Chinese province looks for UK economic partners

A delegation from Shaanxi province, Northwest China, is on the hunt for British businesses to invest in the region’s aviation, agriculture and automobile industries.

Shaanxi vice governor Wei Zengjun told a trade forum in London that the region hopes to more than triple its automobile production to 2 million vehicles by 2021, with a focus on driverless trucks, smart cars and electric vehicles.

Wei said the region also wants to partner with British financial institutions. Shaanxi’s local state-owned finance corporation is looking to launch a 500 million-euro ($614 million) bond issue in Europe.

“Shaanxi leads China in aircraft manufacturing, and the car industry is our latest industry which we are growing,” Wei said. “We are really looking forward to partnering with British businesses in this industry.”

Wei said that factories in Shaanxi produced and sold 600,000 cars in 2017, up by 50 percent on the previous year. The region aims to produce two million vehicles in 2021.

As well as traditional automobiles, Shaanxi will increase production of innovative vehicles as China looks to phase out combustion engines and increase transport efficiency.

One of the region’s leading truck and bus manufacturers, Shaanxi Automobile Group, recently partnered with Californian technology firm TuSimple to produce driverless trucks.

China’s largest private automaker Geely, which has two plants in Shaanxi, now produces hybrid vehicles in both the UK and China.

In 2014 Geely acquired the London Taxi Company, now called the London Electric Vehicle Company, and developed a new hybrid model of the black cab,the TX, which went on sale last month.

Chris Gubbey, chief executive of the London Electric Vehicle Company, said Geely plans to take the TX to markets beyond the UK.

“We are a very good example of a company that has strong ties and roots both in China and in the UK, with investment in Shaanxi,”Gubbey said.

In 2016 Geely opened a plant in Baoji, Shaanxi, which makes 200,000 cars a year. In November, Geely started construction on a plant in the region’s capital Xi’an, which will eventually produce 600,000 cars.

Lyndon Sanders, general manager of Nottingham-based vehicle composites manufacturer Far-UK, said the growth of the Shaanxi automotive industry presents opportunities for British firms.

“The smaller UK technology companies will certainly be proactive about getting out there,” Sanders said. “For us the most attractive piece of information is that there are bus and truck makers out there, and we could go knocking on their door.”

As well as car production, Shaanxi’s local economy relies on aircraft manufacturing and agriculture. The Y20 heavy military transport aircraft and key components of the C919 passenger jet are produced in Shaanxi, and the region is home to one of China’s largest agricultural technology trade shows.