According to a survey by the European Union Chamber of Commerce in China, nearly one-third of European companies are onshoring further in China, while 37% have not altered their supply chain strategies in the past two years. The survey, which included nearly 300 members familiar with their companies' operations, revealed that 68% are either maintaining or expanding their presence in China.
In stark contrast, only 7% are relocating manufacturing outside of China. Jens Eskelund, President of the EU Chamber, noted that this trend suggests a growing dependency on China for sourcing and manufacturing. Despite ongoing scrutiny of China's trade practices by the European Commission, China remains a critical player, accounting for approximately 28% of global goods manufacturing.
The survey also highlighted that cost efficiency, driven by low labor costs and increasing automation, is a key factor for European companies. Denis Depoux from Roland Berger emphasized that automation is rapidly transforming production capabilities, allowing factories to operate more efficiently.
For instance, Nio, a Chinese electric vehicle manufacturer, utilizes 941 robots in one of its factories, enabling continuous operation without human workers.
The findings suggest that European companies are recognizing the competitive advantages of Chinese supply chains, which include lower industrial energy prices and effective supplier negotiations, making it essential for them to integrate into these networks to compete effectively