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- Open-sea floating solar ☀️ China to hit $1T trade surplus 📦 Peru opens mega port 🚢
Open-sea floating solar ☀️ China to hit $1T trade surplus 📦 Peru opens mega port 🚢
China Insights Weekly for November 18, 2024. Unpacking China’s Economic and Technological Advances.
Welcome back to this week’s edition of the China Insights Weekly Newsletter!
China’s continues to make headlines. Here are some of the key takeaways in this week’s edition:
China’s $1 Trillion Trade Surplus? 2024 exports up 16%, surplus at $785B in 10 months.
BYD Tops Ford in Sales, as Toyota plans to double production in China to 3M cars annually by 2030.
10M NEVs Produced: China hits record, targeting 12M units by year-end.
Flying Cars in Thailand by 2025? EHang tests solid-state batteries, aims for commercial flights.
BioNTech Invests $800M: Buys Biotheus to expand oncology R&D in China.
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.
🚀 Headlines
China's trade surplus is projected to reach a record USD 1 trillion this year. The trade surplus for the first 10 months of 2024 stood at USD 785 billion, a 16% increase from 2023, marking the highest level for that period on record. The result in October was the third-widest surplus in history, coming just below June’s record. This has been attributed to China's increasing reliance on exports due to weak domestic demand and a significant drop in export prices leading to substantial volume growth. The surplus with the US has risen by 4.4% year-on-year, while it increased by 9.6% with the EU and jumped 36% with ASEAN nations. China now exports more goods to almost 170 countries and economies than it buys from them, the most since 2021.
In a first, BYD to topple Ford on deliveries, Toyota to double production and build 3 million cars in China (link, link)
Chinese automaker BYD is on track to surpass Ford in annual shipments, a significant milestone as Ford is ranked 7th globally. In October, BYD sold 534,003 vehicles, nearly matching Ford's year-to-date sales. Ford's global sales have averaged around 1.1 million vehicles per quarter for the past three periods. In Q3, BYD delivered 1.13 million vehicles, outselling Ford by 40,000 units. BYD's annual delivery target is 4 million vehicles, a goal that would see it overtake Ford. BYD has topped Tesla on quarterly revenue as well. BYD continues to expand, it increased production capacity by nearly 200,000 units from August to October.
Japan’s Toyota aims to nearly double its vehicle production in China to 3 million units annually by 2030, up from 1.75 million last year. This strategy is part of Toyota's response to increasing competition from domestic brands like BYD. The company plans to consolidate its two Chinese joint ventures to enhance efficiency and empower local teams to lead development, leveraging their understanding of Chinese consumer preferences.
China has reached a significant milestone in new energy vehicle (NEV) production, surpassing 10 million units year-to-date for the first time. This marks a substantial increase from the 18,000 units produced in 2013, the first year NEV production was recorded. By 2018, China's annual NEV production reached one million units, and by 2022, it exceeded five million units. With over a month left in 2024, the current NEV production of 9.77 million units is already up 4.3% from last year's total of 9.59 million. Experts anticipate that by year-end, production could exceed 12 million units. In October alone, NEV production reached 1.46 million units, a 47.93% increase year-on-year. Battery electric vehicle (BEV) production for the January-October period stood at 5.86 million units, up 14.06% year-on-year, while plug-in hybrid electric vehicle (PHEV) production reached 3.91 million units, marking an 80.73% year-on-year increase.
German biotechnology company BioNTech has agreed to acquire Chinese biopharmaceutical firm Biotheus for USD 800 million, with additional milestone payments of up to USD 150 million. The acquisition will grant BioNTech access to Biotheus's pipeline of drug candidates and its bispecific antibody drug development platform, expanding BioNTech's presence in China. Biotheus Zhuhai will become BioNTech's R&D center in China, with over 300 Biotheus staff joining BioNTech. BioNTech's Nantong production site is expected to contribute to the global production and supply of BioNTech's products. Founded in 2018, Biotheus focuses on cell therapy technology and R&D of new antibody and anti-cancer drugs. This move follows BioNTech's recent partnerships with Chinese biopharma companies in the field of antibody-drug conjugates for cancer treatment.
Beijing-based AI startup Shengshu Technology has launched a new feature for its text-to-video tool, Vidu, which can now generate videos by combining multiple images, challenging OpenAI's Sora. Vidu allows users to create 8-second clips from written prompts and can integrate three unique images with visual consistency into an AI-generated video. This breakthrough focuses on solving the issue of visual consistency in AI-generated videos. The tool has already gained traction, with monthly usage rates per customer ranging from 100,000 yuan to 1 million yuan. Vidu has taken measures to address copyright issues, such as signing deals with artists for style imitation and banning the use of images of celebrities or sensitive individuals. The AI video generator is powered by rented cloud servers in China and abroad and is backed by investors including Baidu Ventures and Ant Group (Alibaba).
China’s EHang aims for commercial solid-state battery production, and commercial operation of autonomous electric flying vehicles in 2025 (link, link)
EHang, a leading Chinese electric vertical takeoff and landing (eVTOL) developer has launched a new Urban Air Mobility (UAM) hub in Hefei, Anhui Province, China. Additionally, EHang has completed the first-ever flight test of an eVTOL powered by solid-state batteries. The EH216-S model completed a 48-minute flight, showcasing the potential for increased endurance of 60-90% with solid-state batteries compared to traditional liquid lithium batteries. It aims for certification and mass production by the end of 2025. This technology is expected to increase the EH216-S's flight time by 25% to 60 minutes by 2025.
The EH216-S model also completed its inaugural passenger flights in Thailand. It already achieved over 50,000 flights. EHang aims to launch commercial operations in Phuket and Koh Samui by 2025. The EH216-S, a fully autonomous, two-seater eVTOL, has three airworthiness certificates from the Civil Aviation Administration of China and is capable of a cruise speed of 100km/h and a maximum speed of 130km/h, with a limited range of 18.6 miles (30km) and a flight time of approximately 25 minutes. The aircraft is priced at USD 410,000.
China is on track to reach record oil production levels, with a projected increase to 4.5 million barrels per day by 2025, up from the current 4.3 million, according to the International Energy Agency. This strategic push for energy security comes despite China's daily oil consumption being around 15 million barrels. Increased domestic production will come to 28.6% of total consumption. A standout project is the Bohai oil field, China's largest offshore site, which produced over 733,000 barrels per day in 2023, accounting for about a sixth of the country's total daily output. China National Offshore Oil Corporation (CNOOC) operates the field. In 2022, it discovered the Bozhong 26-6 oil field, the largest in metamorphic rock, with reserves exceeding 1.3 billion barrels. These developments highlight China's efforts to bolster domestic oil production and enhance energy independence.
China Energy Investment Corporation (CHN Energy), has completed the world's largest open-sea floating solar PV project in Shandong Province, China. The 1GW facility, connected to the grid, spans approximately 1,223 hectares and features 2,934 solar PV platforms installed on large-scale offshore steel truss platform fixed pile foundations. Located 8km off the coast of Dongying City, adjacent to the Bohai Sea, the project includes a 66kV offshore cable paired with an onshore cable, a first for the Chinese market. The project is expected to generate 1.78 billion kilowatt-hours of electricity annually, enough to power 2.67 million homes. It also employs an integrated fishing and solar PV development model, combining fish farming with power generation to enhance marine area utilization. This milestone underscores China's strategic focus on offshore PV systems as part of its clean energy strategy.
📸 China Snapshot
Dongying, located in the north of Shandong Province, became the focal point for a landmark cultural tourism event last weekend. At the “Where the Yellow River Meets the Sea” Cultural Tourism Promotion Conference, China Insights co-founder Yereth Jansen delivered a keynote speech on “Yellow River Tourism: A Global Perspective and Roadmap to International Appeal,” highlighting opportunities to draw inspiration from world-renowned river destinations like the Mekong and the Nile.
The Yellow River, stretching over 5,464 kilometers, flows through nine provinces and is the cradle of Chinese civilization. Known as the “Mother River,” it reportedly supports a population of over 400 million and irrigates 15% of the country’s farmland. Along its course, it passes through iconic landmarks like Qinghai’s serene lakes, the ancient Hukou Waterfall in Shaanxi, and the historic cities of Luoyang and Zhengzhou. As the river meets the sea in Dongying, its legacy continues to inspire efforts to blend ecological preservation with cultural tourism, shaping its future as a global destination.
🎁 Bonus Stories
The United Nations World Tourism Organization (UN Tourism) has recognized seven Chinese villages as "Best Tourism Villages" for the year, increasing the total number of Chinese villages with this honor to 15, the highest count for any country. The villages—Azheke in Yunnan, Guanyang in Fujian, Shibadong in Hunan, Taoping in Sichuan, Xiaogang in Anhui, Xitou in Zhejiang, and Yandunjiao in Shandong—span across eastern, central, and western China, showcasing the country's diverse geographical, cultural, and developmental achievements in rural tourism. These villages are exemplary in nurturing rural areas, preserving landscapes, cultural diversity, local values, and culinary traditions. For instance, Azheke Village in Yunnan, part of the Honghe Hani Rice Terraces UNESCO World Heritage Site, has developed a unique tourism model based on collective participation and shared prosperity.
China and Peru opened a USD 1.3 billion mega port, Brazil to upgrade infrastructure to benefit from the new trade route (link, link)
China's USD 1.3 billion investment in Peru's Chancay port, majority-owned and operated by Chinese port operator Cosco Shipping, aims to boost access to South America's agricultural resources. The port, which holds three airworthiness certificates from China, is expected to reduce travel times for cargo between China and South America by 10-12 days. Peru sees the port as a potential hub for exports to Asia, hoping to increase trade with Brazil. The success of Chancay Port is crucial for integrating South American countries and creating a direct route to Asia.
Further Chinese investments are planned to integrate the region further. Brazil’s plan includes a new road and rail system aimed at reducing the journey time of goods to Chinese ports, potentially adding one percentage point, or about USD 22 billion, to Brazil's GDP per year. This infrastructure development is part of a broader plan to move Brazil up the value chain with Beijing's help. Lula is seeking Chinese participation in four projects: domestic infrastructure, regional integration routes, clean energy transition, and industrial modernization. China has already invested USD 96 billion in the Mercosur trade bloc and plans to raise that to USD 250 billion by 2025.
📆 Upcoming China Expos
Auto Guangzhou 2024: Nov 15–24, Guangzhou (http://www.autoguangzhou.com.cn)
China International Travel Mart (CITM) 2024: Nov 22–24, Shanghai (https://www.citm.com.cn/zh_en/index.aspx)
bauma CHINA 2024: Nov 26–29, Shanghai (https://bauma-china.com/en/)
DMP - China International Plastics, Packaging & Rubber Exhibition: Nov 26–29, Shenzhen (https://www.dmpshow.com/)
INMEX China 2024: Nov 27–29, Guangzhou (https://www.inmex-china.com)
CR Expo China 2024: Nov 28–30, Beijing (https://www.crexpo.cn/en/)
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👥 About us
China Insights is brought to you by Tomas Kucera, China General Manager at Gemini Personnel in Shanghai, and Yereth Jansen, China CEO at Darling Advertising + Design in Shanghai.
Tomas and Yereth together have almost 30 years of experience working and living in China across different industries, and have a shared mission of bringing you objective insights about the world’s second largest economy.
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