Bosch China bets big on strategic importance of its local headquarters

When German industrial giant Bosch decided to locate its China headquarters in western Shanghai's Hongqiao central business district 11 years ago, the area where its buildings now stand was agricultural land.

"Opposite our site were vegetable patches, bungalows where farmers lived, a table tennis court and a deserted warehouse," said Chen Yudong, president of Bosch China.

"But we had faith in this area because we knew it would become one of the two development engines of Shanghai. The Lingang Special Area in the eastern part of the city was to feature high-end manufacturing, while Hongqiao was to become an important research and development hub that radiates the spirit of the Yangtze River Delta region," he said.

As such, Bosch invested nearly 1 billion yuan ($141.7 million) to build its present 70,000-square-meter regional headquarters. The building, which became operational in 2011, is the largest of its kind for Bosch in the Asia-Pacific region.

Over time, Bosch China has seen its head count hit the 60,000 mark, making it the company's largest workforce outside of Germany. By the end of last year, Bosch China operated 59 legal entities and its sales revenue topped 112.6 billion yuan, making China the largest international market for the Bosch Group for four consecutive years.

While Shanghai serves as the regional headquarters, the majority of Bosch's China operations are located in the Yangtze River Delta region. Production bases and technology centers have been set up in neighboring cities such as Suzhou in Jiangsu province, Hefei in Anhui province and Hangzhou in Zhejiang province.

In late November, Bosch broke ground on its China hydrogen fuel cell plant in Wuxi, Jiangsu province, the first of its kind outside of Germany. Also located in Wuxi is the company's software center, which will be managed independently from the other Bosch China business units.

According to Chen, the geographic advantage of the Hongqiao CBD is crucial to Bosch. About 75 percent of Bosch China's annual turnover comes from its operations in the Yangtze River Delta region. Nanjing serves as the headquarters for household appliances of Bosch China.

In addition, three-quarters of Bosch China's workforce are based in this area. Among the 10,000-plus employees in its Suzhou factory, nearly half are engineers who frequently travel between Suzhou and Shanghai.

"As the construction of the Hongqiao CBD continues, the connection between the Shanghai headquarters and our facilities in the rest of the Yangtze River Delta region has deepened. As the development of the cities in this area continues to be integrated, it is our hope that there will be a free flow of talents that will benefit companies like ours," said Chen.