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After joining the WTO, with the development of China's auto industry and the strengthening of China's trade position in products, the auto parts industry's exports have increased year by year, and this year has begun to show rapid growth.
Historical review of parts exports Since the establishment of China's auto industry in 1953, with the development of China's auto industry, the parts production industry has followed a long road of development. The real scale of the export of parts and components began in the 21st century. From January 2001 to September 2004, the total exports of parts and components totaled more than US$10 billion.
The main feature of this phase is the realization of four transformations.
The change of export form. From a single product-type export to a capital-type export. Such as Wanxiang Group's acquisition of parts and components companies in the United States and other places.
Product structure changes. From the labor-intensive and material-intensive exports of low-end products to the export of higher value-added electromechanical products, the product coverage has become more extensive.
Export area changes. From the main export to developing countries began to export to developed countries. Exports to the United States, Germany, Japan, France, South Korea, and Britain in the six auto industry developed countries and re-exports through Hong Kong have exceeded 70% in 2003.
Export market changes. The export of parts and components will gradually shift to the OEM market with the aftermarket. A group of excellent domestic companies such as Wanxiang and Dika have successfully entered the European and American OEM matching market.
Export status of parts and components In the first three quarters of 2004, the export value of automobile body parts and components was US$3.956 billion (US$6.371 billion), a year-on-year increase of 70.18%. Compared with the same period of last year, the rate of increase was 45.63 percentage points higher, accounting for 42.15% of the total export volume of auto products.
The main problems in the current part export work
The rapid growth of the automotive industry has driven the rapid development of parts and components companies, but there are still many problems in the export, mainly reflected in three aspects:
First, the export products are still dominated by low-end products with low technology added value. The entire export form still belongs to extensive and labor-intensive products. More than 80% of them enter the international aftermarket market, and the profitability is generally lower low.
Secondly, there is still a considerable proportion of the total export products that use the brands of foreign manufacturers for parts and components products, and even some products are returned to the domestic market after they are exported.
Third, in the export enterprises, the contribution of the domestic backbone enterprises to exports is not high, and domestic SMEs, private enterprises and non-OEM companies play a protagonist.
The above issues, we believe there are five reasons:
First, China has not yet formed large-scale, competitive group companies. The Delphi Group, the world's largest auto parts company with 167 manufacturing companies and 32 technology centers in the world, with a sales income of 27.4 billion U.S. dollars, has set up 12 companies and a scientific and technological R&D center in China. The amount reached 770 million U.S. dollars. Wanxiang Group is currently China's largest parts and components company. Last year's total industrial output value was 15.2 billion yuan, which is equivalent to about one-fifth of Delphi's sales.
Second, the size of parts and components companies is generally small, lack of independent development capabilities, product technology advancement, product quality stability, and business capabilities of enterprises and other requirements with the international market there is a big gap.
Third, companies lack the initiative to export. Due to the small size of the company and the rapid growth of the domestic market, mainstream companies are busy meeting the needs of the domestic market and lacking the initiative to export.
Fourthly, the main channel of the international market is mainly in the hands of multinational corporations. Historically, a relatively stable strategic alliance has been formed. It is very difficult to break this system.
Fifth, with the increasingly internationalization of the auto industry, global procurement has become a trend. In order to reduce costs, despite the fact that multinational corporations have started to implement global procurement strategies, due to the pressure from their governments and employment pressures, this process is quite a long one. The transfer of manufacturing industry is gradual, and the wave of global procurement is later than expected.
In addition, due to the fact that the standards and regulatory systems have been controlled by developed countries and are subject to many technological constraints in product exports, this has become the main technical barrier that restricts the export of China’s automotive products.
Opportunities and Challenges The level of manufacturing, management, and scale of auto parts in China are steadily increasing. After hard work, they are fully capable and qualified to enter the international market and participate in competition. At present, the competition in the spare parts industry in Europe, the United States, and Japan is unprecedentedly fierce. Under the pressure of cost, and attracted by the rapid growth of the Chinese auto industry, international multinational corporations have already recognized China's status as a world machining center and have successively invested in China to build. Factory, to China to seek procurement opportunities. On the one hand, it is hoped that it will be able to occupy the rapidly growing Chinese market; on the other hand, it hopes to reduce costs through global procurement and deal with the increasingly fierce new international competition.
This trend has provided good opportunities for domestic enterprises to expand their cooperation with foreign countries and dredge international host matching markets.
In addition, China's accession to the WTO, changes in the trade environment, will have a positive impact on the export of parts and components.
Many of China's private parts and components companies still have the advantage of flexible mechanisms and low cost. In the near future, they will continue to be the protagonists of component exports.
International Competitiveness of Parts and Components Comparing Competitive Advantages of China's Parts and Components Industry Cost Advantage: Labor costs are only 1/8 to 1/25 of that of the developed countries in the automotive industry. The cost composition of domestic parts and components companies provided by an overseas research organization in 2004 showed that raw materials accounted for 60%, while the labor force only accounted for 2% to 3%.
Domestic market advantage: A huge domestic market provides the conditions for domestic companies to achieve basic economies of scale.
Basic advantages: China's processing industry has a certain basis, a complete range of industries, the automotive industry, such as steel, aluminum and other major raw materials in the world, relatively comparable to some emerging developing countries have comparable advantages.
A stable social environment: China’s political situation is stable, exchange rates are stable, and the national economy continues to grow.
China's spare parts industry is relatively short of the lack of development capacity; lack of large-scale production capacity; lack of international trade channels, experience, talent; export self-discipline. Exports forecast total export target to 2010, the domestic auto parts production value will reach 700 billion yuan. Based on the export volume of US$3.25 billion in 2003 and the average annual increase of 36% from 2000 to 2003, the export value of comparable parts and components will be expected to exceed RMB230 billion (US$28 billion) by 2010, which will account for domestic parts and components. One third of the total output value. Considering the factors of rapid export growth in 2004, and referring to the export targets set out by the National Development and Reform Commission during the "Eleventh Five-Year Plan" period, we forecast that by 2010, the export value of spare parts with comparable diameters will reach US$30 billion.
Structural adjustment objectives With the entry of multinational companies in parts and components, and the overall improvement in technology, quality and production scale of domestic companies, the export of components and parts should be aimed at increasing access to the international OEM market, and strive to account for 40% of exports by 2010. 50%.
With the development of parts and components, with the construction of export bases in place, exports from major domestic companies and major export regions will dominate.
Main measures for promoting exports
Actively cooperate with the Ministry of Commerce and National Development and Reform Commission to do a good job in the construction of export bases
In the construction of export bases, the secretariat of the association mainly undertakes the planning, drafting of documents, coordination of daily affairs and other transactional tasks, and establishes specialized management departments based on the secretariat of the association. At present, the preliminary preparations for the base construction have been basically completed.
Strive to build an export platform and establish a stable export channel
International held the "Detroit China Auto Parts Products Exhibition" and summed up the experience. Expand the exhibition countries and regions, and use the channels of international companies such as PAC to actively develop overseas OEM markets.
In China, we established the "China Auto Parts Products Exhibition Fair" for international sourcing and domestic aftermarket, and attracted overseas companies to negotiate purchases in China. Promote the domestic mainstream parts and components companies to expand exports and expand the aftermarket. We have plans to organize this exhibition into an annual exhibition of parts and components similar to Las Vegas. Fixed-point, regular, run the brand. The member companies exhibiting at the exhibition stand in front of the China Association of Automobile Manufacturers (ACA) with their uniform accreditation logo as a guarantee of quality and reputation.
The establishment of a relatively fixed export platform association has signed a cooperation agreement with Shanghai International Automobile City to establish a business office, year-round display, product trading, information collection, analysis and publication, legal advice, education and training, import and export trade services, and finance. The "Shanghai Auto Parts Global Sourcing Center", which is an integrated service, provides a full range of export services for the entire industry and international buyers.
Cooperate with the Ministry of Commerce to determine the export base and improve its management methods
Further improve the construction of export warning systems, strengthen guidance, avoid trade disputes, and maintain the export safety of products
The Chinese auto industry has entered a long-term and stable stage of development, and auto parts and components will face an unprecedented period of development. We must seize this opportunity and, with the high attention and policy support of the government departments, work together to create a new pattern of China's auto parts going international and create a new situation for auto parts exports.
China's auto parts industry's export status and countermeasures