Policy, new energy vehicles, car sales

Li Shaohua, Deputy secretary general of China Association of Automobile Manufacturers and Minister of Industry Development

        On October 21, China Auto Supply Chain conference 2020, co-sponsored by China Association of Automobile Manufacturers and Xi 'an Municipal Government, was held in Xi 'an, Shaanxi province. The theme of this year's Supply chain Conference is "Cultivating new machines, Seeking new articles, and Opening a new Bureau -- Helping to build a safe and controllable automobile industry chain". It discusses the ideas of the "14th five Year plan", controls the industrial situation, analyzes the development trend of global automobile supply chain, and helps to build a safe and controllable automobile industry chain.

        Held on October 21 afternoon "' difference 'period, development strategy and prospect of Chinese car parts group" theme on the BBS, vice secretary of China association of automobile manufacturers and industry development minister Li Shaohua said that over the next five years is to realize the industrial transformation and upgrading of the critical period, grasp the opportunity and industry will enter a new stage of development with high quality, and this year, next year may still in industry development is relatively low, but to grasp the basic trend of development of the industry characteristics, in priority areas to carry out the relevant work, "difference" can realize back slowly and even growth stages of steady growth.

Li Shaohua thinks, auto industry should be laid out from 9 big fields in the future.

        First, implement the brand strategy to build a world-class automobile vehicle and parts enterprise; Second, we need to strengthen weak links, eliminate bottlenecks, and build a safe and controllable industrial chain. Iii. Strengthen technological breakthroughs, accelerate the integration of information technology, and promote the coordinated development of the automobile industry and social factors; Fourth, we will continue to provide policy support, innovate development models, and comprehensively promote the marketization of new energy vehicles. Fifth, grasp the advantages of the intelligent network car first, innovative construction of intelligent car development system; 6. Strengthen the construction of talents of all types and enhance the soft power of the industry; Seventh, the deeper level system reform, brings the high-quality development opportunity for the automobile industry; A higher level of opening to the outside world will bring better development opportunities to excellent enterprises; 9. Consolidate the foundation, make concerted efforts to comprehensively strengthen the support for the development of industrial globalization.

         First, implement the brand strategy to build a world-class automobile vehicle and parts enterprise; Second, we need to strengthen weak links, eliminate bottlenecks, and build a safe and controllable industrial chain. Iii. Strengthen technological breakthroughs, accelerate the integration of information technology, and promote the coordinated development of the automobile industry and social factors; Fourth, we will continue to provide policy support, innovate development models, and comprehensively promote the marketization of new energy vehicles. Fifth, grasp the advantages of the intelligent network car first, innovative construction of intelligent car development system; 6. Strengthen the construction of talents of all types and enhance the soft power of the industry; Seventh, the deeper level system reform, brings the high-quality development opportunity for the automobile industry; A higher level of opening to the outside world will bring better development opportunities to excellent enterprises; 9. Consolidate the foundation, make concerted efforts to comprehensively strengthen the support for the development of industrial globalization.

The following is a transcript of his remarks:

       Li Shaohua: the China association of automobile manufacturers has been attaches great importance to industry planning research work, in the process of national five-year plan, of RGL has been cooperate with government departments to carry out long-term planning study of the auto industry, in recent years, relevant departments have also introduced a medium and long-term development, new energy vehicles development of auto industry, intelligent snatched the car development and a series of planning, reflects the important position of auto industry in the national economy and the government emphasis to the development of auto industry. Today, I would like to take the opportunity of this forum to introduce to industry colleagues some preliminary work ideas of THE China Automobile Association in the research and judgment of the development trend of the automobile industry in the 14th five-year Plan period, hoping to provide industry colleagues with reference and welcome feedback.

        My introduction is divided into four parts. The first part is the development status of the automobile industry. First of all, we summarize the characteristics of the current development in six aspects:

First, the automobile industry occupies a pivotal position in the economic and social development. The automobile industry is the fixed star of industrial manufacturing, and the added value of automobile manufacturing industry accounts for 7% of the industrial added value. The automobile industry chain covers a wide range and has many related industries, which is the consensus of the industry and plays an obvious driving role in the industrial growth. From the perspective of the consumer market, automobile is the ballast of the consumer market, and automobile products are important consumer goods related to people's livelihood. Automobile consumption accounts for about 10% of the whole social consumption portfolio, and it once exceeded 12%. In September, the contribution of the total retail sales of consumer goods by one percentage point is brought by our automobile industry.

Second, the auto parts industry has developed steadily, and the ability of the industrial chain to resist risks has been further improved. In the process of planning and development research, we pay close attention to the development of industrial chain, supply chain and auto parts industry. Judging from the current development situation, the operating trend of auto parts industry is consistent with that of the whole auto industry, and it has also entered the stage of fluctuation adjustment. At the same time, our industrial chain cluster effect is very obvious. This morning, many leaders also mentioned this point. We are a cluster of parts with large vehicle enterprises as the core, which is a very typical feature. Our local governments support the creation of clusters of characteristic parts, which is also a very good foundation for forming regional industries. At present, the whole industrial and supply chain has been equipped with a certain degree of vertical integration capability. Especially under the impact of coVID-19 earlier this year, our supply chain has shown relatively strong stability.

Third, China has become the world's largest new car market, the number of increasing. After China's accession to the WTO, China's automobile industry has been developing rapidly. In 2009, China became the world's largest automobile industry, ranking first for 11 consecutive years, and reached a peak of 28.88 million automobiles in 2017. In the first three quarters of this year, car PARC has reached 275 million, and it is expected that China will become the world's first car PARC this year. With the growth of our market, China's automobile manufacturing and product technology level has been in line with the international standards, electric and new generation of information technology is leading the industry's next development.

Fourth, new-energy vehicles have laid a solid foundation and entered a new stage of accelerated development. New energy car sales about 1.2 million, 2019, during the period of "much starker choices-and graver consequences-in", the compound growth rate of 35% new energy vehicles, new energy automobile sales in the first world for many years, 50% of the global market share, the first six months of 2020, the new energy car ownership has reached 4.17 million, more than 50% of the world's, at the same time in 2019 about 203 GWH accumulated loading power battery, public ownership of about 520000 charging piles, these are all reflected the new energy vehicles in the prophase of rapid development, formed a very good foundation.

Fifth, steady progress was made in overseas business of vehicles and spare parts, and the total import and export volume continued to rise. Before 2019, the total import and export of automobile commodities had maintained a relatively stable growth. In 2019, due to sino-us relations, geopolitics and other reasons, the import and export declined, but the export trade surplus was relatively large. At the same time, driven by vehicle manufacturing, a number of parts enterprises with comparative advantages have been expanding in scale and have begun to enter the global supporting system.

Sixth, the recovery of the auto market in 2020 has exceeded expectations and is expected to continue to improve. Outbreak of the new champions league this year let's car production and sales and revenue index fell sharply in the first quarter, sales fell 42% year on year, three months lost 2 million car sales, the state has adopted a series of return to work rehabilitation measures and under the joint efforts of our industry, the second respectively 10% and 14% growth in the third quarter from a year earlier, the fill come back more than 100 sales, in the first three quarters of decline has narrowed to less than 7%. It should be said that the market recovery situation continues to improve, of course, the future market uncertainty, instability factors still exist.

The second part talks about our judgment of the development trend of the automobile industry, which also includes 6 aspects.

First of all, we believe that the new round of technological revolution has provided broad space and unlimited opportunities for industrial transformation. Covid-19 has increased the difficulty of industrial transformation, but it has also accelerated the speed of industrial transformation. In the future, the automobile industry will have the possibility of industrial chain, product, marketing, manufacturing and other changes. Reform, innovation, integration and openness have become the themes of the future development of the automobile industry, including collaboration and development.

The first trend, the shift in consumer demand, makes possible the change in products, the change in marketing, the change in manufacturing. Software has brought about changes in the functional definition of automobile products, and new approaches such as mobile energy storage, data and information have also expanded the profit space of vehicles and parts, bringing opportunities to enterprises in the industrial and supply chains. At the same time, the combination of traditional marketing mode and Internet marketing interaction, the pattern of marketing mode constantly appears chain reaction, we believe that the future will enter a new era of intelligent information interaction, the application of information technology to make the future user definition, personalized product customization possible.

Second, the complex global situation has brought instability and uncertainty to the automotive industry and supply chain. In the future, with the profound changes in global trade rules, the upsurge of thoughts of trade protectionism and anti-globalization and the frequent emergence of "de-China-ization", the global division of labor in the manufacturing industry will be challenged and some profound changes will take place in different regions. As for China's automobile industry, our shortcomings and bottlenecks have been further highlighted since the outbreak of the epidemic in terms of vehicle grade chips, sensors, rubber, resin materials, core secondary components and raw materials. At the same time, for the next development of the automobile industry, we should turn challenges into opportunities, accelerate industrial integration in the upstream of the industrial chain, and concentrate our efforts to tackle the key technologies.

The third trend, a more sound innovation system, promotes the industrialization of innovation results. The national innovation system is playing an important role, and the national effort to break through the upstream of the automobile industry chain (mainly chips) has also set the requirements for technological breakthroughs in the core key components of the automobile industry. At the same time, the country has been ready for financial support, especially in the market-oriented situation play the role of investment leading, industry fund for us to overcome the core technology, crack the neck of these problems to create the possibility. The atmosphere of encouraging innovation in the whole society is also taking shape, which will drive our enthusiasm for innovation in the whole automobile industry chain. This is a process of mutual influence, which will give rise to more and more innovative achievements, promote the industrialization of achievements, and realize the high-quality development of the industry chain.

The fourth trend is cross-border integration to create new industrial ecology. The industrial chain reconstruction brings the opportunity of innovation and development to the component enterprises. More and more auto-centered ecospheres are emerging, injecting new vitality into the traditional automobile industry. The development of cross-boundary integration and mutual empowerment among industries will become a very important way for future industry development. In the process of the formation of new industrial ecology, parts and components enterprises should strengthen the awareness of integrating into the ecosystem, instead of taking the initiative to join. At the same time, we should give full play to our traditional advantages, whether in manufacturing, technology or talent, and use new technologies and new models to realize our own transformation and development, so as to seize the opportunity in the process of industrial chain reconstruction.

The fifth trend is to open up to a higher level and create a better development environment for outstanding enterprises. We believe that opening-up brings competition, but competition will breed our excellent enterprises. In the next stage of development, both vehicle enterprises and parts enterprises should have a clear understanding of positioning, form competitive advantages, develop in a differentiated way, accelerate the absorption of international experience and advanced technological achievements, and achieve international standards.

The sixth trend is deeper reform of the governance system to promote high-quality development of the automobile industry. The development of the automobile industry cannot be separated from policies and governance system. The deepening implementation of the reform of national system and mechanism will further improve the governance system of the automobile industry and greatly enhance the governance level. The formulation and implementation of policies of the automobile industry will be more and more consistent with the actual development of the automobile industry.

After talking about the trend, the third part introduces the future layout of the automobile industry in nine fields, as well as the key work that should be carried out and relevant Suggestions.

The first is to implement the brand strategy and build a world-class automobile vehicle and parts enterprise. The development of the industry cannot be separated from the development of enterprises, and the promotion of the competitiveness of enterprises ultimately depends on the competitiveness of the brand. Therefore, the 14th and 5th five-year plan or the future development should firmly promote the brand strategy. From the national level, it is necessary to implement the national brand strategy, establish the brand protection mechanism of integrity and self-discipline. From the perspective of enterprises, it is necessary to firmly implement the enterprise brand strategy, strengthen the core management ability of enterprises, improve products and services, and finally establish their own brand.

Second, we need to strengthen weak links, remove bottlenecks and build a safe and controllable industrial chain. First of all, industrial funds should play the role of investment guidance and concentrate their efforts to solve the problems of weak links and bottlenecking of core technologies. At the same time, an atmosphere of innovation should be created. On the one hand, vehicle enterprises should be supported to cultivate their industrial chain capacity; on the other hand, a cross-industry cooperation mechanism should be established to promote the integrated development of parts industry. Of course, advanced materials, technologies and equipment should also be developed with the help of national projects with strong foundation and key projects, and the industrial layout should also be optimized. Finally, the high-quality development of industrial clusters should be promoted, and the parts cluster and standard system, including the remanufacturing system, should be established.

The third is to strengthen technological breakthroughs, accelerate the integration of information technology, and promote the coordinated development of the automobile industry and social factors. At present, the contradiction between the automobile industry and social factors such as environmental protection, safety and energy conservation has become increasingly prominent in its development. In the future development, this problem cannot be avoided and must be solved. We believe that the fundamental path conducive to the industrial development will be found in the future. First of all, we should increase support for independent innovation. As a country, we should encourage technological breakthroughs and applications in environmental protection, energy conservation, safety and informatization. To promote the development of China's energy-saving and environmental-friendly automobile industry, the most important thing is to formulate a unified national strategy and technical standards, create a good social atmosphere, give play to the exemplary role of the government, and promote the joint development of various technologies. Country at the same time should also be conducted on the tax system is perfect, establish financial incentive mechanism, to encourage energy conservation and environmental protection car mass consumption at the same time to speed up the industry and coordinated development in the field of transportation, is big data, Internet, artificial intelligence, block chain technology applied in traffic industry, to provide vehicles and the coordinated development of transportation. It also includes integration with the energy sector.

Fourth, we will continue to provide policy support, innovate development models, and comprehensively promote the marketization of new energy vehicles. At present, there has been a two-year market fluctuation of new energy vehicles. The main reason is that in the process of policy guidance to the market, the development environment of complete marketization has not been formed. Therefore, the development environment of marketization in the future is the most important work. First of all, we should optimize our thinking from the perspective of management and attach importance to market selection. All policies related to new energy should focus on the fundamental law of market development, basic law of development and market selection. At the same time, we should promote the adjustment of the double - point policy, so that it really give play to the actual effect. The business model should adjust the way policy is supported. Accelerate infrastructure construction, improve the convenience of new energy products, make users more acceptable. We should strengthen the research and development of new energy core technologies, solve the problem of battery echelon utilization, and seek breakthroughs in technology and business models.

Fifth, grasp the advantage of intelligent network car first, and build the development system of intelligent car innovatively. The development of the smart car, at the same time for the whole industry chain, all enterprises in the supply chain to create a bigger development space, to strengthen overall coordination, through intelligent vehicle innovation and development from the perspective of national policy, the major task, the implementation of major projects in a timely manner to solve major problems in the process of development at the same time, need across departments, to coordinate, from the national level. At the same time, relevant management standards and rules should be studied and formulated to guide the orderly development of the industry and industry. Intelligent network is a special field and a special product, which will bring new challenges to the reform of the existing management system and laws. To promote the planning and construction of intelligent road infrastructure, it is necessary to support the next development of intelligent net-connected vehicles from the perspective of infrastructure. We will encourage domestic and foreign enterprises to strengthen industrial cooperation and jointly carry out basic research and technological development, including market-based applications. We will improve the security management linkage mechanism and build a network security system.

Sixth, strengthen the construction of talents of all types to enhance the soft power of the industry. During the recent research, I can deeply feel that whether it is a vehicle or a parts enterprise, the demand for different types of talents is very high, and the development of the industry cannot be separated from the development of talent strategy. In the future, we should strengthen the team construction of high-end talents and cultivate a large number of core talents to tackle key technical problems. In terms of industrial workers, great efforts should be made to cultivate manufacturing talents with the spirit of craftsman. These policies need both the central government and local governments to formulate corresponding encouragement policies based on regional industrial characteristics. We should deepen the reform of the system and mechanism for talent development.

Seventh, the deeper institutional reform brings high-quality development opportunities for the automobile industry. Association and government departments work together in the recent years, can deeply feel the reform of the government in promoting the pipes, deepen the reform of the administrative examination and approval system has made the very big effort, the future will also further simplifying items of administrative examination and approval, relaxation for the enterprise, at the same time improve the industrial policy and regional system, including the government department coordination, and balance the government guidance and market choice, the relationship between future policy may be more in line with the industry and the basic rule of market development. We will formulate industrial policies in a scientific and reasonable manner, and suggest that the government increase the decision-making and evaluation mechanisms for policy implementation to ensure the continuity and consistency of policies.

The eighth higher level of opening to the outside world, for excellent enterprises to bring more good development opportunities. The establishment of a high-level policy guarantee mechanism for opening-up will create a favorable environment for opening-up, accelerate the integration of domestic institutions and rules with international standards, promote deeper market reform with high-level opening-up, and use advanced foreign experience to help our own reform.

Ninth, we will consolidate the foundation and work together to comprehensively strengthen support for the development of industrial globalization. First of all, we will push forward the signing of free trade agreements with key automobile exporting countries. We hope that the country can speed up its work in this regard, set up an overseas development fund and strengthen its support for enterprises going global. We will improve the guarantee system for international services, promote the construction of overseas regional industries, and strengthen overseas collaborative service capabilities. We will strengthen international certification cooperation and promote the coordination of mutual recognition of domestic and international standards.

The above are the key tasks and Suggestions in the nine aspects. The fourth part is the overall judgment of the future development.

        China's auto market has experienced more than ten years of high-speed development period, reached all-time highs in 2017, after two years at the platform period, in the next five years is to realize the industrial transformation and upgrading of the critical period, grasp the opportunity and industry will enter a new stage of development with high quality, achieve steady growth, the future is not to scale growth stage, is to further the pursuit of quality, and the effect of growth stage, so as to reflect the development of high quality characteristics, so we think that this year, next year may still in industry development is relatively low, but we believe that to grasp the basic trend of development of the industry characteristics, in priority areas to carry out the relevant work, The 14th five year Plan can achieve slow recovery and even steady growth.

         During the 14th Five-Year Plan period, China completed the building of a moderately prosperous society in all respects and embarked on a new journey to build a modern socialist country in all respects. China's auto industry is embarking on a new journey to lead global industrial development. The automobile industry must seize the strategic opportunity period in the next five years, cultivate new opportunities in the crisis, build a powerful automobile market that plays a leading role, and create new opportunities for the development of the automobile industry. In the midst of changes, we will open a new bureau, accelerate the formation of a healthy domestic industry cycle, and open up new prospects for the globalization of the automobile industry.

       Thank you all for listening, I today is introduced here, RGL association is willing to industry colleagues to study the basic characteristics of the industry's future development, also hope to create a better environment for industry development, let us into the new journey the effort for the automotive industry, also hope to get each enterprise expert feedback, thank you.