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In China, the low-concentration and low-level competition of many industries seems to have existed for a long time. The state's integration and optimization measures for these industries are also frequently implemented. However, in the face of such a wide range of industries across the country and deep-rooted interest struggles among local governments, the sound of industrial mergers and reorganizations has become fragile. However, with the release of the "Guidance Opinions on Accelerating the Promotion of Mergers and Restructuring in Key Industries," the merger and reorganization plan for the automotive industry as the leading industry once again surfaced. Perhaps this has begun to have a new meaning for the development goals of the Chinese auto industry becoming bigger and stronger.
"Guidance Opinion" Releases Major Opportunities for Automotive Industry
Recently, 12 departments including the Ministry of Industry and Information and the Joint Development and Reform Commission jointly issued the "Guidelines on Accelerating the Merger and Restructuring of Key Industries and Enterprises" (hereinafter referred to as the "Guidance Opinions") for automobiles, steel, cement, ships, electrolytic aluminum, rare earth, electronic information, etc. The merger and reorganization of nine industries and fields in the pharmaceutical and agricultural industrialization put forward the main goals and key tasks.
The "Guiding Opinions" clarified the goals and tasks of the merger and reorganization of the automotive industry: By 2015, the industry concentration of the top 10 automobile manufacturers in the automotive industry will reach 90%, and 3-5 large-scale automobile enterprise groups with core competitiveness will be formed. The "Guiding Opinions" mainly includes four aspects.
First, promote the horizontal merger and reorganization of vehicle companies. Encourage auto companies to integrate element resources through mergers and acquisitions, optimize product lines, reduce operating costs, increase capacity utilization, vigorously promote the development of independent brands, foster core competitiveness of enterprises, and achieve scale and intensive development.
Second, promote the merger and reorganization of parts and components companies. Supports key enterprises to expand their scale through mergers and acquisitions, establish long-term strategic partnerships with vehicle companies, develop strategic alliances, and achieve specialized division of labor and coordinated production.
Third, support large-scale automobile companies to extend their service areas through mergers and acquisitions. Improve the automotive industry service system, with brand marketing as the mainstay, develop R&D, procurement, modern logistics, auto finance, information services and business services, and realize the integration of service industry and manufacturing industry.
Fourth, support for participation in global resource integration and management. Encourage auto companies to “go global†and seize the opportunity to conduct cross-border mergers and acquisitions, optimize the allocation of resources on a global scale, develop and improve global production and service networks, improve the ability of international operations, and enhance international competitiveness.
Improving the core competitiveness of automobile enterprises must overcome many difficulties
Different from previous policies, the New Deal does not regard the scale of production and sales as an important standard for companies to achieve compliance, but aims to guide auto companies to enhance their core competitiveness. This can be seen from the specific content of the Guiding Opinion.
Over the years, the Chinese automotive industry has been characterized by small, weak, and scattered. According to statistics, there are 171 domestic auto vehicle companies, of which a number of companies have been in production or semi-discontinued production for many years and their survival is very difficult. To improve this situation, the merger, reorganization, and optimization of enterprises in the automotive industry are imminent.
Under the current system, the biggest difficulty in the merger and reorganization of the automotive industry still lies in the difficulty in balancing the interests of local authorities. Since the auto industry's investment contributes a lot to the growth of local GDP, as well as large output value and high taxation, local governments often hope to drive the growth of output value, taxation, and employment through the development of the local auto industry, thus achieving more success in government performance appraisal. good grade. Therefore, whether the “Big Four†(Shangqi, FAW, Dongfeng and Chang’an) or the “Four Small†(Beiqi, Guangzhou Automobile, Chery and CNHTC) not only failed to grow their businesses through mergers and acquisitions, but changed with the external environment. All face the cruel market test. In order to improve the core competitiveness of China's auto companies, we must take fair market competition as the precondition and overcome many difficulties of “rights†and “profits†before we can hope to complete the rebirth of the industry as a whole.