IF ALL GOES as planned, builders will break ground on a battery plant in the German state of Saarland in 2022. The 24-gigawatt-hours (GWh) per-year factory will not only be one of the largest of its kind in Europe—it will also be a beachhead for Chinese battery-makers. The company behind the plant, SVolt, is rapidly gaining market share outside China. So, too, are other Chinese groups such as BYD and CATL. Becoming global leaders in the industry is part of a high-level government plan.
Just a few years ago it seemed that China Inc was about to make a big global splash. Starting in 2014 Chinese companies began buying assets across Europe and America, including well-known brands and iconic properties. In 2016 this activity reached its peak, with Chinese firms sealing around $200bn in mergers and acquisitions (M&A) abroad. The spree did not last. Chinese authorities grew weary of the vast amounts of dollars draining from China’s capital account, often to purchase trophy assets such as football teams. Regulators in the countries receiving the investments also became sensitive to potential security threats. As relations between China and America came unstuck starting in 2018, so did the ability of Chinese companies to continue the binge. Cross-border M&A by Chinese companies in 2021 was the lowest for more than a decade.