“Manufacturing Champions” + Equipment renewal + Mobile Internet of Things

In this issue of MERICS China Industries Brief, we cover the following topics:

1. China promotes more equipment renewal in key industries
2. “Made in China” flag bearers: MIIT picks a new set of industrial champions
3. A vision for 2027: China to establish a comprehensive mobile IoT ecosystem
4. CAC seeks to harness synergies in digital and green transitions
5. Tracking CO2: SAMR introduces carbon footprint certification pilot

1. “Made in China” flag bearers: MIIT picks a new set of industrial champions

At a glance: The Ministry of Industry and Information Technology (MIIT) issued instructions for the selection and review of “Manufacturing Champions” – a title awarded to firms deemed to be leaders in a particular industrial field. It outlined selection processes for a new round of Manufacturing Champions in 2024, and the review of firms chosen in the third and sixth rounds. The policy includes a series of attachments, such as:

• Details of the company information required of applicants, such as the firm’s economic performance, degree of specialization, the domestic and global market share of key products, innovation capabilities, contribution to resolving weaknesses in the domestic supply chain etc.
• A list of nine key technology areas and numerous sub-categories for the selection of firms, covering virtually all the key sectors outlined in the Made in China 2025 strategy
• Quotas for each province and centrally administered city government, stipulating how many firms they can recommend to the central authorities for final selection

MERICS comment: Eight rounds of Manufacturing Champions had been announced since 2016, leading to the selection of 1,557 companies. They get benefits that include preferential policies on land, labor and energy use, support to access loan and equity capital, and support for recruitment, research and development (R&D) activities and international expansion.

The Manufacturing Champions program shows the ongoing implementation of the “Made in China 2025” strategy and China’s self-reliance push. A key objective is to build supply chain security and resilience. The program also shows how China’s leadership is applying competitive forces to industrial policy, to make policy support more targeted. Companies are reassessed every three years and their status may be revoked if they fail to meet the requirements.

The outcome of this year’s selection and review process could impact foreign firms in China as it will boost or limit the performance of their local partners or competitors. Foreign companies wanting to gauge the level of government backing given to local firms in their sector should look at this and similar titles, such as the Little Giant status.

Article: Notice on the Selection of Manufacturing Champions in 2024 and Reevaluation Work (工业和信息化部办公厅关于开展2024年制造业单项冠军企业遴选认定和复核评价工作的通知) (Link)
Issuing body: MIIT
Date: September 4, 2024  

2. China promotes more equipment renewal in key industries

At a glance: The MIIT released guidelines on equipment renewal and technological transformation in 27 industrial sectors and four focus areas. The industrial sectors include petrochemicals, automotive, machinery and pharmaceuticals, while the focus areas cover industrial software, industrial internet equipment, green and energy saving equipment, and safety and emergency equipment. Key goals by 2027 include:

• Promote the CNC (computerized numerical control) deployment rate of key processes to ensure it exceeds 85 percent, while the adoption of digital research and development (R&D) and design tools should exceed 75 percent in the petrochemical industry
• Upgrade two million sets of industrial software and 800,000 sets of industrial operating systems to enhance supply chain resilience in sectors such as petrochemicals, automobiles or pharmaceuticals
• Improve production efficiency, quality and environmental protection for automobiles and components, focusing on vehicle stamping, welding, painting, and assembly and parts manufacturing
• Achieve a digital R&D and design tools adoption rate of 90 percent for industrial machine tool enterprises