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Chinese Carmakers Stepped Up at Frankfurt Auto Show – Shift Towards Electric Cars

Chinese suppliers and generators have gamed up their demeanor at the Frankfurt auto show, capitalizing on a shift towards electric cars compelled on German carmakers by regulators seeking to regulate pollution.

Although the variety of exhibitors has fallen to 800 in 2019 from 994 in 2017, Chinese automakers and suppliers now make up the most significant international contingent, with 79 companies, up from 73.

Several European and Japanese carmakers, together with Fiat, Alfa Romeo, Toyota, Nissan, and Peugeot, have skipped the present because the industry seeks cost savings.

Automakers face multi-billion-euro investments to develop electric and automatic cars. However, China’s more significant presence is also due to Europe’s lack of expertise in lithium-ion battery cell production, space where Asian suppliers dominate.

German companies are striking major offers with Chinese suppliers to help them meet stringent anti-pollution guidelines, which have been launched within the obsequies of Volkswagen’s 2015 emissions cheating scandal.

Zentgraf said he expected additional supply offers to be struck in Europe this year following agreements with BMW and Volkswagen.

Daimler on Wednesday mentioned it had chosen China-backed Farasis Energy to supply battery cells for its Mercedes-Benz electrification push.

Farasis is building a 600 million euro ($663 million) factory in East Germany, near the place Chinese rival CATL is erecting a 1.8-billion-euro battery plant.

German carmakers have been forced to speed up electrification plans after European Union lawmakers imposed a 37.5% reduction in carbon dioxide emissions between 2021 and 2030 in addition to a 40% cut in emissions between 2007 and 2021.

Electric cars made up only 1.5% of global gross sales last year, or 1.26 million of the 86 million passenger vehicles bought, JATO Dynamics mentioned.

If carmakers fail to meet the 2021 targets they face 33 billion euros in penalties, analysts at Evercore ISI have estimated.

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