Domestic foreign parts companies face challenges in entering domestic market


Internationally renowned auto parts companies once again aimed their attention at China. Recently, Magneti Marelli has contracted with two domestic companies to establish a joint venture company. The new company will manufacture automotive exhaust system components in China. It will also provide technical consultation, assistance and other after-sales services to automobile manufacturers in the Chinese market. .


At present, the actions of many foreign companies will face challenges for domestic parts and components companies.


Parts industry foreign investment


In the auto parts industry, foreign investment in auto parts and components in China is not limited by the number of shares. The rapid development of China's auto market has brought unlimited business opportunities to the related parts and components industry. Therefore, foreign-funded enterprises have come one after another. Statistics show that the influx of a number of multinational auto parts companies has brought capital, technology, and management to the development of the domestic auto parts industry, but it is also very effective in inhibiting the ability of local companies in technological innovation.


In terms of high-tech and core technologies, the key areas of automotive electronics and engine parts and components, the market share of foreign investment control is as high as 90%, and a large number of multinational companies in Bosch and other well-known parts and components industries have emerged.


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. 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.


Indigenous companies are inhibited


Insiders pointed out that in the economic slowdown and the market downturn, foreign-funded parts and components companies are actively developing low-cost products while continuing to expand into the low-end market while maintaining the existing high-end product market. Prominently exposed.


According to the financial data of the top 20 automotive parts and components listed companies in the first three quarters of this year, most of the 20 companies in the first three quarters of this year have increased their revenue and net profit, but their overall revenue and net profit Both saw a decline. Revenues of 20 companies fell 3.7% year-on-year, and net profits fell 19.4% year-on-year.


“Domestic parts and components companies have not made progress with the blowout of the automotive market. The key reason is that local auto parts companies do not pay attention to the input of technical forces. Many companies see the development of automotive-related technologies too simple and easy.” Said.


Unlike traditional parts, the imitation of electronic components is relatively difficult, and many key technologies have been controlled by foreign companies. With the intensification of competition, China's self-owned brand parts and components companies are facing more and more challenges.



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