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China's auto parts industry has made significant progress thanks to the rapid development of automakers.

Published time:

2025-07-01

　　In 2010, China's auto parts industry made significant progress thanks to the rapid development of automakers, leading to a deeper understanding that auto parts companies and automakers must develop collaboratively, such as through simultaneous development, automaker support, and increased use of domestic auto parts. If automakers focus primarily on purchasing foreign parts, it could lead to foreign control of key components and significant losses for domestic parts companies. The key to addressing this is for parts companies to strengthen their capabilities and establish group-level operations to compete with foreign parts companies. Successful examples of domestic independent auto parts companies, such as Fast and Wanxiang, started as small businesses, producing high-quality parts compatible with numerous vehicle models, outcompeting many foreign parts companies for a period of time.
　　First, domestic auto parts companies should seize the opportunity presented by government support policies and not be complacent. They must steadily advance in product development, capacity building, and expanding cooperation with automakers; otherwise, they risk being overtaken by foreign companies. Second, foreign parts offer lower risk and guaranteed quality, leading to greater procurement by domestic automakers. Therefore, domestic parts companies must also improve their management and quality control to gain the trust of their customers.
　　The same conclusion applies to the expansion from traditional components to key components for new energy vehicles. Otherwise, if key components are dominated by foreign companies, imitation will hinder development. Therefore, product quality is crucial. For a period of time, domestic companies have shown a high level of competence in the easily damaged parts industry, such as filters and brake pads, particularly in the filter industry. With China's growing vehicle ownership, the market for consumables is also substantial. There are no issues with manufacturing costs and R&D; the main focus should be on quality, leveraging strengths and quality to build customer confidence.
　　In 2011, the overall development trend of China's auto industry remained optimistic, with an expected growth of around 10%. However, some unfavorable factors existed, such as the expiration of preferential policies from 2010, and the poor performance of the real estate and stock markets. This led to panic buying and even stockpiling of vehicles, resulting in 30% to 40% growth in 2010. Objectively, the Chinese auto industry in 2011 will likely see more rational development. Annual growth of 30% to 50% is not necessarily reasonable; rapid growth often leads to unforeseen problems, and companies need to gradually move towards standardization and rationality.

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