Ulrich Walker / Daimler Northeast Asia
Nachhaltiger Erfolg in ChinaErfahrungen eines Automobilunternehmens mit den Herausforderungen im größten Automobilmarkt
März 1, 2012
Stuttgart, Deutschland
Ulrich WalkerChairman & CEO
Daimler Northeast Asia
Daimler NEA / Corporate Office 2
Content
Daimler Business Set-up in China11
33 Indigenous Innovation for Sustainable Growth in China
44 Daimler Innovation and China Future Strategy
22 Dragon Rising: An Inside Look at China Today
Daimler NEA / Corporate Office 33
Beijing
Taiwan
Hong Kong
Fuzhou
Shenzhen
Korea
Mercedes-Benz (China) Ltd.
Equity: DAI 51% / LSH 49%
Product: MB PV wholesale
2005
Mercedes-Benz Auto Finance Ltd.
Equity: DAI 100%
Business: Financial Services
2005Daimler Northeast Asia Parts Trading & Services Co., Ltd.
Equity: DAI 100%
Business: Spare Parts Trading & Services
2008
Beijing Foton Daimler Automotive Co., Ltd.
Equity: DAI 50% / Foton 50%
Product: MHDT Auman Truck, OM457 Engine
2011
Fujian Daimler Automotive Co., Ltd.
Equity: FJMG 50% / DAI 34% / CMC 16%
Product: MB Vito/Viano, Sprinter
2007
Shenzhen BYD Daimler New Technology Co., Ltd.
Equity: DAI 50% / BYD 50%
Product: NjEV (2013)
2011
Mercedes-Benz Taiwan Ltd.
Equity: DAI 51% / LSH 49%
Product: MB PV & CV wholesale
2001
Mercedes-Benz Korea Ltd.
Equity: DAI 51% / LSH 49%
Product: MB PV wholesale
2002
Daimler Trucks Korea Ltd.
Equity: DAI 100%
Product: MB CV wholesale
2007
Daimler is the ONLY company in China that covers all automotive segments
Beijing Benz Automotive Co., Ltd.
Equity: DAI 50% / BAIC 50%
Product: MB C-Class, E-Class, GLK-Class
2005
Daimler Northeast Asia Ltd.
Equity: DAI 100%
Business: Investment Holding
2001
Equity: DAI 100%
Product: MB PV & CV wholesale
Mercedes-Benz Hong Kong Ltd.2005
Daimler Business Set-up in China11
Daimler NEA / Corporate Office 4
Growth Potential of China (Daimler Business)
� Wholesale VolumePV / Trucks / Van[in thousand units]
� Wholesale Net RevenuePV / Trucks / Van[in million EUR]
� Headcount China
CAGR
+50%
CAGR
+55%
CAGR
+28%
31
2006 … 2011
1,414
2006 … 2011
~12,850
590
2006 … 2011
~2,000
~230
Daimler Business Set-up in China11
Daimler NEA / Corporate Office 5
1S-Class & R-Class rank No.1 in
worldwide MBC ranking
200,000Another record year with sales
of almost 200,000 units in China
35Fast growing premium brand in
China with a 35% YoY growth
5,800Deliveries of around 5,800
units in China in the year 2011
91Nearly doubling sales with a 91%
growth compared to 2010
4The 4th largest market for
Daimler in 2010
5,800Deliveries of around 5,800
units in China in the year 2011
91Nearly doubling sales with a 91%
growth compared to 2010
4The 4th largest market for
Daimler in 2010
Daimler China Performance 2011
Mercedes-B
enz Trucks
Mercedes-B
enz A
uto Finance
Mercedes-Benz Cars
Mercedes-Benz Vans
1.8Portfolio increased to EUR1.8
billion in 2011
15.0MCG Penetration rate reached
15.0% in 2011
90Market coverage in close to 90
retail cities in China in 2011
Daimler Business Set-up in China11
5353 dealerships in operation by
the end of 2011
12,909Sales reached 12,909 units in
2011, a 43% growth over 2010
2China ranked No.2 for Viano in
worldwide MB Van ranking
Daimler NEA / Corporate Office 6
Key to Success: Full Commitment to China
FJDA R&D CenterAuto Shanghai 2011BDNT Business LicenseOpen MB Arena
BBAC Engine Plant€2 billion investment MB Design StudioNew C-Class Launch Sprinter SoP at FJDA China Auto Academy
VDA 6.2 Certificate Supervisory Board Visit New CLS Launch
July 2011June 2011 July 2011July 2011 August 2011 September 2011
MofCom Approval Mr. Jia Qinglin HQ Visit
September 2011September 2011 September 2011 October 2011
GLK Job#1 at BBAC
November 2011 December 2011
Sustainability Dialogue Star Fund 1st anniversary
May 2011February 2011January 2011 April 2011 May 2011 June 2011
Daimler Business Set-up in China11
Daimler NEA / Corporate Office 7
Content
Daimler Business Set-up in China11
33 Indigenous Innovation for Sustainable Growth in China
44 Daimler Innovation and China Future Strategy
22 Dragon Rising: An Inside Look at China Today
Daimler NEA / Corporate Office 8
China: History and Transformation
Dragon Rising: An Inside Look at China Today22
1949
New China Established,
Economy Started
1978
Reform & openness,
Economy transferred
1992
Market economic
Mechanism be set up
2001
Joined WTO, integrated
into the global economy
2008
Stimulus package
against financial crisis
……‘55 ‘78 ‘80 ‘85 ‘90 ‘95 ‘00 ‘05 ‘10 ‘11
61 units 149 222 443 5091,452
2,068
7,707
18,418Automotive Production Volume- in thousand units -
Source: National Bureau of Statistics of China
China Economic Growth: GDP Growth Rate (in %)
9.1
12.714.2
9.6 9.2 10.3 9.210.010.111.3
8.3
01 02 03 04 05 06 07 08 09 10 11
Daimler NEA / Corporate Office 9
China Government Intervention
9 Standing Members of the Politburo Standing Committee
(PSC) of the Communist Party of China
Sizable government subsidies(Stimulus package)
Tax exemptions & incentives
Promising Domestic Demand
Significant leaps with infrastructure
Policy formulation & changes
NDRC clustering control
Restraint of trade & investment
IPR protection / Piracy
Dragon Rising: An Inside Look at China Today22
�☺
Communist Party of China leadership faces the toughest
management task on earth
Ministries and Commissions
of the State Council
(NDRC, MofCom, MIIT, etc)
Municipalities, Provinces,
Autonomous Regions, Special
Administrative Regions
The State Council
National People's Congress (NPC)
Central Committee of the Communist Party of
China (CCCPC)
9 Members of Standing Committee&
Political Bureau of CPC Central Committee
Ministries and Commissions
of the State Council
(NDRC, MofCom, MIIT, etc)
Municipalities, Provinces,
Autonomous Regions, Special
Administrative Regions
The State Council
National People's Congress (NPC)
Central Committee of the Communist Party of
China (CCCPC)
9 Members of Standing Committee&
Political Bureau of CPC Central Committee
Daimler NEA / Corporate Office 10
124
234
427
450
505
563
9India
China
Brazil
Russia
USA
Japan
Germany
Italy
China Auto IndustryGreat potential for future growth
Regional Differences
Middle
WestEast
Source: China State Statistics Bureau
Dragon Rising: An Inside Look at China Today22
Urbanization
47.5%End of 2010
51.5%End of 2015
����
10Cities, population > 10 million
100Cities, population > 5 million
270Cities, population > 1 million
>
~
Low Car Density
Car per 1000 people
(in units, as of 2010)
990
548
295
5,949
2,554
1,348
26,005
6,016
11,670
‘90 ‘95 ‘00 ‘05 ‘10
Source: National Bureau of Statistics of China
GDP Growth in East, Middle and West
(1990 – 2010, in billion RMB)
~40
Daimler NEA / Corporate Office 1111
New Consuming Power supports Innovation
Source of Wealth
Source: Chinese snap up luxury products, China daily.com
Chinese Millionaire – A General Profile
…30% are female
…is 39 years old
…full 15 years younger
than their Western
counterparts
In 2011, according to Hu Run wealth list, the average
wealth of top 1000 entrepreneurs is 5.9 bil. RMB, up
20% from last year. Their average age is 51.
Chinese people spend…
• $7.2 bil. abroad on luxury goods during this
Spring Festival, up 29%
• RMB 14 bil. on designer handbags
• RMB 12 bil. on accessories
“ Chinese people buying high-end
products, including cell phone, is a way
of showing off their status, identity and
being noticed “
High-end products have a bright future…
China …
• has already become the largest
consuming country for Swiss watch
• has already become the second largest
luxury market worldwide
• is the world's largest mobile phone
market, and Apple's second-biggest
market
Dragon Rising: An Inside Look at China Today22
Daimler NEA / Corporate Office 12
Content
Daimler Business Set-up in China11
33 Indigenous Innovation for Sustainable Growth in China
44 Daimler Innovation and China Future Strategy
22 Dragon Rising: An Inside Look at China Today
Daimler NEA / Corporate Office 13
China Economy and DevelopmentLead the growth among major world economies in 2011
China Today:
• 975.3Mio. Cellphone Carriers;
• 513.1Mio. Internet Users;
• 149Mio. Weibo (microblog) active visitors;
• 187Mio. Online Shoppers;
• 76.4% Searches through Baidu.com.
Innovation-oriented Country:
China will embark on a new path of innovation with
Chinese characteristics, the core of which is to adhere
to innovation, seek leapfrog development in key areas,
make breakthroughs in key technologies and common
technologies to meet urgent requirements in realizing
economic and social development.
(Hu Jintao at 2006 National S&T Conference)
Informationalization in social life (till 2010):
• 975.3Mio. Cellphone Carriers;
• 513.1Mio. Internet Users;
• 149Mio. Weibo (microblog) active visitors;
• 187Mio. Online Shoppers;
• 76.4% Searches through Baidu.com.
Infrastructure related achievements (till 2010):
• 91,178 Km Railway Mileage;
• 85,000 Km Highway Mileage;
• 2,765,147 Km Total Mileage of Civil Aviation Routes;
• 6,113 Mio. Tons Coastal port cargo throughput;
• 55.89 Mio. Units Car Parc
Source: National Bureau of Statistics of China
iResearch Consulting Group
Indigenous Innovation for Sustainable Growth in China33
Daimler NEA / Corporate Office 14
Innovation Performance“Science and technology are primary productive forces”
Gross Domestic Expenditure on R&D
GERD (in billion RMB)
GERD/GDP (%)
245
300
371
462
580
706
1.321.39 1.4
1.47
1.761.7
2005 2006 2007 2008 2009 2010
State High-Tech Development Plan (863 Program)
“Independent Innovation, Focused Development”
Key Innovation Field:
1. Information technology
2. Biotechnology and medical technology
3. New materials technology
4. Advanced manufacturing technology
5. Advanced energy technology
6. Resources environment technology
7. Marine technology
8. Modern agricultural technology
9. Modern transportation technology
10.Earth observation and navigation technology
Source: The Ministry of Science and Technology of China
Indigenous Innovation for Sustainable Growth in China33
Daimler NEA / Corporate Office 15
Innovation Performance: Major Achievements
Telecommunication Technology High-speed Railway
Aerospace Science and Technology Aviation Technology
Indigenous Innovation for Sustainable Growth in China33
Daimler NEA / Corporate Office 16
China’s improving IPR landscape
Indigenous Innovation for Sustainable Growth in China33
Actual situation on the Chinese IPR landscape Future actions for a stronger IPR
landscape
+22%
+29%
In China…
•Dramatically increasing number of patent and trademark applications
•Fast increase in the number of court cases
Admitted cases YoY +25.49%
closed cases YoY +29.73%
•Foreign litigants involved cases reduced to 4.46% - it indicates that more and more Chinese sue Chinese because of IP infringement
•Newly established IPR regulations and strategies
The Chinese government ….
• gives incentives to stimulate independent innovation by Chinese enterprises
• will strengthening its future IPR landscape in 7 core fields (12th Five Year Plan)…
2003 2005 2007 2009 2011
Patent applications
Trademark applications
IP applications: China vs. Germany (in k units)
Daimler NEA / Corporate Office 17
Content
Daimler Business Set-up in China11
33 Indigenous Innovation for Sustainable Growth in China
44 Daimler Innovation and China Future Strategy
22 Dragon Rising: An Inside Look at China Today
Daimler NEA / Corporate Office 18
Innovation in Technology and Business
Further optimization
of combustion engine
Increase efficiency
with hybridization
Emission-free driving
(battery-electr./fuel cell)
Car2go: Intelligent concept for up-to-date mobility
Paris Vienna San Diego
Sustainable mobility for the future
Daimler Innovation and China Future Strategy44
Daimler NEA / Corporate Office 19
Daimler’s R&D Institutions in China
19
Beijing
Shanghai
Shenzhen
Mercedes-Benz AdvancedDesign Center of China
Focus : Advanced design
of MB automobiles
2011
Mercedes-Benz Research & Development China (GRPCN)
Focus : Advanced engineering,
Group Research,
2011R&D Center of Beijing Benz Automotive Co., Ltd.
Focus: Local produce for MBPV
2011
Mercedes-Benz SIM Technology Co., Ltd.
Focus : R&D and services in auto
electronics and electronic
packaging
2000Shenzhen BYD Daimler New Technology Co., Ltd.
Focus: NjEV (2013)
2011
R&D Center of Fujian Daimler Automotive Co., Ltd.
Focus: R&D for Local Van produce
2011MBC Engineering SupportingOffice (ESO)
Focus : Support for localized MB
products in China
2006
R&D Center of Beijing Foton Daimler Auto
Focus: R&D for CV
2011
R&D in JV
R&D within Daimler
Fujian
Daimler Innovation and China Future Strategy44
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