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China auto parts industry will enter a "small profit period"
2012-09-04

Source: China Information Network

       The authority of the state sector statistics show, China's auto parts industry by the industry downturn and the cost of steel increased effect, for the first time in 10 years the profit decline.The study shows that, with the aggravation of the market competition, the domestic auto parts industry profits era gone, the future will be the direction of the development of corporation.
Auto parts industry to "small profit period" has the following four reasons:
       One is truckload enterprise on cost, lead parts enterprises profit.In recent years, the whole enterprise for the expansion of the scale, stimulate consumption, to hit price war.Some manufacturers cut prices of some models of the spare parts, used wearing parts prices by an average of 21%, with the highest decrease to 50%.Therefore, most of the parts enterprises affected, because the vehicle enterprise transfer price pressure.
       Two is parts enterprises mutual demand a low price lead to decline in profits.The whole enterprise and host plant for each component consists of 1 to 4 parts suppliers.Since 2011, some parts enterprises to expand their market share in the competition, technology, quality, brand and after sale service at the same time to hit price war, bring about company profit to drop.
       Three is the raw material price rises considerably, extrusion parts enterprises profit space.In recent years, used in the manufacture of motor vehicles of various raw materials prices rose sharply, aggravated the car companies and auto parts enterprises cost burden.Among them, the increase in the price of steel for automobile enterprises the impact is bigger, because the steel is the main raw material for manufacturing automobile.
       Four is the international auto parts giant to enter the Chinese market, to seize the China automobile spare parts enterprise's traditional market.In recent years, many influential international automotive components group with advanced technology, quality, brand and after sale service, become a major vehicle as well as a host of suppliers and to realize the localization of production enterprises.China auto parts enterprises and foreign enterprises Tongtaijingji, due to technical, management and other aspects of face opponents, at present whole vulnerable.
       Experts predict that, with the aggravation of the market competition and industry concentration, dimensions expands, the future auto parts enterprises to rely on sales to increase profit, small scale, technology strength weak, no brand auto parts enterprises will be eliminated.


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