covid-19 impact on german companies in china · 2020. 12. 17. · continuous recovery from severe...
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Beijing, December 17, 2020
COVID-19 IMPACT ON GERMAN COMPANIES IN CHINA
WINTER FLASH SURVEY RESULTS
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METHODOLOGY & DEMOGRAPHICS
IndustryRegional Location
~ 530November2020
Machinery/Industrial Equipment
25%
Automotive17%
8% Business Services
Electronics5%
Plastic/Metal Products5%
Size(number of employees at local operation)
2%4%5%
8%9%
19%
41%
6%7%
20%
33%33%
More than
3000
employees
1000-3000
employees
250-1000
employees
50-250
employees
Less than 50
employees
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RETURN TO OPERATION - ON TRACK TO RECOVERY
HOWEVER, STILL NOT AT PRE-PANDEMIC LEVEL
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By when do you expect your company's business operations to return to normal?
72%
70%
63%
62%
47%
11%
16%
10%
17%
15%
11%
9%
13%
15%
23%
6%
5%
14%
6%
15%
Production/Manufacturing capabilities
Logistics & Warehousing
Staffing rate
Supply Chain
Demand
Already returned to
normal / end of 2020
H1 2021
H2 2021
in 2022 or later
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Looking forward, to what extent do you foresee your business being impacted by the COVID-19 pandemic in 2021?(n=491, only one answer possible)
10%
42%
39%
9%
No impact
Low impact
Medium impact
High impact
90% forecast an impact in 2021
52% forecast no oronly low impact
RETURN TO OPERATION - ON TRACK TO RECOVERY
COVID-19 WILL STILL HAVE AN IMPACT ON GERMAN BUSINESS IN CHINA IN 2021
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CHALLENGES HAVE BEEN EASED
BUT TRAVEL RESTRICTIONS REMAIN BIGGEST CHALLENGE
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Please specify how your business in China is currently affected by the COVID-19 epidemic.(n=525, multiple answers possible)
10%
8%
9%
18%
36%
14%
36%
28%
69%
89%
3%
4%
5%
9%
10%
16%
20%
21%
30%
32%
49%
74%
Lay-offs
No impact
Costs of HR compliance
Inability to meet contractual delivery deadlines due to disruptions to domestic logistics
Staff shortages
Increased demand for products/services
Cash flow challenges
Manufacturing delays due to shortage of supplies
Uncertainty and inability to make business and investment decisions
Disruptions to global supply chains
Decreased demand for products/services
Travel restrictions (e.g. quarantine measures, international travel disruptions)
Nov-20
Jun-20
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Please indicate how your operations in China are affected by (international) travel(n=381, multiple answers possible)
12%
20%
22%
25%
27%
32%
37%
58%
Sourcing compromised
Investment projects not realized
Maintenance and service of
machines/production sites limited
Loss of turnover
Initial commissioning/installation of
machines/production sites hampered
Urgent business negotiations do not proceed
Missing participation in trade fairs
Limitation to maintain business relationships
TRAVEL RESTRICTIONS REMAIN BIGGEST CHALLENGE
DELAYED IMPACT OF TRAVEL RESTRICTIONS ON GERMAN BUSINESS
20%20%
Transactions & investments will be done, but with delays and disturbances to communication and relationship.
5 Mio Euro: New warehouse in Tianjin
Knowledge Transfer and R&D Investment
100 Mio Euro: New factory
40 Mio Euro: Machine Sales not happen due to travel restrictions
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SME, WFOE, Machinery/Industrial Equipment industry
SME, WFOE, Plastic/Metal Products industry
IT/Telecommunications (Services, Infrastructure) WFOE,
more than 3.000 employees
SME, WFOE, Machinery/ Industrial Equipment industry
SME, WFOE, Electronics industry
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CONTINUOUS RECOVERY FROM SEVERE ECONOMIC IMPACTTWO THIRD OF COMPANIES HAVE FELT IMPACT OF COVID-19 ON THEIR REVENUES IN 2020
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To what extent has the COVID-19 epidemic impacted your company’s revenue 2020?(n=527, only one answer possible)
*only February and March
21%
48%
1% 3%
24%
14%
68%
2% 3%
12%
27%
55%
6%9%
37%
29%
13%
21%
Decrease of less than 10% Decrease of more than 10% Increase of revenue No impact Too early to state
Expected Revenue in 2020
Feb-20
Mar-20
Jun-20
Nov-20
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CONTINUOUS RECOVERY FROM SEVERE ECONOMIC IMPACT IN 2020DESPITE COVID-19, 40% HAVE IMPROVED THEIR REVENUE COMPARED TO 2019
10%
12%
13%
25%
17%
13%
9%
Turnover
substantial increase (>20%)
increase (10 - 20%)
increase (5-10%)
similar/unchanged (+/-5%)
decrease (5-10%)
decrease (10-20%)
substantial decrease (>20%)
How do you expect your company to perform in terms of turnover by the end of 2020 compared to 2019? (n=534, only one answer possible)
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1%
3%
5%
19%
37%
25%
10%
Turnover
substantial increase (>20%)
increase (10 - 20%)
increase (5-10%)
similar/unchanged (+/-5%)
decrease (5-10%)
decrease (10-20%)
substantial decrease (>20%)
OPTIMISTIC OUTLOOK FOR 2021 DESPITE ONGOING COVID-19 IMPLICATIONSMORE THAN 70% EXPECT HIGHER REVENUES COMPARED TO 2020
What is your view about the outlook of your company for 2021 in terms of turnover when compared to 2020? (n=535, only one answer possible)
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10
4%
9%
19%
22%
24%
30%
32%
33%
36%
55%
Shifting production capacities out of China
None
Reduction of number of employees
Investment in digital sales channels
Localization of R&D
Delaying investments
Different and/or new product offers
Change of working models and work distribution
Investment in digitalization of internal processes
Various cost cutting measures
What actions are your company considering to offset COVID-19’s impact on your bottom-line (i.e. profits) and increase the resilience of your business? (n=495, multiple answer possible)
HOW TO STRENGTHEN RESILIENCE IN FUTURECOUNTER MEASURES IN COST CUTTING, BUT ALSO PURSUING INNOVATION OPPORTUNITIES
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About the German Chamber of Commerce in China
The German Chamber of Commerce is the official membership organization for German companies in China, and has currently
more than 2,700 members. The German Chamber helps its members to succeed in China by providing up to date market
information and practical advice. It offers a platform for the German business community and represents its members'
interests towards stakeholders including government bodies and the public.
www.china.ahk.de
Contact for press inquiries
Lisa FischbachDirector Media & Public [email protected]
Olivia HelvadjianSenior Communications Manager & Chief Editor [email protected]