China is an important market for the German automotive industry in particular, as was made clear at the 7th Sino-German Automotive Congress in October 2023, which was attended by an 80-strong delegation from Germany. In addition to companies, trade associations, government and business development organizations, industry experts, the Automotive Cluster also accompanied the delegation, which included cluster partners and other companies from Bavaria.
The success story of our cluster partner ZD Automotive is a particularly pleasing example of German-Chinese cooperation. The technology company is one of the most important development partners in the automotive industry and serves international OEMs as well as Tier 1 suppliers with first-class products and services.
In our interview with founder Qiang ZHOU, we talked about the development of ZD Automotive with a total of four locations in China and a development center in Ingolstadt and gained exciting insights into the successful cooperation with the ZD-Uni Innopark in Nanjing.
ZD Automotive was founded in 2012. What drove you to found the company back then?
Qiang ZHOU: "The founding of ZD Automotive was driven by a deep passion for the automotive industry and the pursuit of technological innovation. Our goal was to revolutionize the industry with advanced R&E technologies and increase the efficiency of our customers' development processes to achieve global success."
Why did you decide to run your company in two countries, China and Germany?
Qiang ZHOU: "The decision to establish the company in both countries was based on the conviction that this is the best strategy for long-term success: China offers an enormous sales market with innovative developments, especially in the field of autonomous driving, while Germany is known for its engineering expertise and quality in the automotive industry. By combining both locations, we have not only been able to better serve local needs, but also create synergies that have made us more competitive on a global level. This allows us to continuously improve our products in order to offer efficient and innovative solutions worldwide."
What advice would you give to German companies that are interested in the Chinese market but don't know how and where to start?
Qiang ZHOU: "Cooperation with local experts is crucial. Trust and understanding of the local culture are key factors. It is advisable to build local partnerships and invest in relationships. You should also react flexibly to the market and be open to adjustments. The Chinese market is dynamic and changes quickly, so agility is a success factor."
What prerequisites should a German company have in order to be successful in China?
Qiang ZHOU: "Comprehensive market research is essential. Companies need to understand the needs of Chinese customers and adapt to local trends. In addition, it is necessary for companies to respond flexibly and adapt quickly to frequently changing customer requirements. The price-performance ratio is of great importance to Chinese customers. Although German companies have an advantage due to their high quality standards, they must optimize their costs in order to remain competitive."
Are there certain trends where you see particularly good opportunities for German companies in China?
Qiang ZHOU: "Electromobility is undoubtedly an up-and-coming market in China. I see enormous potential for German companies that offer innovative solutions in this area. The prospects for 'connected vehicles' and 'autonomous driving' are also very promising. China is investing heavily in these technologies and German companies with the relevant expertise can benefit from this. The integration of sustainability aspects into products and business models is also a trend that is becoming increasingly important."
The example of our cluster partner clearly shows that cooperation between different markets not only opens up sales opportunities, but also the chance to learn from each other and grow together.
Companies from Bavaria and Germany should seize this opportunity and see the increasing competitiveness of Chinese companies as a chance for fruitful cooperation. ZD can impart valuable knowledge here through its special bridging function and be a competent contact for our network in order to take the first tentative steps towards China.
TUM International visits ZD Automotive in Großmehring near Ingolstadt (from left to right: Dr. Liu LIU, Qiang ZHOU, Friederike Hettinger, Stella Neuhofen, Meibin Han)
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