The "First China Auto Parts Entrepreneurs Annual Conference and International Conference on Automotive Electronic Informationization" is being held in Beijing. The conference was sponsored by the China Association of Automobile Engineers and the China Machinery Industry Enterprise Management Association. It aims to explore how China's auto parts industry can grasp Seize the opportunity to accelerate development, enhance market competitiveness and other issues.
Strong demand
Zhang Xiaoyu, chairman of the China Automotive Engineering Society, said that from the perspective of national trends, the size of the auto parts market is gradually expanding, not only in the overall increase in market share, but also in the scale of the group's operations. It is expected that within the next two to three years, there will be heavyweight large groups.
Lin Lei, general manager of Xinhuaxin Market Research Co., Ltd., believes that the Chinese auto market has entered a period of rapid development. According to the model and expert forecasts, by 2008, the Chinese auto market demand will reach 10.3 million vehicles.
Accompanied by the rapid growth of China's domestic auto consumption market, the auto parts industry, as the basis for the development of the auto industry, presents a very strong market demand. Sun Bohuai, chairman of the China National Machinery Industry Enterprise Management Association, told reporters that auto parts account for more than 70% of the total vehicle cost, and the development of auto parts is the cornerstone of the revitalization of the domestic auto industry. He analyzed that since the manufacturing industry is the most intensely cost-competitive sector, foreign automobile and parts manufacturers have turned to developing countries to establish production bases. Therefore, the development opportunities facing the Chinese auto and parts and components industries are enormous.
The challenge is severe
Only strong market demand is not enough. Only when this market demand becomes its own market can it be useful. The current parts and components industry in China is not optimistic.
“The parts and components industry is facing severe challenges.†Tian Yushi, assistant general manager of FAW Group Corporation and general manager of Fuao Automotive Parts Co., Ltd., has been in the automotive industry for more than 30 years, and was once the head of the purchasing department of FAW Group. The industry has considerable understanding.
Difficulties exist in three areas: In the international market, the import tariffs on spare parts have fallen to around 15%. In 2003, the import of auto parts and components was 6.26 billion U.S. dollars, which took up a large amount of market resources; the CKD assembled car production model is blooming all over China and does not require domestic zero. Assembling components will put domestic parts and components companies in awkward position.
In the domestic market, energy and upstream raw material prices have risen, and only steel prices have risen by more than 40%. The cost of production of parts and components has increased substantially; the competitive crisis in the vehicle market has been passed directly to parts and components manufacturers, and profit margins have become smaller and smaller, and even have fallen into losses.
In terms of institutional mechanisms, the structural defects of state-owned enterprises have made it difficult for parts and components companies to develop. It is difficult to operate the reforms of China-China auto parts and components enterprises. The inertia of the planned economy has made it difficult for state-owned enterprises to operate.
Self-reliance
The new "Automobile Industry Policy" pointed out the right direction for China's auto parts industry. Auto parts companies will participate in the development of the car in the future development work. In the early stages of development, they will be able to develop relevant parts and components based on the models.
"We are a high-tech company and invest 1.7 billion U.S. dollars in R&D every year." When interviewed by reporters, Chen Jinya, president of Delphi China Co., Ltd., the world's leading auto parts supplier, emphasized that there are two kinds of auto parts, one is a major road cargo, and anyone can do it, which is easy to produce vicious competition; one is high technology. Unique products have high profits and close customer relationships.
Tian Yushi said that China's auto parts do "big" and "strong" countermeasures can be used to guide investment in the tilting of parts and components industries; strict implementation of the new "automotive industry policy" and control of the current fragmented parts market Open local barriers and complete vehicle barriers for professional and systematic integration.
Chen Jinya also stressed in particular that "China's spare parts industry really needs orderly competition, we must promote each other, do not promote each other."