China's Guangdong makes great strides in high-quality development

In a production workshop at GAC Aion, a NEV subsidiary of Guangzhou Automobile Group Co Ltd, lines of industrial robots equipped with precise seven-axis robotic arms install the car tires and execute the welding of the steel-aluminum structure car body while two uniformed technicians monitor parameters on a digital screen.

With a new industrial park of more than 470,000 square meters and an investment of 45 billion yuan ($6.9 billion), the new plant in Guangzhou's Panyu district, which started construction in April 2017, has become not only a production base but a research and development center for the company.

"The total sales reached 271,000 units last year, up 126 percent year-on-year, the fastest growth rate in history. Since 2017, the average annual compound growth rate has exceeded 120 percent, and the industry ranking has risen from 16th to the current 3rd," said Xiao Yong, deputy general manager of GAC New Energy.

Production and sales of new-energy vehicles have soared in China since the beginning of 2022, thanks to the central government's persistent efforts to accelerate high-quality manufacturing and build up the nation's industrial competitiveness in the global marketplace.

For instance, the country exported 3.11 million vehicles in 2022, up 54.4 percent year-on-year, ranking China second only to Japan. Among them, a total of 679,000 new energy vehicles, which consist of electric cars and plug-in hybrids, were shipped overseas from China last year, up 120 percent year-on-year, said the China Association of Automobile Manufacturers.

A total of 301,000 vehicles were exported in January this year, jumping 30.1 percent from the same period last year. Meanwhile, NEV exports rose 48.2 percent year-on-year to 83,000 units, according to the CAAM.

"Benefiting from China's huge market size and the government's pro-growth measures, NEV production will continue to flourish and NEV-related new technology innovations will continue to be rolled out in the world's second-largest economy," said Xiao.

Regional cluster

Over 40 automobile parts and related enterprises are based in GAC Aion Zhilian new industrial park. As the chain leader in the park, GAC Aion could assemble a NEV in about a minute thanks to the efficient supply from partner firms.

To forge a more resilient firewall against risks to industrial and supply chains, South China's manufacturing giant Guangdong province introduced a chain-chief mechanism to leverage industrial synergy for win-win growth.

In the multi-player scheme, the local government, with a senior official as chain chief, encourages and supports an industrial giant to act as a chain leader to expand the ecosystem and coordinate efforts for shared development.

Guangdong has introduced a project to nurture chain leaders in 20 strategic industries, including automobiles and smart home appliances. Some 60 companies playing the role of chain leaders are expected to be in place in 2025.

By 2025, GAC Aion is expected to build all its core component factories nearby, and the output value of the enterprise will exceed 300 billion yuan ($46.5 billion), driving the output value of supporting facilities in and around Guangzhou province to about 2 trillion yuan ($309.6 billion).

What underpins China's steady industrial economic growth is the smooth and functioning industrial and supply chains, which even emerged stronger from downward pressure thanks to a raft of innovative attempts to keep the ball rolling.

The chain-chief scheme is not only about building a solid industrial chain. It also seeks to drive innovation, maintain stable supply and climb up the value chain.