Taicang in Jiangsu province is a hot spot of German investment. Over the past three decades, Taicang, just 800 square km and home to around 800,000 people, has gradually gathered more than 550 German enterprises in total, making it a true home for German businesses. The No 103 bus route through Taicang tells the story in miniature. Each stop bears the name of a German company, which includes Kern-Liebers, Trumpf and TOX. Within a four-km radius of the Kern-Liebers stop, over 40 foreign-invested enterprises, mostly from Germany, have established operations. These German firms, occupying just 0.24% of the city’s land, have contributed about 8% of Taicang’s GDP.
Schaeffler led the way in 1998, when it established its first Chinese plant in the city. In an interview with China Daily, Armin Kress, Vice President of Strategy and Processes at Schaeffer, gestured to rows of conveyor belts where cobalt-blue automated guided vehicles ferried raw coils into robotic presses. “This was our very first factory in China, both our oldest and our newest,” Kress said, recalling when German engineers calibrated bearings by hand and trained local workers on delicate assembly techniques. Over the past three decades, Schaeffler has reinvested 13 times, pouring more than CNY11 billion into expansion, he said. “Today, the site’s annual output tops CNY20 billion, and a new factory wing – completed in March 2023 – melds the company’s original workshops with state-of-the-art technologies,” he said. The new facility was designed from the ground up to manufacture the latest products, such as coaxial reducers for electric vehicles. The ability to innovate locally rather than simply import products has been key to Taicang’s appeal. “When China’s EV boom took off, Schaeffler didn’t just follow – it led, launching and mass-producing new gearboxes right here in Taicang. Now they’re going global, alongside our Chinese clients,” he said.
Taicang’s rise owes much to a pragmatic local government that understands when to step in and when to leave businesses alone. According to Tomas Herman, Deputy General Manager of German auto supplier Brose Taicang Automotive Systems Co, when applying earlier this year for green-factory certification, the company encountered some questions. “We received all the answers the next day,” he emphasized. That “unseen stewardship”, as he said, has fostered a deep trust. “That’s also the reason why we have three factories in Taicang,” he added. It took 14 years – from 1993 to 2007 – for Taicang to land its first 100 German firms. But momentum picked up fast. The 400th German firm arrived in 2021. The 500th invested in January 2024. Government incentives have added further fuel.
As Taicang’s German community grew, demand for vocational talent skyrocketed. Still, machines alone don’t build industries – people do. In response, Taicang imported Germany’s vaunted “dual education system”, whereby apprentices spend part of the week in classroom lectures on processes and part on the factory floor under master technicians. “They learn theory in school, then apply it immediately in our workshops,” said Willi Riester, CTO of Chiron Machine Tools (Taicang) Co. Riester likened the program to a “talent reserve account” that guarantees a pipeline of high-quality workers. Companies commit to guiding apprentices through their entire careers. “We develop these young talents according to our precise needs. Then we support them long-term, ensuring that loyalty and expertise stay here,” he added.
Collective German investment has now topped USD6 billion, even as U.S.-China trade tensions and global supply-chain shocks rattled many multinationals. Instead of pulling back, German companies here have expanded. Krones, a Bavarian beverage-packaging specialist, announced a €200 million expansion last year to double its capacity, workforce and annual output. Merck, a German life-sciences company, runs a materials-development center in Taicang that serves China’s burgeoning semiconductor sector. Heraeus, Trumpf and other German firms have fine-tuned their operations in Taicang, citing the city’s blend of reliable local partners, a cohesive expatriate community and practical bureaucracy. In early 2025, Standard Foods broke ground on an intelligent digital supply-chain hub for high-end edible oils, a USD70 million project expected to generate CNY800 million in annual output.
Across town, Taicang is already eyeing the next phase of growth: integration of artificial intelligence in production, carbon-neutral manufacturing and deeper collaboration on next-generation battery materials. “China’s market is massive,” said Kress from Schaeffler, “but Taicang shows how German companies can succeed here by blending our precision with Chinese scale and speed.” In Taicang, German rigor and Chinese dynamism have created a recipe whose flavor only deepens with each rising cycle – proof that this little city has become much more than a manufacturing outpost, the China Daily reports.
