skills and expertise," Diess said.

The VW boss means the following problem: The industry, once driven by mechanical engineering, needs more and more software engineers who can program complex systems.

Industry connoisseurs like to compare the car of the future with a smartphone as a metaphor: in addition to the housing and the camera, it would increasingly come down to the chip, the sensors and the apps. Already, many new car models have huge screens that allow the driver to control the car by finger pressure rather than gadgets and levers.

A development center for the new technology is on the one hand the Silicon Valley. On the other hand, the development takes place in China. There are companies such as Baidu, Alibaba and Tencent, whose systems and apps determine the digital everyday life of the Chinese.

German university graduates, it is said by the boards, but these would not know and therefore did not know how to program for it. "I find it very interesting to have my employees show me and explain the different apps and their functions on their smartphone," says Holger Klein.

The German companies have now understood how important the location of China is in all its facets. The suppliers agree that they want to increasingly fill their customer portfolio with Chinese carmakers. Chinese cars are the most commonly bought Chinese (39 percent). The Europeans follow with 31 percent in second place.

This fact should also be reflected in ZF sales, where German major customers still account for the lion's share of the portfolio, Klein said. Bosch is already one step ahead: Chinese carmakers already account for half of their sales.

Also the production and the personnel are to establish themselves in China. Even now, most of the department heads at Bosch are native Chinese, says Feng Hao, who is responsible for business strategy at Bosch. Already in 2006 they started to relocate both the procurement of materials as well as production for local customers to China. At present, one lies with both divisions at 90 percent.

ZF opens a new transmission plant in autumn

ZF also wants to achieve these values. The Friedrichshafeners are planning to open a transmission plant for the 8-speed 8HP automatic transmission – their silverware – in Shanghai. Currently the hall is still relatively empty. Only a few German employees from the tail unit in Saarbrücken are currently studying their Chinese colleagues.

But already in autumn, the plant should be put into operation and supply the local customers directly: The products should then come to 80 percent from China. "Nearly all our customers will expand their business in China in the coming years," Klein calculates. Therefore, it makes sense "to offer our entire portfolio on site – from development services to local just-in-sequence delivery."

Volkswagen, for its part, recently created a new brand, Jetta, especially for the Chinese market, which is primarily intended to appeal to spending-conscious new customers. For the market launch in autumn, a sedan and two SUV are initially planned.

But China is not just a major customer and sales market. China is also becoming more and more the driving force. For example, Bosch recently developed a warning system for approaching electric scooters with Great Wall Motors for its Chinese customers. "We could imagine that other customers and other countries would be interested in this solution," says Feng. After all, many countries know the problem, only with other vehicles.

It will be seen, however, whether it will remain so easy to attract talented staff. Klein self-critically admits that ZF is not always the first choice of university graduates who could also start at Google or Tencent. There are also competitors from the Chinese start-up scene.

. (tagsToTranslate) Company (t) VW (t) Volkswagen (t) China (t) Car Market (t) ZF (t) Foreign Investment (t) Foreign Investment by Country (t) Foreign Trade (t) Innovation (t) Foreign Trade by Land ( t) Location (s) Robert Bosch (t) Formula One (t) Tencent Holdings (t) Great Wall Engine (t) Alibaba (t) Baidu.com (t) Audi (t) Google (t) Herbert Diess (t) automobile parts (t) automotive

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