Hubei auto parts industry must bid farewell to "reducing poverty" to reshuffle


Hubei is known as the "automobile province," which is why it can become a "large automobile province." First, Dongfeng is in Hubei. Second, in order to support Dongfeng's production, a large number of auto parts supporting enterprises have been developed. However, it was recently announced by the Ministry of Commerce of Hubei Province, the Hubei Provincial Development and Reform Commission, and the Investment Promotion Center of the Machinery and Automobile Industry of Hubei Province that the Hubei Automobile Industry Investment and Utilization of Foreign Investment and the Cooperation of Enlargement and Complete Vehicle Manufacturers Cooperation Symposium had been passed. An important message: The development of the province's auto parts industry has reached a critical period and it is necessary to bid farewell to the “era of poverty alleviation”.

The great opportunity is taken for granted.

It is understood that this forum is an important meeting for the implementation of the new industrialization plan for Hubei's machinery and automotive industry. It is also the "Hubei Automobile Parts Development Strategy and Expansion of Cooperation with Dongfeng Company, which was jointly held by Hubei Provincial Government and Dongfeng Company at the beginning of last year in Shiyan. The extension and concretization of high-level seminars. At the meeting, the focus was on Lei Ping, Director of the Business Planning Department of Dongfeng Motor Co., Ltd., Li Jingqiao, Head of the Commercial Vehicle Procurement Headquarters of Dongfeng Motor Co., Ltd., Zhou Zhemin, Director of Procurement Department of Shenlong Motor Co., Ltd., and Head of Procurement Support Department of Dongfeng Honda Automobile (Wuhan) Co., Ltd. Mr. Liu Xiang, Deputy General Manager of Wuhan Zhongyu Automobile Co., Ltd., and Mr. Jin Zaiyu, General Manager of Daewoo Korea, introduced the company’s brand strategy and the total amount, standards, and requirements for auto parts production support.

The above-mentioned persons agreed in their speeches that in recent years, the Chinese automobile industry has experienced rapid development and the auto parts industry has also grown rapidly. In this regard, the Hubei auto parts industry has performed particularly well. It is understood that last year, the overall strategic cooperation between Dongfeng Motor and Nissan Automobile officially entered the implementation stage. According to the current plan, Dongfeng Motor Co., Ltd., a joint venture company, will have annual sales of 550,000 vehicles by 2006, and annual sales revenue will reach 80 billion yuan. According to the current ratio of 1:0.4 for the direct auto parts industry, Dongfeng Motor Co., Ltd. directly generates an annual auto parts market share of over 32 billion yuan. In addition, Dongfeng and France’s PSA Group have cooperated and Dongfeng Honda has entered Hubei and Zhejiang. With the establishment of Zhongyu Wuhan Automobile Industrial Park, the entire Hubei auto parts market will reach over 40 billion yuan.

However, the person in charge of the auto parts procurement of various manufacturers in the speech also unanimously emphasized that the huge auto parts "big cake" does not mean that Hubei auto parts enterprises take for granted that "there are". The main reasons are:

First, the times have changed. What is being implemented now is a market economy. Everything is open, fair, and fair. Local protectionism not only becomes a "cross-strait mouse," but also does not help. As a closely related and high-tech product, auto parts will inevitably be promoted and developed in cooperation and competition.

The second is the high demand of car manufacturers. Lei Ping pointed out in his speech that the vehicle manufacturer does not have the obligation to “help the poor” in order to “get bigger, stronger and give priority to strength”. At present, the main trends and characteristics of the development of auto parts in the world are as follows: With the promotion of mergers and reorganizations, auto parts companies also go through specialized mergers and acquisitions, alliances, and other methods to become professional and group-oriented development; Modular and systematic development requires parts and components companies to constantly cultivate their own R&D capabilities and system supply capabilities; the relationship between vehicle companies and parts and components companies has undergone new changes, and parts companies have begun to share more new products and technologies. The development work is ahead of the development of the vehicle.

Third, the standards for auto parts procurement are different. The person in charge of the parts procurement of various manufacturers emphasized in their speeches: In the future, procurement of parts and components will be subject to the “global-oriented” procurement standards. This is to say: There is no geographical distinction, there is no face to face, who has the best parts and components, the best price, the best service, the best market reputation, who to buy. This requires the relevant auto parts manufacturers not only to meet their high standards, but also to do everything possible to enter its "modular", "pago-style" supply chain.

Fourth, both sides need to share risks and bear pressure. In terms of pressure, the current OEMs mainly come from two aspects: 1. In accordance with the “rules of the game” of WTO accession, the tariff protection policies implemented by the country will be abolished in five years, and the prices of domestic cars will be “levelled” with imported ones. And to compete with a number of famous brands abroad. 2, raw material prices. Taking steel as an example, it was originally around RMB 1,000/ton, which is now around RMB 3,000/ton. As an auto parts manufacturer, their pressures also have two aspects: 1. The manufacturers keep depressing prices. In order to maintain collaboration, auto parts manufacturers mostly have to “swallow”. 2, also face the pressure of raw materials such as steel prices. In the event that both parties are under pressure, participants discussed in the discussion that: OEMs and auto parts manufacturers must understand each other, share the risks, coexist and co-prosperity, and take good positions on their own; everything is handled according to market rules. , to achieve "win-win" and "win-win" in the market competition.
During the discussion, relevant experts unanimously held that the auto parts industry in Hubei is currently facing an unprecedented historical development opportunity; at the same time, it is also facing enormous challenges. The core of the question is: Does Hubei auto parts enterprises have the ability to “follow” the east wind? Are there skills to seize their own auto parts "cake"?

It is understood that the auto parts industry in the province was developed at the end of the 1960s following the investment and construction of Dongfeng Company. At present, there are two densely-automobile parts belts from Shiyan and Xiangfan to Wuhan along the Hanjiang River and Yichang, and from Jingzhou to Huangshi along the Yangtze River. There are about 700 auto parts companies in the province. Its main spare parts production supporting capacity exceeds 500,000 vehicles. Among the 60 key components supported and developed by the country, aside from a small number of products such as EFI, ABS, and airbags, there are mass production capabilities.

However, the problems in Hubei auto parts industry are also obvious. At this symposium, Li Jingqiao, Zhou Zhemin, Wang Hao, and Liu Xiang discussed the existing problems of Hubei auto parts companies from different perspectives:

First, there is not enough market awareness. At present, the province is still part of the head of auto parts companies, "I come to mouth, clothes to reach out," used to think that the market opportunities not only belong to themselves, and some products "ownership" is their own. Mistakes to share the opportunities in the auto parts market competition as their own exclusive opportunities. Therefore, to take the initiative to enter the new Dongfeng "global procurement" supporting system, looking for the company's "new position" is not high enthusiasm, so that "the door of the gold but let others run away."

Second, the system is not smooth and the mechanism is difficult to live. According to reports, of the 291 or more auto parts enterprises in Hubei, more than half are still “state-owned”, and the status quo of “one dominance” has not been fundamentally changed, and state-owned enterprises have suffered from the abuse of “big pot”. Failed to eradicate. Such as: Hubei Automobile Group, is a large-scale "fleet" of the province's dominant auto parts enterprises, has 14 holdings of industrial enterprises, has been recognized by the State Economic and Trade Commission as one of the country's 1000 dominant large-scale enterprises and enterprise groups . However, it has a large amount of losses in the market competition. Some of its subordinate companies are very good in terms of operations, management, projects, and market development prospects. Foreign investors and banks are fancy and are willing to invest in buying or lending; but because they belong to a large group, big groups lose money, and they also suffer. The subordinate enterprises made it impossible for the loans to be reorganized, and they couldn't move "up and down". The whole group was caught in a dilemma of "advancing and retreating".

Third, the "scattered, weak, and small" dysentery has not been eradicated. In recent years, the auto parts and components companies in Hubei have changed their outlooks through restructuring and reorganization, but there are still 291 auto parts enterprises above designated scale. In these "above-scale" enterprises, a data from the Hubei Provincial Bureau of Statistics shows that the average asset size of the state-owned and non-state-owned auto parts enterprises above the scale is even lower than that of the average assets of enterprises in the province by 10%. Assets are There are only 1 billion yuan, there are 5 between 500 million and 1 billion yuan, 39 between 1-4 billion yuan, and the assets of a Zhejiang Wanxiang Group exceed 6 billion. yuan. At the same time, this information also shows that the province's 685 auto parts corporations employ 128,500 people, and each company has only 188 people, and the scale is small. Among them, 51.9% of the companies with less than 50 employees and 31.1% of companies with 50 to 100 employees. Enterprises with an annual operating income of less than 5 million yuan accounted for 64.7%, while those with more than 50 million yuan accounted for only 8.1%.

Fourth, the production of Hubei auto parts enterprises is mostly in the “low level” state. It is understood that the province's 291 auto parts companies above designated size have a total annual sales of nearly $3 billion more than the world's 100th-ranked company; more than 70% of parts and components companies are still in the mid-tonnage truck production level. Only about 30% of cars are supported; annual R&D expenditure of enterprises only accounts for 0.4% of sales revenue in the same period, which is much lower than the level of 5%-6% of developed countries; lack of national brand-name products, among the famous brand products in the province Only two parts and components products; several companies around the same vehicle series, the production of the same type of parts and components; parts of the product is low export, export delivery value of less than 1% of output value. At the same time, due to lack of investment for many years, most auto parts companies are in a “low-level” operating state with aging equipment, lagging technology, obsolete technology, and lack of funds.

In light of the above situation, Li Zhixin, director of the Investment Promotion Center of the Machinery Industry in Hubei Province, pointed out that how to seize the opportunity and meet the challenges and realize the leap from "a big automobile province" to a "strong automobile province" in Hubei has become a province's automobile and parts and components company. Realistic and serious topics. Hubei auto parts enterprises are facing the test of “rescue” and “survival” of the survival of the fittest.

Strong domestic and foreign enterprises occupy the commanding heights

During the discussion, relevant leaders and experts believe that the Hubei auto parts industry is currently at a critical period of development. There is one thing that cannot be overlooked: This is where the auto parts companies in Hubei are still in the “great dream” or “great dream”. At the moment of "wake up", there have been quite a number of strong auto parts companies at home and abroad, taking advantage of and entering the market to seize the commanding heights of Hubei auto parts manufacturing.

Li Zhixin said that in terms of exploring the market and supporting the vehicle manufacturers, Dongfeng Motor Co., Ltd. is located in Hubei. It should be said that Hubei auto parts have unique conditions. According to the statistics of the previous year, there are more than 340 manufacturers supporting Dongfeng Motor Company. Among them, Hubei Province accounts for more than half of the total, but Dongfeng Company's annual supporting volume is 120 billion (including raw materials), Hubei Province only accounts for 1/4 or so, and it also includes 10 million yuan of Wuhan Iron and Steel and Dongfeng Tire Factory. Only 20 billion components are matched, which shows that the auto parts products in Hubei are scattered in their supporting layout, with small scale and low added value. From the point of view of supporting vehicles from other provinces' entire vehicle companies, with SAIC and FAW, Hubei is ranked after Zhejiang, Liaoning, Jiangsu, and Shanghai, regardless of the number of manufacturers or the output value of products. According to current understanding, Shanghai has reorganized 45 auto parts companies; Dalian is embarking on the construction of an auto parts industrial park; Guangzhou proposed to seize Fengshen Sunshine and build Huadu into an important base for auto parts production in South China. Shenyang plans to invest 20 billion to build an international automobile city; Jilin is determined to build itself into a production base for auto parts that can participate in the competition in the domestic market. All these have brought severe challenges to the development of the auto parts industry in Hubei.

It is understood that, after the marriage of Dongfeng and Nissan, the original auto parts company with Nissan has moved to China to participate in more than 32 billion yuan cake competition. Nissan has included suppliers from Shiyan and Xiangfan into its global procurement system, and Nissan's spare parts supporting companies are also eyeing the share of New Dongfeng's auto parts. On the other hand, in order to reduce costs and improve service quality, Nissan also forced the original auto parts companies in Japan to “marry” to China, or they would no longer purchase their accessories. As early as the previous year's Wuwu meeting, more than 50 Nissan suppliers came to Han to find partners. Moreover, in the personnel arrangement of Dongfeng Motor Co., Ltd., Japan has occupied key positions such as General Manager, Purchasing Minister, and Finance Minister. According to the universal business model of joint venture auto companies in the world, in the first few years of the joint venture, the Japanese company will use Nissan's parts on a large scale, which will help Nissan quickly recover the joint venture costs and ensure the quality of the entire vehicle. Therefore, the joint venture will cause Hubei Province's auto parts industry to face the most severe and cruelest challenges. It has brought the international competition of the province's auto parts industry ahead of schedule, and has also made Hubei the most competitive center for the national auto parts industry.

At the same time, the reporter also learned that in recent years, the auto parts industry in East China, represented by Jiangsu and Zhejiang and other provinces and cities, has developed rapidly. Its products are cheap, high-tech and high-tech, which has greatly impacted Hubei’s share of Donghua’s supporting industries. Most auto parts products in Hubei were dubbed as supporting actors, accounting for a year-on-year decline. Most of the original share of Hubei Province was occupied by auto parts companies in East China.

Such a historic development opportunity is such a severe challenge. Then, we must bid farewell to the “autonomous era” of the Hubei auto parts industry. People wait and see.

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