Chinese Manufacturer Opens Assembly Plant in Europe

Topics: European Union, Japan, Europe Pages: 2 (602 words) Published: December 2, 2012
When I was looking for car manufacturers that have opened up assembly plants in Eastern Europe, I stumbled upon some very interesting articles with information I haven’t heard about before. The article of Spiegel, which is a highly reputable German newspaper, is about the Chinese car manufacturer ‘’Great Wall Motors’’ which has opened an assembly plant in Bahovitsa, Bulgaria recently in 2012. When I read this, I immediately realized that this process normally is the other way around, European car manufacturers who move their assembly plants to China due to lower labor costs. But in this article it depicts upon the opening of an assembly plant in Europe by a Chinese car manufacturer. As I kept reading the article I more or less understood why the Chinese manufacturer is making this move. Great Wall Motors is not the first Chinese car manufacturing company that wanted to open up assembly plants in Europe. There were several others; however they have failed to meet stringent European safety standards. Other Chinese carmakers are also expanding into Europe, as they are buying assembly plants of European car manufacturers to improve the quality of their cars and therefore to meet the stringent European safety standards. This is a way for those Chinese car manufacturers to make progress in quality. So first of all, why in Europe? By producing in Europe, the cars that are produced no longer have to be exported from China to Europe and thus Great Wall Motors is circumventing EU import taxes and tariffs. Therefore, the cars that are produced in Europe are meant to be sold in the European market. This saves Great Wall Motors a lot of money. But then a second question arises; where in Europe? Great Wall Motors did not choose Bulgaria as location for their assembly plants because of its geographical location, but rather for their cheap labor. Bulgaria is the poorest country in the European Union, and therefore is the most attractive location to open an assembly plant...
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