Recently, China's entire vehicle and parts and components companies have frequent overseas acquisitions. On July 13, a message came from the United States that Beijing Pacific Century Automotive Systems Co., Ltd. formally signed a general global steering and transmission business agreement. News came from Ningbo on July 15. Ningbo Lawrence Automotive Interiors Co., Ltd. of Ningbo Huaxiang Group signed an agreement to acquire the real wooden parts manufacturing center of the British Jaguar Land Rover. The acquisition involved more than 15 million pounds in funds. It is understood that this is the second UK merger conducted by the Huaxiang Group. Three years ago, they invested £3.4 million to acquire the 85-year-old British Lawrence Corporation. Previously, there were a series of overseas acquisitions such as Beijing West Heavy Industries’ acquisition of Delphi's brake and suspension business, Geely’s acquisition of Australia’s DSI Automatic Transmission Company, and Wanxiang’s acquisition of the steering shaft business of US auto parts companies. China’s domestic auto parts companies hope to increase their technological capabilities through overseas acquisitions, and the strategy of breaking foreign companies’ control of key technologies and market conditions is becoming increasingly apparent. Rubber Hoses,Oil Hose,Rubber Hose Pipe,Flexible Rubber Hose Xingtai City Xinyuan Sitong Auto Parts Co.,Ltd. , https://www.xystrubber.com
Key technologies are still controlled by foreign companies
In recent years, with the continuous expansion of vehicle sales in China, the parts and components industry has also achieved an unprecedented momentum of development. However, compared with the level of the international spare parts industry, the gap is still very clear.
Foreign companies or joint ventures not only control the core technologies of some key components, but also monopolize the market for supporting auto parts factories, especially joint ventures. According to the statistics of Xinhuaxin International Consulting Co., Ltd., US-owned vehicles purchase 100% of foreign-owned vehicles and parts of joint ventures in China's joint-venture vehicle companies; 88.9% and 89.5% of German and Japanese car companies purchase parts and components from foreign-invested companies. Joint ventures; 52.8% of spare parts of self-owned brand vehicle companies are purchased from foreign-invested and joint-venture parts companies.
At the same time, the system of foreign investment and joint ventures established in China from product development to production, personnel training to sales has also taken shape, and it has begun to integrate its investment companies in China according to effective division of labor and layout.
Under the influence of the financial crisis, the profits of international auto parts suppliers fell sharply in 2009, and emerging markets became their hope. On July 12, 2010, Wenhande, the representative of the German Freudenberg Group in China and president of the company, said that China is the cornerstone of Freudenberg's success. In the 2009 financial crisis, the Chinese market was The Group’s sales have made important contributions and they will continue to invest in this important market.
Under the same recognition, ZF, Freudenberg, Continental Group, Bosch, Delphi, Visteon and other multinational component companies have recently established new wholly-owned or joint venture factories in China.
In March 2010, ContiTech, a subsidiary of the Continental Group, invested 40 million euros in a new plant in Changshu, producing automotive hoses and piping systems, commercial vehicle air springs and automotive engine mounts. In June, Visteon’s joint venture in Changchun began to expand the automotive air conditioning product line and the automotive all-aluminum assembled radiator production line. On July 4, the Continental Group started a new tire company in Hefei. Waco Shock Absorber Factory, a wholly owned subsidiary of the Freudenberg Group, will also be officially put into operation in the second half of 2010. It will mainly produce automobile air springs, and will later produce engines and transmissions.
"Acquiring" is the Shortcut to Mastering Core Technology
Relevant experts believe that the lack of technology accumulation in China's auto parts industry, and the use of existing resources of foreign companies to obtain their own development is a short cut. Using the technology of foreign companies for my own use can achieve rapid development in a relatively short period of time.
China's auto industry revitalization plan puts forward that for the "autonomy of key components and technologies," the state will invest 10 billion yuan in the next three years as a special fund for the technological transformation and technological upgrading of auto companies. Driven by policies and market demand, some domestic parts and components companies see overseas acquisitions as the path to core technology.
According to expert analysis, it is difficult for China's auto parts industry to form a comprehensive independent research and development capability in the short term. Technology upgrades require the completion of technology, talents, experience, and capital accumulation. In these areas, the vast majority of domestic parts and components companies are still far from being completed. Rapidly increasing the overall competitiveness of China's auto parts industry through overseas acquisitions is a good way.
Zhou Xiangmei, Chairman of the Hua Xiang Group Board of Directors, believes that through the acquisition, Huaxiang Group not only successfully obtained huge orders for the production of interior parts for European luxury cars such as Jaguar and Land Rover, but more importantly, further established in this segment. With competitive advantages, it ranks among the top three in the world in the automotive wood trim industry.
After acquiring the global steering and transmission business of General Motors of the United States, Beijing Pacific Century Automotive Systems Co., Ltd. accelerated the accumulation of technology, talents, and experience and became one of the world's leading auto parts suppliers.
The rapid rise of local companies
In recent years, the market share of China's self-owned brand autos has risen rapidly, especially in 2009 when it once exceeded 40% of the market share. People in the industry believe that the development of automakers with their own brands and the increase in market share have brought great growth opportunities to local auto parts companies.
Domestic auto parts companies have rapidly risen in many segments, and the overall growth rate exceeds that of foreign companies in many areas. A survey of Chinese and foreign OEMs and component suppliers by an authoritative organization found that in more than 80% of auto parts market segments, the share of local parts and components companies has increased, and in more than 40% of market segments, the share of local companies has increased. More than 50%. This phenomenon is most prominent in the field of commercial vehicles and secondary and tertiary components.
The survey shows that in the past five years, local parts suppliers have dominated more than a dozen auto parts markets such as automotive wheels, glass, filters and radiators. Many markets, such as alternators, clutches, and seals, which were previously dominated by foreign companies, have taken a place and are expected to share equal shares with foreign companies.