Lu Guanqiu and Tan Xuguang: North American Hunting and Shipping Inc.


On December 21, the website of the Ministry of Commerce released the news of the ranking of the world's top 100 auto parts enterprises in 2005. Among them, China did not have a component company.

Ranked first is Germany's Bosch company, with a turnover of 26.3 billion euros, followed by Denso, Delphi of the United States and Magna of Canada.

Of the top 15 companies, 6 are from the United States, 3 from Japan, 3 from France, 2 from Germany, and 1 from Canada. The top 15 companies are all located in the world's automobile manufacturing powerhouses.

In 2006, China’s auto production is expected to reach 6.8 million to 7 million vehicles. Although China has entered the ranks of the world's automobile manufacturing powers, there is no enterprise from China in the world’s top 100 auto parts rankings. This indicates to some extent that China is not yet a car manufacturing country.

However, Chinese auto parts companies are trying to change their weak position. Especially this year, when Detroit was in a desperate situation at the American automotive headquarters, parts and components companies from China were trying to participate in mergers and acquisitions and parts and components related to GM and Ford. China's parts and components companies are taking a positive attitude to participate in the international division of labor. .

Take the initiative

The latest news this month showed that Weichai Power (2338.HK), China’s largest internal combustion engine manufacturer, is planning to acquire Delphi’s assets in North America.

It is reported that Tan Xuguang, head of Weichai Power, is interested in Delphi Corporation’s North American assets for bankruptcy protection. These assets may be non-core assets of Delphi North America. However, Weichai Power did not specifically disclose which assets it was interested in. Delphi's spin-off of six non-core businesses were: brakes and chassis, catalysts, cockpits and dashboards, door modules and door locks, steering systems, and wheel bearings.

Before that, Wanxiang Group, China's largest private parts and components company, has been eyeing Delphi’s overseas assets. The Wanxiang Group, led by China's auto diving predator Lu Guanqiu, also prepares for the opening of the Lions Club. Wanxiang said whether it is Delphi, Ford Motor, General Motors or Chrysler, as long as it is a company that hopes to negotiate with Wanxiang Group, Wanxiang is interested.

According to news, the universal targeting is the flagship company of Delphi and Visteon, the two US auto parts companies, but the talks are underway for Ford Motor Co.'s Automotive Components Holdings, which is currently in trouble. The group consists of 17 plants and Ford Motor Co. Saved Visteon and made up of six other factories acquired last year. Visteon is a parts company that was spun off from Ford Motor Company.

The troubled component giant gave the Chinese parts companies the opportunity to acquire and participate in international competition, not only Wanxiang Group, which is concerned about the assets of Delphi and its 38 subsidiaries in the United States. It is also one of the top three automotive companies in China. Dongfeng shares of the company rumors that it will join hands with Minth Group, one of the largest domestic parts and components manufacturers, to participate in the merger and acquisition of North American bankruptcy assets of American auto parts business Delphi.

Faced with opportunities, in the face of the same emerging Indian companies and four expanding Japanese companies, the ever-growing Chinese parts and components companies took the initiative to take the initiative.

change plan

While Chinese parts companies took the initiative, component giants also increased their investment in China. The world’s fourth largest parts and components company MAGNA global president Mike Horn said during the Beijing auto show that although Magna already has 19 entities in China, it will also add some new factories in China because China The market is certainly a market that continues to advance and develop.

In 2005, there were 4,447 auto parts enterprises above designated size in China. Among the top 100 parts and components companies in 2005, foreign investment enterprises had reached 54. Foreign-invested companies such as Sino-foreign joint ventures and cooperation have accounted for half of the total.

However, this year's collective sea-going M&A of China's spare parts companies shows that China's spare parts companies are also replicating the purchase of core technology asset plans for SAIC and other vehicle companies. This plan will have the opportunity to directly shorten the technological gap between Chinese companies and automobile giants.

For Chinese companies involved in mergers and acquisitions, it is not just the technical assets of Delphi and Visteon. Delphi and Visteon are inextricably linked to General Motors and Ford. McHaugh said that the problem with Delphi and Visteon is that they have a strategic relationship with their parent companies, GM and Ford, and they have agreements, such as the relatively high wages for employees, which will increase their production costs and therefore cause their problems today. Where

Delphi and Visteon are also GM's and Ford's component suppliers, so once the M&A is successful, China's spare parts companies will also directly enter the world's leading parts and components supporting system and have the opportunity to participate more widely in the international division of labor.



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