Declining performance The auto parts industry is an inseparable part of the auto industry and provides more than 70% of its profits. It is the basis for independent innovation in the auto industry. However, in the Chinese auto parts market, parts companies with foreign-invested backgrounds account for more than 75% of the total market share, and control the market share of most core parts. The local parts and components enterprises that rely mainly on the survival of their own brand car companies have begun to encounter development problems. From the financial data of the top 20 auto parts listed companies in the first three quarters of this year, in the first three quarters of this year, most of the 20 companies had revenue and net profit growth, but their overall revenue and net profit were Both fell. The revenue of 20 companies fell 3.7% year-on-year to 168.85 billion yuan, net profit fell nearly 20% (19.4%) to 9.649 billion yuan; the average net profit margin was 5.7%, down 1.1 percentage points year-on-year. Xu Changming, director of the Information Resource Development Department of the National Information Center, told China Union Business Daily that while the domestic economy is slowing down, consumption is shrinking, and the market is generally depressed, foreign-funded parts companies are also maintaining their original high-end products market. Actively developing low-cost products and expanding into the low-end and mid-end markets, local auto parts companies are facing development difficulties. At present, due to the weak foundation and weak comprehensive strength of China's parts and components enterprises, the main service target is self-owned brand automobile enterprises. Due to the limitation of this business scope, once the sales volume of self-owned brand enterprises encounters difficulties, these parts and components enterprises will also be implicated. At the same time, in order to improve competitiveness and improve the quality of automobiles, domestic independent brand car companies that are in decline have gradually increased the proportion of purchasing foreign auto parts in recent years. This is aggravating the domestic component companies. A person from the Automotive Industry Branch of the China Council for the Promotion of International Trade said that China's Hyundai Motor Industry started from a joint venture vehicle. Therefore, the foreign-funded enterprises in Europe, the United States, Japan and South Korea led the formation of the parts supply chain. For example, the suppliers of American cars in China are all foreign-funded enterprises; 88.9% of the suppliers of European cars in China are foreign-funded enterprises; the proportion of Japanese cars is 88.5%; the supply chain of Korean cars is almost not open to Chinese-funded enterprises. Although the development of self-owned brand cars has driven the development of domestic-funded parts and components enterprises, 52.8% of the selected suppliers have foreign investment background. Therefore, the relationship between domestic-funded enterprises and the whole vehicle industry is loose, and it is difficult to form an industrial chain relationship between systems, assemblies, accessories and parts. Deep control of foreign capital At present, core components including automobile engine management system, power matching system, safety electronic control system and fuel injection system are almost monopolized by multinational corporations, and automatic transmissions are also dominated by a few multinational companies. Most local parts companies are at the low end of the industry chain. 80% of the company's sales revenue is less than 100 million yuan, and its market share and manufacturing capacity are 90% concentrated in low-end parts and components. According to the statistics of the Ministry of Commerce of China in 2010, the proportion of foreign-funded enterprises in the production of automotive EFI systems, engine management systems, ABS, micro-motors, airbags, etc. is 100%, 100%, 91%, 97 respectively. % and 69%. In high-tech and core technologies, such as automotive electronics and engine parts, the market share of foreign-controlled is as high as 90%. Multinational parts companies such as Bosch, Denso and Delphi occupy an important position in China's auto parts market. Due to the different joint venture policies between auto parts and complete vehicles in China, in the field of auto parts, there is no limit on the proportion of foreign investment in auto parts in China. The rapid development of China's auto market has brought unlimited business opportunities to the related parts and components industry. Therefore, foreign investment Enterprises have increased their investment in China. Relevant statistics show that in recent years, the number of newly approved foreign-owned auto parts enterprises in China has exceeded the number of joint ventures. It is understood that German multinational parts companies such as Bosch, China, Haila, Brose and France's Faurecia have now become suppliers of local auto companies. Recently, Bosch in Germany invested RMB 700 million in a new factory and R&D center in Changsha, and will develop start/stop systems and electronic drive products suitable for the Chinese market. The Beiru system of BorgWarner, Inc. of the United States has also confirmed that it will invest in Ningbo in August this year, and plans to officially launch a new compact set-top ignition coil in the fourth quarter of 2013. Delphi's automotive wire harness production base in Chongqing - Delphi Packard Electric Systems Co., Ltd. Chongqing Branch was also recently established. Recently, Magneti Marelli announced that it has signed a joint venture with Anhui Jianghuai Automobile Co., Ltd. and Hefei Lingdatang Collective Asset Management Co., Ltd. to produce parts for automobile exhaust systems in China. Zhang Zhiyong, a well-known person in the automotive industry, believes that the survivability of foreign-funded parts and components enterprises is stronger than that of local parts and components enterprises. Considering the huge market of China's auto industry, whether it is cooperation between local auto companies and foreign-funded parts, or foreign-funded parts companies in China The investment means that the sales volume of local parts companies will be further reduced, and the bargaining power will become weaker. Therefore, the profits of domestic parts companies may continue to decline for some time. In terms of overseas exports, European and American countries have frequently launched special insurance investigations, anti-dumping investigations, and countervailing investigations against Chinese component companies, which have caused great impact on many domestic parts and components enterprises. Domestic component companies will continue to face survival challenges.
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