Turning away from China is losing the Future: Multinational Carmakers Warned by Foreign Media

Let's cut to the chase. As Hans Greimel, Asia Editor for Detroit's Automotive News, recently put it in a piece for Nikkei Asia: "Global carmakers must stay in China so they can compete outside China." It's a blunt assessment, but it’s the stone-cold truth.

The IAA Mobility, a legacy auto show. Munich, Germany,  September this year

China isn't just the planet's biggest auto market—it's the brutal “boot camp” where the future of the industry will be forged. Get knocked out here, and you risk losing your edge everywhere else. In the last few years, the Chinese market has transformed into the most unforgiving battlefield for global car companies. Some have packed their bags and fled; others are digging in, gritting their teeth to survive.

The Game Has Changed

Greimel nails it: for the legacy auto giants, China is "no easy proposition" for making a quick buck anymore. It’s a high-stakes exam where survival is the only grade that matters.

Just a decade ago, foreign brands commanded a whopping 60% of the Chinese market. Today? That number has plummeted to less than 40%. They've been completely outmaneuvered by homegrown powerhouses like BYD, Geely, and XPeng, especially in the all-important new energy vehicle sector.

XPeng hits the stage in Munich, putting the world on notice that China's EV titans are going global.

This shift wasn't gradual; it was a total reset. It feels like yesterday that Chinese carmakers were still playing catch-up, learning the tech and patching their weak spots. Now, they boast a complete, vertically integrated industrial chain and an innovation ecosystem that's second to none. From the battery titan CATL to massive investments in smart driving from Baidu and Xiaomi, China's auto industry has built a fortress of systemic advantages.

This means that any multinational car company that bails on China isn't just giving up sales—they're forfeiting a front-row seat to the industry's next great transformation. Greimel puts it starkly: "The danger is being more easily bowled over when Chinese brands eventually flood into global markets. And make no mistake, the Chinese brands are coming."

BYD's Seal 6 DM-i Touring on display in Germany—another sign that Chinese innovation is ready for export.

Learn in China, or Perish Globally

Sticking it out in China is about forging steel in the hottest fire. Only the brands that can make it here will have what it takes to secure a foothold on the world stage.

Greimel points to Nissan and General Motors as prime examples. Their initial strategy was lazy: just bring their overseas EV models to China and expect them to sell. The market’s response? A resounding "no, thanks." Chinese consumers demand more than just a ride from A to B; they want cutting-edge intelligence, slick design, and incredible value for their money.

These spectacular failures were a wake-up call, forcing these multinationals to completely rethink their approach. Nissan empowered its Chinese team to lead R&D and design models specifically for the local market. The result? Sales stopped bleeding and started climbing. GM did the same, leaning on its China R&D center to roll out platforms built from the ground up for Chinese drivers.

From "Made for China" to "Made in China for the World"

Today, everyone from Toyota and Volkswagen to Ford and Audi is getting with the program. They are launching products developed in China and then exporting them globally. The playbook is evolving from "(made) In China For China" to "(made) In China for the World." It’s a dawning realization among multinationals that China is no longer just a market—it’s a global wellspring of innovation.

Greimel argues this model is quietly rewriting the entire logic of the global auto industry. In today’s Chinese auto market, price wars are absolutely savage, technology evolves at a dizzying pace, and consumer patience is zero. Launch a new car without a spark of innovation or genuine effort, and the market will chew it up and spit it out before you can blink.

This pressure-cooker environment forces foreign car companies to master "China speed." New product development cycles are slashed to under two years, with R&D and market feedback happening in lockstep. This is the kind of rapid-response agility they simply can't learn anywhere else.

The Ultimate Litmus Test

As Greimel notes, the truly smart companies don't see China as some external challenge but a dynamic arena for learning and co-creation. The firms that manage to survive the gauntlet in China will emerge tougher and more resilient than their rivals, precisely because they've learned how to innovate and win in the world's most demanding environment.

This explains why more and more multinationals are doubling down on their investments in China, even if the profit margins aren't what they once were. For them, China is both a final exam and a masterclass. You might lose the short-term market share battle but still win the long-term war for the future.

In this new era of global industrial realignment, holding your ground in the Chinese market gives you the confidence to compete anywhere. The alternative—retreating to home turf to protect old interests—is a recipe for disaster. The real crisis will hit when Chinese brands make their inevitable landing in Europe and the Americas.

"The smart legacy brands will choose to keep fighting it out there. After all, if they can successfully compete against Chinese rivals in China, they can compete against them anywhere." In this new chapter of globalization, China is more than a market—it's the ultimate litmus test for competitiveness. Only those willing to stay, learn, and adapt have any right to talk about "globalization."

Mao Paishou

** The blog article is the sole responsibility of the author and does not represent the position of our company. **

The New Year barely begins, and Washington drops a flashbang on global diplomacy. A sitting president is forcibly detained and taken out of his own country — a move that blows past diplomatic convention and rams straight into international law’s red lines. On Taiwan, the chatter instantly turns into self-projection, as some people try to shoehorn a faraway conflict into the island’s own storyline. Anxiety spreads fast.

Maduro in cuffs, in a US federal courtroom — the raid’s image problem. (AP)

The South China Morning Post says the US action against Venezuela ignites a fierce debate on the island. Some commentary links the raid to the PLA’s recent encirclement drills around Taiwan, arguing parts of those exercises look, at least in form, like the US’s so-called “decapitation operations”: essentially a leadership-targeting operation. Some American scholars also warn this kind of play could set a dangerous precedent and invite copycats.

“Justice Mission-2025” rolls on as the Eastern Theater Command drills.

That debate doesn’t stay academic for long. It pumps up the island’s unease, with some people asking whether the same kind of military method could one day be copied and pasted into the Taiwan Strait. Even if it mostly lives in public talk, a high-tension political environment turns speculation into something that feels like risk.

People on the island don’t read the US move the same way. A small minority treats it as a US power flex, packed with intel integration, precision strike, and long-range reach. But the more clear-eyed view is harsher: such action chips away at the basic consensus of international order — because if major powers can raid at will and topple other countries’ leaders for their own aims, “rules” stop acting like rules.

Anxiety turns into politics

That worry quickly lands in Taiwan’s political arena. On Jan 5, multiple Taiwan legislators pressed Deputy Defense Minister Hsu Szu-chien at the legislature, asking how he views the US action against Venezuela and whether the PLA might replicate a similar model in the Taiwan Strait. Hsu doesn’t answer head-on. Rather, he merely mentioned preparing and drilling for all kinds of sudden contingencies.

Then he pivots to money. He urges the legislature to pass military budget appropriations quickly and plays up the urgency of delays eating into “preparation time.”

That kind of sidestep, unsurprisingly, only deepened public unease.

SCMP, citing multiple security experts, says the DPP authorities try to play down the association — but outsiders don’t fully rule it out. The reason, those experts argue, is the PLA’s continuing push to improve its ability to shift from exercises to real combat. On the island, that alone works like an anxiety amplifier.

Back in the real world, the PLA Eastern Theater Command has been running “Justice Mission-2025” exercises since Dec 29 last year. Official statements spell out the purpose: a stern warning to “Taiwan independence” separatist forces and external interference, and a move aimed at safeguarding national sovereignty and unification. The message is public and clear, there’s no gray area.

Some US think-tank voices pull a more confrontational takeaway from the US action. American Enterprise Institute senior fellow Hal Brands warns the US raid on Venezuela could create a “demonstration effect,” and he speculates China would watch those tactics closely. Some military commentators on the island seized the moment to hype fears, claiming the mainland might act during a “window” when US power is stretched thin.

That line of talk sounds like analysis, but it functions like a panic pump. US scholar Lev Nachman even says bluntly on social media that if a sudden military action hits the Taiwan Strait, the island could suffer “instant collapse” — not just militarily, but as a psychological shock to society.

KMT Chairperson Cheng Li-wun, in an interview, points to Donald Trump repeatedly stressing a shift of strategic focus toward affairs in the Americas. She says the Venezuela incident should be examined through the framework of international law, and she calls for disputes in any region to be resolved by peaceful means rather than force.

Cheng also reiterates the KMT position: uphold the “1992 Consensus,” oppose “Taiwan independence,” and urge Lai Ching-te to clearly oppose “Taiwan independence,” not touch legal red lines, and avoid continuously raising cross-strait conflict risks.

Rules talk meets reality

International reaction also turns critical of Washington’s approach. Multiple governments and regional organizations speak up quickly, condemning the action as a violation of the UN Charter, which explicitly prohibits using force to threaten or violate another nation’s territorial integrity and political independence. The telling part is the silence: the Western countries that often talk about “international rules” either zipped their mouths, or danced around the question this time.

Reuters says that even though China, Russia, and others clearly condemn the US behavior, the Trump administration is unlikely to face strong pressure from allies as a result. That selective muteness, by itself, drains the credibility of the international order.

On Jan. 5, Chinese Foreign Ministry spokesperson Lin Jian commented again, saying the US actions clearly violate international law and the basic norms of international relations, and violate the purposes and principles of the UN Charter. China calls on the US to ensure the personal safety of President Maduro and his wife, immediately release them, stop subverting the Venezuelan government, and resolve issues through dialogue and negotiation.