Shanghai Automotive Group Co., Ltd. (hereinafter referred to as SAIC Motor Corporation), a component company controlled by Huayu Automotive Systems Co., Ltd. (hereinafter referred to as Huayu Automotive), has released a news report that its wholly-owned subsidiary Yanfeng Automotive Trim Systems Co., Ltd. ( (hereinafter referred to as Yanfeng) and the United States Johnson Controls Inc. (hereinafter referred to as Johnson Controls) have signed a global cooperation framework agreement for automotive interiors in Shanghai. The two parties intend to establish a joint venture company for automobile interiors in the Shanghai Free Trade Zone to accelerate their parts and components. The "sea" of the product. “Compared to the enterprises outside the region, the free trade zone can provide enterprises with a better platform to reduce their operating costs and provide companies with international investment and financing,†said a person who has long been concerned about the policy trends in the free trade zone. In recent years, with the overseas deployment of auto companies speeding up, local companies have seen overseas mergers and acquisitions and investments become commonplace, and the investment model has changed from a simple trade model to a brand export model. Under this background, flexible policy support is obviously more favorable to the expansion of enterprises. . Expected to reduce operating costs by 20% According to the above agreement, Yanfeng will hold 70% of the shares of the new joint venture company, and Johnson Controls will hold 30% of the shares. “At present, the main customers of Yanfeng are Shanghai Volkswagen, Shanghai GM, Dongfeng Nissan, etc. Johnson Controls' customers are BMW, Mercedes-Benz, and Ford,†said Zhang Haitao, general manager of Huayu Automotive. The new joint venture will help Huashi Automotive. Into the supporting fields of high-end brands such as BMW and Mercedes-Benz. At the same time, after the joint venture between the two parties, Yanfeng's products can enter overseas markets through the existing channels and layout of Johnson Controls. With the acceleration of the globalization of auto companies, the requirements for parts and components companies have also been further enhanced. "Not only must have the ability to participate in global research and development, but also must have the ability to supply the world. Auto parts companies do not have the property of 'globalization' and can only become a foundry," Zhang Haitao said. In the eyes of people in the industry, parts and components companies must possess the attributes of globalization. Besides the globalization of product research and development, the global service capability and convenience of back-office services are crucial. In this context, the settlement of the free trade zone is undoubtedly conducive to the start of its globalization path. “Compared with the outside of the region, enterprises in the FTZ will be more convenient in importing and exporting procedures. For example, customs clearance will have quick exits and exits similar to the green channels, which will help improve the efficiency of enterprises,†said Tian Yongqiu, an automotive analyst. At the same time, in terms of interest rates on taxation and financing loans, policies in the FTA are all more generous. According to the data released by the SAIC Group before this, according to current policy forecasts, Shanghai Automotive International Trading Co., Ltd., which was established in the Free Trade Zone, could reduce the Group's international trading business by more than 20% in capital, trade, transportation, and warehousing costs. This is obviously a great attraction for parts companies that are currently making thin profits. According to Tian Yongqiu, an analyst of the automobile industry, “As there is no limit on joint venture shares in domestic parts and components companies, in the current market, the more lucrative plates are basically controlled by Bosch, BorgWarner and other foreign companies. Corporate profitability is relatively weak. Therefore, in the market competition, the control of costs becomes extremely important." Overseas investment shows flexibility For SAIC and Huayu Automobile, the settlement of the Free Trade Zone in addition to the reduction in operating costs of the company will also help improve the flexibility of overseas investment. "From the current point of view, with the development of domestic vehicles and parts companies, 'going out' has become a major trend, followed by overseas mergers and investments will become more frequent in the future." Tian Yongqiu thinks . "As car companies accelerate the expansion of overseas markets, the model of car manufacturers' exports has also shifted from the previous trade model to the export of brands." Cui Dongshu, deputy secretary-general of the National Federation of Chessmen, said that the difference between brand output and trade output is that The investment and marketing decisions made by the exporter are more determined by local partners, and by the time the brand is exported, the scale of investment and the direction of marketing are all set by the car companies. In this process, the continuity and flexibility of investment are particularly important. “From the information that has been disclosed so far, it can be seen that the free trade zone's foreign exchange, foreign exchange exchange, foreign exchange settlement procedures and quotas are all more flexible than outside the zone,†said Zhang Zhiyong, an automotive analyst. According to Tian Yongqiu, in the future, the free trade zone is also expected to be further relaxed in the review of mergers and acquisitions by overseas companies. For example, previous companies involved in overseas mergers and acquisitions more than 100 million US dollars need to go to the Ministry of Industry and Information Technology, Development and Reform Commission and other relevant departments for review and approval, and mergers and acquisitions in enterprises in the Free Trade Zone, as long as no more than 1 billion US dollars, generally only need to record. According to the characteristics of the Free Trade Zone, in the future, the restrictions of this review will be further relaxed. Hydraulic Pump Series,Variable Hydraulic Pump,Custom Hydraulic Pump,Eaton Hydraulic Pump Jinan Voton Machinery Equipment Co., Ltd , https://www.votonmachinery.com
Free trade zone pushes auto parts "to sea"