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‘US conspiracy’ allegations against Volkswagen groundless (Zhao Yongsheng)

‘US conspiracy’ allegations against Volkswagen groundless (Zhao Yongsheng)

Author:Zhao Yongsheng From:Global Times Update:2023-03-13 14:14:02

 

Volkswagen's emissions scandal is a real surprise for those who believe in the "Made in Germany" brand which represented many decades of precision, quality and rigorous control.

The US is cited by some as the ultimate manipulator of these kinds of scandals.  Is it justified? As a center of high-end manufacturing, Germany is one of the strongest carmakers in the world, and its ex-CEO had even drawn up an ambitious plan to explore the American market.

Is it this aggressive plan that angered Americans? I suppose this is partly plausible because car manufacturing is no longer a pillar industry in the US in this so-called post-industrial era and the impact of German's car industry on the US is limited. Furthermore, even if Volkswagen penetrates even deeper into the US market, the American cars are not strong rivals to German cars but rather Japanese cars.

Or is it one of the US' strategies against the EU? In my opinion, today's world is mainly dominated by three major forces: the US, EU and China, which I call the "International Triangular Relationship." Does that mean by discrediting Germany - the most economically-competitive EU country, the US meant to teach the EU dual lessons apart from the EU refugee crisis? Hence, with this dual crisis, Germany will be largely weakened compared with the US.

However, from a macro-geopolitical point of view, it remains only a theoretical hypothesis because there is no evidence to prove that the US is weakening Germany.

Nevertheless Volkswagen has to deal with its emissions scandal, and the US has capitalized on it. Hence, the US response to Volkswagen is expected.

Volkswagen's scandal has destroyed the "Made in Germany" myth. But China has lessons to learn from it because "Made in China" is likely to replace "Made in Germany" one day.

Strict conformity to regulations is something Chinese manufacturers should never ignore. "Regulations" refer to both national and international ones.

Just like any other resource, the market is limited; hence we will continue to be in a competitive environment. If we want to be competitive, product quality is important, and all related services. However, measures should also be taken to reduce the probability of being victimized by various regulators. Here, a Chinese proverb can be used as a reference: "The fly does not bite the seamless egg." If the egg of "Made in China" has no seam, the  flies in the world can do nothing to it.

Nevertheless, the supposed downward trend of other competitors does not automatically mean our rise. "Made in China" has its own problems and difficulties during this transitional stage.

From low-end manufacturing to high-end ones is a real challenge as it requires the reorganization of the industrial process and restructuring of social, political and economic systems, which still lag behind.

It is only after tackling all these problems that "Made in China" can equal "Made in Germany" and eventually replace it.

Germany is focused on high-end manufacturing while China is developing manufacturing from other levels.

I am convinced that, in the future, China can lead manufacturing, thanks to its size, its geographic diversity and its emerging huge domestic market.

If Volkswagen's emissions scandal represents a decline in "Made in Germany," it could mark the start of the rise of "Made in China" in the world.

The author is a Paris-based economist & professor and vice-president of the Paris-based China-France Association of Lawyers and Economists. bizopinion@globaltimes.com.cn

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