Multinational vehicle companies in China to develop local production to help them gain competitive advantage

Xinhua Tianjin, April 26, the company insisted on the localization of China's production and research and development strategy, not only to help multinational car manufacturers and component suppliers to improve sales and profits, but also to occupy the commanding heights of the future "magic weapon."　　This is the experience of a well-known German enterprise.　　April 26, the world's leading international auto parts supplier Continental Group held the 1 millionth automatic Transmission Control unit in China, the line ceremony. "We have achieved 1 million production in China, which is a milestone in the development of the Continental group," said Eric Maire, vice president of the Transmission Control business unit of powertrain Systems, Continental, Germany. "This great achievement not only confirms the development and growth of China's auto industry, It also proves the correctness of the group's firm in China in the localization of production and research and development strategy.　　Continental executives said that with firm commitment and determination to the Chinese market, China's mainland group is firmly implementing its localization strategy to enhance its share and business in the Chinese market. "At present, we have achieved the research and development, procurement, manufacturing, marketing and other aspects of the local development," the mainland group China Communications manager Shong stressed, "All can localize the link we must insist on localization."　　"At present, the Continental Automotive Group in China has a total of 8 production base, 13 sales and procurement offices, in addition, the investment of € 60 million in 2009 in Shanghai to establish 2 research and development centers to ensure that the production strategy in China innovation and leadership."　　As China has overtaken the US as the world's largest auto producer, China has become a key market for global carmakers and component suppliers to grow.　　China Auto Industry Association statistics show that 2009 China's auto production and sales have completed 13.791 million and 13.6448 million respectively, the year-on-year growth of 48% and 46% respectively.　　Since the financial crisis, China's automobile market has bucked the trend, expanding its domestic business volume, generally raising the overall sales and profits of multinational companies. The global auto market shrank in 2009, but the strong growth in the Chinese market has kept the products of auto parts companies in short supply, according to a new study published by AlixPartners, a global consultancy, April 14.　　Last year, Chinese auto parts companies ' profit margins nearly doubled, making the most profit in peer-industry companies around the world. "Localized production helps us respond quickly to the needs of our customers and, at the same time, to better support all automakers, especially local carmakers, so that our engineering expertise and local manufacturing networks are better positioned."　　Richard Anderson, manager of Continental Automotive Systems (Tianjin) Limited, the Continental group, said that localized research and development and production strategies were a winning strategy. It is this strategy to ensure that the Continental automotive Systems (Tianjin) Co., Ltd. to become one of China's largest automotive suppliers, at present, the company Nissan Automatic Transmission Control unit more than 3,000 units, this year, Tianjin factory production will exceed 100 units are expected to surpass 2 million units next year. Multinationals, on the other hand, are aware that the localization strategy is conducive to long-term development in China.　　The huge potential of China's auto market means that whoever wins the Chinese market will occupy the commanding heights of future competition. Automobile Industry association secretary General Dongyan said that China's auto production and sales in the past 15 years to maintain high-speed growth, the average growth rate of 16.74%. China Automobile Industry Association cautiously forecasts that 2010 China's auto industry will still show a better development trend, the annual auto production is expected to grow at around 10%, is expected to reach 15 million vehicles.　　In the long run, China's rapid economic growth, the car market potential is huge.　　The Chinese government April 13 released a number of views on further work on the use of foreign investment, and once again stressed that multinational companies in China to set up regional headquarters, research and development centers, procurement centers, financial management centers and other functional institutions, for the localization strategy of multinational companies to identify the direction. It is noteworthy that the multinational automobile group is intensifying its localization of China in the emerging fields.　　At the 2010 Beijing International Auto Show, Volkswagen announced that it would introduce advanced hybrid and electric-vehicle technology into China, and VW would start producing electric cars in China in the 2013-2014-year period. Vahland, CEO of Volkswagen Group (China), said it was the world's first electric car strategy for the local market.