Vitesco electrifies China market with investments, big plans
Considering China as a major market, German automotive supplier Vitesco Technologies has been a big investor in the country, especially in electrification solutions.
The company, as a global supplier of modern drive systems and electrification solutions for sustainable mobility, has set great store by the Chinese market.
"It is a super-large market," said Grégoire Cuny, CEO of Vitesco Technologies China. "We forecast that by 2030, more than 35 percent of the total world vehicle production will be in China.
"And for us it's a very important market. Since 2021, 18 percent of Vitesco Technologies' sales have been in the country. Therefore, our first intention is to grow together, and even, if we can, faster than the market.
"Many players are interested (in China's new energy market) and what we're doing is investing heavily."
He noted that in the past three years, the company has invested more than 500 million euros (US$544.20 million) in the Chinese market purely for electrification, citing the establishment of a new research and development center in Tianjin City as an example.
Cuny also noted a significant change: "We used to develop solutions more from the rest of the world and bring them to China, while now it's more the opposite."
"We develop many things first here and put into production first here, and then take them to the rest of the world. This definitely has changed."
That was also a reason why the firm set up an R&D center in north China's Tianjin – in order to have more local engineers to support the innovation that is needed around electrification.
The German company on Thursday released its global fiscal year report for 2022, showing its consolidated sales increasing by 4 percent to 9.07 billion euros. It was also a record year with its electrification products accounting for around 75 percent of order intake.
The sales of electrification components amounted to around 1.1 billion euros, with the Electrification Technology business unit registering the strongest organic growth in sales, surging 17.6 percent to 691.9 million euros.
"This was driven by strong demand, particularly from China and Germany, for high-voltage electric drives and power electronics," the report pointed out.
Expecting the recovery in the international vehicle market to continue, Vitesco believes that Europe and North America will see the strongest increase in the production volume of passenger cars and light commercial vehicles in 2023, with a range of 5 to 7 percent. The company expects the rise in production volume in China to be between 1 and 3 percent.
Based on the rising production figures and the supporting trends provided by the transition to electric vehicles, the company expects to generate group sales to the tune of 9.2 billion euros to 9.7 billion euros in fiscal year 2023.