Chinese auto parts suppliers are facing numerous challenges and difficulties in today's global market. Many of these companies are still at the stage of being simple manufacturers rather than true suppliers. Issues such as cultural differences, logistics, legal frameworks, quality certification systems, the global political environment, and economic conditions all need to be addressed through effective communication and integration. As they aim to participate in global procurement, these suppliers must tackle four major problems.
First, there is a lack of continuous improvement in meeting international standards. While certifications like ISO/TS 16949, ISO 14001, and QS9000 are often seen as stepping stones for exporting, many domestic companies do not truly understand the meaning behind these standards. In fact, few go beyond just obtaining the certification and fail to continuously improve their operations according to the standard’s requirements. This results in a growing gap between some Chinese companies and international benchmarks.
Second, the level of specialization among domestic suppliers is still low. Industry experts suggest that companies should move beyond just "being able to do" and aim for "doing it well." However, many companies don't see the value in this approach, considering it unnecessary and costly.
Take Collins Ackerman from the U.S., for example. The company specializes in automotive flooring and acoustic components, and due to its deep expertise, it has captured 90% of the North American market. When it faced bankruptcy, major automakers like Ford, GM, Daihatsu, and Toyota quickly provided financial support, recognizing that the company's survival was crucial to keeping the market running smoothly.
Third, information dissemination is often delayed. One of the biggest obstacles for Chinese auto parts companies trying to enter the global supply chain is the inefficiency of their information channels. In contrast, foreign companies typically rely on industry associations, peer reviews, intermediary agencies, professional publications, and online networks to overcome such bottlenecks. They also often bring in top consulting firms to assist with implementation and monitoring.
Fourth, there is a lack of strong collaboration between vehicle manufacturers and parts suppliers. The competition in the domestic auto parts market is intense, and most suppliers face pressure from OEMs demanding price reductions without any flexibility. This puts them in a difficult position.
The relationship between OEMs and suppliers should be one of mutual support. To counteract the threat of price cuts, auto parts suppliers must focus on high-tech, cost-effective solutions. By increasing the technological content of their products, they can enhance competitiveness and secure a stronger position in the market. As the saying goes, “Only competitive parts will leave vehicle manufacturers with no choice but to accept.â€
The success of multinational car companies shows that a strong automotive group must be supported by a robust and reliable parts industry.
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