European Tier 1 Suppliers in China

Bosch, Continental, ZF, Faurecia, Schaeffler

2022/04/27

Summary
Bosch: Promoting alliances and R&D with local Chinese companies in the fields of autonomous driving and hydrogen energy
Continental: Establishes autonomous driving JV with Horizon and increases production capacity of electrification products in China
ZF: Accelerating intelligence in the commercial vehicle sector, aiming to locally produce electric powertrain systems, etc.
Faurecia: Received order for hydrogen tanks for SAIC commercial vehicles, expanding into the field of hydrogen energy
Schaeffler: Investing in power semiconductor companies to promote the development of fuel cells

Summary

First order for HPC (High Performance Computer) units from a major Chinese automaker
(Source: Continental Group official website)

The COVID-19 pandemic continued in its severity worldwide in 2021. Furthermore, despite the ongoing shortage of semiconductors at home and abroad, the automotive, industrial technology, and consumer goods sectors of the Chinese market are recovering rapidly, and the Chinese automobile market in 2021 exhibited an optimistic upward trend. According to the China Association of Automobile Manufacturers (CAAM), new vehicle sales in China in 2021 were up 3.8% year-on-year (y/y) to 26,275,000 units, with passenger car sales up 6.5% to 21,482,000 units and commercial vehicle sales (excluding buses) down 6.6% to 4,793,000 units. Of this total, NEV (new energy vehicle) sales were up 157.5% y/y to 3,521,000 units. Furthermore, China’s total sales volume in 2022 is projected to be 27.5 million units.

Despite challenges due to COVID and semiconductor supply shortages, European Tier 1 suppliers continue to aggressively develop their presence in the Chinese market. Robert Bosch GmbH (Bosch) has partnered with Hycan Automobile Technology Co., Ltd. (Hycan), a joint venture between Guangzhou Automobile Group Co., Ltd. (GAC) and NIO, Inc., as well as Black Sesame Technologies Co., Ltd. (Black Sesame), which develops AI chips in the field of autonomous driving. Regarding electrification, Bosch is jointly developing hydrogen energy-related products with China FAW Group Co., Ltd. (China FAW) and Qingling Motors (Group) Co., Ltd. (Qingling Motors). Continental AG formed a joint venture with AI (artificial intelligence) chip specialist Horizon Robotics to focus on developing total software and hardware solutions for advanced driver assistance systems (ADAS) and autonomous driving, and established a software development center in Chongqing. It is supporting the development of innovative driver assistance systems. ZF Friedrichshafen AG (ZF) has signed a strategic cooperation agreement with automotive intelligent vision system developer CalmCar to jointly develop cost-effective automated parking assist (APA) and automatic valet parking (AVP) systems. The company also announced the signing of a Memorandum of Understanding (MOU) for a partnership between its Commercial Vehicle Control Systems business unit and the innovative self-driving startup Pony.ai. Faurecia SE has completed the acquisition process of China's leading hydrogen tank manufacturer Shenyang Gas Cylinder Safety Technology Co., Ltd. Also, Schaeffler Technologies AG & Co. KG (Schaeffler) has entered into a partnership with Leadrive Technology (Shanghai) Co. Ltd., a power semiconductor company, in the field of NEV electric drive systems.

This report summarizes the main trends of European Tier 1 suppliers Bosch, Continental, ZF, Faurecia, and Schaeffler regarding autonomous driving, electrification, and intelligentization in the Chinese market. (Target period: January 2021 to March 2022)

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