Abstract : Since 2004, domestic auto parts companies have faced the “high-into-low-output†phenomenon in which the purchase price of raw materials has risen higher than the increase in the ex-factory price of products. The average selling price of products has fallen by more than 5% year-on-year. The purchase price of materials rose by 10% to 15%. The phenomenon of “increase and decline†in prices “inverted and out-of-hung†has caused domestic auto parts manufacturers to bear the enormous pressure of price differences. The industry’s profits have been severely squeezed and some companies’ capital chains have been strained.
Affected by the global supply and demand factors, such as crude oil, black and non-ferrous metals prices fluctuate with the international market, leading to rising raw material prices in the upper reaches of the auto parts industry. In contrast, auto parts and components, as downstream products and final consumer goods, are basically determined by the domestic supply and demand relationship and have little relevance to the international market. Due to the fact that compared with the upstream products, the artificial input ratio of these products is significant, and the low labor price determines the advantages of low manufacturing costs, making the prices far lower than the general international level, and is rarely affected by the international price level. This difference in pricing mechanism makes the gap between the price of upstream raw materials and the price of downstream auto parts and products more and more wide. The “high-low-low-output†scissors difference has made the investment environment of the industry worse and worse.
Fierce competition caused by the market
Although the pricing mechanism of upstream and downstream products is different, it is an important external factor affecting the delay in price transmission. However, the reason for this is that the pattern of fierce competition in the domestic auto parts market has not changed fundamentally. In recent years, auto parts companies have suffered from three parties' "squeezing": First, the auto parts industry is becoming more and more fierce; Second, domestic major auto parts companies, in order to compete for market share and engage in homogenous competition The use of scale advantages to fight "price war"; Third, some host plants and dealers in order to compete for their own needs, in the quality of stricter, higher standards, but year after year to reduce the price. The intensification of competition has led to an increasingly smaller profit margin for auto parts companies.
At the same time, because most domestic auto parts enterprises are mainly small and medium-sized enterprises, they are relatively small in scale, have weak independent innovation capabilities, and have inadequate management systems. They lack effective means to open up markets and their ability to resist risks is generally poor. From the point of view of the production companies, the current price competition is almost the only and most comfortable way of competition for China's auto parts companies. It is precisely because of the current fierce competition in the auto parts market, and consumers are very sensitive to prices, it is very difficult for auto parts companies to pass on the increased costs completely to the consumers. Therefore, as compared with the increase in costs, as a downstream car Not only did the parts and components companies not dare to raise prices easily, but they also had to operate cautiously to keep their existing market share. In this rise in upstream prices and in downstream prices, the company’s operating costs have increased significantly. This is an abnormality in funds. The intense auto parts industry is no different from the bottom-line salary, and companies can easily fall into financial crisis.
The Influence of "High Entering Low" on the Industry
Due to the continuous rise in the prices of international non-ferrous metal materials and the increase in energy prices, the production costs of auto parts companies have increased significantly, resulting in more auto parts companies producing more and more losses, and increasing the long-term development of enterprises. Uncertain factors. If this phenomenon continues, the pressure for auto parts companies to increase economic efficiency will increase, which will cause the company's lack of development potential, weakened market competitiveness, and affect the company's living space. Some small and medium-sized automobile parts and components companies have to stop production or change their production because they cannot afford the pressures of cost, financing, etc. The pace of mergers and reorganizations of auto parts companies will further accelerate, and the degree of industrial concentration will further increase.
At the same time, due to the arrears of funds from companies in the downstream vehicle industry, there is a shortage of funds in the industry. Generally, the auto parts companies usually pay more than 3 months after they are delivered to the auto manufacturers, and the raw material purchases cannot be owed. Therefore, spare parts for auto parts are not available. Every month, companies need sufficient liquidity to maintain normal production. Many companies rely on bank short-term loans to maintain the company's cash flow, but also rely on long-term loans to maintain project construction and production, for which companies also have to bear huge financial costs . Once the corporate capital chain changes, the upper reaches of the debt or downstream debt is not returned, the company's funds are difficult to maintain business, pay interest, the capital chain break will force the bankruptcy liquidation. If it is a short-term change, companies can also rely on refinancing to tide over the difficulties. However, in the current situation where the industry is extremely sluggish, corporate profits are insufficient to maintain its continuing operations. A single financial crisis may result in the continued deterioration of corporate financial conditions. Insolvency.
Zhongjinyi Viewpoint
Auto parts companies are being squeezed by both automakers and raw material companies, and they must not only meet the continuous price reduction requirements of OEMs, but also have to keep up with rising raw material and energy prices. Many parts and components companies are unable to further expand their R&D, procurement, production, and marketing due to the difficulty of capital operation. In particular, the parts and components companies supporting commercial vehicle companies are under more financial pressure than the companies supporting passenger car companies. The demand for financing is also stronger, and the risk of debt repayment is also relatively large.
The bank should do business with the automobile as a whole business, analyze the growth potential of the parts and components companies from the perspective of the entire supply chain, and assess the risks. The preferred customers are the supporting parts and components companies for well-known domestic and foreign manufacturers. At the same time, it signed an agreement with the entire vehicle company to list the list. The entire vehicle company recommended high-quality suppliers to share information. Suppliers who have a history of violations will not be granted loans.
It is suggested that the bank launches three innovative supply chain financing types, namely, financing for provisioning, inventory pledge financing, and domestic/international factoring at the stage of procurement, production, and sales, based on the trade characteristics of auto parts suppliers. This series of loan measures can not only solve the financial difficulties in expanding purchases based on orders, reduce procurement costs, ease the use of funds in inventory during the production phase, accelerate inventory turnover, but also increase the liquidity of accounts receivable and speed up the withdrawal of funds.
A lathe is used to fashion a rotating piece of raw metal, wood, or composite into a precise configuration using movable cutting tools, or bits set to varying depths. The process, known as turning, or machining, is most often accomplished with a horizontal lathe. Often, however, space or material constraints, sometimes even personal preferences, necessitate the use of a vertical lathe.
Essentially a horizontal lathe turned on end, a vertical lathe, also called a boring tool, is composed of basically the same parts as a horizontal lathe. As implied, the functions of vertical lathes are performed up and down, rather than side to side, as is the case with horizontal lathes. This vertical alignment allows short, heavy, bulky materials to be machined more efficiently than with a horizontal lathe.
All lathes, vertical or horizontal, are comprised of the same basic parts. The headstock encloses the spindle and chuck, the parts that actually turn the material. The bed catches the shavings, and also serves as a brace for the horizontal lathe. The feedscrew and leadscrew, mounted on the lathe carriage, adjust the speed and distance traveled by the cutters along the stock. The cross slide and compound rest position the toolbox, which, in turn, mounts the bits.
The tailpost, at the opposite end of the lathe spindle, clutches the stock and braces it, thus eliminating wobble and vibration. The headstock and tailpost may be at the upper or lower end of a vertical lathe, or to the right or left end of a horizontal lathe. Either way, the headstock is one end of the lathe, the tailstock, the other.
Vertical lathes may be vertical turret lathes (VTL), where a turret holds various toolboxes, allowing little wasted time resetting bits during the machining process. There are also computer numerical control (CNC) vertical lathes in which the entire machining process is computer operated.
The top of the lathe pyramid are the CNC vertical turret lathe machines, most often used to turn stainless steel into precision parts for engines, turbines, transmissions, etc. These machines, though expensive to purchase and operate, are perfectly suited to the task, saving space, as well as over-stressed equipment. A CNC VTL can also be used on alloys to efficiently turn precision bearings and gears.
A vertical lathe can used on rough wood in a home workshop, mainly for its space-saving attribute. Many home hobbyists, however, simply feel more comfortable turning wood up and down, rather than side to side. Altogether, the vertical lathe is a very capable and versatile tool.
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Jiangsu Hoston Machine Tools Co., Ltd. , https://www.hosdunmachinetools.com