BEIJING, July 16 /PRNewswire-Asia/ -- Frbiz.com, one of China's leading B2B search platforms, analyzes auto part industry development trends.
The spare parts industry is seeing increasing competition, and local and international companies are upgrading products in order to better compete.
Foreign auto parts companies have an absolute advantage in high technology fields. In more than 10 areas, foreign or joint-venture market share has reached above 70% in China.
Sticking to core auto parts localization therefore has been a recent primary development goal for China's motor vehicle and parts enterprises. Chinese domestic enterprises and foreign enterprises are looking to integrate a multitude of options in order to achieve better market share: foreign investment, joint ventures and domestic investment. Usually, technology, scale, brand and advantages of foreign parts suppliers is self-evident and carries great weight with customers. However, many local enterprises have significant cost advantages and are not bad in certain technical areas. Some domestic companies are attempting to retain local customers while also actively developing foreign markets in order to find more market share however possible. Joint ventures combine domestic and foreign enterprise advantages. China's auto parts enterprises continue to expand in the United States, Japan and other traditional markets, while also expanding in Southeast Asia, the Middle East, Russia, Europe, Africa and other areas.
The competitiveness of China's local auto parts companies is relatively weaker than the international suppliers due in part to some high tech disadvantages, but in the vast majority of component and device areas, local parts are growing more rapidly, especially as cost plays a huge factor in purchasing decisions.
Some enterprises through three or four years of hard work, have cut a striking figure in the market and development potential remains very strong.
At present, the Chinese auto parts industry has good development trends.In 2009, the Chinese auto industry growth soared, leading auto parts companies to achieve revenue and profit growth. Profit growth rates are much higher than income growth, and scaled features are very obvious. With 2010's foreign investment and joint ventures, the domestic parts companies will find it challenging.
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