Auto parts suppliers profit margins for 5 consecutive years of decline
Chinese auto parts suppliers are facing increasing competitive pressures. Over the past 10 years, China's auto suppliers and other markets, such as Europe and the United States automotive suppliers, in terms of profitability has been a dominant position, the average profit margin is much higher than other national suppliers. But the trend is in the first quarter of this year happened great changes, the report released yesterday by the global business consulting firm alixpartners, Chinese auto parts enterprises in the first quarter of this year the average profit rate was 5.8%, basically and Europe and the United States market automotive suppliers profit to flat.
China's auto suppliers, the average profit margin over the past 5 years, continued to decline in the first quarter of this year, the average profit margin of 5.8%, compared to 10.8% in 2009 fell more than 40%. Ai Rui platinum director Li Lihua told the "First Financial Daily" reporter: "automotive suppliers in China, the average profit rate of decline in the trend is not optimistic, may maintain and Europe and the United States and other mature markets automotive supplier profit margins." Li Lihua said that the reason for the decline in the average profit margin of China's auto suppliers mainly has two aspects. First, the price competition between car suppliers is fierce, car manufacturers will be part of the cost of car sales price war passed on to the head of the automotive suppliers, the annual demand for the annual price of the car supplier. Another reason is that auto supplier capacity utilization rate is not high, accept investigation of 70% of the auto supplier's executive said auto supplier capacity utilization rate of less than 80%, the lack of large-scale difficult to reduce automotive supplier production cost.
Europe and the United States and other mature auto market is relatively high degree of integration, by 5% of the automotive suppliers to provide more than 80% of the whole car market, but the supply of the Chinese auto market is relatively fragmented. Based on the local government to the local GDP and the pursuit of tax and employment, different brand system of supplier systems are scattered all over, which indirectly led to the lack of production of automotive suppliers.Zhang Haitao, China's largest domestic auto supplier, is the same with the general manager of China. "Chinese domain car also faces the challenge of the local set up factory. Local government for regional production requirements, the hope that the Chinese domain car factory in the local, but now the relative dispersion of the car manufacturers, we also need to balance the investment income in the local plant." Zhang Haitao told reporters. Automotive suppliers in the future to achieve the two digit sales growth, the biggest challenge is the increasingly fierce price competition, as well as the vehicle demand continues to slow down. Automotive suppliers to get more market share, the first penetration into the new models or new market segments, while the car manufacturers to report a competitive pricing. However, the fierce price competition will further deteriorate the living environment of automobile suppliers. Platinum survey showed that 76.7% of respondents said that price competition is the most severe challenge in 2013, compared to last year, 54.2% of respondents expressed concern about price competition.
At the same time, China's auto suppliers also face the challenge of the leading car manufacturers "super platform" strategy. "Super platform" refers to the leading car manufacturers in order to reduce production costs and even the complexity of the manufacturing process, able to do on the same platform to produce a million cars. Ai Rui platinum managing director Roman said: "the 'super platform will change the rules of the game industry, the automotive suppliers to increase investment, and Global OEMs to establish closer relationship to continue to supply spare parts for automobile factory of manufacturing platform. But from the current point of view, a super platform strategy of China automotive suppliers is spread news, China has not meet good, failed to establish a global distribution, and large platform solutions, some models of the supply chamber of Commerce lost some market share. "