Chinese delegation visit DIRFT near Rugby
Chinese investors are increasing their focus on Coventry and Warwickshire as a potential centre for investment.
A recent fact-finding mission saw a delegation of key Chinese dignitaries and senior business people visit Warwickshire to meet a range of firms, decision makers and business organisations.
Part of the visit included a tour of DIRFT, near Rugby, as their interest heightens in the logistics and e-commerce sectors.
The visit to Coventry was the only stop for the Chinese delegation on their tour of Europe. But why? Craig Humphrey, managing director of the CWLEP Growth Hub, said the city is now as appealing as ever.
He said: “I was delighted to be part of the group that welcomed the delegation from China to the region.
“There were a mix of managing directors, vice presidents, chair-people and owners of large corporations and they are all very interested in this region – Coventry, Warwickshire and the wider Midlands Engine area is seen as a very strong place to invest.
“Over the past couple of years, we have really seen this interest grow – we are speaking to potential Chinese investors all the time and when it gets very serious, they want to come out into the market and see the opportunities in the flesh.
“We’ve worked with companies already in this area which have benefitted from Chinese investment and the feedback from this visit has already been extremely positive.
“China already his billions invested in the UK but there is a real hunger to increase that – estimates are that they will have invested £100bn in UK infrastructure by 2025.
“So when we have the opportunity to meet key individuals and organisations from China in this way, it’s absolutely vital that we make the most of it.”
Gareth Edwards, the logistics lead for the CWLEP Growth Hub, added: “With the increased growth in logistics and, in particular e-commerce, the Midlands offers significant opportunities for businesses to invest and it is great that this delegation chose to visit this area.”
One of the companies which is really tapping into these opportunities is the Chinese-owned London Taxi Company, which manufactures the iconic London black cabs.
The manufacturer opened its new £300m manufacturing plant in Ansty, Coventry back in March creating up to 1,000 direct jobs and supporting a further 500 roles in the local supply chain.
The facility is the first greenfield development of any Chinese automotive manufacturer in the UK, demonstrating parent company Geely’s ongoing commitment to the country and the West Midlands region.
Speaking ahead of the plant opening, Nigel Driffield, a professor of international business at Warwick Business School, said: "The opening of the London Taxi Company's Ansty Park plant is unambiguously good news for Coventry and the region, and highlights many of the benefits of inward investment.
"Much like JLR, the company was essentially sound with a good product, but was starved of cash for further investment. The foreign investors - who are typically themselves cash rich from successful investments in the home country - are therefore able to take advantage of opportunities others cannot.
"On the face of it, this is one foreign investment that appears relatively robust to the threats from Brexit. The challenge for policymakers both locally and nationally is to ensure that this continues to be the case, supporting local supply chains, both with skills and access to innovation and finance, and aligning the much-vaunted industrial strategy, to the needs of these businesses.
"This includes, for example, support for battery technology, and other sectors that play into these supply chains, to ensure that the region benefits to the greatest possible extent."
Another automotive company which has received investment from China to continue investing in the region is CAD CAM Automotive (CCA).
CCA secured a multi-million-pound funding boost when it merged with the China Red Sun Group back in 2015, creating up to 1,000 jobs.
Red Sun Group is one of China’s Top 500 companies both in the manufacturing industry and private sector. It employs over 7,000 people and has a turnover of more than £2bn.
The company was supported during its investment by the Coventry and Warwickshire LEP alongside Coventry City Council and CCA.
Speaking at the time, Jonathan Browning, chairman of the Coventry and Warwickshire LEP, said: “The deal between CAD CAM Automotive and the China Red Sun Group is particularly exciting and will enable the company to expand significantly and increase their workforce which is a massive boost to the local economy – and it is the third major investment into the city from China in recent times.
“The team at the Coventry and Warwickshire Growth Hub has been working tirelessly for the last six months behind the scenes to help the successful completion of this merger.
“We are proud of our world-class expertise in automotive, engineering and research and design and we hope this deal will attract more international companies in the future to invest in companies in Coventry and Warwickshire.”
And it’s not just the automotive sector which is benefiting either. Coventry University is set to strengthen its links with China by launching the first Confucius Institute in the West Midlands.
The collaboration between Coventry University and Jiangxi University of Finance and Economics (JUFE) in Nanchang, China, aims to develop strong educational and business links between the West Midlands and China.
The new Confucius Institute will join 29 other institutes across the UK to help businesses to understand the Chinese market, as well as providing support with issues around language and culture.
Prof John Latham, vice-chancellor of Coventry University, said: “Coventry has a long history of engagement with China and there are many points of connection between there and our region.
“The recasting of our industrial heritage around new growth opportunities and the development of advanced manufacturing techniques has strengthened our links and we are delighted that we will now have another point of focus for business, as well as social and cultural engagement.”
So, are we to expect more Chinese investment in Coventry in the near future? Only time will tell…
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