Auto parts makers are not in a hurry to transform vehicle manufacturing

Auto parts makers are not in a hurry to transform vehicle manufacturing


Recently, the Industrial Policy Department of the Ministry of Industry and Information Technology released the 254th batch of "Vehicle Production Enterprises and Products Announcement", and Wanxiang Group's subsidiary Wanxiang Electric Vehicle Co., Ltd. will obtain special vehicle production qualifications. As a parts and components manufacturer, Wanxiang Group is not the first one to invest in the manufacture of spare parts. After this, Ningbo Huaxiang and Weichai Power all made similar attempts.

In fact, at present, the production of Auto Parts in China is still a shortcoming in the development of the industry. The parts and components companies are eager to transform the vehicle manufacturing industry without being able to consolidate the foundation of their technical strength and are not optimistic about the industry.

Uncertain prospects for the transformation of auto parts companies

Ningbo Huaxiang Group once merged into a vehicle manufacturing industry. Huaxiang Group has a reputation as a mahogany interior in the auto parts industry and serves as a spare parts supplier for multinational auto giants such as Shanghai Volkswagen, Changchun FAW and General Motors. From 2003 to 2004, Huaxiang Group wholly owned Volkswagen Automotive through a series of acquisitions, capital increase and equity swaps. Fuqi is a veteran automobile company. What Huaxiang Group regards is that it owns all the hardware and software for the production of the entire vehicle and a product that has already been granted the "life permit" - the Fuqi 6500.

The Fuqi 6500 is a large-scale SUV produced by the Toyota 4500 original mold, and Huaxiang had originally placed high hopes on it. However, shortly after Huaxiang took over the company, due to the rising oil prices and the adjustment of national policies, the entire SUV industry has experienced a dramatic downturn. Not only has the SUV failed to become a weapon for Huaxiang to break through the auto market, it has increasingly become a burden to Huaxiang.

After that, the situation began to deteriorate. Huaxiang Group invested 200-300 million yuan in succession. However, except for a factory currently under semi-cessation and an unfinished automobile industrial park, basically nothing can be said. In just one year, in June 2006, Huaxiang was plunged into a semi-discontinued state. In the end, Huaxiang had to give up dream of building a car.

The failure of Huaxiang did not deter the ambitious and powerful companies in the spare parts industry. Just a few years after Huaxiang’s dream of building a truck crashed, Weifang Power, which was very strong, set foot on the road to manufacturing a complete vehicle.

In 2009, Weichai Power acquired an 80% stake in Chongqing Jialing Chuanjiang Company. With the passenger vehicle production license of Jiachuan Company, Weichai Power gained a “stepping stone” in the field of passenger cars. Weichai Power is currently one of the most comprehensive parts and diesel engine manufacturing groups in China with comprehensive strength. It mainly produces commercial vehicle engines, and it is the leader in the domestic parts and components industry. The Jialing River Passenger Vehicle project will be officially implemented at the end of 2013, and Weichai will also formally enter the passenger vehicle market.

Long-term lack of core technology components has become a shortcoming in the industry

In recent years, China's auto industry has entered a stage of rapid development. In 2012, the production and sales exceeded 19 million vehicles, but the long-term lack of state-of-the-art technology for China's core auto parts has not been eased. At present, there are a large number of large enterprises in China's auto parts industry. However, internationally renowned companies that produce key components such as engines and transmissions are rare.

Wang Binggang, former director of the China Automotive Technology and Research Center and director of the Automotive Industry Planning and Design Institute of the Ministry of Machinery, publicly stated that there are still seven kinds of key components in the 12 foreign trade associations that need to rely on foreign technology. There are also parts such as bearings and oil seals that have had decades of production history in China. When the automaker purchased them, they still chose the products of foreign companies. The reason is that the products of Chinese manufacturers cannot meet the requirements of high-speed conditions.

In the 2012 edition of the "Car Blue Book", it was also mentioned that "the parts industry is still a shortcoming of the domestic auto industry. The problem of low critical parts, low added value, and lack of core technologies has constrained the overall competitiveness of China's auto industry. improve."

“At present, car companies generally implement R&D outsourcing, and 90% of technology upgrades rely on parts and components. Previously, as the state and local governments did not attach importance to the upstream component industry, the industry upgrade was slow, and if the protection policy was lost, upgrading was difficult. Follow-up, the future will be more problems.” Chen Guangzu also expressed concern about the development prospects of the parts and components industry.

Transformation is by no means the trend to make good parts and components is the fundamental to the stability of the industry

With the future development of the parts and components industry, the transformation of finished vehicles will never become a trend. In fact, as a capital- and technology-intensive industry, the automotive industry is highly imaginative in terms of production, logistics, marketing, and post-market, and has launched a series of links including production lines, R&D products, brand building, and marketing networks. Companies are required to have long-term and sustained high input capabilities. Once a certain one of the above links is not properly grasped, it will affect the development of the entire enterprise.

For China's current auto parts manufacturers, solid and focused spare parts are the foundation for the future stable development of the industry. China's spare parts industry is in a critical stage of urgent development. Some leading auto parts manufacturers in China only see the lucrative profits of vehicle manufacturing. They have all started to implement the entire vehicle project and try to maximize their profits.

As a leader in the parts and components industry, it may be more appropriate to focus on research techniques, narrow the gap between domestic and foreign key components, and lead the overall growth of China's parts and components industry.

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