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- 1.2M NEVs sold in Nov 🚗 Foreign hospitals enter China 🏥 Building 65% of global ships 🚢
1.2M NEVs sold in Nov 🚗 Foreign hospitals enter China 🏥 Building 65% of global ships 🚢
China Insights Weekly for December 9, 2024. Unpacking China’s Economic and Technological Advances.
Yereth Jansen & Tomas Kucera
December 09, 2024
Welcome back to this week’s edition of the China Insights Weekly Newsletter!
From record-breaking achievements in tech and sustainability to transformative collaborations and booming industries, here are the highlights:
BYD powers Japan’s critical infrastructure: EVs with V2H tech ready to supply electricity during emergencies.
Pharma giants invest $3.15B in China: Western companies tap into China’s rising biotech innovations.
65% of global ship orders: China dominates with a massive lead in the shipbuilding sector.
Xiaomi embraces CarPlay: Integrates Apple tech to expand its EV footprint internationally.
And don’t miss updates on China’s new solar milestones, its burgeoning ski industry, and major expos happening this month. Scroll down for more!
🚀 Headlines
China's new energy vehicle (NEV) retail sales reached 1.268 million units in November, marking a 50.5% increase from the previous year and a 5.9% increase from October. This is the fourth consecutive month that NEV retail sales have surpassed the 1 million mark. Battery electric vehicles (BEVs) accounted for 59.8% of NEV sales, while plug-in hybrid electric vehicles (PHEVs) and extended-range electric vehicles (EREVs) contributed 30.7% and 9.5%, respectively. The overall NEV penetration rate was 52.3%, down from October's 52.9%. NEV penetration declined for the third consecutive month due to faster growth in gasoline vehicle sales. China's total passenger car sales, including sedans, SUVs, and MPVs, reached 2.423 million units, up 16.5% year-on-year and 7.1% from October.
China’s BYD struck a deal with the Japanese government to power critical infrastructure with EVs (link)
BYD Japan announced that 10 of its sales outlets across the country had signed cooperation agreements with the Japanese local governments to use its pure electric vehicles to power shelters, hospitals, and other facilities to maintain the operation of critical infrastructure in the event of a natural disaster. BYD’s pure electric vehicles have a “Vehicle to Home” (V2H) function that can be used as a power source to power homes or businesses in an emergency. For example, the BYD Atto 3 can provide a household with about 4 days of electricity. From January to September this year, BYD’s car sales in Japan were 1,742 units, a 96.6% increase compared to last year. Japan imported only 10,785 pure electric cars out of 113,887 total vehicles imported.
Western pharma giants bet big on China’s biotech with USD 3.15 billion in deals in 2024 as Chinese drug discoveries rise (link)
Pharmaceutical dealmaking between China and the West remains a bright spot, with seven major pharma companies licensing or acquiring Chinese-originated drug molecules this year, spending at least USD 3.15 billion in upfront cash and equity. China's growing role in global asset licensing activities has tripled over the last six years, reaching 12% of overall deals in 2023-24. China has emerged as a key source of novel therapies. Its biotechnology sector is the source of 23% of drug candidates in development globally. So far 5 drugs from China have been approved by the US Food and Drug Administration, three of them in 2023. These include Brukinsa, a treatment for blood cancer, and Carvykti, a cell therapy used to treat multiple myeloma, which has beaten competitors in clinical efficacy or sales.
China has announced a plan to permit wholly foreign-owned hospitals in eight major cities and one province to attract overseas investment and enhance healthcare services. The National Health Commission's plan, issued on November 29, designates Beijing, Fuzhou, Guangzhou, Nanjing, Shanghai, Shenzhen, Suzhou, Tianjin, and a Hainan province as trial areas. The initiative covers general, specialty, and rehabilitation hospitals but excludes traditional Chinese medicine hospitals and public hospital acquisitions by foreign entities. China had over 38,000 hospitals last year, with public hospitals comprising less than one-third but handling nearly 84% of all patient consultations. Foreign-owned hospitals can differentiate their services to facilitate access for foreign nationals and attract affluent domestic patients seeking advanced treatments.
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China’s combined orderbook for merchant ships has grown by a remarkable 170% this decade, stretching its lead over its nearest shipbuilding rivals. Chinese shipyards dominate the sector like no other nation has been able to for generations. China has emerged as a market leader, commanding nearly 65% of global shipbuilding orders, an impressive rise considering the less than 10% share in 2000. Meanwhile, the combined orderbook share of Japan and South Korea has declined from 78% to 31% over the same period. As of November 2024, the Chinese shipbuilding order book counts 3,256 vessels of 224m dwt total carrying capacity, marking a 37% increase from 2023 and a 72% rise from 2022, with the global order book increasing by 21% since 2023.
Xiaomi integrates Apple within its EV car ecosystem in a planned international expansion strategy (link)
Xiaomi is accelerating its entry into the electric vehicle (EV) market with a strategic focus on integrating Apple's CarPlay platform, aiming to appeal to a significant segment of international buyers. This move aligns with global EV market demands for seamless smartphone-to-car integration, as 80% of new car buyers consider platforms like CarPlay essential. In China, Xiaomi's SU7 sedan has gained popularity, with over half of domestic orders coming from iPhone users. The company is also developing its proprietary HyperOS to attract non-Apple users, aiming to provide a seamless experience across ecosystems. Since its launch in March, Xiaomi has ramped up SU7 production, delivering over 20,000 vehicles in October alone, contributing to a cumulative delivery target of 100,000 units within 230 days. The EV segment generated RMB 9.7 billion (USD 1.4 billion) in Q3 2024, with gross profit margins rising to 17.1% from 15.4% in the previous quarter.
China is on track to break another solar capacity growth record, with new installations expected to reach between 230 and 260 GW this year, surpassing the previous record of 217 gigawatts set in 2023. This significant growth increase is supported by utility-scale solar development in deserts, rooftop solar expansion, and grid improvements, which help reduce wasted solar power. However, excess stock and overcapacity have driven component prices to record lows, causing billions in losses for manufacturers. In response, the Chinese government has tightened investment criteria for solar component manufacturing to a 30% minimum capital ratio, up from 20%, to address oversupply. Since 2017, China's solar capacity has grown at a compound annual rate of 25%, leading the global supply chain and capacity.
In the 2023/24 season, China saw 30 new resorts built, with 15 indoor and 15 outdoor. The total number of ski resorts in China rose to 719. That's the most in any country on the planet. There are 60 indoor ski resorts in China. Indoor resorts alone generated 4.88 million skier visits, a 33.7% increase from the previous year, and accounted for 21.14% of total skier visits in China. China also saw a large increase in participants in the sport. 12.8 million took part in some amount of skiing, a 14.49% increase compared to the previous year. The number of ski areas in China with aerial tramways accounts for 24.48% of resorts but for 60.35% of all skier visits. A vertical drop of more than 300 meters (984 feet) generated 51.07% more visits than the previous year.
📸 China Snapshot
Shanghai’s Christkindlmarkt brings the charm of a traditional German Christmas market to Yuanmingyuan Road, next to The Rockbund and The Peninsula Hotel. Set between the historic Union Church and Shanghai’s skyline, it features over 40 wooden stalls offering festive treats, gifts, and decorations. With sold-out crowds and activities like Santa visits, this cozy market has become a highlight of Shanghai’s holiday season.
🎁 Bonus Stories
China has activated the world's most advanced hypergravity facility, the Centrifugal Hypergravity and Interdisciplinary Experiment Facility (CHIEF), located in Hangzhou, Zhejiang province. CHIEF features the largest hypergravity centrifuge, capable of producing forces up to 1,900 times Earth's gravity, surpassing the US Army Corps of Engineers facility with a capacity of 1,200 g-t. The facility includes three primary hypergravity centrifuges and 18 onboard units, designed to create extreme conditions for multidisciplinary research. CHIEF aims to address complex engineering challenges and advance research in geological processes, material behaviors, and engineering applications. The project represents a major national investment of over 2 billion yuan ($276.5 million) and is listed in China’s 13th Five-Year Plan as one of ten key scientific infrastructures.
China has completed a 46-year project to create a 3,000 km "green belt" of trees around its largest desert, the Taklamakan, as part of national efforts to combat desertification and reduce sandstorms. The initiative, known as the "Three-North Shelterbelt" or Great Green Wall, began in 1978 and has involved planting over 30 million hectares of trees. This effort has increased China's total forest coverage to over 25%, up from 10% in 1949. In Xinjiang, forest coverage has risen from 1% to 5% over the last 40 years. Despite these efforts, 26.8% of China's land is still classified as desertified, a slight decrease from 27.2% a decade ago. China plans to continue planting vegetation along the Taklamakan's edge to ensure desertification remains in check.
📆 Upcoming China Expos
AquaTech China 2024: Dec 11–13, Shanghai (www.aquatechtrade.com)
Interclean China 2024: Dec 11–13, Shanghai (www.intercleanshow.com)
HOTELEX Shenzhen 2024: Dec 12–14, Shenzhen (www.hotelex.cn)
China (Shanghai) International Casting Exhibition 2024: Dec 18–20, Shanghai (www.foundry-exhibition.com)
International Advanced Rail Transit Exhibition 2024: Dec 18–20, Shanghai (en.artsexpo.cn)
World Cafe Expo Shanghai 2024: Dec 20–22, Shanghai (en.cafeex.com.cn)
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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.
We hope to see you again next week!
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