The trend of parts and components industry under the new polarization

The results of the selection of the top 100 suppliers of auto parts and components in the country in 2015 were announced, which attracted the attention of the industry. This is because 2015 is a very significant year for the Chinese auto parts industry.

In 2015, the biggest challenge facing the auto parts industry is the new normal of economic development.

The appearance of the new normal means that China’s economic development conditions and environment have undergone or will undergo many major changes. Economic growth has basically bid farewell to the high speed of about 10% over the past 30 years, and the unbalanced, uncoordinated, and unsustainable mode of extensive growth has been abandoned. . Whether it can adapt to the new normal and become the key to the sound development of auto parts companies.

Under the new normal, the parts industry will be polarized
Under the new normal, the parts industry will be polarized

Under the new normal, the parts industry will be polarized

The new normal tests the comprehensive strength of parts and components companies. Under the new normal, the performance of different companies in the auto parts industry varies widely in 2015. In general, polarization is irresistible. The so-called polarization refers to the separation of Chinese auto parts industry groups that can adapt to the new normal economy, and those that cannot adapt to the new normal economy. Those parts and components companies that focus on technological innovation, develop new products for a long time, and accumulate sufficient technical resources have a strong ability to adapt to the new normal of the economy; on the contrary, the adaptability of parts and components companies is weak. All auto parts companies that can adapt to the new normal can maintain normal sales, sales revenue and profits, and they can continue to develop. For auto parts companies that cannot adapt to the new normal, sales, sales revenue, and profits have continued to decline, making it difficult to continue to develop. In 2015, the top 100 suppliers of auto parts and components in the country were among the companies that emerged in the process of adapting to the new normal economy.

There are tens of thousands of companies in China's auto parts industry. The overall scale is not small, but there are too many low-end products and few high-end products. High-end parts have high added value and low-end parts have low added value. Under the new economic normal, the profits of parts and components companies with high-end products have fallen far lower than those of low-end products.

This is the difference between China's auto parts industry's disadvantaged enterprises' habit of relying on drawings for model production and strong companies accustomed to taking the technological innovation route to seek long-term development, and it is also the most fundamental reason for the polarization of China's auto parts industry. Therefore, structural optimization is the basis for Chinese auto parts companies to adapt to the new normal.

2015 is the last year of the 12th Five-Year Plan. The 13th Five-Year Plan is coming.

Smart, connected, and new energy are the main melody of the automotive industry during the 13th Five-Year Plan period. New energy vehicles have new power systems and electrical systems that are easier to integrate with electronic and information technologies, and are expected to become the best carriers for smart cars. The combination of onboard information devices, onboard information services, and human-computer interaction systems will lead to revolutionary changes in the automotive parts industry.

The new economic normal and new technology trends will surely bring about a new competitive landscape. The auto parts industry is bound to reshuffle and the industry restructuring will accelerate. Those auto parts companies with innovative capabilities will win more opportunities for development. At the same time, many auto parts companies that do not have innovative capabilities will certainly disappear.

The general trend. The Chinese auto industry needs to establish a component supply system with international competitiveness during the “13th Five-Year Plan” period. This also requires parts and components companies to increase investment in innovation, consolidate basic skills, and enter high-end products. Only in this way can we ensure that China's auto parts industry has a place in the international competition in order to promote the coordinated development of China's auto industry chain.

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