At the beginning of the year, SAIC’s Huayu Automotive completed the acquisition of a 50% stake in the joint venture company Yanfeng Visteon Automotive, making it a wholly-owned subsidiary; Wanxiang Qianchao Co., Ltd. announced the establishment of its wholly-owned subsidiary, Wanxiang Qian, with its own funds. Chaochao Sales Co., Ltd. has a registered capital of RMB 50 million and is engaged in the procurement and sales of auto parts products. This series of events has promoted the further development of the localization of auto parts, which will have a positive impact on the implementation of the "Strengthening the Strategy for Auto Power."

At present, China's auto industry lacks key technologies in parts and components. Most of the core components are wholly foreign-owned or controlled-owned enterprises. China's auto parts production is relatively low. Therefore, to promote the “Strengthening the Strategy for Auto Powers”, we must improve the industrial chain through the development of parts and components and form a group of world-class component suppliers.

Auto parts and components are important foundations for supporting the healthy and stable development of the automotive industry. The development of China's auto parts industry is of great significance for the realization of the “Strengthening Strategy for Autos”. The development of China's auto parts industry has become an important issue that the auto industry has to consider. CCID Consulting's Equipment Industry Research Center will discuss the development of auto parts in terms of the development status of auto parts industry, the challenges faced and the development strategy recommendations for the development of local auto parts and components. The implementation of the "Strengthening strategy for autos".

First, the parts of investment intensity is not high, the whole is not yet mature partnership zero
<br> <br> thanks to the rapid development of automobile industry in recent years, the pace of development of China's auto parts industry has accelerated noticeably. In 2013, the total output value of auto parts in China reached 3.0237 trillion yuan, a year-on-year increase of 17.7%, accounting for 49.9% of the total automobile industry output value. The total profit of auto parts manufacturing industry increased by 13.9% year-on-year.

In 2013, in the output value structure of China's auto parts industry, the output value of the transmission system, body, accessories and engine systems accounted for 56.7% of the total output value of parts and components. It is the three sub-sectors with the strongest driving force in the auto parts industry. .

In 2013, in the output value structure of China's auto parts industry, the output value of the transmission system, body, accessories and engine systems accounted for 56.7% of the total output value of parts and components. It is the three sub-sectors with the strongest driving force in the auto parts industry. .

The auto parts industry has the following features:

Heavy equipment and light sale. Due to the large value of production in the automobile manufacturing sector, which contributes a lot to the GDP, the domestic parts and components industry is highly regarded as a phenomenon of “heavy accessory and light after-sale”. The local governments allocate more resources to automobile manufacturing, and do not attach importance to the development of the automobile service industry. Less investment. In international mature markets, the importance of services account for 1/3, 2/3 of profits from the post-market, and China only about 1/10. The immature development of the after-sales market leads to a much larger scale of the domestic complete vehicle market than that of the parts replacement market. While facing great opportunities for development, parts and components companies are also faced with unavoidable obstacles in the development process: overall strength is weak, private enterprises are dominant, and they are fragmented, chaotic management, lack of core technologies, and poor overall competitiveness. The concentration of the industry is low, and most of them rely on low-cost vicious competition, leading to disorderly markets and inability to raise industrial standards.

Local companies are small in scale and have low R&D investment. Compared with complete vehicles, parts and components have a longer investment cycle, a higher capital threshold, and greater operational risks. Lack of core technology accumulation is still a drawback of local auto parts companies. Local parts and components companies are mostly concentrated on low technological content and profits. In the low-level, low-end areas, prices have become the only competitive means for domestic companies. The lag in the development of the parts and components industry has severely constrained the implementation of China's "Strong Car Strategy."

Foreign-funded enterprises have mastered core technologies and control most of the market share. After the opening of China's automobile industry, Bosch, Delphi, Denso and other international spare parts companies have entered China. At present, most of the world's leading auto and parts and components companies have established joint ventures or wholly-owned enterprises in China, and domestic companies have introduced more than 1,200 technology joint ventures. Due to the rapid establishment of foreign-funded enterprises, its market share has exceeded half, and core parts and components are in a monopoly position. According to incomplete statistics, the wholly foreign-owned and joint venture auto parts companies are in the EMS engine control system, airbags, ABS systems, catalytic converters, electric sunroof, air conditioning systems, car seat assembly, electric window regulators, lighting systems, Automatic transmissions, high-pressure fuel pumps and other systems and components basically control the market share of more than 75%.

The overall investment of the industry continues to grow, and the investment intensity of parts and components is not high. China's auto market has entered a stage of large-scale development. Although the sustained high growth of the Chinese auto market began to slow in 2011, the overall investment scale of the industry is still rising. In 2013, the Chinese auto market attracted more than 10 billion U.S. dollars worth of investment from global automakers. In addition, the total investment of domestic manufacturers in the field of finished vehicles and parts and components exceeded 100 billion yuan, an increase of more than 5% year-on-year. The scale of China's auto parts investment has long accounted for about 40% of the entire vehicle investment. In contrast, parts and components investment in developed countries is usually larger than investment in whole vehicles, and the ratio of vehicle investment to parts and components investment is usually 1:1.3 to 1:2. In China, the opposite is true, and the scale of auto parts investment accounts for a long time About 40% of car investment, the idea of ​​heavy-duty trucks and light parts and components not only makes the investment of parts and components smaller than the entire vehicle, but also the investment speed of parts and components tends to lag behind the whole vehicle. The lower investment level of components, including key components such as engines and chassis, has become a constraint factor in the healthy development of the automobile industry chain. At the same time, the low investment intensity of parts and components has not been adapted to the rapid development of the Chinese auto industry.

The domestic zero-sum cooperation system is not yet mature and the strength of local companies needs to be improved. The Chinese government department has been promoting the sustainable and healthy development of the auto parts industry, but the problem of the “large number and small scale” of parts and components companies has not been well resolved. The current situation of low production concentration and unclear level of structure has affected the cooperation between parts companies and vehicle companies. At present, the intensified malicious competition among Chinese auto parts companies has hindered the establishment of auto parts and components enterprises that are composed of system development and modular supply, and to a certain extent, they have also increased the number of vehicles and suppliers and assembly It is difficult to establish a long-term and stable cooperative relationship between the plant and the part factory. Due to the lack of awareness of mutual responsibility, mutual benefit, and win-win between the upstream and downstream companies, the industrial chain is not solid. The unstable supply-demand relationship in turn causes component manufacturers to be in a subordinate position in their cooperation with purchasers, causing parts and components companies to hesitate due to large market risks, which in turn affects both parties' cooperation.

Second, China's auto parts industry face multiple challenges, the industry faces long-term integration <br> <br> though China's auto parts industry to achieve rapid development, but also face many challenges:

Multinational companies have increased their investment, and the market battle has intensified. The global economy has shown signs of recovery. The energy and raw material prices have risen. The pressure of cost control has increased, and the attractiveness of China's auto market has been increasing. Many multinational companies have increased their investment in China, and the competition in the Chinese market has intensified. The situation is more severe, especially for Chinese-funded enterprises.

Energy-saving, environmental protection and safety standards are more stringent. Increasingly stringent energy conservation, environmental protection, and safety standards, such as national standards and industry standards for electric vehicle safety, power battery, fuel consumption test methods, charging interfaces, etc. These increasingly stringent standards have increased the parts and components industry. The urgency of technological progress.

International trade protection has increased the export costs of parts and components companies. With the improvement of China's spare parts technology and the increase in exports, developed countries are feeling increasingly pressured, they may adopt anti-dumping measures, or develop new quality, technology, environmental protection laws and regulations to safeguard the development of the domestic parts and components industry. This has led to a significant increase in the export costs of domestic parts and components companies, including various unreasonable taxes and fees and the high costs of international litigation.

Low cost in Southeast Asia and South America poses a threat to Chinese companies. Southeast Asia, South America and other regions are in a period of rapid economic growth, causing some pressure on China's spare parts industry. With regard to cost advantages, China may not be able to compare with these countries. If we cannot rely on technological progress to gain a leading position, the cost advantage of China's auto parts industry will be lost.

Third, give full play to the role of government, enterprises and scientific research institutions and make concerted efforts to promote the development of the auto parts industry In view of the current status and status quo of China's auto parts industry, and the many challenges it faces, CCID Consulting made the following suggestions:

(A) actively improve industrial policy, to cultivate their own national brands <br> <br> as the world's largest auto sales market, China has attracted the world's major auto parts enterprises gathered. In the face of the symbiosis between international brands and local brands, the Chinese government must, on the one hand, formulate active policies to enhance the overall strength of China's parts and components industry in the world trade environment. It also urgently needs to cultivate and form an autonomous national brand of parts and components. In promoting the healthy development of the industry, the government needs to continue to improve its policies on spare parts import and export, product management, trade balance, investment, market access, etc., and fully integrate with the development environment of the international spare parts industry. In addition, the government should also actively organize and participate in the internationalization of the domestic parts and components industry standardization system, and create conditions for enhancing the competitiveness of “Chinese design” and “Made in China” in the global auto parts industry.

(B) actively promote technological innovation, industrial upgrading parts <br> <br> overall Chinese auto parts industry technological innovation capability is not strong, a lot of business with low technical difficulty, small profit margins, resource consumption and more products. For joint ventures, China plays a role as a global production base. The development of new products mainly depends on foreign partners' research and development bases in foreign countries. The research and development of auto parts in China is mainly focused on localization. Only a few parts and components companies have carried out limited local product optimization designs. If you want to change the status quo of China's auto parts companies with weak development power and weak core competitiveness, you must rely on technological innovation to start with many links such as materials, processes, design, and manufacturing to fully enhance the technological competitiveness of domestic auto parts. Through the support of national policies, enterprises use the independent development, joint scientific research, and cooperative manufacturing to achieve industrial upgrading. Only on the basis of technological innovation will Chinese auto parts companies be able to develop into product areas with large profit margins and low resource consumption, thereby promoting the upgrading of China's auto parts industry and changing the current product structure, from low-end manufacturing to High-tech development in the field.

(C) to strengthen research cooperation and personnel training, technological innovation and industry alliance established <br> <br> domestic auto parts enterprises and research institutions to work together to set up a technology research and development related to automotive components, standardization, industrialization based Industrial Technology Innovation Strategic Alliance. Carry out demonstration applications and projects of auto parts industry, build auto parts production, research and development platform, jointly digest and absorb advanced technology introduced, establish industrial technology cooperation mechanism and technology promotion system, actively introduce advanced talents at home and abroad, and improve the technical development of employees in the field. To understand and understand the trend, actively declare and build national auto parts industry-related engineering research centers, technology centers, key or joint laboratories, and industrial bases, etc., to comprehensively improve the auto parts industry technology level and market competitiveness.


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