China's auto parts exports suffer trade barriers

Yao Jian, spokesman of the Ministry of Commerce, said that the Chinese government has expressed its deep regret that the US International Trade Commission has determined that the large increase in China’s imports of tire products has caused or threatened the disruption of the domestic industry’s market.

China's auto parts exports fell due to trade barriers

In 2008, China produced 170-180 million tires, half of which were exported. The United States is China’s largest exporter of tires. China’s total annual tire exports to the United States amount to 46 million, and sales revenue reaches US$1.7 billion. As the main source of profit for domestic major listed tire companies, the national sales of all-steel radial tires in 2009 will reach about 57 million, of which 30% will be used for export. The profit contribution of this part of export products is slightly lower than that of domestic replacement products. But higher than the domestic supporting products.

With China's accession to the World Trade Organization, from fasteners to car tires, the friction experienced by Chinese auto parts exports has never stopped. The recent anti-dumping measures against the export of tires by the United States, India, and Brazil are the result of the resurgence of international trade barriers after the financial crisis.

As we all know, China's auto parts have an inherent advantage in terms of exports. Lower labor costs and preferential export policies have been stimulating the development of auto parts exports in China. With the advent of the financial crisis, the auto manufacturing industry in various countries has been severely hit. Governments in various countries are increasing their support for the auto industry in the country and international trade barriers have begun to rise.

Statistics from the Customs show that from January to April 2009, China exported $1 billion worth of auto parts to the United States, a decrease of 33.7%; exports of auto parts to the EU decreased by 37.1% to US$550 million; exports of auto parts to Japan decreased by 52.1 million to US$260 million. %. The above three together accounted for 59% of the total value of China's auto parts exports during the same period. The main objects of China's auto parts exports are the United States, the European Union and Japan. The downturn in the international auto industry has had a significant impact on China’s auto parts exports. From January to April, China exported 2.44 billion US dollars in auto parts, a 35.9% decrease, accounting for 79.2% of China’s auto parts exports during the same period. During the same period, China exported 550 million U.S. dollars of auto parts through processing trade, a decrease of 44.7%.

While the world auto parts industry is experiencing severe difficulties, Michel Rollier, chief executive of French tire manufacturer Michelin SA, predicted in an interview that the global tire market will not be in 2010. Recovered from the middle to the end of the year.

Parts companies respond to anti-dumping

Since 2009, affected by the financial crisis and anti-dumping measures of the European Union, purchases of fastener parts from China's international buyers have declined slightly. How should China's fastener companies cope with it? Some surveys have shown that adjusting the market structure, increasing scientific management, and maintaining relations with major customers will be the key strategies for fastener companies to cope with the crisis and EU anti-dumping.

It is true that in the current financial crisis, the intentional or unintentional trade barriers of various governments have a certain role in protecting the domestic auto parts industry. However, as a highly globalized industry, the international trade disputes of auto parts will eventually improve in a wave of globalization. In order to be invincible in the wave of globalization, China's spare parts enterprises are also crucial to actively responding to anti-dumping and striving to establish their own image in international trade.
Xiao Wenfan of Xinyi Glass said in an interview that anti-dumping is a means of technical barriers to trade barriers, and anti-dumping is a natural thing. In the next few decades, Chinese companies will also have to fight back and initiate anti-dumping lawsuits against companies in other countries.

In responding to foreign trade barriers, governments, industry associations, and enterprises should give full play to their advantages and jointly deal with them.

For developing countries, there are some key steps to resolve the issue of trade barriers: increase the technological level of products; develop high-precision measurement equipment and methods; and balance the importance of intellectual property rights, patent protection, and competition. The most fundamental link lies in the improvement of the level of technology. This is the ultimate support to ensure that Chinese enterprises survive and fight in the global standards competition environment.

It is necessary to regard technological innovation and technological transformation as the preferred strategy for parts and components companies to deal with trade barriers. The government should guide all types of enterprises to implement the strategy of winning with quality, take the road of science and technology to promote trade, and actively support enterprises to upgrade their technological level. It is necessary to formulate brand development strategies and technology development strategies that are suitable for the development of parts and components companies and industrial characteristics, strengthen the incentive mechanism for technological innovation and the protection of intellectual property rights, and combine the intellectual property strategy with technological development policies and the strategy for rejuvenating trade through science and technology. The government must vigorously support enterprises in registering trademarks and applying for patents. Governments at all levels must formulate scientific industrial policies based on local conditions and increase support for technological transformation and technological innovation of enterprises. In order to enhance and maintain the competitive advantages of the dominant industries in the world, the government can support strategically-researched commercial industrial technology research and development projects that are difficult for some companies to complete independently, and can also provide financial, export, taxation, and fiscal support to companies. Technological innovation gives the necessary support and benefits. It is necessary to promote product standardization in line with international standards, promote standardized quality management, and strengthen the construction of corresponding inspection systems and certification systems.

Industry associations shall promote the joint development of core technologies and supporting technologies with independent intellectual property rights that support the sustainable development of the industry, strive to form their own technical standards, effectively prevent and break foreign technical barriers, and increase the overall competitiveness of the industry. The cooperation of related companies in technology should be strengthened, public technology platforms established, and resources shared. In some advantageous areas, such as major scientific and technological projects and research, we should consciously preemptively conduct research and development directly in accordance with international standards, and follow through to lead, effectively countering the competition of multinational corporations.

Enterprises should strengthen the collection of various kinds of technical trade barriers related to the export products of their enterprises in order to improve production and bypass barriers. It is necessary to speed up the formulation and implementation of intellectual property strategies supported by brand strategies and patent strategies. The development of "core technologies" and "independent standards" with independent intellectual property rights by enterprises is the key to breaking down technical barriers. More efforts should be devoted to "technological breakthroughs", and passive restrictions should be taken as active adjustments. At the same time, it is necessary to change the business philosophy, improve the scientific and technological level of products and the quality of environmental protection, speed up the transition from extensive and intensive types to ecological development, and realize the coordinated development of enterprise development and environmental protection.