The impact of Shanzhai version heavy trucks on the Chinese heavy truck market will affect the entire Chinese heavy truck industry


It is reported that China’s heavy-duty truck market once again broke the record of sales of heavy-duty trucks maintained by developed countries, and successfully won the first transcript of sales of the world’s heavy-duty trucks market. Especially in the mid- to high-end heavy truck market, major truck manufacturers all over the world come to share the market with joint ventures or investments. As of the end of last year, sales of heavy trucks in China reached more than 1 million.

In recent years, the heavy-duty truck market in China has suddenly been on fire. The Chinese and foreign industries are staring at this big cake. The relevant and unrelated industries have all broken their heads and need to enter the heavy-duty truck industry. The rapid development of the heavy-duty truck market has created a high degree of openness. The formation of a high-profile trend over the single-plank bridge. There are special vehicles, agricultural vehicles, passenger cars, motorcycles, parts and components, and even car dealers have also entered the heavy truck market.

At the same time, it has attracted more and more foreign and domestic auto giants to seize the treasure. Having seized market share in heavy trucks, their market competition will also become increasingly fierce. The former local heavy truck company has occupied about 90% of the domestic market share. Now this advantage is being weakened by the international truck giants. The monopoly overlord of overseas commercial vehicles is now achieving integration with the Chinese commercial vehicle market, especially in the heavy truck sector.

Instead of "market-for-technology" or "technology-for-market", the Chinese heavy-duty truck market is unprecedentedly highly open, with Volvo, Scania, MAN, Mercedes-Benz, GM, Caterpillar and With the rapid entry of future Duff and other international truck giants, a process of accelerating the integration of Chinese truck companies and markets is taking shape. It can be expected from this that the future development of the Chinese truck market will be parallel to competition and integration, and both domestic and foreign truck companies will compete and interdependent.

As is known to all, heavy-duty trucks are a technology-intensive industry with greater investment, higher output, and greater mobility. The requirements for reliability, safety, and economy of heavy-duty trucks are more than N times higher than any models. At the same time heavy trucks are production materials, which are the most important tools for users to survive and make their own fortune. Therefore, its reliability, safety and economy are particularly important. At the same time, heavy trucks have higher requirements on the manufacturers' technological level and service capabilities. Although many assembled trucks with counterfeit heavy trucks are advantageous in terms of price, the quality and reliability of their products are difficult to guarantee. In particular, the impact of the new influx of Shanzhai Edition heavy trucks with low technology and management levels on the Chinese heavy truck market may not only be a loss to users but also the entire heavy truck industry in China.

This is undoubtedly a strong attraction for local governments that are keen to invest in high-intensity, high-output, and fast-growing GDP. The problem of structural overcapacity in China's heavy truck industry is due in large part to the promotion of the performance of local government performance. In addition, heavy trucks have too low entry thresholds, censorship and approval of the power department for dereliction of duty, overinvestment by local governments, and blind pursuit of GDP performance. This terrible “car excess” can only be China appears.

Newly-emerging truck companies can initially imitate or even copy competitors' products and marketing models. However, long-term development requires continuous research and development and superb marketing creativity. Buying a component assembly product can only be solved by a solvable company for a while, but it is only necessary to build its own component supply chain to become bigger and stronger. In addition, due to the extremely complex working conditions of heavy-duty trucks, the requirements for matching technologies are extremely high. Even if they are assembled and assembled, they also have high scores, requiring huge investment in R&D and long-term technological accumulation. Although the threshold for the production of heavy trucks on the surface looks very low, in recent years the threshold for the technology market has increased substantially. It is not easy to enter and leave, and high tuition fees are indispensable.

At present, there are about 30 heavy-duty truck manufacturers with announcements (catalogues) in China, and approximately 40 companies with unannounced (catalogue) quasi-heavy truck manufacturers. In addition, there are at least 40 host manufacturers of heavy-duty trucks such as Brilliance, Yutong, Weichai, Hengtian, Wuzheng, Lifan, etc. that have actually entered or entered. This data is also added by all heavy truck manufacturers in all countries of the world. There are not many in China, but the average annual production and sales volume is less than 10,000 vehicles. Among them, there are more than 10 production and sales volumes, and more than 20 production and sales volume are less than 1,000. If we add the so-called Shanzhai version of heavy trucks that will be listed on the market within the next few years, once production and sales are shared, the average production and sales volume may be less than 10,000.

According to the author's estimation, if the national total capacity of heavy-duty trucks and quasi-heavy trucks expands, the total capacity will be about 2 million vehicles. This is the case for the heavy-duty truck industry where the actual market size is less than 1 million. Obviously, it is overcapacity and oversupply of manufacturers. As a result, the resources for repetitive investment and redundant construction are greatly wasted.

Although the state wants to curb the chaotic situation in the auto industry through various means such as improving the access threshold of the auto industry, many times the national policy cannot fully control the pace of local policies, and even runs counter to it. The overcapacity of heavy trucks reflects the traditional inertia of the Chinese auto industry from a deep level. It only seeks to increase the backwardness of the number of simple copying, and the distinct “regional economy” characteristics of the automobile economy in China, such as the interval between hundred in Anhui Province. Within a kilometer, there are the JAC Gehl Development Heavy Truck, the Chery United Truck, and the Valin Heavy Truck. Such a high-density brand competition can only lead to a vicious cycle. If this low-level vicious competition trend is not contained in a timely manner from the macro level of the industry and the market, the restructuring of the Chinese auto industry will go astray in the rapid expansion of production and sales.

The automobile industry has the characteristics of long industry chain and strong driving ability. Developing the automobile industry can not only bring greater economic benefits to local economic development, but also bring about a large area of ​​local labor force employment, precisely because of the unique economy and society of the auto industry. Benefits, the auto industry has become the focus of local governments to fully promote economic development, driven by interest, planning capacity is blindly raised.

At present, the development of China's auto industry has been out of the track of the market and has become an important part of the performance of some local governments. Most of the auto industry's funds are derived from bank loans. Excessive bank lending has led to high investment in the auto industry, resulting in a certain degree of overheated investment and increasing credit risk. In this situation, controlling credit growth has become a way to curb excess capacity. As long as the loan industry reduces the loan, it will affect its further expansion, which will reduce the excess capacity. At the same time, more stringent barriers to entry and higher product standards should be used to curb and eliminate the low level of backward production capacity caused by local investment impulses.

At present, the issue of overcapacity is the problem of structural overcapacity. Among the more than 30 heavy-duty truck OEMs, most of the vehicle manufacturers have low profitability, resulting in a surplus of “inefficient production capacity” and insufficient effective production capacity. The resulting repetitive investment has caused waste, overcapacity, and potential safety problems in products. Low-cost vicious competition is also not conducive to the sound and orderly development of China's heavy truck technology and the market.

In the "Auto Industry Adjustment and Revitalization Plan" issued by the State Council in early 2009, the automobile industry group that explicitly promoted the merger and reorganization of the automotive industry, and whose production and sales scale accounted for over 90% of the market share, was reduced from the current 14 to less than 10.

Recently, Miao Wei, Minister of Industry and Information Technology, said that during the "12th Five-Year Plan" period, it will increase the merger and reorganization of the automobile industry. Relevant regulations for the implementation of strategic emerging industries will be reported to the State Council after the two sessions and they are expected to be introduced in the first half of this year. The overall goal of the “12th Five-Year Plan” of the automotive industry is still to emphasize that the development of China’s auto industry will change from a big automobile country to a powerful automobile country. In the next five years, the Chinese automobile industry will shift from a large-scale to a strong one in the past.

Merger and reorganization is an unavoidable and necessary process for the development of China's auto industry. The development history of the international auto industry shows that mergers and reorganizations are important ways for the survival of the fittest and optimization of the auto industry. From the perspective of the development of the international automotive industry, the development of the automotive industry in the world is accompanied by the merger and reorganization of a large number of automotive companies. Nowadays, the American automobile industry, from more than 100 brands and enterprises in the 1920s, has finally been integrated into today's “Big Three”.

Specifically, on the one hand, it promotes the adoption of mergers and reorganizations to eliminate backward production capacity to solve the problem of structural overcapacity; on the other hand, it advocates the development of energy-saving vehicles including new energy vehicles. In the next five or ten years, the Chinese auto industry will shift from a large scale to a strong one in the past. Specifically, on the one hand, advocacy through the merger and reorganization, to reduce the capacity of the team to deal with the issue of excess capacity of the layout; on the other hand to advocate the growth of new energy vehicles are included within the energy-efficient cars.

The biggest obstacle to the promotion of mergers and acquisitions among domestic auto companies is that the interests of local authorities are difficult to balance and there is no incentive for mergers and acquisitions. China's auto companies have complex institutional components and involve various aspects of interests. There are state-owned, privately-owned; directly under the central government, provincial and municipal jurisdiction. In addition, the auto industry is closely linked with local GDP and taxation, so no one wants their own companies to be merged and reorganized by external companies.

There are a large number of auto manufacturers in China. Under the circumstance of vigorous development of the auto market in China, auto companies have a large living space and the role of market regulation is very limited. Relying solely on market forces to promote mergers and acquisitions will also cause huge waste of resources. ”

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