Automotive mold industry reshuffles technology competition

The automotive mold industry, known as the "mother of the automotive industry," has entered a period of rapid growth along with the development of China's automobile industry.

In January of this year, SAIC and Sekely, the largest manufacturer of automotive exterior parts in the United States, formed a joint venture to establish Shanghai Sikeli Auto Mould Technology Application Co., Ltd. with a total investment of US$92 million; in February, Ningbo Che Lighting Electric Co., Ltd. and the United States Le Mould Co., Ltd. also signed a letter of intent for cooperation in preparation for the construction of a 150-mu vehicle mold base. According to the data from the China Die and Mould Industry Association, from 2005 on the ranking of import and export of mold, Guangdong, Jiangsu, Shanghai, Zhejiang, Tianjin, Beijing, Jilin and other automotive industries are the most advanced places. In 2004, China's mold imports rose to 1.8 billion U.S. dollars, of which automobile molds accounted for about 1/3.

At the recent China Die and Mould Base Industry Upgrading Forum held in Huangyan, Zhejiang Province, experts believe that the potential for automotive molds in China is high and automotive molds are becoming a hot spot in the domestic mold industry.

Rapid development gap is not small

"The rapid development of China's auto industry has brought more room for development to the automotive mold industry," said Dr. Wang Qin of the Institute of Industrial Economics of the Chinese Academy of Social Sciences during an exclusive interview with reporters.

Experts predict that domestic autos will maintain a growth rate of 15% this year and sales will reach 6.4 million, while the auto parts market is larger than the entire vehicle. The rapid development of the mold industry that provides equipment for auto parts is obvious.

According to reports, in the production of automobiles, the appearance of automobiles and various functional components are molded by molds. The production of an ordinary car requires about 1,000 sets of stamping dies and more than 200 interior dies. Nowadays, in order to meet the market demand, domestic automakers are renewing their models more frequently. About 80% of the molds need to be replaced when the cars are changed. The number of molds required for a model car is several thousand, worth hundreds of millions.

It is understood that the country’s new automotive industry policy has listed the automotive mold industry as an industry that will focus on encouraging and supporting development in the next few years. The national policy on vehicle characteristics (restricted imports, local production of key parts) promulgated by the government has also increased the opportunity for mold enterprises to produce molds for exterior car covers.

From the "gap" perspective, the data show that the current domestic automotive stamping die industry's annual production capacity is only 8 billion to 9 billion yuan, while the Chinese auto market mold demand has reached more than 200 billion yuan scale. The hardware equipment and computer management level of several large-scale mold factories in China are close to or parallel to the foreign mold manufacturing industry. However, at present, China still needs to import 300 million to 500 million US dollars worth of auto cover molds to meet the market demand.

All companies move

At present, in addition to some old mold enterprises such as FAW Mold Manufacturing Co., Ltd., Dongfeng Automobile Mold Co., Ltd., and Tianjin Automobile Mold Co., Ltd., foreign and domestic capital have started to accelerate into this area in recent years.

The layout of foreign companies in China has accelerated. Like the United States Cole Asia Co., Ltd. and Dongfeng Automobile Mold Co., Ltd. jointly established "Dongfeng Kerr Mold Standard Parts Co., Ltd." in Wuhan, which is the first joint venture company in China. Honda Corporation of Japan invested 20 million U.S. dollars to establish Yantai Junhui Mold Co., Ltd. in Shandong, which is mainly engaged in the development, design, production, and sales of various automotive molds.

The domestic capital shows a "collective entry" trend. As one of the largest auto mold manufacturers in China, Tianjin Automotive Mold Co., Ltd. jointly established Hebi Tianqi Automobile Mould Co., Ltd. with Xugou Coal Mine in Hebi City, Henan Province; Chengdu Aircraft Industry Group Co., Ltd. cooperates with Chengdu Aircraft Instrument Company, Zhejiang Geely Group, Nanjing University of Aeronautics and Astronautics and Northwestern Polytechnical University jointly established Sichuan Chengfei Integrated Technology Co., Ltd., which is mainly engaged in the design, development and production of molds such as automobiles. It is intended to build the largest automotive mold production base in the west. Diversification of other companies is also aimed at the mold industry, such as Wuliangye Group Corporation has reached an agreement with the Japanese Marshun Company to jointly build a large-scale automotive mold production base.

At the same time, local policies are also supporting the development of the local mold industry. For example, in the latest "Shenzhen Industrial Structure Adjustment Implementation Plan", the automobile mold is clearly listed in the forefront of advanced manufacturing. The Shenzhen Mould Industry began a collective “mobilization” to enter the automotive mold industry. More than a dozen companies have been or are planning to increase capital and expand stocks to develop automotive-related mold products; Shanghai will also focus on the mold industry to the automotive industry.

Take the road to technology upgrade

“From a global perspective, the level of technology in the domestic mold industry is still relatively low. For the mold industry, upgrading has become a common proposition.” Professor Han Xiaoming from the School of Economics at Renmin University of China told reporters.

According to the data from the China Die and Mould Industry Association, the technical content of domestic automotive molds is generally low, and the proportion of high-grade molds is relatively small. Especially for high-end cars, the molds are almost entirely dependent on imports. According to rough statistics, China’s annual import of body molds will require 200 million US dollars.

Experts pointed out that there is still a big gap between China's auto mold enterprises to participate in international competition, mainly due to the lack of independent research and development capabilities. In the front of the mold industry chain research and development, personnel construction and industrial chain back-end detection, information services, one step ahead, in order to mold industry and even the entire manufacturing upgrade. The future development direction of domestic auto mold enterprises must fully arm themselves with high and new technology, develop toward specialization, and take the joint road as an inevitable trend when conditions are ripe.

The reporter learned that, whether it is from government promotion or corporate autonomy or market orientation, some mold enterprises in China have begun to actively seek ways to upgrade. Dongfeng Auto Mould Co., Ltd. took the lead in the successful design and manufacture of high-end passenger car exterior parts. The inner and outer plate dies of the engine cover changed the history of the imported high-end passenger vehicle exterior tooling tooling. In order to improve brand building and enhance competitiveness, Beilun New District of Ningbo City, Zhejiang Province has applied for registration of the “Beilun Mould” collective trademark to the State Administration of Industry and Commerce, which is the first in the domestic industry.

Industry Competition Should Accelerate "Five Changes"

Dr. Wang Qin of the Institute of Industrial Economics of the Chinese Academy of Social Sciences interviewed the reporter and pointed out that the next five years are not only a five-year rapid development of the market, but also a five-year period in which China's mold industry has been re-divided. The current competition in China's mold industry should speed up the realization of the "five changes."

The first is the change from individual industry competition to industrial cluster competition. At present, in the Beilun and Huangyan regions of Zhejiang, Shenzhen and Dongguan in Guangdong, the mold enterprises have changed their previous “big and full” development models and have begun to form a good division of labor and collaboration with each other, forming a benefit community and developing toward a cluster.

The second is the transition from low-end competition to high-end competition. Although China's total mold production ranks third in the world, the level of design and manufacturing is generally behind. China's mold with low technological content has been oversupply, and there is little room for market profit. While middle and high-grade molds with high technological content are still far from the needs of national economic development, a large part of them still rely on imports. In recent years, the amount of imports each year is 100 billion yuan.

The third is the change from the competition for reducing taxes and profits to the competition for providing public services. In supporting the development of mold and die enterprises, government departments should change from the previous competition for tax reduction and profit-taking to the provision of public service competition.

Fourth, from a single level of technology and equipment competition to personnel, management and other aspects of all-round competition.

The fifth is to gradually shift from domestic market competition to international market competition. In recent years, mold buyers in Europe, the United States, Japan, and Southeast Asia are paying more and more attention to China's molds. Domestic companies should closely follow the needs of the main products to develop molds and actively explore overseas markets.