China's spare parts industry to take advantage of the three advantages of overseas acquisition

In 2009, China's vehicle companies took a giant step toward overseas mergers and acquisitions, and the high-end auto parts industry has attracted the attention of domestic companies. The acquisition of GM's steering business unit is a large-scale acquisition initiated by international companies for well-known auto parts companies after Beijing Auto's acquisition of Saab's vehicle technology and Jingxi Heavy's acquisition of Delphi's brake and suspension business.

July 12, 2010, Beijing, China Pacific Century Motor Co., Ltd. and the United States General Motors Corporation formally signed the General Motors headquarters in Detroit, the acquisition of GM's global steering and transmission business NEXTEER, which is by far the largest Chinese auto parts companies in overseas An acquisition activity.

Industry insiders believe that this acquisition is inseparable from the rapid development of the Chinese auto market. For Pacific Century Motor Company, the value of the acquisition is worth looking forward to. NEXTEER management is very optimistic about the prospects of the company after the acquisition, President Robert said that Pacific Century Motor Corporation will inject capital for NEXTEER, plus the original governance and technology, will help improve global competitiveness. Zhao Guangyi, chairman of Pacific Century Automobile Co., Ltd., said that the acquisition is conducive to NEXTEER's entry into the Chinese market and the formation of new parts and components in China, which will help improve the automobile industry structure in Beijing.

Tianbao Bao, chairman of Tianbao Group, said that the company has conducted more than two years of tracking and investigation of the general global steering and transmission business. The acquisition is the success of Tianbao Group's successful acquisition of the General Motors' DELPHI suspension and brake business in 2009. Once again, the acquisition of GM's high-end industries will benefit the structural adjustment of China's auto parts industry.

How Chinese Auto Parts Enterprises Go to Overseas Markets

In recent years, parts and components have gradually become the main force in the automotive industry's import and export, but 79% of them are resource-intensive and low-value-added products. Enterprises go out and technology is the core. Acquisition is the best way.

Co-building technology research and development platform

It is understood that in the recent upsurge of “mergers and acquisitions” prevailing in the automotive industry, there are actually more frequent M&As by foreign multinationals to China’s domestic leading enterprises, and the number of mergers and acquisitions by Chinese companies abroad is still rare.

Obviously, only with unique advantages can we compete with competitors. "Now, with the internationalization of the domestic market, China's spare parts enterprises cannot yet have an advantage in the domestic market, and it is impossible to talk about competitiveness in foreign countries." Guo Wei said, "The parts and components have international competitiveness, and the basic condition is to have a comparative advantage. Is the technological innovation advantage."

There are many disadvantages for domestic parts and components companies: small scale, lack of R&D capital, lack of professional and technical personnel, tight domestic zero-reduction relationships, lack of direction in parts and components companies innovation, high risk in technology research and development, and unreasonable parts industry structure. Decentralized investment is serious.

"For the unfavorable situation of the domestic parts and components industry, parts and components companies must jointly build a technology research and development platform." The joint construction of a technology R&D platform has saved R&D costs and reduced investment risks. It is understood that consensus has been reached in the industry.

Joint force overseas market research

It is understood that the common problems faced by enterprises are the occlusion of overseas markets and the blind spots in the market that prevent companies from operating.

"We must do a good job in market research: The uneven development level of the international market, combined with political, cultural, religious, and customary complexities, and entering the international market, I am afraid there is no solution to the problem once and for all. As the saying goes, do as the Romans do. Before attempting to enter the international market, component companies must make use of various channels, channels, and methods to earnestly conduct in-depth market research on the target market. Only the demand capacity, characteristics, structure, and competition structure of the target market are numerous. However, in order to take a solid step toward internationalization, Wen Jiaping said.

According to Wen Jiaping, as the Chinese have strong personal awareness, they prefer to go it alone even if they are overseas. Parts companies are not willing to form a joint relationship with each other because of various considerations. Market participants also share the same view: Some overseas markets do not have a good export situation, and domestic companies hold down each other's prices and kill each other. This is an important reason why domestic companies should unite and avoid vicious competition.

“Party companies should strengthen their joint efforts overseas to conduct market research,” Wen Jiaping said. “The joint research will not only help reduce costs and extensive access to information, but also help to change the situation of China's auto parts exports.”

According to reports, in the report submitted by the relevant experts to the Ministry of Industry and Information Technology of the People's Republic of China, in response to the problem of asymmetric information in overseas markets, it is strongly recommended that relevant government agencies and industry associations and other intermediaries provide vigorously to parts and components companies with their respective resource advantages. stand by.

Multi-channel use of export policy

"Actually, there are still many opportunities for companies to go out." Wen Jia said with a clear focus, "No matter from the official level or the corporate level, export enterprises need to pay extensive attention to various international trade policies and regulations."

It is understood that the main ways for SME market development and product promotion are to participate in the Canton Fair and the China Fair, and they have not received due attention and promotion for other forms of domestic and foreign exhibitions, various forms of advertising, and e-commerce. Many parts and components companies export a single form.

Wen Jiaping believes that domestic parts and components companies must pay attention to the opportunities that various export policies may provide in a variety of channels and in various forms. For example, attending a trade show is not only a contract, but also communication with a local company to understand who is the main competitor, who is the main buyer, what the opponent's strategy is, and where the buyer's demand is. Second, reading trade magazines and participating in some of the most influential industry seminars will also give you plenty of opportunities. In addition, talk to marketing service providers such as trade magazine publishers, online search engine operators, and more.

Wen Jiaping also reminded that, like obtaining a “visa” for the target country, Chinese auto parts companies must also make great efforts to obtain “passes” for market access through internationally recognized or authoritative organizations in the target countries if they want to go to the international market. Proactively do quality certification and brand awareness. In addition, due to the complex and ever-changing international market, many businesses and affairs, especially after-sales services, require the parties to come to their own territory to handle. “Choose carefully the partners” is not only necessary, but also can be said to be internationally successful. The essential.

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