In recent years, the development of the auto market makes a lot of independent parts manufacturers expand. They provide assemblies for the domestic automobile business. Some of them become suppliers who offer products for well-known international enterprises. After a long period of accumulation, these companies are not satisfied with the present status. They want to improve their market competitiveness through going public. Among them, there are many transmission and gear manufacturers.Many companies are preparing for going public. For example, in June, Hangzhou Advance Gearbox Group Co., Ltd. approved the IPO (initial public offerings). This company specializes in producing all kinds of gear drives, including automotive transmission. Besides, it also designs and manufactures powder metallurgical products. It is reported that Hangzhou Advance Gearbox Group intends to issue 101 million shares on Shanghai Stock Exchange. The raised funds will mainly be invested in four projects, including plans to invest 30 million Yuan in the technology research and development projects of automatic transmissions.Transmission companies seek listing actively; meanwhile, gear companies are not far behind. For example, a company in Zhejiang Province which specializes in automotive gears plans to issue 30 million shares on Shenzhen Stock Exchange and raise about 400 million Yuan. It intends to invest the funds on the expansion project about gear replenishment.The prosperous automobile market accelerates the trend of going public. Chen Jianxing said that there are three companies in the automotive parts business. Except for one company which is producing automotive transmission, the other two companies are in the production of wheel hub unit and shock absorbers.There are more and more auto parts enterprises apply for going public when compared to the same period in previous years. There are maybe two reasons. One is that automobile industry plays a more and more important part in the national economic development. Some competitive enterprises in the automobile parts industry are becoming mature with the development of the automobile industry. The other is that sales of many parts enterprises achieve significant growth. It is a good chance for those companies which intend to go public.Raising funds is the most important objective for companies to go public. But the listing of enterprises is not limited to this. It will have much effect on the other aspects of companies.In addition to financing, going public can improve the mechanism system and management of enterprises. Most parts companies in the domestic market are private enterprises. Generally, their scale is small and the management is rather unscientific. The listing will offer new requirements for the company management. In addition, after the listing, the company’s market position, brand image, and market acceptance will be further enhanced.
Recently, the trade association would like to organize a number of domestic backbone enterprises in parts industries to visit America. They intend to exchange skills with their U.S. counterparts, visit their factories and look for opportunities for cooperation. Unexpectedly, no company is willing to host. It is said that the possibility for this is that American parts companies want to prevent rapid imitation parts enterprises from China, and avoid the technology leakage.It should be very easy for Chinese parts companies to visit the foreign counterparts. Why does it become so difficult? Dong Jianping, the associate secretary-general of China Association of Automobile Manufacturers, says that it is related with the rapidly expanding of Chinese automotive market, the technology improvement of the automotive parts and the copying of some parts industries.With the rapid growth of the automotive market, the auto parts industries also develop rather quickly. The expanding of the market brings many opportunities for the parts enterprises in China. At the same time, the technology of the domestic companies is improved continuously. The auto parts industries have developed a lot since the reform and opening up policy. After 30 years’ development, many parts enterprises not only have the ability to support their own brands, but also enter the brand matching system of a joint venture.On the one hand, many foreign parts manufacturers consider Chinese counterparts as their competitors. On the other hand, they are afraid of the imitation. This is the key to the problem. Dong Jianping thinks that the improvement of the overall technology level can not cover up the misunderstanding in the independent innovation of the parts enterprises, i.e. taking the imitation as a major source of technology.According to Dong Jianping’s analysis, parts enterprises have three errors in understanding the source of the technology. The first one is imitation instead of technological innovation. Secondly, they rely on buying from the outside. Thirdly, they are unwilling to seize the opportunity to make use of the international resources.Taking the first one as an example, in Chinese parts industries, there are many enterprises which develop by imitation. One clutch company does not introduce any technology. It develops the company by imitating other companies. Currently, this company’s products occupy great market share in the domestic market, besides, they are exported to foreign countries. A company which produces water pumps wants to buy a sample copy from a foreign auto brand. Many other companies are also following this path. They consider it as a good way to develop their companies. But Dong Jianping said that imitation has become the “stumbling block” for the independent innovation. It is an impracticable way to develop the parts industries.