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China's auto parts position in the global supply chain
Deputy Secretary-General of the China Association of Automobile Manufacturers, Shen Ningwu, and Jan Borgonjon discussed the Chinese auto parts industry in a detailed session. The discussion emphasized how the auto parts sector is an essential component of the broader automotive industry, not only due to technological advancements and cost efficiency but also because global automakers are increasingly interested in sourcing components from China.
Shen Ningwu, who has held various roles within the Dongfeng Group and currently serves as Deputy Secretary-General of the China Association of Automobile Manufacturers, focused his speech on the current status of China's auto parts industry within the global supply chain. He outlined five key areas: challenges in the industry, historical background, overseas expansion, the 11th Five-Year Plan for the industry, and the position of China's auto parts in the global market.
He pointed out that while China's auto parts industry is growing rapidly, there are still significant challenges, including weak independent R&D capabilities, reliance on foreign technology, and limited competitiveness on the international stage. The industry is still largely dependent on OEMs and local government support, which hinders its ability to develop independently and compete globally.
Shen also highlighted the importance of improving industrial competitiveness through better R&D investment, structural adjustments, and fostering independent brands. He stressed the need for both domestic and foreign companies to work together to strengthen China's position in the global supply chain.
According to the data presented, the output value of auto parts in China reached nearly 35% of the total automotive industry value last year. However, the industry remains fragmented, with most companies being small or medium-sized enterprises. While private and foreign-owned enterprises are gaining momentum, state-owned enterprises still hold a significant share, though their performance lags behind others.
The export of auto parts has been increasing, with over 8 billion yuan exported last year and more than 70 billion yuan in the first nine months of this year. Despite this growth, exports remain concentrated in low-value products, and the industry still lacks the scale and technical depth needed to become a true global supplier.
Looking ahead, Shen emphasized the importance of the 11th Five-Year Plan, which aims to enhance the competitiveness of the auto parts industry by focusing on new energy, environmental protection, and electronics. The plan sets ambitious targets, including reaching 1.3 trillion yuan in total auto parts output by 2010 and exporting 50 billion US dollars worth of components.
In conclusion, Shen called for a comprehensive approach to improve the industry, involving government policy, corporate innovation, and international collaboration. He urged the industry to move beyond low-cost competition and build a more sustainable and competitive ecosystem that can stand on its own in the global market.