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Many problems have not solved China's spare parts industry urgently need its own brand
Shen Hui, President of BorgWarner China, one of the world’s top automotive parts manufacturers, recently sat down for an interview with *First Financial Daily*. He highlighted that while self-owned car brands in China are gaining momentum, the domestic auto parts industry still lags behind in core technologies and brand recognition. According to Shen, there's a significant gap between Chinese auto parts companies and their global counterparts, and the industry urgently needs strong, independent brands to support the growth of Chinese automakers.
“China hasn’t truly focused on developing its own auto parts brands,†Shen said. “In this sector, there must be real independent brands. Only then can we have truly Chinese-owned car brands.†He emphasized that parts companies often go unnoticed, and there are almost no well-known domestic brands in the spare parts market. This is a major issue, he added.
Currently, many Chinese auto parts manufacturers are small-scale and lack technological innovation. However, some provinces like Zhejiang have produced notable companies such as Xiaoshan Wanxiang, Shaoxing Wanfeng, Wenzhou Ruili, and Taizhou Yinlun. Despite having hundreds of suppliers, 80% to 90% of their exports are for the after-sales market, not the high-end segment. The main reasons? On one hand, the large aftermarket has led to widespread imitation and intellectual property infringement. On the other, many small and medium-sized enterprises focus on short-term profits rather than long-term strategies, which prevents them from entering the mainstream market.
Moreover, domestic parts companies are underinvesting in brand promotion and R&D. Many prioritize immediate profits over long-term brand building and innovation, which worsens the overall situation. Another challenge is the lack of resource integration. In foreign markets, parts companies play a critical role, but in China, OEMs typically hold more power than their suppliers. Shen called for better collaboration and government support to bridge this gap.
Additionally, there's a noticeable gap in independent development among domestic parts manufacturers. While the government encourages self-reliance in整车 (complete vehicles), it often overlooks the importance of the parts industry. Shen pointed out that without a strong brand in auto components, the entire industry remains dependent.
Intellectual property protection is also a concern. If a company invests in R&D, it risks having its products copied and sold at lower prices. This discourages innovation and stifles progress. Shen admitted that multinational companies are hesitant to conduct core R&D in China due to fears of technology leakage. To build a true independent brand, he stressed that both talent development and stronger IP protection must be prioritized.
In summary, while China’s auto industry is growing, the parts sector still faces numerous challenges. Building strong, independent brands is essential for long-term success and national competitiveness.