Chinese auto parts are facing issues such as currency wars and inflation

For a certain period of time, Chinese automotive parts are facing issues such as exchange rate wars and inflation. To solve these problems, it is not only necessary to improve our own technological level to increase product added value to resist exchange rate and inflation, but also to have a long-term vision, grasp the future trends of automotive parts, and fight with confidence. From a certain period of time, there are four major trends in the development of Chinese automotive components:
1. The international industrial transfer is accelerating, and mergers and acquisitions are active.
During a certain period of time, most domestic automotive parts companies had low sales, and compared to multinational giants with sales of billions of dollars, the scale of Chinese automotive parts companies was significantly smaller. Moreover, China's manufacturing exports have always been known for their low prices. Multinational corporations, in order to effectively reduce production costs and explore emerging markets, not only transfer their production and manufacturing processes to low-cost countries and regions on a large scale, but also gradually extend their transfer scope to research and development, design, procurement, sales, and after-sales service. The scale and level of transfer are becoming larger and higher.
In 2010, several multinational component companies had already established factories in China through joint ventures and other means.
The quickest way for domestic component companies to gain a foothold in the future international market competition is through mergers and acquisitions, forming large-scale component enterprise groups. The merger and reorganization of component companies is more urgent than that of complete vehicles. Without the emergence of large component companies, costs cannot be reduced and quality cannot be improved. The development of the entire industry will be extremely difficult. In the context of small scale, weak strength, and insufficient research and development capabilities of domestic component enterprises, if the component industry wants to develop rapidly, it must accelerate mergers and acquisitions to form economies of scale.
2. Automotive parts enterprises actively implement systematic development, modular manufacturing, and integrated supply, and the clustering development characteristics of the automotive parts industry are obvious.
From the perspective of the development of the automotive parts industry in major automobile producing countries around the world, the development of the parts industry cluster is equally important as the development of the automotive industry. To become bigger and stronger, it is necessary to develop into an industrial cluster, which is a strategic choice for the automotive parts industry. The use of platform strategy in product development, systematic development, modular manufacturing, and integrated supply has gradually become a development trend in the automotive parts industry for whole vehicle enterprises. At the same time, the clustering development characteristics of the automotive parts industry are becoming increasingly evident.
3. Global procurement of automotive parts will become a trend, but in the future, China will still focus on exports and internationalization.
With the changes in the organizational structure of the automotive parts industry, more and more vehicle manufacturers will implement global procurement of parts. However, China's huge manufacturing industry and the characteristics of high quality and low price cannot be transformed in the short term, so the future of automotive parts will still be dominated by exports and internationalization.
During a certain period of time, international buyers have become increasingly rational and practical towards Chinese procurement by selecting and cultivating potential core suppliers; Strengthen the integration of its own logistics; Strengthen communication with foreign factories in China to increase their enthusiasm for exports; Diversifying procurement destinations and comparing them with other emerging markets to determine procurement locations can promote the process of procurement in China.