BYD automaker grows workforce by 200K 🚗 Temu tops eBay in traffic 🛍️ China accelerates push for EUV chip independence 🔧

2024-09-16 | subscribe | homepage

Happy mid-autumn festival! Welcome back to this week’s edition of the China Insights Weekly Newsletter!

Some of the key takeaways this week:

• 9% Export Growth: China’s exports surged by 9% in August, reaching a two-year high.

• Temu’s Rise: Temu surpasses eBay to become the second most-visited e-commerce site worldwide.

• $2,800 Trifold Phone: Huawei launched a groundbreaking $2,800 trifold phone, taking on Apple’s premium market.

• BYD’s Workforce Boom: BYD now employs over 900,000, adding 200,000 workers this year alone.

Dive deeper into these stories and more by clicking the headlines below. We value your feedback—let us know your thoughts or suggestions on LinkedIn, X or Facebook.

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🚀 Headlines

China's exports grew by 9% in August, reached highest value in 2 years (link)

China exports grew by 8.7% from a year ago to USD309 billion in August, reaching their highest value in 2 years, while imports rose by just 0.5%. In July, exports rose by 7%, while imports were up by 7.2%. China's exports to its major trading partners — the U.S., European Union, and Association of Southeast Asian Nations (ASEAN) — all rose in August. Exports to the EU grew the most, up by 13%. China's imports from the US rose by 12%, from ASEAN by 5% and from the EU fell. China's imports from Russia fell by 1%, while exports rose by 10%. China's exports of cars rose by nearly 40%, ship vessels rose by 40%, and smartphones climbed by 6.7%. The value of integrated circuits exports rose by 18%, while imports increased by 11%. The volume of China's rare earths exports fell by 1%, while imports declined by 12%. China's imports of crude oil fell 7% in volume in August.

Temu surpassed eBay as No. 2 most-visited e-commerce site in the world (link)

PDD’s Temu has overtaken eBay as the world’s second most-visited e-commerce website, just two years after its initial launch in September 2022. The budget-focused retailer has seen explosive growth with a rapid expansion path into over 70 countries. According to the figures, Temu gets nearly 700 million visits per month via its website portal, with a quarter of those visits coming from the United States, putting Temu behind the top-ranked Amazon which has 2.7 billion monthly visits, almost all from US users. The China-linked retailer has reportedly set a USD60 billion sales goal for this year. Alibaba’s Ali Express is ranked 4th on the e-commerce website list.

Alibaba’s Taobao shopping app launched AI-powered English version in Singapore, jumped to #1 in Apple’s App Store (link)

On Wednesday, September 11th, Taobao topped Singapore’s App Store charts across all categories after launching an AI-powered English version a day earlier, enhancing accessibility for non-Chinese users. Singapore and Malaysia are the first markets to offer this update. The new platform enhances accessibility for non-Chinese users, eliminating their need for manual translations that previously made shopping less convenient for them. The new version can convert prices from yuan to the Singapore dollar, and product descriptions are also available in English. Taobao and Tmall Group’s revenue for the quarter ended June 30 was 26.55 billion yuan (USD3.65 billion), a 6% increase year-on-year.

Huawei launched a revolutionary USD2,800 trifold phone hours after Apple debuted iPhone 16 (link)

China’s top smartphone maker Huawei unveiled the world’s first tri-fold mobile phone. The Mate XT received over 4 million preorders and will launch in stores on September 20, 2024, with prices starting at over USD2,800. The move marks Huawei’s attempts to snatch the premium smartphone market share of Apple’s iPhone. The Mate XT features advanced artificial intelligence capabilities such as text translation and cloud-based content creation, which came after five years of development. The phone can display content on a single, double, or triple screen. Its battery is 1.9 millimeters thick. The Mate XT also works with a foldable keyboard. Huawei ranked fourth by market share in the Chinese smartphone market in 2nd quarter. Apple fell out of the list of top five smartphone vendors.

BYD employs most employees in China, added 200,000 more in 2024, building R&D center for 60,000 engineers (link, link)

On September 13th, 2024, the number of BYD employees exceeded 900,000. This is an increase of 200,000 this year alone. BYD recruited nearly 50,000 fresh college students in the past two years. BYD’s workforce is higher than any of the more than 5,300 Chinese A-share listed companies and 400,000 more than the second-place company. Of BYD's total workforce, nearly 110,000 are in technical research and development, making it the automaker with the largest R&D staff in the world. BYD Group's businesses include automobiles, batteries, consumer electronics assembly, and rail transportation, with the automotive business comprising brands including BYD, Denza, Fang Cheng Bao, and Yangwang. BYD is building USD2.8 billion 3.3 million square meter (35.6 million square feet) global R&D center in Shenzhen. The nine-building center will house 60,000 engineers.

China's SMEE files patent for an EUV chipmaking tool aiming to break export restrictions on the ASML tools (link)

Dutch firm ASML, the world's only maker of EUV lithography chipmaking tools, has never shipped an EUV tool to its Chinese customers due to export restrictions. Last week it was revealed that Shanghai Microelectronics Equipment (SMEE) had in March 2023 applied for a patent covering an EUV lithography machine, used to make chips on advanced process technologies less than 10nm. SMEE is attempting to patent the key set of components of an EUV tool: a laser-produced plasma (LPP) EUV source. SMEE is China's leading producer of lithography equipment. The company supplies customers with its most advanced tool, the SSX600, which can be used to make chips as small as 90nm. Last year, the company said it was on track to demonstrate a 28nm-capable system, though it is unclear whether it started mass production. SMEE is not the only company in China that has filed a patent on EUV lithography. Huawei filed an EUV system-related patent in China back in 2022.

China’s LandSpace scores breakthrough in reusable rocket technology (link)

LandSpace Technology has successfully carried out the first vertical takeoff and landing test of a reusable rocket developed by a private Chinese aerospace firm. It is a technological breakthrough for China that positions it to compete with Elon Musk’s SpaceX. The Zhuque-3 rocket test included an ascent to 10 kilometers, engine shutdown, power-off glide, in-flight engine restart, and a landing back at the Jiuquan Satellite Launch Center in northwestern China. China's first successful reusable rocket's vertical takeoff and landing test to 10 km was conducted in June by state-owned China Aerospace Science and Technology Corporation. LandSpace’s Zhuque-3 is expected to complete its official maiden flight next year and achieve full operability by 2026. The technology opens the way to high-capacity, low-cost, high-frequency, and reusable rocket launches.

China to raise the retirement age for the first time since 1978 (link)

Starting next year, China will raise its retirement age for workers, which is now among the youngest in the world’s major economies, to address its shrinking population and aging workforce. The policy change will be carried out over 15 years, with the retirement age for men raised to 63 years, and for women to 55 or 58 years depending on their jobs. The current retirement age is 60 for men and 50 for women in blue-collar jobs and 55 for women doing white-collar work. The previous retirement ages were set in the 1950s when life expectancy was only around 40 years. China’s life expectancy reached 78.2 years in 2021. The China dependency ratio, which counts the number of people over the age of 65 compared to the number of workers under 65, was 21.8% in 2022, meaning that roughly five workers would support one retiree.

🎁 Bonus Stories

China connected world’s largest flywheel energy storage system with 30 MW output to grid (link)

China has connected its first and the world’s largest 30-megawatt (MW) flywheel energy storage system (FESS) to the grid in Shanxi province. The Dinglun flywheel energy storage power station, costing USD48 million, uses 120 advanced magnetic levitation flywheel units and a semi-buried underground system for safe operation and maintenance. This setup, with 12 energy storage units, efficiently stores energy in a vacuum and low-friction conditions, enough to power over 2,000 households annually. The station will stabilize the local grid and support renewable energy integration.

Flywheel energy storage works by spinning a large wheel at high speeds, storing energy as rotational kinetic energy. When electricity is needed, the wheel’s speed is reduced, converting the kinetic energy into electrical power. This system provides rapid energy storage and release, offering higher efficiency and power density compared to other systems. Unlike Li-ion batteries, flywheels have longer life spans (20-30 years) and lower environmental impact, as they use no chemicals or toxic metals.

Beijing's inbound arrivals are now more than pre-Covid, with more Russians and fewer Americans, the city is 1st to allow foreign cards for transit (link)

The number of inbound travelers to the Chinese capital in recent months has exceeded pre-pandemic levels, with more arrivals now coming from Asia and Russia, and fewer from the US. Beijing received 379,300 and 336,900 inbound travelers in June and July this year. Beijing also become the first city on the Chinese mainland to support contactless fare payments in rail transit for foreign MasterCard and Visa card holders. Beijing has upgraded more than 20,000 sets of facilities at subway stations of its rail transit system to facilitate the new payment initiative, which supplements current payment methods such as UnionPay cards and QR codes.

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