[Shanghai Auto Show] Parts companies are not just bad money
At this year's Shanghai International Auto Show, we could no longer see the trolley case with the Michelin logo on the streets. This tire giant, who has not been sponsoring the Shanghai International Auto Show for years, chose not to exhibit.
Some people say that the auto show is a barometer of the automobile industry economy. During the financial crisis, what kind of auto companies suffered the most? Look at the current Shanghai Auto Show exhibitors lineup will know.
Compared with the entire vehicle, the enthusiasm of the part companies and tire companies participating in the Shanghai International Auto Show was significantly reduced.
There were more than seven large-scale parts and components companies absent from this year's Shanghai Auto Show, including Magna International, Arvin Meritor, American Axle Manufacturing, Delphi, GKN Plc., Johnson Controls, and TRW Automotive. Michelin and Goodyear, three big tire giants, also chose not to exhibit.
The background of the absence of these companies is, of course, severely affected by the global financial crisis.
Among the auto parts companies that are cutting back on expenses, the US-based companies (or their main vehicle customers are American auto companies) are the first to bear the brunt. This is mainly due to the fact that the three giants of Detroit are in turmoil, and the sales of whole vehicles have fallen sharply. As a result, the income and profits of parts suppliers have also dropped sharply.
The tire industry is another industry that has suffered heavy losses. In 2008, sales of Michelin tires fell by 2.9% and profits plummeted by 53.8%. Bridgestone tirelessly predicts that its sales revenue will drop 22% year-on-year in 2009, and profits will fall by 71%. The tire production plan of Goodyear Tire in North America will also be reduced by 50%. In 2009, it may eventually reduce 17 million sets of tires.
Under the pressure of cost reduction, it is also reasonable for some parts and tire manufacturers to choose to cancel their participation in the Shanghai International Auto Show.
But I can't help but wonder if the parts giants are treating the Shanghai auto show coldly just because of “bad money�
The author believes that, in addition to the difficulties in hand, the lack of confidence in the prospects of vehicle manufacturers and the poor relevance of the auto show positioning are also important reasons.
Prior to this, parts and tire suppliers were most concerned about the main engine factory is no more than the following three aspects: the pressure to reduce prices and improve quality, profit opportunities and technical and management assistance from the vehicle factory. However, in the financial crisis, these three major areas have been shaken.
The financial crisis led to a sharp decline in the production and sales volume of the global automotive industry, and the poor performance of the entire vehicle plant resulted in its suppliers or tire suppliers pricing or delinquent or paying indefinitely, which, of course, hampered the performance of suppliers and caused the suppliers to the OEMs. The outlook lacks confidence. The automaker itself is difficult to guarantee, and paying on time is a problem, not to mention profit opportunities, and what kind of technical and management assistance. In this sense, after the financial crisis, parts suppliers are actually more affected than vehicle companies.
On the other hand, after all, major auto shows such as the Shanghai International Auto Show are aimed directly at vehicle consumers, and the audience of parts and tire companies is a professional. Therefore, the diversity of audiences also makes these companies carefully assess the value of participating in the Shanghai auto show. This is also in line with international practice. At the five major international auto shows, there are fewer parts and components exhibitors.
The author believes that rational self-rescue of parts and tire manufacturers should not be a drawback of Shanghai Auto Show, but should be a warning. Under a "car show grand scene", the full recovery of the auto industry is coming.
Manual Chain Hoist,Electric Chain Hoist Co., Ltd. , http://www.chropehoist.com