Automotive Technology Development Brings New Opportunities to Parts and Components Industry

In 2005, the technology of the international automotive industry developed even more rapidly. The application of new vehicle technologies is increasingly reflected in automotive components. For example, automotive parts adopt many electronic technologies to solve many problems in the automotive industry, which greatly improves the safety, emissions, economy, and comfort of the vehicle. Most of the patents and technologies for automotive vehicle design are created by component manufacturers. According to statistics, of all the patents for a car, 70% are on parts and 30% are on vehicles.

In this regard, Zhao Hang, director of the China Automotive Technology and Research Center, pointed out that the rapid development of automotive technology has brought unprecedented opportunities for China's spare parts industry. “This is mainly manifested in two aspects: First, through the process of introduction, digestion, absorption, and self-innovation, the development of new automotive technologies can be carried out in parallel with the developed countries on a new platform; second, more than 50 years of accumulation and industrial transfer. The international environment has made it possible for the potential advantages of the traditional parts industry to become a reality."

Electronic Technology Synchronized with the Development of Developed Countries

Since the reform and opening up, through cooperation with foreign automotive companies, the Chinese automobile industry has introduced more than 1,000 automotive technologies. Now that we have been able to produce cars with world-class manufacturing technology, new models are increasingly in sync with the international market. The Chinese automobile industry has become an important part of the world's automotive industry technology. At present, although the world’s multinational corporations are still the main driving force for Chinese auto companies’ technological development, more domestic companies have begun to try various new product development methods and expand the sources of technology.

Through more than 20 years of introduction, digestion, and absorption of advanced foreign product design and manufacturing technologies and implementation of technological transformation, the overall level of China's parts and components industry has significantly improved, and some companies' equipment and technology have reached internationally similar levels. The introduction of technology and the accumulation of technology have made China's auto parts industry itself possess the technical level and comparative advantages of participating in international competition. Shen Ningwu, deputy secretary-general of the China Association of Automobile Manufacturers, believes that the most important driving force for comprehensively upgrading the technology and product level of the parts and components industry is the realization of automotive electronics. “The development of China’s automotive electronics technology is synchronizing with the development of international mainstream technologies, which has greatly promoted the development of China’s automotive safety, environmental protection, and energy-saving technologies. With the development of automotive electronics technology, it is gradually becoming electronic, informative, networked, and intelligent. The direction of development, the car will have entertainment, office and communications and other functions." Shen Ningwu forecast that the future of automotive electronics products will account for an average of more than 30% of the cost of car manufacturing. To maintain the sustained and rapid development of China's auto parts industry, the application of electronic technology in automobiles will play an important role.

New environment integrated into global procurement system

The "Automotive Industry Development Policy" clearly stated that China's auto parts enterprises should adapt to the development trend of international industries and actively participate in the product development work of the host plant. In the key auto parts field, it is necessary to gradually develop system development capabilities. In the production of general parts and components, we must establish production lines and management systems in accordance with international standards, form a scale, continuously improve quality, reduce costs, and enter the international procurement system.

Zhao Hang believes that real localization and internationalization of parts and components can truly improve the competitiveness of the automotive industry. In recent years, China's auto parts export business has developed rapidly. The export of auto parts has become the main force for the export of auto products in China. From the statistics, we can see that the export value of auto parts is much higher than that of imports. The market position of China's auto parts companies is gradually increasing. The world's automobile giants, especially parts and components companies, have gradually transferred their R&D and production bases to China. This has trained a large number of high-quality talents for China's spare parts industry. The comprehensive advantages brought by advantages will sooner or later appear in the independent innovation of China's spare parts enterprises.

At the same time, China's spare parts enterprises have advantages that cannot be matched by developed countries in terms of labor costs, the number of engineering technicians, and production potential. Statistics show that China's auto parts product variety has reached more than 60%, domestic market satisfaction rate has reached more than 70%, the general product production capacity has greatly exceeded the market demand. As the general parts and accessories of labor-intensive and raw material-intensive products, China's auto parts and accessories products can not only meet the domestic demand, but also a large number of exports to the United States, Japan and other international markets. For those parts and components that have high technological content, such as ABS, airbags, electronic fuel injection systems, and automatic transmissions, China is also increasing the development and introduction of technical equipment in this area. With the acceleration of the globalization process, Chinese factories that are constantly armed with advanced technology will certainly become the global parts production base.

New challenges, innovation, leapfrog development

Gan Zhihe, director of the Investment and Planning Department of the State Economic and Trade Commission, said that in the face of new opportunities, China's parts and components industry is also facing severe challenges, "mainly reflected in the small scale of production, lack of independent development capabilities of enterprises, and serious local protectionism. The long-term fragmentation of China's automobile industry and the introduction of foreign models have made it difficult for them to form economies of scale. The simultaneous product development capabilities of parts companies and OEMs have yet to be established, and they are not suitable for the development of new models. To shorten the requirements, in order to seize the opportunities of technological progress, parts and components companies must strengthen technological development and promote technological innovation."

The cycle of replacement of automotive products is constantly being shortened. The development of the automotive industry requires auto parts companies to assume more and more responsibilities in vehicle development and become part of vehicle development. In order to meet the requirements of simultaneous development of automobiles and components and system development, and to meet the requirements of automotive electronics, information, and networking technologies, auto parts companies must increase investment in product development funds and improve their ability to independently innovate components. In the face of new opportunities and challenges, we must focus on technology and give full play to our own strengths and strive to form a large-scale and professional group. Gan Zhihe believes: “Big groups should develop high-tech and electronic technologies, and actively cooperate with internationally-advanced parts and components companies in production and support; small enterprises should form an industry order and strictly control and check quality in terms of quality. The connection of the automakers makes the development of parts and components a real part of the development of the vehicle."