For the first time in years, Sweden’s exports to China are larger than imports. A key factor has been car exports from Gothenburg. With Geely’s acquisition of Volvo Cars in 2010, China entered West Sweden’s automotive cluster – and the next step is Geely’s planned innovation centre at Lindholmen.
In connection with Lokalmarknadsdagen in Gothenburg, arranged by Fastighetssverige, Business Region Göteborg and Lokalnytt, the relations between China and Gothenburg were discussed.
Journalist Erik Blix moderated the discussion, which included Gang Wei, vice CEO at Geely’s development company CEVT; Patrik Andersson, CEO at Business Region Göteborg; and Liu Chun, China’s Consul-General in Gothenburg.
What is it that makes the Gothenburg region so interesting for Geely and other Chinese actors?
“Gothenburg is Geely’s second home. We have great respect for the engineering expertise and talent that’s here, and we appreciate the support we have received as well as the openness in the city,” said CEVT’s deputy-CEO Gang Wei, during the panel discussion at Lokalmarknadsdagen.
“When I came here in 2013, I had a handful of colleagues at CEVT, today we are 2,200. I have lived in China and the UK, and now five years in Gothenburg – and I have become a Gothenburger,” he added.
Why is Geely investing so much in Gothenburg, when it has operations in other locations?
“From a business perspective we need to look at where we can gain the biggest return on investment. And here is both Volvo and CEVT. The expertise that exists in Gothenburg and the support we received is why Geely has invested here. We really value Lindholmen Science Park; it’s a unique place with unique expertise. In the 1700s people from Gothenburg dared to sail to China and be away from their homes for a couple of years. In my eyes it requires innovation and entrepreneurship, and I find that DNA remains today among Gothenburgers.”
Gothenburg has strong trade traditions with China that go back a few hundred years. How does that affect the current development?
“Gothenburg and Sweden were the first Western Europeans to establish diplomatic relations with China. Tradition is important,” said Consul-General Liu Chun.
Business Region Göteborg’s Patrik Andersson added:
“Everything in business – except for quality products and services – is about trust and relations, and our relationship has developed over many, many years, and especially since 2010 when Geely bought Volvo Cars.”
What can we expect in terms of future investments?
“Geely’s ambition is to be a top five car company in China within five to ten years and top ten in the world. And I believe that CEVT will play a big role in this. We are proud of what we have done in Gothenburg. When we released our new car Lynk & Co 01 in the autumn, which was developed in Gothenburg, the first 6,000 cars sold out in 137 seconds. In the future, rather than move things away from Sweden, we will contribute resources, such as Geely’s innovation centre,” says Gang Wei.
Within which areas, besides car manufacturing, can we expect Chinese establishments and investments?
“I’m a government representative and I don’t know which Chinese industries will come here, but regardless which ones, it will be a win-win situation. China is the world’s second largest economy, and many say the world’s economic motor. Things didn’t look good for Volvo Cars when Geely bought the company, but with Chinese help, it’s created new jobs and tax revenue here,” said Liu Chun.
Patrik Andersson added:
“It has undoubtedly been a win-win situation. Net exports to China have risen, at the same time Chinese firms have invested billions [SEK] within research and development in the Gothenburg region. Apart from the automotive industry, Chinese companies have also shown great interest in the life science industry. Last year, for example, Fosun Pharma became a majority owner in Breas Medical, a deal worth SEK 800 million.”
Gang Wei – is skills supply a large problem for CEVT as it is for many others?
“Yes. There is a lot of competence in Sweden of course, but there are many actors competing for it. Gothenburg is an international city, but there is a need for further efforts to attract more engineers from other countries. Housing and schools is the biggest obstacle – not the weather.”
What can the region do to better support Geely and CEVT?
“First and foremost, I appreciate the city’s support on the establishment of Geely’s innovation centre at Lindholmen. But when one talks about the innovation centre, they often talk about the technology side of things – self driving cars etcetera. I want the innovation centre to become a platform for broader collaboration and innovative thinking. And I would like support and ideas from the region on how we can develop the centre so that it also has a societal focus. For example, I would like to see that we have a library that is open to the public and that academia has premises and education programmes with us. I would also like us to have the best Chinese restaurant in town.