China’s current PMI is at 48.8, down 0.81% from 49.2 last month and down 1.61% from 49.6 one year ago. Industry demands are still insufficient, and the release of production capacity has been restrained.
Some key industries have slightly rebounded. The PMI of equipment manufacturing and high-tech manufacturing is at 50.4 and 50.5, up 0.3% and 1.2% from April 2023, respectively. The automotive industry, especially EV manufacturing, is still a major hot spot in the Chinese market.
The Regional Comprehensive Economic Partnership (RCEP) free trade agreement among the Asia-Pacific nations of Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand, and Vietnam is now official and in effect. The 15 member countries account for about 30% of the world’s population (2.2 billion people) and 30% of global GDP ($29.7 trillion), making it the world’s largest trade bloc. Signed in November 2020, the agreement is the first free trade agreement among the largest economies in Asia, including China, Indonesia, Japan, and South Korea. The FDI accounted in the trade bloc was $23.53 billion in 2022, a year-over-year growth of 23.1%, and from January to April 2023, it reached $1.27 billion, a YOY growth of 13.7%.
According to Chinese customs data, the machine tool industry totaled $10.56 billion in imports and exports from January to April 2023, up 1.8% YOY. Imports totaled $3.71 billion, down 10.2% YOY, while exports totaled $6.85 billion, up 9.7% YOY. The market demand for machine tools is expected to recover gradually but steadily throughout 2023.
A few recently announced projects and investment news items are listed below for your reference. Please reach out to learn more about any of these listed projects.
BYD Group has seriously failed to keep up with the continuous sales surge. To remedy the situation, the group recently announced a new $2.14 billion investment cycle to expand the production capacity expansion of its Xi’an facility.
General Motors announced a new investment of $143 million in its Baotou City facilities in Inner Mongolia to build a high-performance radial tire production site. The investment includes constructing new ancillary facilities and installing new tire production lines, while plans are to increase annual output to 1.3 million units.
Nanjing Shantian Precision Plastic & Rubber announced a $43 million investment in Taihu County to build a high-end die-cutting production site. The investment includes the construction of a new plant, installing new production lines, and ancillary facilities.
Ganfeng Lithium Power announced a new lithium battery production site in Dongjin. The investment includes the construction of a new plant, a research and development center, new production lines, and other ancillary resources, totaling $1.43 billion. The company plans to reach an annual output of 20 GWh with the new investment.
Volkswagen will invest $150 million in its APP500 electric vehicle drive motor project. The construction of this new site in the Tianjin district includes new production lines with a planned annual production capacity of 330,000 units. The plant will be fully operational by 2025.
BMW Group announced a new investment of $1.43 billion in its Shenyang facilities to improve the supply chain and establish its sixth-generation power battery production site.
For more information, please contact Fred Qian at fredqian@AMTchina.org.