China's auto overseas expansion needs to focus on relations with overseas parts manufacturers

When Chinese auto companies expand abroad, they should solve the problem of how to deal with the relationship between our complete machine manufacturers and component manufacturers. -- Ni Wei

Yesterday, at the 2nd Global Automobile Forum , Mr. Ni Wei, Visiting Professor of Tsinghua University and Vice President of ASIMCO Group , gave a speech on the "Overseas Expansion Strategy" of Chinese car companies at the forum.

This year, China exported more than 500,000 vehicles as of August, and last year we exported 580,000 vehicles. Although there has been some progress, but from the percentage point of view, this percentage is still relatively low. In particular, compared to the 6.1% share of exports in 2008, China’s auto exports this year are still not optimistic from a percentage point of view.

Increase R&D investment to improve product quality

For Chinese auto manufacturers, not only must they meet the challenges of their domestic counterparts in the development process, but also face competition from foreign automakers. In such an era of “internal and external problems,” Chinese auto companies want to occupy the market. For a place, it is necessary to think about how to improve product quality and the image of a product brand on this basis. Ni Wei believes that "the fundamental solution to this problem lies in how to enhance the company's independent research and development capabilities. The majority of domestic companies' R & D investment only accounts for 7% or 8% of foreign counterparts, so this investment, R & D investment is relatively small Of course, we also have some very good companies, such as Chery's R&D investment is relatively high."

Pay attention to the relationship with overseas parts manufacturers

China is a big producer, but it is not a big country for R&D. Especially for R&D components, some old industrial countries such as the United States, Germany, and Japan have strong auto parts companies in addition to well-known auto companies. China lacks such a company. "This situation also determines that when Chinese companies expand overseas, they must seriously handle the relationship between our complete machine manufacturers and component manufacturers." Ni Wei.

Looking ahead to the development model of overseas expansion of Chinese car companies, Ni Wei believes that “When we are developing the international economy, especially when the economy is recovering globally, we should not be satisfied with the current situation and are satisfied with the Chinese auto factories. We should think positively and eagerly about how we build factories in other countries, not just exporting, assembling locally in foreign countries, but should be producing locally in foreign countries. This has grown in the past few years. However, we should have more potential to do this work, so I would like to say that it is our long-term goal to build such factories in other countries.

Doing a good job in the domestic market abroad

China is already the largest car market in the world. It is expected that domestic autonomous production may reach 40 million vehicles in the next few years. Not only passenger cars, commercial vehicles, etc., but also many cars are available. Ni Wei believes: "In response to the development trend of the domestic auto industry, first of all we should do our own work and then go abroad, otherwise we will lose our foundation after export. From the perspective of China's development, there are more Chinese people. And Chinese consumers, especially big cities, want to buy big cars, but I think that for the long run, small cars and compact cars are necessary. For domestic manufacturers, they should produce more compact vehicles. Because we know that fuel and other issues are very critical, and in the next few years, the industry and the government will support the production of small cars, and domestic automakers should produce more, invest more R&D forces to develop small vehicles. Do not forget that China, Beijing, Shanghai and other large cities, but there are second- and third-tier cities, the people of these cities just out of poverty, in the acquisition of the first car, you must buy affordable vehicles."

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ASIMCO Industrial Technology Co., Ltd. ("ASIMCO Group") was established in 1994. It is one of the largest independent foreign-funded parts manufacturing groups in China with annual sales of more than 500 million U.S. dollars. It provides the automotive market in China and the world. Competitive parts and high quality parts products. ASIMCO Group, headquartered in Beijing, produces a wide range of component products, including fuel injection systems, various types of power transmission systems, chassis system components, automotive motors, and noise reduction and shock absorption technology products. With the increasingly stringent requirements of the Chinese government on fuel economy, emission standards and safety, combined with the characteristics and needs of the Chinese market, ASIMCO Group pays high attention to the independent research and development of new products, and enhances the product mix, increasing Product development and investment.

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