Key parts "hollow" is very dangerous

Recently, various industries in the country are discussing the issue of import tax cuts and have expressed their feelings of an overwhelming pressure. China's auto parts companies also responded, but most of them felt "nothing is affected." Some analysts believe that the tariff reduction has little effect on domestic parts manufacturers, mainly because most of the auto parts have already been domesticated, and only a few key parts are imported. Domestic production of auto parts is at the mid-end, and imported auto parts are mainly high-end, which is a competition of different categories.

At first glance, the first sentence was very gratifying, but after a while, the last sentence was worrying. The expression “most domestic auto parts are realized” is no problem, and this is indeed the case. According to statistics from the China Chamber of Commerce, the total amount of imported auto parts in China is estimated at 37 billion U.S. dollars in 2017. It is estimated that the imported parts and components will account for an average of 9% of the vehicle's total vehicle cost. %. Such a high localization rate is not to say "dependence". However, if we look at the 9% of imports, we will understand why. The main components of imported automobiles in China this year are transmissions and their parts and components. , engines and their parts, automotive lighting and signal devices, automotive electronics, etc., are all key components. How critical is it? For example, the car has more than 10,000 parts and components. Some parts are removed and do not affect the opening, but leaving these parts can not be opened. It can be said that imported parts and components are the "key few" in the true sense.

Obviously, the dependence on a few key components has determined the overall backwardness of China's spare parts industry. Tariff reduction has little effect on domestic parts and components companies. It is precisely because domestic companies are basically in the middle and low-end areas and rarely produce high-end parts that involve tariff adjustments, which is a sign of the industry's backwardness. Not long ago, the world's automatic transmission giant Japan Aisin AW Co., Ltd. (hereinafter abbreviated as Aisin) has signed a joint venture agreement with Geely Automobile and Guangzhou Automobile Group, will set up factories in China to produce transmissions and supporting components, which makes domestic transmission manufacturers is very tension. They are concerned that the rapid deployment of Aisin's transmission market in China may seriously undermine the development of the autonomous transmission industry.

Once the Aisin transmission is localized, its price will be significantly reduced, and it will be as low as the self-owned company's. This may be different from the “tax reduction”, and it will have a negative effect. In fact, the transmission produced by Aisin and a Chinese company in a joint venture is a relatively backward 6AT transmission, but even so, domestic companies cannot compete with it. This shows that the overall backwardness of China's transmission industry is not a bit of a point. The Aisin incident that caused a wide range of discussions represented, to a certain extent, the “collective anxiety” of the independent parts and components industry.

Industry experts say that although the transmission is known as the most difficult “fortress” to overcome, there are still many difficulties to be overcome by the independent brands in the core components. In recent years, China has made great breakthroughs in the machinery manufacturing sector, and parts and components such as connecting rods, crankshafts, airframes, and cylinder heads can all complete production. However, once a single component is to be combined with “electricity”, there are quite a few components that rely on foreign companies. For example, variable valve timing, electronically-controlled supercharger, and electronically controlled exhaust gas recirculation valve, domestic enterprises of these parts and components are not yet able to independently research and develop and put into production. The technology “non-electricity” is an issue that cannot be avoided by independent research and development. It is also our country. The performance of "hollowing out" of auto parts technology.

The production of key parts and components, non-critical parts and components also face the problem of low market concentration. The number of auto parts enterprises in China is conservatively estimated at more than 100,000, of which less than 13,000 enterprises have an annual output value of 20 million yuan. From the perspective of the nature of enterprises, small enterprises accounted for 62%, medium-sized companies 25%, large-scale enterprises 9%, and very few large-scale component companies. Although a number of professional companies have emerged in China's branded parts and components companies, more domestic parts and components companies are concentrated in low value-added components and are scattered. Since they are all earning little money and hard money, there is no spare time to invest too much in R&D. The survey shows that China’s auto parts companies’ R&D investment currently accounts for only 1.4% of sales revenue, far below the average of 5% for multinational companies. Without frontier technology and core technology, it can only imitate others' product production at the same time. This has led domestic parts and components companies to have no market discourse rights, and they are vulnerable to the entire vehicle industry. They can only mix in the low-end market and fall into a vicious circle and find it difficult to extricate themselves.

China's auto parts and components technology is backward, and hollowing is serious. There are historical reasons that cannot be ignored. Insiders pointed out that the development of China's auto industry has historically had the drawbacks of “rebuilding vehicles and light components”. The parts and components industry does not enjoy the "protective" policy, nor does it obtain many market benefits through joint ventures. It has been in a state of "free-living," and has to struggle to feed on the pressures of foreign peers and vehicle companies. In view of this, to change the state of survival of the independent parts and components companies, the past “taking in”ism cannot solve the problems. After missing out on opportunities for development, only relevant parties in the industry chain, vehicle manufacturers, and parts and components companies and other industrial chains will be able to find new opportunities in order to identify the direction of their efforts.