“Actively maintaining our course of growth”


ERGO moves in on the Chinese automotive market

Digitalization & innovation, 28.10.2019

Today, ERGO board members Markus Rieß and Karsten Crede concluded a “strategic partnership agreement for insurance business” with Great Wall Motors, one of the most innovative automobile manufactuers in China with annual sales of over one million cars.

EMS Joint Venture

 “With this agreement, we are actively maintaining our course of growth,” said the CEO of ERGO, Markus Rieß, at the signing. “Together with Great Wall Motors we aim to create a leading provider of technology and data-driven product and service solutions in the mobility ecosystem. This will further strengthen ERGO’s presence in China, a strategically important growth market.” In addition, ERGO also wants to offer products to its new partner directly: industrial insurance products for its factories, commercial insurance policies for its traders and private insurance policies for its 70,000 staff.

The new cooperation is embedded in the organisational structure of ERGO China, but it will be directed and run by ERGO Mobility Solutions. Karsten Crede, Head of ERGO Mobility Solutions and member of the Board of Management of Digital Ventures AG, tells more about the details and the strategic organisation of the new cooperation in the interview.

Mr. Crede, at the beginning of 2017 you started your tenure at ERGO Mobility Solutions by saying: “We want to become a strategic partner for the automotive industry.” Did you have the Chinese market in mind back then?

Karsten Crede: Actually China has always been one of our three core automotive markets that we, as insurers ‘who speak car,’ definitely want to participate in. The other two markets are the US and our home market, Germany. You only have to think of the 22 million cars that were registered last year alone in China. In Germany that figure was barely 3.3 million, and declining.

But even without this enormous potential for revenue, our cooperation with Great Wall Motors, which follows our alliances with Ford, Volvo, BMW and NRW-Garage in Germany, as well as our investments in innovative start-ups such as Fair and Ridecell in the US, is a next logical step for ERGO Mobility Solutions. As you said, we have set out to develop innovative “new mobility” solutions with strong partners for corporate customers, households and car dealers and to be a part of the future of mobility. Ultimately, mobility has been in the throes of disruption for a while and ERGO has to adjust as an insurer.

With this background, what makes Great Wall Motors a suitable partner?

Crede: The company has 70,000 employees, a turnover of €13bn and is aiming to sell more than 1.2 million cars annually until 2021. It will soon be here in Germany as well. Not only does its founder, Jianjun Wei, have good political connections in China, he is also valued in Berlin as a partner for dialogue and for business because he focuses on Germany as the most important target market in Europe. While Great Wall Motors does manufacture more SUVs and pick-ups than any other car manufacturers in China, it also invests heavily in e-mobility, such as a joint venture with BMW, and has already assigned over 10,000 of its employees to research and development activities.

Equally as important for us is that Great Wall Motors is the only car manufacturer in China that has systematically included insurance in its expansion plans and with this in mind was seeking an international and broadly diversified insurance partner. In return for becoming a partner of Great Wall Motors and meeting the insurance needs of its customers and business partners with innovative, digital and integrated insurance and mobility solutions, we receive valuable insights into technological innovations as well as vehicle and customer data. The insights gained from this partnership in the Far East will certainly be useful in other markets.

What is the agreed goal of this new partnership and what will you do first?

Crede: Our common goal is to create a leading provider of technology-driven and data-driven product and service solutions in the mobility ecosystem for the entire Chinese market. Technology, data management and end-to-end digital solutions will form the basis of this collaboration.

Overall, the integrated business model strengthens the distribution and partner network of both Great Wall Motors and ERGO China. We of course had a valuable reference from our cooperation with NRW-Garage. We can also add even more expertise to our cooperation talks thanks to our ability to interlock with Munich Re. I am of course talking about the specialist knowledge of our colleagues in Munich, for example with regard to industrial insurance for our new partner’s factories. As you can see, the cooperation with Great Wall Motors is the logical next step in our aim to create a comprehensive “win-win” agreement for providers of primary insurance, reinsurance and mobility.

Interview conducted by Ingo Schenk

 

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