German car manufacturers have seen an increase in car sales in China in last quarter. While the companies are happy that it offsets the fewer units sold in European countries amid the pandemic, they are also being cautious. A report in FT states that in last quarter, Daimler saw 23% rise in sales in China. Better known as Mercedes-Benz, Daimler is a German multinational automobile manufacturer.
The rich Chinese, who could not take foreign trips due to the Chinese coronavirus pandemic, bought luxury cars instead. While the corporates are elated, it has also raised concerns that the German industry is highly dependent on the Chinese market.
An October report in DW quotes Stefan Bratzel, head of the Center of Automotive Management (CAM) who had also said that it was only Chinese market that was currently recovering. Last year, VW had sold 40% of its vehicles in China. He says that while the Chinese market may be temporarily helping companies stay afloat, in longer term, the industry’s dependence on Chinese market makes it prone to blackmail.
