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Although the domestic auto consumption market is huge, the enthusiasm of local auto parts companies to expand overseas markets has not diminished. At the recent Beijing auto show, reporters fully felt this. Many auto parts companies have no doubt that their target customers are from overseas markets.
An interview with the reporter found that almost every company's booth has both Chinese and English logos, and bilingual exhibit data, business cards, and translators have also become the standard for exhibitors.
At a company booth that produces brake pads, in just 20 minutes, the staff received three foreign merchants from different countries, and two of them confirmed the quantity and amount of purchased products. Similar scenarios can be seen. It can be said that in the seemingly deserted parts pavilion, the enthusiasm of the local parts companies “overseas gold rush†has increased.
■After-market overseas – gold rush of small and medium-sized parts and components companies “Our products mainly face the foreign auto market.†Mr. Wang Kuaidi, general manager of Anma Filter Co., Ltd., Ruian City, Zhejiang Province, told reporters that many small and medium-sized companies attending the exhibition The situation of parts and components companies is similar, and their main business scope is concentrated in overseas markets.
From the variety of exhibits, it can also be found that most of the exhibited parts and components are easy-to-consumer parts that are popular in the post-market. Large air-conditioning condensers, bearings, shock absorbers, small brake pads, sockets, battery lines, springs, etc., rich product categories cover almost the entire automotive market demand for products.
During the interview with the reporter, a foreign businessman came to the booth of Wang Kuaidi and carefully consulted a transmission filter. After some bargaining, he reached an order with Wang Kuaidi. The foreign businessman stated that he is the head of a branch of a Russian trading company in China. He uses the opportunity of the auto show to order a batch of products to be sold in the domestic repair market. "I will attend every session of the Beijing auto show because the goods are all in full. Convenient," said the foreigner.
With many and full product advantages, many local exhibitors will extend their reach into the global market. According to the reporter, the underdeveloped areas of the automotive industry, represented by South Africa and Southeast Asia, have become the "main battlefields" for overseas gold rushes by local component companies. “There is basically no automakers in these areas, and they cannot afford to support a huge parts and components industry. All post-market parts are almost entirely dependent on imports. Domestic products are their main choice.†Ye Du, head of Ruian Dubang Auto Parts Co., Ltd. Huan told reporters that while the United States, Europe and other developed countries and regions of the automotive industry, there is a huge amount of car ownership to absorb the domestic low-priced component products.
Later, a large overseas aftermarket provided ample room for development for many domestic small and medium-sized parts and components companies. “Overseas gold rush†has also become the focus of the survival and development of these enterprises. At the same time, China is an important global auto parts production base. With the full support of export policies, labor costs, and the upstream industry chain, local parts and components companies have grown to become the backbone of the overseas market.
â– Exhibition - Gate to Overseas Markets "I run the exhibition most of the year, and I run both domestically and abroad." Ye Duohuan described to the reporter the working conditions of many small and medium-sized component companies. For these domestic parts and components companies, the exhibition has become a stage for them to show their strength to the world. Extending the market scope through the auto show platform and finding overseas orders are the most important objectives for the parts and components companies to attend.
The major domestic exhibitions include the Beijing Auto Show, the Shanghai Auto Show, the Shanghai Frankfurt Auto Show and the Canton Fair. After years of development, these auto parts exhibitions have formed a certain degree of international influence. The international buyers attending the exhibition are also relatively professional. The orders are relatively large, the rent is cheaper than the international exhibitions, and many of the participating parts companies have achieved good results. For foreign trade shows such as the Las Vegas Auto Show, the foreign traders are more professional and the number of orders is larger. This is an important exhibition for some parts and components companies to participate in for a long time.
In addition to getting orders, understanding market changes and demand is also one of the important goals of the part companies participating in the exhibition. “The market demand for accessories has changed rapidly. We also understand the new needs of foreign companies at the auto show and expand new business segments.†The person in charge of an auto parts company in Zhejiang told reporters that more than 70% of the company's annual orders are related to the show. After receiving new orders and then developing into old customers, many companies can achieve good results at the show.
Hangzhou Zhaofeng Electromechanical Co., Ltd. is one of the earliest companies to make domestic parts and components in China. Due to the decrease of profit in the domestic matching market, it began to shift to overseas markets. According to the relevant person in charge of Zhaofeng Electromechanical, 87% of the company's products are exported overseas. Nowadays, the company not only does overseas after-sales market, but some products have already entered the Brazilian VW OEM supporting system.
When the exchange rate was lowered, the external demand was weak, and the export competitive advantage was weakened, which caused many parts and components companies to greatly reduce their overseas orders in 2015. “The days have never been better than beforeâ€, which has become the voice of many companies. The grim situation also prompted these parts companies to actively seek overseas business opportunities at the exhibition.