As the foundation of globalization is shaken, European enterprises in China are facing unprecedented challenges and opportunities. In order to safeguard their development in the Chinese market and their competitive position on the global stage, European enterprises need to choose appropriate strategies according to their own situations, to cope with uncertainty and risk.

The strategic choices of European enterprises in China can be divided into five types, namely, “wait and see”, “change identity”, “flexible structure”, “focus on China” and “go abroad together”. These strategic choices reflect the different attitudes and expectations of European enterprises towards the Chinese market, as well as the different ways of coping with the changing globalization.

“Wait and see” strategy is a conservative strategy, suitable for European enterprises with relatively small or limited business in China. These enterprises tend to adopt a pure export mode, reduce investment and production in China, to reduce risk, but also give up the opportunities and potential market share of the Chinese market. For example, the Dutch Stellantis Group closed its local manufacturing plant of Jeep brand, and adopted a “light asset, light footprint” business model, selling pure imported Jeep brand models.

“Change identity” strategy is a transformation strategy, suitable for European enterprises with relatively small business scale and low technology sensitivity in China. These enterprises can consider selling their industries in China to local Chinese enterprises, achieving separation between Chinese and foreign, and retreating from “holding dominant” to “behind-the-scenes empowerment”. This transformation strategy enables the new company to manage locally and develop its business according to local market needs. For example, Mead Johnson sold its business in China to China Spring Capital Group, creating a “new Mead Johnson” model. Under this model, the enterprise retains the option of increasing its investment in the Chinese market when the situation is stable.

“Flexible structure” strategy is a balanced strategy, suitable for European enterprises with sensitive business content and not suitable for outsourcing. These enterprises can flexibly localize some of the research and development, procurement, production and other links, to balance the requirements of China and the United States, and avoid being restricted. This strategy requires enterprises to review technology and legal regulations, as well as establish good relationships with local partners. For example, French Airbus established a research and development center in China, and chose to cooperate in the field of hydrogen energy, in line with China’s policy of supporting high-tech industries.

“Focus on China” strategy is a positive strategy, suitable for European enterprises with relatively large business scale in China. These enterprises can reduce the risk of geopolitical and trade conflicts by localizing research and development, procurement, production and other links, and achieving a closed loop of business chain. This strategy requires enterprises to increase their investment and innovation in the Chinese market, to adapt to the needs and changes of the Chinese market. For example, Volkswagen achieved a localization leap from customer service center to research and development center to assembly line through its localization strategy in China.

“Go abroad together” strategy is a collaborative strategy, suitable for European enterprises that want to expand overseas markets. These enterprises can follow Chinese enterprises to the international market, reducing risk. Cooperate with Chinese customers, follow Chinese supply chain enterprises to go abroad, expand overseas markets. This can not only strengthen cooperation relations, but also achieve industrial diversification, enhance risk resistance ability. For example, German Siemens cooperated with China State Grid to build the largest direct current transmission project in South America in Brazil.

The strategic choices of European enterprises in China not only affect their development in the Chinese market, but also their competitiveness on the global stage. In an era full of uncertainty and change, European enterprises need to choose the most suitable strategy for themselves according to their own situations and goals, and constantly adjust and optimize. Only in this way can European enterprises seize more opportunities in adversity.

The strategic choices of European enterprises in China are a complex and important issue, involving various factors and interests. European enterprises should make wise decisions based on their own strengths and weaknesses, as well as the characteristics and trends of the Chinese market. At the same time, European enterprises should also maintain good communication and cooperation with the Chinese government and enterprises, jointly cope with the challenges brought by the changing globalization, and promote the healthy development of bilateral economic and trade relations.

The strategic choices of European enterprises in China not only concern the interests of European enterprises themselves, but also the future of China-EU relations. China and Europe are two major forces, two major markets, and two major civilizations that maintain world peace, promote common development, and advance human progress. China-EU relations go beyond bilateral scope, have global significance and important strategic impact. It is hoped that European enterprises will adhere to the principles of openness, cooperation, mutual benefit, inclusiveness, diversity, innovation and development, and make positive contributions to the stability and long-term development of China-EU relations.