The OEMs shifted the pressure of vehicle price cuts to parts suppliers. Parts suppliers face the dual pressure of lower prices and higher prices of raw materials. Although the profit margins are getting smaller and smaller, they are not shy to say anything. Dare to supply, fear of loss of supporting qualifications and the future market Following Shanghai Tong's first price reduction of the full range of models in May this year, Shanghai Volkswagen, FAW-Volkswagen and Dongfeng Citroën have been involved in one after another, and the price cuts sweeping the Chinese auto market are inevitable. Several families are happy and happy. While consumers clap fast and rationally, the auto parts suppliers are threatened by automakers. The automakers transfer the pressure of vehicle price reduction to parts suppliers and parts suppliers. Faced with the dual pressures of lowering prices of automakers and rising prices of raw materials, although the profit margins are getting smaller and smaller, they are not shy about anger, and they are even more afraid to not supply them, fearing that they will lose their qualifications and future markets. Therefore, the price war has already begun in the auto parts supply market. Price cuts threaten parts suppliers. “I’ve been in a lot of headaches recently because I’ve received requests from OEMs to reduce the prices of spare parts every day. I’m still very tough.†President of Delphi China in a recent media conference Expressed indifferently. It is understood that the current competition in the domestic auto parts supply market has become very fierce. Almost all domestic parts suppliers have encountered this kind of embarrassment. That is, vehicle manufacturers put forward price reduction requests for spare parts suppliers that have no room for maneuver, otherwise they will cancel. Qualification of the supply of its parts and components. At the same time, vehicle companies also drastically reduced the price of accessories. At the beginning of this year, Nanjing Fiat announced that it has lowered the price of all its auto parts in an all-round manner. At the same time, BYD also announced that it will adjust the retail price of its full-scale vehicle parts. This is the first large-scale consumer-oriented component price reduction in the history of Chinese automobiles. It is understood that the impact of spare parts prices on vehicle sales has gradually increased since 2003. Ou Ride, vice president of the European spare parts giant Valeo Group, said in an interview that this is only one of the characteristics of the Chinese auto market in the process of rapid development, in fact, the global auto parts market is more fierce competition. At present, Chinese autos continue to cut prices and can only be relatively stable after falling to a suitable price. The vehicle manufacturers and component suppliers are all seeking to survive together in competition, and ultimately the survival of the fittest. For example, in Europe, the earliest cars did not have air conditioners installed, and now they have all been installed, but they have not increased the price of cars, but are improving their competitiveness. From this perspective, vehicle manufacturers and component suppliers are working together to increase the competitiveness of their respective products, rather than the superiority of the entire vehicle manufacturer. Counterattack "I believe that vehicle manufacturers must understand this principle. Auto parts do not simply bend the iron." An auto parts executive told reporters. In response to the price reduction threats of vehicle manufacturers, auto parts suppliers have played high-tech cards, and have improved their product competitiveness with low-cost and high-tech content. The person said, "Only competitive parts products will leave nothing to the vehicle manufacturer." At this year's Beijing auto show, the reporter saw at the Valeo booth some of the current high-end luxury vehicles. Technology products, such as: car does not have a car key, the magnetic card worn on the owner of the car allows the owner to approach the side of the car door will automatically open, and the car starts only with the foot on the brake even if completed; an automatic sensor wiper does not require Drivers open; when the driver is drowsy when driving a car, or the car starts to walk S-type, the car will remind like a "mobile phone shake." "These products are expected to be loaded into future China-made cars," Oude said. Establishing R&D Centers To increase product competitiveness, more and more international component giants have set up R&D centers in China. In the first half of this year, the Big Three of Michelin, Goodyear and Bridgestone were involved in a melee battle to compete for the original tire order for the Changan Ford Fiesta. Michelin stands out thanks to its advantages in the R&D center in Shanghai. In 2001 Michelin set up a research and development center in Shanghai and became one of its four major research centers in the world. Dole, Chairman of the Bosch Diesel Systems Group, Germany, said recently that in addition to investing hundreds of millions of euros in betting on the Chinese diesel car industry, a technology center with independent research and development capabilities will be established and the largest electronically controlled diesel injection system production base will be built in China. At this year's Beijing Auto Show, Bosch also officially announced that the company will establish a new joint venture with Wuxi Weifu Group. With the approval of relevant government agencies, Bosch Automotive Diesel Systems Co., Ltd., to be established soon, will provide advanced diesel common rail systems to Chinese customers. Bosch will hold 67% of the shares of the new company. Oride also revealed to reporters that the Valeo Group will launch a series of projects, including setting up an R&D center in Wuhan, setting up schools in Shanghai and introducing new product lines. Ou Ruide said that China's first technology center to be established this year will develop advanced automotive lighting systems for the Chinese and European car market. The R&D center is expected to employ 40 employees by the end of 2004. The R&D center will work with Valeo Group's technical centers in other parts of the world to develop products for all markets. It is undeniable that domestic auto parts companies face enormous challenges. China’s auto parts market has great potential. According to statistics, China’s auto parts industry’s sales in 2003 were US$31.8 billion, including US$3.3 billion in exports. However, Chinese domestic parts suppliers are facing serious threats from automakers and multinational giants. Shen Ningwu, deputy secretary-general of the China Association of Automobile Manufacturers, said at a conference: “China’s auto parts companies are numerous, complicated, and have diversified capital structures. They lack a large-scale dragon skull enterprise that is recognized by the public as a vehicle company. "At present, China's domestic auto parts suppliers can only use "scattered, chaotic, and poor" to summarize. According to statistics from the China Association of Automobile Manufacturers, there are approximately 4,500 parts and components manufacturers in China, of which about 800 are foreign joint ventures. Compared with the multinational giants of parts and components, local parts suppliers lack the technology of competition. A foreign auto parts specialist said: "Even if their production processes are improving and there are many companies that are very good, they still have no technology." He believes that parts manufacturers need high-level technology to meet car manufacturers. The needs, as well as their requirements for parts that can be used in different parts of the world. Some experts stated that China's parts and components companies should enter the complete transition process from the market to manufacturing, from manufacturing to development and integration into the international community as soon as possible, form an independent development system and independent development capabilities in the process of transformation, and form an independent development team. Form international competitiveness and compete with multinational giants. News Source: International Finance News Editor
Reduced prices threaten auto parts makers to face downward pressure
The OEMs shifted the pressure of vehicle price cuts to parts suppliers. Parts suppliers face the dual pressure of lower prices and higher prices of raw materials. Although the profit margins are getting smaller and smaller, they are not shy to say anything. Dare to supply, fear of loss of supporting qualifications and the future market Following Shanghai Tong's first price reduction of the full range of models in May this year, Shanghai Volkswagen, FAW-Volkswagen and Dongfeng Citroën have been involved in one after another, and the price cuts sweeping the Chinese auto market are inevitable. Several families are happy and happy. While consumers clap fast and rationally, the auto parts suppliers are threatened by automakers. The automakers transfer the pressure of vehicle price reduction to parts suppliers and parts suppliers. Faced with the dual pressures of lowering prices of automakers and rising prices of raw materials, although the profit margins are getting smaller and smaller, they are not shy about anger, and they are even more afraid to not supply them, fearing that they will lose their qualifications and future markets. Therefore, the price war has already begun in the auto parts supply market. Price cuts threaten parts suppliers. “I’ve been in a lot of headaches recently because I’ve received requests from OEMs to reduce the prices of spare parts every day. I’m still very tough.†President of Delphi China in a recent media conference Expressed indifferently. It is understood that the current competition in the domestic auto parts supply market has become very fierce. Almost all domestic parts suppliers have encountered this kind of embarrassment. That is, vehicle manufacturers put forward price reduction requests for spare parts suppliers that have no room for maneuver, otherwise they will cancel. Qualification of the supply of its parts and components. At the same time, vehicle companies also drastically reduced the price of accessories. At the beginning of this year, Nanjing Fiat announced that it has lowered the price of all its auto parts in an all-round manner. At the same time, BYD also announced that it will adjust the retail price of its full-scale vehicle parts. This is the first large-scale consumer-oriented component price reduction in the history of Chinese automobiles. It is understood that the impact of spare parts prices on vehicle sales has gradually increased since 2003. Ou Ride, vice president of the European spare parts giant Valeo Group, said in an interview that this is only one of the characteristics of the Chinese auto market in the process of rapid development, in fact, the global auto parts market is more fierce competition. At present, Chinese autos continue to cut prices and can only be relatively stable after falling to a suitable price. The vehicle manufacturers and component suppliers are all seeking to survive together in competition, and ultimately the survival of the fittest. For example, in Europe, the earliest cars did not have air conditioners installed, and now they have all been installed, but they have not increased the price of cars, but are improving their competitiveness. From this perspective, vehicle manufacturers and component suppliers are working together to increase the competitiveness of their respective products, rather than the superiority of the entire vehicle manufacturer. Counterattack "I believe that vehicle manufacturers must understand this principle. Auto parts do not simply bend the iron." An auto parts executive told reporters. In response to the price reduction threats of vehicle manufacturers, auto parts suppliers have played high-tech cards, and have improved their product competitiveness with low-cost and high-tech content. The person said, "Only competitive parts products will leave nothing to the vehicle manufacturer." At this year's Beijing auto show, the reporter saw at the Valeo booth some of the current high-end luxury vehicles. Technology products, such as: car does not have a car key, the magnetic card worn on the owner of the car allows the owner to approach the side of the car door will automatically open, and the car starts only with the foot on the brake even if completed; an automatic sensor wiper does not require Drivers open; when the driver is drowsy when driving a car, or the car starts to walk S-type, the car will remind like a "mobile phone shake." "These products are expected to be loaded into future China-made cars," Oude said. Establishing R&D Centers To increase product competitiveness, more and more international component giants have set up R&D centers in China. In the first half of this year, the Big Three of Michelin, Goodyear and Bridgestone were involved in a melee battle to compete for the original tire order for the Changan Ford Fiesta. Michelin stands out thanks to its advantages in the R&D center in Shanghai. In 2001 Michelin set up a research and development center in Shanghai and became one of its four major research centers in the world. Dole, Chairman of the Bosch Diesel Systems Group, Germany, said recently that in addition to investing hundreds of millions of euros in betting on the Chinese diesel car industry, a technology center with independent research and development capabilities will be established and the largest electronically controlled diesel injection system production base will be built in China. At this year's Beijing Auto Show, Bosch also officially announced that the company will establish a new joint venture with Wuxi Weifu Group. With the approval of relevant government agencies, Bosch Automotive Diesel Systems Co., Ltd., to be established soon, will provide advanced diesel common rail systems to Chinese customers. Bosch will hold 67% of the shares of the new company. Oride also revealed to reporters that the Valeo Group will launch a series of projects, including setting up an R&D center in Wuhan, setting up schools in Shanghai and introducing new product lines. Ou Ruide said that China's first technology center to be established this year will develop advanced automotive lighting systems for the Chinese and European car market. The R&D center is expected to employ 40 employees by the end of 2004. The R&D center will work with Valeo Group's technical centers in other parts of the world to develop products for all markets. It is undeniable that domestic auto parts companies face enormous challenges. China’s auto parts market has great potential. According to statistics, China’s auto parts industry’s sales in 2003 were US$31.8 billion, including US$3.3 billion in exports. However, Chinese domestic parts suppliers are facing serious threats from automakers and multinational giants. Shen Ningwu, deputy secretary-general of the China Association of Automobile Manufacturers, said at a conference: “China’s auto parts companies are numerous, complicated, and have diversified capital structures. They lack a large-scale dragon skull enterprise that is recognized by the public as a vehicle company. "At present, China's domestic auto parts suppliers can only use "scattered, chaotic, and poor" to summarize. According to statistics from the China Association of Automobile Manufacturers, there are approximately 4,500 parts and components manufacturers in China, of which about 800 are foreign joint ventures. Compared with the multinational giants of parts and components, local parts suppliers lack the technology of competition. A foreign auto parts specialist said: "Even if their production processes are improving and there are many companies that are very good, they still have no technology." He believes that parts manufacturers need high-level technology to meet car manufacturers. The needs, as well as their requirements for parts that can be used in different parts of the world. Some experts stated that China's parts and components companies should enter the complete transition process from the market to manufacturing, from manufacturing to development and integration into the international community as soon as possible, form an independent development system and independent development capabilities in the process of transformation, and form an independent development team. Form international competitiveness and compete with multinational giants. News Source: International Finance News Editor