China's auto parts business expects breakthrough should solve four major problems
Chinese auto parts suppliers face many difficulties and challenges. Many companies are simply part manufacturers rather than suppliers. Such as cultural, logistics, legal, quality certification systems, global political environment, and economic environment, etc., all need to be overcome and resolved through communication and integration. Auto parts suppliers face up to the global procurement of auto parts and should solve four major problems:
One is the lack of continuous improvement in international standards. It is understood that the lack of continuous improvement in international standards is a common problem among domestic parts and components companies. ISO/TS 16949, ISO 14001, and QS9000 certifications in these industries are now considered as a stepping stone for export by many domestic parts and components companies. However, many companies do not even know the essence of certification when they get certification, and it is even less likely that they will continue to improve according to the requirements of the standard. The result of this is that the distance between some companies and international standards has grown.
The second problem is that the level of specialization is not high. Insiders pointed out that domestic parts and components companies should not only stay at the level of “will do†and “can doâ€, but should go deeper into “doing well†and “doing fine workâ€. Many parts and components companies do not understand this approach. In their view, doing so is not necessary and adds cost.
The United States Collins Ackerman specializes in the production of automotive flooring and acoustic components, which is based on its own specialization in the field, occupying 90% of North American market share. When the company encountered difficulties in filing for bankruptcy, Ford, General Motors, Dai-ke, Toyota and other large companies immediately provided loans to help the company cross over. Because these OEMs know that if Collins Ackerman can't continue to supply, the North American auto market will be paralyzed.
The third problem is the delay in information dissemination. The biggest bottleneck for China's auto parts industry entering the global procurement industry is the lag in information dissemination channels and efficiency. In foreign countries, the usual practice is to use “industry associations, peer evaluations, intermediary agencies, professional newspapers, magazines, and business networks†to “boost bottlenecks,†and at the same time invite world-renowned consulting firms to assist implementation and supervision.
Fourth, there is a lack of joint force with the vehicle. It is understood that the current competition in the domestic auto parts supply market is very fierce, and almost all domestic parts and components suppliers have encountered this kind of embarrassment, that is, vehicle manufacturers put forward price reduction requirements for spare parts suppliers without any room for maneuver.
The relationship between OEMs and parts suppliers is a joint force. In response to the price reduction threats of OEMs, in the face of global component procurement prospects, auto parts suppliers can only play high-tech cards with low cost and high prices. Technology content to enhance their own product competitiveness, in order to gain a firm foothold in the market competition, because "only competitive parts products will allow vehicle manufacturers to have nothing to say."
The successful experience of the development of multinational car companies tells us that a strong auto group must have its own strong components to support it.
(Source: China Business Daily)
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