VW's Gotion Tie-up Shows Europe Can Benefit from Careful Integration of Chinese Tech

Dow Jones09-29 23:25

1524 GMT - Volkswagen's latest partnership with Chinese battery maker Gotion High-Tech shows how Europe's auto business can selectively integrate products and tech from China, says Philipp Seidel, principal at Arthur D. Little. The German auto group said this week it was teaming up with Gotion--in which it is also an investor--on joint ventures to produce lithium-battery cells at sites in Spain and Slovakia, as well as a cathode-material facility in Morocco. Chinese players have a competitive advantage in lithium batteries, Seidel notes. "For European industry, selectively integrating this know-how into its own value chain can therefore be more effective than trying to recreate every capability independently from scratch," he says. "The strategic question is not whether Europe should use Chinese technology, but whether that technology transfer helps Europe build its own capabilities--or simply creates a new dependency."

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