The German automotive industry expects Chancellor Friedrich Merz to demand market liberalization during his trip to China.
“The German side must present a detailed account of where China is distorting competition,” Hildegard Müller, president of the Germany’s automotive industry association VDA, told the Sunday edition of Die Welt newspaper.
“The aim of the talks must generally be to further open up markets on both sides – not mutual isolation. China also has a responsibility here.”
German car manufacturers have recently seen a significant drop in sales in China. In addition to the highly subsidised new local electric car brands, this is also due to a new luxury tax on expensive cars, which mainly affects German brands.
“We also expect China to make constructive proposals for reducing distortions of competition,” said Müller.
The VDA boss warned against provoking counter-reactions with new EU regulations, such as giving preference to European cars in public procurement, purchase premiums or customs duties.
“Even if China is now being called upon to make offers, Europe must generally weigh up its actions and corresponding reactions. Depending on the decision, the local industry could face countermeasures from China,” said Müller.
Merz is to travel to China next week for talks on political and economic ties, as well as security issues. It will be his first visit to the country since taking office.
Trade tensions between Berlin and Beijing are simmering, particularly over rare earths – critical raw materials used in products such as mobile phones and electric motors.
German and European manufacturers have reported shortages of these materials linked to restrictive Chinese trade policies.
Germany’s export industry has voiced criticism about what it describes as unfair competition on world markets by subsidized Chinese firms, calling for a level playing field for foreign companies, including in public procurement.
Merz is to be accompanied by a business delegation and is due to also attend a meeting of the German-Chinese Economic Advisory Committee.
According to reports, he also plans to visit the Forbidden City and the Mercedes-Benz Group in Beijing.