China's auto market top 100 hegemony


From 1995 to 2003, the total output value of China's auto industry grew by 18% year-on-year, while the average annual growth rate of auto parts was 20%. China's auto parts industry maintained a high-speed growth. The latest statistics from the China Association of Automobile Manufacturers show that in the first 11 months of 2004, the domestic automobile production and sales reached 4,665,800 and 4,583,300 vehicles, respectively, an increase of 16.2% and 16.8% year-on-year respectively, and both the production and sales volume have exceeded last year. If we add the figures for December, China's auto production and sales will exceed 5 million for the first time in the year. This is the year since China's accession to the World Trade Organization at the end of 2001. It has exceeded one million steps every year for three consecutive years. And the production and sales volume have doubled in the three years respectively, and this development speed is also very rare in the history of world automobile development. As we all know, the auto parts industry is the basis for the development of the auto industry. In the past 2004, China's auto parts market has emerged a situation of competition and top 100 competition. Competition from home and abroad has become increasingly fierce.

Northeast Tiger - Fu Ao Auto Parts Co., Ltd. Fu Ao Auto Parts Co., Ltd. is a wholly-owned subsidiary of China FAW Group Corporation. It was established in August 1998 and is a nine-factory company owned by FAW Group Corporation. Eight foreign joint venture (control, equity) subsidiaries formed. It is currently the largest auto parts production base in China. Backed by big trees, it is easy to cool off. 78% of Fu'ao products are supplied to the First Automobile Group's OEM and OEM. In recent years, we are focusing on the development of external supporting markets and have successively completed the supply of 31 OEMs and OEMs for Guangzhou Fengshen, Shanghai Chery, Jiangxi Ford, Yunnei Power, and Chaoyang Diesel Engine. 68 franchised dealers for first- and second-tier Folio brand products and seven "regional transit stores" were established throughout the country, initially forming a sales and service network throughout the country. In the international auto parts market, exports to the United States, Germany, Belgium, Canada, South Korea and Southeast Asia, including OEM and bulk markets, have been achieved.

According to Cui Mingwei, chairman and general manager of Fu Ao Auto Parts Co., Ltd., in the new year, Fu Ao Auto Parts Co., Ltd. will inherit the effective production, operation and management experience of FAW for many years and give full play to the advantages of FAW product development. Rely on technological advancement, develop a knowledge economy, promote local economic development, move the auto parts industry to module production methods, and build a modern, internationally competitive multi-regional, multinational corporation group as soon as possible.

Dongfeng Motor Company Forms Parts "Aircraft Carrier"
The Dongfeng Motor Parts and Components Business Unit consists of 12 subsidiary companies, including Dongfeng Wheel Co., Ltd. and Dongfeng Electronic Technology Co., Ltd., and Dongfeng Precision Foundry and Dongfeng Powder Metallurgy Plant. A group of "aircraft carriers" with a total of 3.8 billion yuan in assets, 27,500 employees and an annual production capacity of 400,000 vehicles (sets) will be established. The establishment of Dongfeng Automotive Components Division marked that Dongfeng Motor Corporation has begun to integrate all aspects of the parts and components section, and also indicated that Dongfeng Motor Company has fully implemented the strategic implementation of the core competitiveness of the parts “authentic Dongfeng brand”.
The strategy and focus of Dongfeng Automotive Parts Development identified by Dongfeng is: through joint ventures and cooperation, it will actively integrate into the international R&D system, adopt systematic development and modular supply as the direction, cultivate first-tier suppliers; through cooperation, mergers and acquisitions, and resource integration , eliminate the market, focus on technology, talent, and assets, focus on professional and scale adjustments, rationalize the second and third-tier suppliers, improve innovation through institutional mechanisms, improve corporate governance, and enhance the core competitiveness of enterprises. Establish the operational performance of parts and components and the status of the industry. In the future, the new Dongfeng Motor Co., Ltd. will highlight chassis, key assemblies, and components with comparative advantages in the production of auto parts; other auxiliary businesses and products that do not have advantages will undergo strategic contraction adjustments.

SAIC's affiliated parts and components companies “grab, force, and encircle”
"Grabbing, forcing, and encircling" means actively expanding the global market. Parts and components companies are striving to become parts and components production bases for the private auto industry. "Grabbing" accounts for the domestic market share of parts and components, expanding the CM market (Chinese market); "forcing" parts and components companies to go abroad, expanding the AM market (aftermarket); "encirclement" around the world-renowned auto manufacturers supporting OEM market (original matching market). At present, over 80% of the parts and components companies of SAIC Group are supplied with products for domestic and foreign large vehicle companies, and the market share of over 30% is out of the market, including Natiefoss, United Electronics, Yitong, and The supporting rate of the external system such as dynamic system, Shangshi Transport and Steamed Tooth Works is as high as 60%; Xiaolan Auto Lighting, Yanfeng Visteon, Shenya and other parts and components companies have established factories in Chongqing, Wuhan, Changchun, Guangzhou, etc. “Real estate for sale”; parts and components manufactured by ZF, United Electronics, NITTO, Shanghai KS, and Jin Heli have entered the international market in batches. In 2002, SAIC Motor’s export value reached US$250 million, exceeded US$375 million in 2003, and is expected to exceed US$500 million in 2004. It indicates that the Shanghai auto parts industry has entered the global auto parts market. By 2007, SAIC Group's exports will increase by an average of 30% annually, and the export value will reach US$1 billion.
The successful road to the development of auto parts in Shanghai is the SAIC Group's active response to the challenges of China's accession to the WTO and economic globalization. It also adheres to the globalization strategy of “bringing in” and “going out” and the implementation of the strategy of “grabbing and circumventing” the business strategy. The enlightenment it gives us is that auto parts are the first to achieve localization, which is not only the only way for the development of auto parts industry in China, but also the only way for the development of China's auto industry. It is undoubtedly of great strategic significance for China's auto industry to realize its dream of localization, to achieve its own development capability, and to become a world advanced level.

Wanxiang Group - building a miracle of China's private auto parts companies Founded on July 8, 1969, Wanxiang Group is one of the 120 pilot companies in the State Council and one of the country's 520 key companies.
But who can imagine that such a large-scale enterprise was a small blacksmith shop with only 7 individuals, 4,000 yuan of funds, and 84 square meters at the beginning of the venture, and the general manager Lu Guanqiu did not even get a junior high school diploma. ?
It is such a company that can make up for the shortages, starting with the production of coulters, shovels, lost wax cast steel and other products. In the course of 79 years, it made strategic adjustments and concentrated production of imported car universal joints. Driven by Lu Guanqiu, Wanxiang Group continues to develop and the scale benefits are changing with each passing day. Now Wanxiang Group takes the path of “corporate grouping and internationalization” and adheres to the strategic principle of “big group strategy, small-accounting system, capital-based operation, and international operation”, with a daily profit of 1 million yuan. Strive to make a profit of 10 million yuan in 2009.
Wanxiang Group divides the entire group's industry into four major segments: Wanxiang Group, Wanxiang Qianchao Corporation, Shanghai Wanxiang Investment Corporation and Wanxiang America Corporation.
Wanxiang Group has created a miracle of China's private auto parts companies. Lu Guanqiu has created a miracle.

The Hunan Torch, a representative of the China M&A Parts Group model, is the former Zhuzhou Spark Plug Factory of Hunan Torch Investment Co., Ltd., which was reorganized into a state-controlled listed company in 1993. In 1997, Xinjiang Delong Group transferred 25.7% of the total shares of the Hunan Torch, which was held by Zhuzhou State Assets Bureau, and became the largest shareholder of the Hunan Torch. The torch’s investment philosophy is to extend the new value of traditional industries. In 1997, based on the first place in the domestic market for single-product spark plugs, the Hunan Torch was accompanied by the entry of Xinjiang Delong. The Torch also began its industrial integration. In 1999, it acquired the competitor MAT, the largest brake system importer in the United States, and a 75% stake in its nine joint ventures in China. It not only achieved a 15% share of the US auto parts import market, but it achieved 150 million US dollars in sales in the United States, but also became the world's largest supplier of brake systems.
After several years of development, the Torch's auto parts cover the key components of heavy-duty vehicles, such as heavy-duty axles, passenger car chassis, heavy-duty transmissions, transfer cases, gears, automotive interior parts, brake systems, spark plugs, and piston pins. , air conditioning compressors, steering gear, car lights mirrors, car appliances, etc. The goal of the Hunan Torch as a strong automobile component has been achieved. The total assets of Xianghuo Torch Company expanded from 366 million yuan in 1997 to 5.471 billion yuan at the end of 2002, an increase of approximately 15 times. The strategic transformation and strategic upgrade of the main business resulted in a substantial increase in business revenue. The Torch has become a large industrial group with 30 molecular companies and businesses throughout the country and North American countries.
Foreign auto parts companies are under heavy pressure. <br> China has a large population, abundant resources, and rapid economic growth. It is the world's most promising automobile market. Foreign auto and parts companies have long been coveted in China's auto and accessories markets. After China's accession to the WTO, with the declining auto market in Europe and the United States, foreign automobile and component giants have accelerated their expansion in China. So far, all the large foreign multinational auto parts companies have set up factories or set up offices in China through joint ventures and joint ventures in order to gain a share in the Chinese market. They are full of hope and most have achieved satisfactory results.
Some people have used sesame seeds to describe China's auto parts production companies. According to statistics, there are more than 8,000 large and small auto parts manufacturers in China. More concentrated in Zhejiang, Fujian, Jiangsu, Liaoning, Hubei, Shandong, Guangdong and other places.
Does the entry of foreign auto parts companies put pressure on Chinese companies? The author investigated some of the auto parts industry stakeholders. Some people think that there are certainly competition pressures, but this is inevitable. After global procurement integration, there will be competition wherever there is a market. At present, it seems that foreign auto parts and components companies in China are more concentrated in electronic products, engine key components and other high-tech products. Domestic companies are mostly engaged in some labor-intensive products with low added value. At present, it seems that domestic and foreign auto parts enterprises are a kind of "advantage" complementary stage (of course, some people also call the "disadvantages" complementary). The key is to learn and master advanced production techniques as soon as possible in the complementary process. Skills to barbarians."
In 2005, China's auto parts market will still show a diversified development trend. Who can lead the market in the future? We will wait and see.



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