Hello from Shunyi for what is shaping up to be a tech centred news week. We start off with a slightly more indepth look into DIDI than is usual, pay a visit to Microsoft, check out China’s newest aspiration to be chip self sufficient, China EV battery makers gain ground in EU ending up at the China UK trade forum. Crammed with techy goodness!
DIDI Blocked in China! NOT~
Hardly news we know, as almost every western media has had mischievous headlines screaming the above. Apart from being rather a bit of a reach from the truth, many gave very little more detail whilst some did clarify further in the story. However, we and they know most readers simply scan headlines.
In realty, DID was not blocked or shut down. It is simply unable to accept new riders until it is cleared. The order did not impact DID’s existing business, its customer base or drivers. Merely the ability to grow new clients.
It continues to operate as it did the night before. That, may on the surface, seem a weak punishment – but we address that further on, under timing. The crux of the issue for DID seems to be the way it collects, stores and uses rider data. Many rumours are currently flying, among them that DIDI was secretly sending data to US intelligence services, or that it was secretly building a data base on Gvt employees.
The latter is similar to international news that GVT officials were banned from buying or driving TESLA EV to work in fear that their data collection was being accessed by US security agencies. TESLA, like DIDI has denied these and Gvt have not commented further.
We labelled the headlines mischievous as DIDI was not blocked or shut down as some overseas media were suggesting. As one of the countries most popular ride share firms, blocking DIDI would have created pandemonium among millions of working Chinese Monday morn and had a serious negative impact on commerce in China. That would have left Gvt open to claims of hypocrisy by claiming it was acting “On behalf of the people” on one hand yet creating misery on the other.
The Chinese gvt is oft criticised, quite rightly, for acting with a heavy hand in some cases. However, like most Gvts it does- basically, exist by the grace of the people. In other words, it survives because the majority of the populace, more or less agree with its direction and policies. Greed, selfishness, apathy and probably laziness keeps the party in power. Alienating the working people though, may test that support.
Nor was this a DIDI only focused attack. Over the course of 2021, China has railed against big tech and the influence it is wielding in society, running roughshod over laws and, by extension, politics. This was seen as a direct challenge to The Party. Many of the countries big tech firms, Alibaba, Tencent, DIDI to name a few have been paraded on the carpet and dressed own.
Issues range form deceptive marketing, unfair competition practices, unfair working conditions and abuse of user private data. This isn’t a Gvt secret agenda. The general Chinese public’s annoyance and anger at these practices has been well and truly exposed on social media platforms. Many tech firms have been fined and have pledged to cooperate. DIDI on the other hand seemed to have been more tardy in its compliance.
For this reason, some industry observers had expressed confusion as to why Gvt has extended DIDI such a long lease. The timing of the order, Last Sunday, 3 days after DIDI’s public listing cleared that up. One order but a double whammy. As expected, DIDI’s shares, have at time of writing, slipped around 20% below their initial offer price. Perhaps borrowing a page form Putin’s playbook: Revenge is a dish best served cold.
Is Microsoft abusing user Data?
Also making news in China this week is a comment from a Microsoft executive last Wednesday that U.S. federal law enforcement agencies secretly access Microsoft user data thousands of times a year without US courts approval. China of course sees this as a gift from heaven and responded with the usual sharp rhetoric. (link is in Chinese but translates easily enough)
A tale of 3 Cities
What do Wales, China and The Netherlands have in common?
Chips.
More exactly, silicone chips.
Huawei and other Chinese firms have been struggling recently as a result of firstly the US blockage of its semiconductor makers supplying to China, and the current global shortage.
Nexperi is a Dutch semiconductor firm.
It’s in talks to buy a Welsh chipmaker; Newport Wafer Fab.
Nexperia is owned by China’s Wingtech Technology.
The deal is worth 63 million pounds and is expected to be closed by next Tuesday at the latest. This of course hinges on the UK Gvt resisting US pressure to reject the sale.
NWF produces silicon chips used in power supply applications for the auto industry. These chips are a key ingredient in the EV industry which Biden has promised the US people he will wrest control of from China. However they are also vital to AI or self driving vehicle development.
Britain’s decision will be watched closely as a bell whether in the ROK firm Magnachip’s planned merger with an affiliate of Chinese private equity firm Wise Road Capital. This was put on hold last month when he Committee on Foreign Investment in the U.S. issued an interim order to pause the deal. A successful Welsh deal could panic the US into rejecting the ROK deal which may not help ROK US relations.
China batteries to power EU EV
End of last month – June 20th – Shanghai-based green tech company Envision Group announced it had successfully bid to be to be part of Renault Group’s new electric vehicle battery strategy. After a fairly lack lacklustre performance in recent years, the problems of Covid and suffering adverse publicity over the Nissan boss scandal as well as emission cheating accusations Renault is expecting EV to return it to being a a competitive brand in the market. You can read the Envision / Renault story here: Green Tech Specialist Envision to Build Battery Plant in France to Supply Renault
This week, Envision unveiled a similar agreement as part of Nissan’s strategy for its electric-vehicle battery manufacturing in the U.K. This will be Envision’s second UK based plant. That story is covered here: EV Battery-Maker Envision AESC to Build U.K. Plant to Supply Nissan. Both articles are courtesy of Caixin Global free.
Now, as the above two car brands are part of the Nissan, Renault, Mitsubishi alliance, Aim2D wonders if we can expect a similar arrangement with Mitsubishi in the near future?
UK China Trade
We read a lot of big headlines re the problems between Beijing and London – how this is hurting trade. Feedback, from both sides after the recent virtual hosted by the China-Britain Business Council (CBBC) seems to paint a different picture.
“U.K.-China trade has increased against all odds; investment is also on the rise,” Li said through an interpreter. “These trends show that between China and the U.K. there are not just shared interests, but space for growth.”
Caixin Global free has more details: China-U.K. Business Group Says Ties Are Strong, Growth Prospects Are Good
UPDATE – UPDATE – UPDATE
Further to the Tale of Three cities, above Nexperia has announced it has successfully closed the deal with Welsh company NFW. This takes China one step closer to becoming self sufficient in hi power chips. That loud sigh you heard was probably Huawei execs! Don’t get too excited, waiting for the Washington to London hot line to ring!
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