China and Germany Deepen Automotive Cooperation as AI and Electric Vehicles Reshape the Industry- China and Germany are seeking to strengthen their automotive partnership as electrification, artificial intelligence (AI) and intelligent connectivity transform the global automobile industry. With traditional manufacturing models giving way to software-driven vehicles and advanced mobility technologies, both countries are exploring ways to combine their industrial strengths, align technical standards and expand access to each other’s markets.
The renewed focus on cooperation was evident at the 2026 World Intelligent Connected Vehicles Conference (WICV), held in Beijing, where government officials and industry leaders discussed practical steps to advance bilateral collaboration. The discussions covered regulatory coordination, vehicle technology, data management and market access, reflecting a shared interest in making cross-border automotive development more efficient.
The partnership is evolving beyond conventional vehicle manufacturing towards a technology-driven relationship centred on electric mobility, artificial intelligence and connected transportation. China brings extensive experience in electric vehicles, digital technologies and large-scale market deployment, while Germany contributes decades of expertise in automotive engineering, industrial production, vehicle safety and systems integration.
Hildegard Müller, president of the German Association of the Automotive Industry, emphasised the importance of turning bilateral dialogue into practical results. She argued that cooperation should focus on workable technical solutions that enable companies in both countries to innovate and compete internationally.
The two countries have an established foundation for collaboration. Their memorandum of understanding on intelligent connected vehicles, signed in 2018, created a framework for technical exchanges. More recently, representatives met in Berlin to discuss vehicle type approval, data recording and vehicle-to-everything (V2X) communication technologies.
These areas are becoming increasingly important as vehicles evolve into sophisticated digital platforms. Modern cars rely on software, sensors, communications systems and computing capabilities to support driver assistance, navigation, safety and energy management. Differences in technical requirements and regulatory procedures can complicate the development and sale of vehicles across international markets.
Greater alignment on standards could help manufacturers reduce duplication, simplify testing and bring new technologies to market more efficiently. However, cooperation will require countries to reconcile differences in safety requirements, data protection, cybersecurity and regulatory oversight.
China’s expanding intelligent-vehicle ecosystem is an important factor in this process. By the end of August, approximately 61 million passenger cars in the country were equipped with combined driver-assistance systems, while around 16 million had 5G terminals and roughly two million were fitted with direct cellular vehicle-to-everything (C-V2X) communication terminals.
These figures illustrate the scale at which connected-vehicle technologies are being deployed in China. The country has also introduced national standards covering driver assistance, automated driving, automatic emergency braking and vehicle cybersecurity, while expanding real-world applications of connected-vehicle communications.
For German manufacturers, this environment offers opportunities to develop and test technologies in a large and rapidly evolving market. It also creates incentives to adapt products to local consumer expectations, digital services and technical requirements.
BMW is one example of how German automotive companies are integrating their traditional engineering expertise with China’s technology ecosystem. Milan Nedeljković, chairman of BMW AG’s board of management, said the new BMW iX3 produced in Shenyang, northeast China, would begin customer deliveries in November.
The model reflects BMW’s effort to combine its established vehicle-development capabilities with advances in electric mobility and digital connectivity. Local production also demonstrates the continuing importance of China to the company’s manufacturing and product-development strategy.
For German automakers, maintaining a strong presence in China is increasingly about more than selling vehicles: it also involves adapting to developments in batteries, software, intelligent driving and digital consumer services. Closer cooperation with local suppliers and technology companies can help them respond to these changes while retaining their established strengths in engineering and vehicle integration.
The relationship is also becoming more reciprocal as Chinese manufacturers expand their activities in Germany and the wider European market. Chery Holding Group, for example, has established research and development centres in Germany as part of its European expansion strategy.
Chairman Yin Tongyue said the company’s international approach extends beyond manufacturing and sales to include local research, procurement, talent development and engagement with regional markets. This reflects a broader shift among Chinese automakers towards establishing a lasting presence in overseas automotive ecosystems.
Historically, German companies such as Volkswagen, Audi and Mercedes-Benz helped develop China’s automotive industry through investment, manufacturing partnerships and technology transfers. The current phase of cooperation is more complex, as Chinese manufacturers increasingly bring their own electric-vehicle platforms, digital technologies and development capabilities to international markets.
The relationship is gradually moving from a model centred on technology transfer towards one involving more reciprocal innovation and competition. German manufacturers can draw on China’s experience in electric mobility and digital services, while Chinese companies can benefit from German expertise in vehicle engineering, safety, industrial processes and European market requirements.
Mercedes-Benz is pursuing a similar strategy through its partnership with Chinese technology company Momenta. Oliver Thöne, a member of the Mercedes-Benz Group AG board of management responsible for Greater China, said the company was expanding its driver-assistance offerings in China from highway applications towards urban driving.
He also highlighted cooperation with Tsinghua University on a vision-language AI model that has been applied to rear-seat systems and is intended for global deployment. Such developments demonstrate how technologies developed through collaboration in China may eventually support products sold in other markets.
AI is becoming a particularly significant area of competition and cooperation because it can influence how vehicles interpret their surroundings, respond to traffic and interact with passengers. Driver-assistance systems increasingly depend on sophisticated algorithms that process information from cameras and other sensors, while generative AI and language models may support more natural interaction between drivers, passengers and vehicle systems.
Nevertheless, advanced driving technology must be developed alongside rigorous safety validation, cybersecurity safeguards and clear accountability for system performance. Differences in regulations and data-governance requirements remain important considerations when companies seek to deploy the same technology across multiple countries.
Wang Zhiqin, vice president of the China Academy of Information and Communications Technology, said bilateral automotive cooperation was expanding beyond complete vehicles and parts procurement into joint research, standards coordination and ecosystem development. She called for stronger collaboration in emerging technologies and across supply chains involving communications, information technology and software.
The economic implications extend beyond automakers themselves. Suppliers, software developers, semiconductor companies, research institutions and communications providers all have a role in developing the next generation of intelligent vehicles. Cooperation could create opportunities for these businesses to participate in joint testing, technical development and cross-border supply arrangements.
At the same time, closer industrial ties will not eliminate competition. Chinese and German manufacturers must still protect their commercial interests, comply with different regulatory frameworks and respond to rapidly changing consumer demand. Trade policy, cybersecurity concerns and disagreements over market access could also complicate efforts to deepen cooperation.
Ultimately, the future of China–Germany automotive relations will depend on whether both sides can translate high-level discussions into practical arrangements that benefit businesses and consumers. Shared technical standards, joint research and reliable regulatory procedures could support innovation while reducing unnecessary barriers to international development.
As electric vehicles and AI reshape the global automotive industry, neither traditional engineering expertise nor digital innovation alone will define success. The ability to combine advanced manufacturing, software, connectivity and safety will become increasingly important.
For China and Germany, the opportunity lies in building a partnership that accommodates both cooperation and competition. By combining complementary capabilities and establishing workable technical frameworks, the two countries can strengthen their automotive industries while contributing to the development of a more connected, electrified and intelligent global mobility system. Houthis Claim Strike on Saudi Arabia’s Ras Tanura Oil Refinery as Riyadh Faces Missile Attacks | Maya
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