China's three-year-old automobile industry looks at small parts industry into disabled

There is a common saying in China that "When you are three years old, you look old, seven years old looks old." If the Chinese automobile industry is likened to a giant that is growing up, then the development of the parts and components industry can be regarded as the "three-year period" of this giant. What is worrying is that from the parts and components industry, the future of Chinese cars is likely to grow into a “disabled person”.

Last week, a U.S. representative from the United States thought that China intended to require auto makers who wanted to enter the Chinese market to hand over their own proprietary electric car technology. According to this, he urged the Chinese government to reconsider the electric car technology property rights program and said that this Actually defamatory of US intellectual property law, and in the end, it also gave China an “accusation” that it estimated also violated China’s obligations as a member of the World Trade Organization (WTO).

In developed countries, 70% of the intellectual property rights of a new car is owned by auto parts companies, while the vast majority of parts and components companies in China do not have product development capabilities. At the just-concluded China Auto Parts Industry Summit Forum, Hirano Yahei, executive director of Japan’s Daikin Association, Nishikawa Corporation, representing Japan’s small and medium-sized component companies, believes that in Japan, OEMs only need to provide the cost of a component. With regard to price and technical requirements, component manufacturers can develop products based on these requirements. However, Chinese auto parts companies are only at the level of “products for drawings”. The figures show that only 43% of parts and components companies in China's parts and components industry have patents, and less than 20% of companies have patents for inventions. Regarding the ownership and gold content of automotive intellectual property, in the face of the developed countries, including the United States, China can only use the term "congenitally deficient" to describe it.

In the core components, the more high-tech and profitable parts, the higher the degree of dependence in China. Taking the automatic transmission as an example, statistics from the China Association of Automobile Manufacturers show that about 80% of the domestically produced automatic transmission passenger cars are equipped with imported automatic transmissions, and the remaining 20% ​​are mainly from foreign-funded joint ventures.

At present, the Chinese automotive industry is regarded as the most advanced electric vehicle that catches up with the advanced level in the world. Lithium battery technology is the core of an electric vehicle. It consists of three major elements: positive electrode material, electrolyte, and separator. Among them, the highest technical barriers and profitability are the diaphragm technologies. For the power battery separators that can be applied to electric vehicles, the import dependency of ordinary lithium battery separators in China is as high as 80%, and more advanced dry process technology is used to produce lithium batteries. The diaphragm is still unable to achieve localization. This means that: China's long-term plan for the development of electric vehicles is based on the import of core components. Just think: If a child hasn't learned to walk, he wants to run it. Is it possible?

At the international level, the relationship between parts and components companies and vehicle manufacturers is "same life and death, coexistence and death." Parts companies and vehicle manufacturers rely on each other and gradually develop into international giants in their respective fields, holding cutting-edge technologies and resources in the global automotive industry. In recent years, overseas auto parts giants have landed in China through joint ventures and cooperation. Delphi, Wescast, Cummins and many other foreign auto parts manufacturers have already built dozens of production bases and branch offices in China. Nowadays foreign ownership of auto parts is as high as 70% to 80%. In particular, Japanese and Korean manufacturers' Spare Parts purchases are almost not open to Chinese domestic parts suppliers. This has caused local suppliers to lose opportunities for common development with vehicle companies. At present, there are more than 5,000 component manufacturers in China, and the survival status of independent component companies is worrying. Foreign investment has accounted for more than 60% of the market share in China's auto parts market, accounting for more than 80% of the auto parts industry. The sales of most parts and components companies in China are relatively low. Compared with multinational giants with sales of up to 10 billion US dollars, the scale of China's spare parts companies is obviously small.

Modern psychology's explanation of "being three years young and seven years old" is: the psychological characteristics and physical conditions of a 3-year-old child can reflect the physical and psychological development of the child's youth; and from a 7-year-old child, it can basically be judged. His achievements and achievements after his adulthood.

Nowadays, the voice of “become a powerful automobile industry” has been “buzzing in China” in China. However, is the equivalent of “three years old” China's auto parts and components industry “physical and mental” so fragile that the Chinese auto industry can grow into a “world giant”?