China’s Continuous Growth Felt a Hit in October
China, the manufacturing hub of the world, continued its activity expansion and growth as the second-largest economy, globally, in October for the eighth consecutive month. But, reports suggest that the economic powerhouse’s growth is slowing ─ or, it’s at least slower than the month prior ─, according to the National Bureau of Statistics. The growth across 2020 has been exponential when you consider the damage that the COVID-19 pandemic wrought on global supply chains and China as a whole.
Industry-leaders and analysts in the manufacturing space are always closely watching the (PMI) to gauge the manufacturing activity and outlook in China, and data trends suggest that post-February, courtesy of robust pandemic-control measures, the People’s Republic has been on a constant bounce-back.
From the Bottom to the Top
Back in October, the stood at 51.4, which was 0.1 below the September figure. 51.4 isn’t bad, though ─ on the PMI scale, any figure above the 50-point mark indicates that a company is growing, while below resembles shrinking. To put China’s growth into context, back in February of this year, the nation’s manufacturing PMI plummeted all the way down to 35.7 points when the pandemic first went global.
According to Zhao Qinghe, a senior statistician at the National Bureau of Statistics announced that this month’s figures, with increasing in several key indices, including exports, imports and now orders, demonstrated a “quick recovery.”
“Manufacturing in major economies is bouncing back... and a recovery in demand has driven up prices,” Zhao added. When discussing the key factors of growth, Zhao suggested that chemical products and raw materials, plastic products, textiles, and rubber ─ all of which were used to fight the virus ─ played a key role.
Industry-wide Growth Surges
Outside of manufacturing, China’s wider-PMI score has hit 55.2 points, which sees a growth of 0.3 year-on-year. All of these statistics indicate that China, for all the struggles of this year, has managed to be resilient in the looming shadow of COVID-19 and that it’ll likely record the strongest economic growth, globally, in 2020.
The nation’s growth stands out so much that the (IMF) has nearly doubled its in 2020 to 1.9 per cent amid its strong recovery and its ability to continuously provide PPE and other products to global markets that are in desperate need, in their fight to resist the adversity of the pandemic’s second and, in some cases, third waves.
"The second wave of Covid-19 outside China could bolster China's exports but may also delay the full recovery of China's services sector, as Beijing still needs to stay alert," said Lu Ting, chief China economist at Japanese bank Nomura.
But an extended pandemic "may eventually dampen demand for China's exports if the purchasing power in overseas economies diminishes and they adjust their manufacturing to the new normal", he added.
Canoo Awards Manufacturing Contract to VDL Nedcar
Canoo, a trailblazing company in the electric vehicle (EVs) manufacturing industry, has officially announced owned and contract manufacturing plans that will ensure the company manages to deliver on its promise to consumers of production and delivery of vehicles in Q4, 2022.
During the company’s first Investor Relations Day, Chairman & CEO of Canoo, Tony Aquila, named VDL Nedcar as its contract manufacturing partner. VDL Nedcar, which I’m sure many of you will already have heard of, is the only independent Vehicle Contract Manufacturer in the Netherlands and has enjoyed fifty years of growth under owners, including Mitsubishi Motors and Volvo cars. According to the report, Nedcar will manufacture the Lifestyle Vehicle for the United States and European Union markets, while Canoo builds a US-based mega micro-factory.
"We conducted an exhaustive search, invested significant amounts of time and resources that span the globe, in our search for our Phase 1 contract manufacturer. VDL Nedcar is the right partner," said Tony Aquila, Investor, Chairman and CEO of Canoo, Inc. "They are the top trusted European manufacturer building high-quality products for leading OEMs, and they significantly outcompeted the other contenders. VDL is also independently owned by the van der Leegte family of entrepreneurs - which aligns with our commitment to support businesses that form the backbone of communities. This strategic partnership will enable us to deliver vehicles to market while we build our Phase 2 factory in Oklahoma. It also strongly positions us for geographic expansion in Europe and builds a lasting relationship with VDL Groep of companies. Our investment will help us scale quickly and fulfil our mission to bring affordable, purpose-built EVs to Everyone."
Canoo and VDL have already gotten to work on vehicle manufacturability and production planning so that Canoo can successfully lay the groundwork for its upcoming US manufacturing operations expansion, which will be completed in Oklahoma in 2022. The Nedcar facility currently expected to produce around 1000 units for both the US and European markets in 2022, with an additional 15000 targeted for the following year.
"Canoo's bold approach to designing and building electric vehicles makes them an ideal partner as we work together to shape the future of mobility," said John van Soerland, CEO of VDL Nedcar. "This partnership advances our strategic vision to provide a contract manufacturing solution and expand our expertise in the EV arena."
Currently, Canoo is entering its GAMMA phase of development and is on track to start production soon. The company intends and expects to launch its Lifestyle Vehicle in Q4 2022, closely followed by the Multi-Purpose Delivery Vehicle and Pickup Truck.
Watch this space.