According to relevant data, in a mature automobile market, automobile sales profits account for about 20% of the automotive industry, and 50% to 60% of profits are generated from the after-sales service industry. In the context of new car sales tending to flatten and rapid growth of holdings, the profit ratio of after-sales service will increase substantially, and parts and components will obtain a relatively long-lasting source of profit from after-sales service.

The medium- and heavy-duty commercial vehicle IV standard plan was implemented in January 2012. It has been delayed by nearly two years compared with the original plan. Although it is expected to be postponed again, it is unlikely to be later than in 2013. Under the background of energy conservation and emission reduction, especially the “12th Five-Year Development Plan Outline for the Road Transportation Industry”, the development of green road transport and energy-saving in the industry will be ranked as one of the nine key tasks. It is only time to implement higher standards. The problem is that low-fuel consumption, low-emission, high-power diesel engines will become the mainstream. The replacement of engines will also bring market space for diesel engine manufacturers. However, local companies have not yet mastered the key and high-end technologies of the engine. Automobile sector securities analysts believe that: The engine industry chain's earnings this year are generally affected by the tightening of economic policies, down year-on-year, the third quarter has been at a low point. This year, the investment value of the auto industry shows the trend of the transfer of upstream engine components. The auto manufacturers are interested in lowering the sales price, making the gross profit rate of vehicle sales decline, and the entire vehicle business become unprofitable. In order to cope with competition, multinational corporations gradually transformed the entire vehicle competition into competition in the entire supply chain, gradually shifting the profit from the vehicle to the core components.


According to analysis by CITIC Securities, the business segments of parts and components listed companies are increasingly subdivided, and the listed entities have gradually extended from traditional areas and non-core parts and components enterprises to new energy fields, core parts and components companies and high-tech electronic products. At the same time, the assembly suppliers are mostly controlled by foreign giants. The analogy is the exclusive suppliers of vehicle companies, such as Huayu Automotive, FAW Fuwei, and Dongfeng Technology. Among the component suppliers, the typical suppliers include the universal money flow of the drivetrain, Ningbo Huaxiang of the interior system, Asia-Pacific shares of the brake system, silver wheel shares of the cooling system, Wanliyang of the transmission, Songzhi of the air-conditioning system, etc. . Parts suppliers include the Tianrun crankshaft, Far East transmission of the drive shaft, Xingmin Steel Ring and Jingu shares of the wheels, and Zhongding shares of rubber parts.

At the same time, the latest data from the Ministry of Commerce show that foreign capital controls most of the market share of auto parts sales, domestic sales revenue of parts and components only accounts for 20% to 25% of the whole industry, auto parts manufacturers with foreign investment background account for the industry 75% or more. Among these foreign-funded suppliers, wholly-owned enterprises accounted for 55% and Sino-foreign joint ventures accounted for 45%. Due to the lack of independent research and development capabilities and core technologies, Chinese self-owned brand parts and components can only use resources and cheap labor to gain market share.

It is understood that the proportion of foreign-funded enterprises in the production of automotive EFI systems, engine management systems, ABS, micro-motors, and airbags, etc., is 100%, 100%, 91%, 97%, and 69%, respectively. Many multinational component companies have come to China to develop, mainly because of the potential of emerging markets. The profit rate is higher than that of mature markets, and the growth rate of profit rate is also higher than the growth rate of sales.
"Roughly calculated, this year's company's efficiency will have a 10% to 15% increase." Spell Automotive Parts International Trading (Shanghai) Co., Ltd. South China Sales Manager Jin Feng told reporters. For example, Luo Fang said: “Foreign companies are not concerned about low-tech parts or even not involved in production competition, such as automatic hubs, domestic companies have no problem with production, but there is almost no profit. Foreign companies have mastered the core technology components, and In the monopoly form of the Chinese market, profits are indeed high; in order to squeeze Chinese local SMEs, they use a near-dumping approach for products that do not have monopoly control. Two years ago, the ABS market price was around RMB 1,000. To 500 yuan, low-cost sales of foreign companies is one of the reasons."

Relevant statistics show that in recent years, the number of newly approved foreign-funded auto parts enterprises in China has exceeded the number of joint ventures. Multinational auto parts companies have brought capital, technology, and management to the development of China's auto parts industry, but they have occupied the domestic market to a certain extent, and it is obvious that local companies are also inhibiting the ability of technological innovation. Therefore, in May when the National Development and Reform Commission and the Ministry of Commerce revised the Catalogue for the Guidance of Foreign Investment Industries, it proposed that key energy component companies of new energy vehicles should not exceed 50% of foreign ownership. Then, in the field of non-new energy vehicles, especially the development and production of key components, will the relevant competent authorities take measures to address the current situation? Luo Fang calls for: “Especially for the behavior of foreign-funded enterprises that are almost dumping, the state should investigate the case. The spare parts industry at the initial stage needs national support and appropriate protection."

“Parts and components are the basis for the development of the automobile industry and also a short board for us to build a powerful automobile country.” Dong Yang, Secretary General of the China Automobile Industry Association, stated that. Dong Jianping, deputy secretary-general of the China Automobile Industry Association, also said that automobile power should mainly be embodied in auto parts, because many of the core technologies involved in safety, energy saving, and emissions are on parts and components, and the advanced performance of automobiles is the technology of parts and components. Progress and realization, the survival and development of the vehicle depends on the parts and components. ”

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