How China's Automotive Sensor Industry Develops and How to Break the Hollowing

Compared with China's automotive sensor industry, China has not yet formed an independent industry. It is reported that 95% of China's market is occupied by foreign capital, and it has lately become a major concern for the development of China's automotive sensor industry. It would rather use the R&D expense of million dollars for Bosch and it will not approve domestic production.

“More than 95% of China’s auto market share is in the hands of foreign-invested companies,” and “whole vehicle companies and ECUs would rather give Bosch several million yuan in R&D expenses, and are reluctant to use domestic production”. Imitation abroad, the scale of the company is also small, the product can not enter the mainstream market "......

At a variety of trade shows such as internal-combustion engine exhibitions and parts exhibitions, we often see such a phenomenon: the central position of the exhibition center is always dominated by multinational giants such as Bosch, and the exhibition booth is luxurious and crowded. Some small booths on the edge of the venue are rather shabby and deserted. Often, the space is only enough for a table and a small amount of exhibits. Two or three staff members look forward to the surging crowds in the stadium because nobody cares.

In these small booths, there are no shortage of local auto companies. They are practical, diligent and tireless in R&D and production. However, they have always been difficult to get the attention of supporting manufacturers. As demand has increased sharply like nuclear fission, it can only be used in the domestic market. This tempting cake throws people away.

"hollowing out"

“The development of intelligent and electronic vehicles is inseparable.” Wei Anli, deputy secretary-general of the China Internal Combustion Engine Industry Association, said that taking the automotive engine as an example, various signals such as brakes, addition and subtraction, and rotation speeds need to be obtained and then transmitted. The ECU (central processing unit) is the brain of the engine, and the ECU notifies the various operation departments according to a preset method to cooperate with the implementation. Image point is equivalent to human eyes, nose, and ears. Capture signals are transmitted to the brain. The brain then dominates the hands and feet to run and jump.

"The modern internal combustion engine is already alive and living with network and nerves, and it is the nerve ending of the engine." Wei Anli said. In fact, in addition to the power system, it is also widely used in various fields such as safety management systems and body comfort systems. Especially when emissions regulations are increasingly escalating and the auto-driving heat is getting higher, the industries related to exhaust gas treatment and auto-driving are even more relevant. Focus of attention.

It can be said that without technology, there is no modern car, which means that the more advanced and automated the car is, the greater the dependence on autonomy becomes. The data shows that about a dozen cars are installed on an ordinary family car and the number of luxury cars is as high as several hundred. There is no doubt that the number of cars in the future will increase at a geometric multiple.

As the world’s largest auto market, China is a fertile ground for development. In recent years, the market capacity has expanded dramatically. Experts agree that the Chinese market is entering a period of vigorous development.

Unfortunately, compared to foreign industries, Chinese cars have not yet formed independent industries.

“The domestic market has a demand of one billion yuan, and the annual import amount is no less than 170 billion yuan. Such a large volume is mostly occupied by international component giants such as Siemens, Bosch, Honeywell, and most domestic companies. Only some low-end products such as water temperature and pressure can be used, and for example, some high-tech products such as nitrogen oxides that must be used for exhaust gas treatment in the country's five or six emission stages are still completely dependent on imports, and they want to imitate the Imitation does not understand.” Li Songlin, general manager of Jilin Province Dewo Si Automotive Electronic Components Co., Ltd. (hereinafter referred to as “Devos”) reluctantly said.

Xue Zuxing, Senior Strategy Consultant of Wuxi Longsheng Technology Co., Ltd. agreed with this. “Indeed, most domestic products have a certain gap between quality and foreign products, and it is difficult to enter the mainstream market. Usually, they are exported to foreign countries and require low maintenance market. Temporary replacement."

"Weak industrial base," "low level of product technology," "the lack of product types," and "poor corporate product R&D capabilities," are some of the high frequency vocabulary that we often hear in interviews. The summary of Wei Anli's words is that the current “hollowing” of domestic industries is very obvious, mainly reflected in two aspects: First, the internal chip technology is in the hands of foreign capital, and the second is that this core component is integrated in China’s automobile industry chain. Weakness can even be said to be missing.

Development encounters

Why is China as a big country in demand but not a strong country in R&D? Wei Anli spoke sharply and pointedly: The start was late.

Prior to this, China was involved in mass-produced daily necessities, and there were too few specializations in the automotive field. When domestic vehicle ownership reached 20 million to 30 million vehicles, the market was long ago Occupation of foreign-funded enterprises.

How late is the domestic research start in this field? It is understood that taking nitrogen oxides as an example, Bosch began research and development as early as 30 years ago. Even if it starts at home lately for more than 20 years, why can domestic companies still be helpless in the face of its annual growth rate of 30%? Li Songlin said frankly: “Lack of capital investment. I personally have several patents for technical inventions, especially non-contact electronic gear switching technology, which fills the gaps in this field in China, but can only lie there to sleep because of financial problems.”

Li Songlin said that the R&D investment is frequently tens of millions or even hundreds of millions. The privately-owned small enterprises do not have this financial strength at all and also lack financing channels. They can only rely on their own modest profits to invest intermittently. “After investing in funds, the industry did not see results in 7-8 years. However, capital is profit-driven. Investors can't wait to invest in tomorrow to make profits, so no one is willing to invest in us. Here."

“Even if we have worked hard to develop products, domestic companies can experience extremely low levels of practical application,” said Song Xibin, deputy general manager of Shandong Guogu Functional Materials Co., Ltd. (hereinafter referred to as “China Porcelain”). In the application, matching tests with the engine and the entire calibration system are to be conducted, but the systems and equipment at this link in China are seriously lagging behind. This leads companies to fail to truly understand the follow-up product's consistency and reliability and how to improve it. Sometimes it is thought that products that have no problem will fail when they reach the customer, and ultimately make customers lose confidence in domestic production.

“Whole vehicle companies are not willing to bear the risk of using domestically produced products. You want to have only a few tens of dollars, and the whole vehicle test will cost hundreds of thousands of yuan. Who would be willing to spend hundreds of thousands and spend a long time to test a few dozens of pieces? The parts and components, customers prefer to choose a foreign country that they believe is more reliable.” Song Xibin said.

In addition to the lack of passive application support, domestic companies also need to change their quality management concepts. “Some technical levels have been achieved, but stable production cannot be guaranteed. For example, some Japanese companies are used in the production of automobiles and consumer electronics. There are two sets of management systems, but most of them are the same quality management system and the same batch of management personnel, so the products produced are often difficult to meet the automotive requirements for stability, reliability and matching.” Song Xibin said.

Without financial support, the company has been struggling, and the products it developed cannot be approved by customers. The worrying sales of products have made further research and development unsustainable.

This is a true portrayal of the status quo of a large number of weak, small, scattered and chaotic enterprises in China. Most companies are struggling in such a vicious cycle.

Grasping the foundation and doing the industrial scale

"In its industry, it was discussed that such a small thing, the cost of procurement is not high, in the end you want to do it yourself? But now it seems that our self-developed Beidou satellite navigation system has been more and more widely used." Watching Wei Anli In order to establish a self-contained network communication system, our country must not fake others in this key area.

Wei Anli pointed out that the fact that cannot be ignored is that in recent years, a number of outstanding companies have emerged in the domestic sector. For example, Guo Guo, which is known to provide basic materials for electronics, is an important supplier to many large-scale manufacturing companies in the world. Barium titanate materials can account for 40% of the world market share; Changzhou Liande Electronics Co., Ltd. is already in the world advanced level in similar products and is widely used in Iran; DeVos seizes opportunities for development of electric vehicles, research and development The high-precision currents of BMS's power monitoring have independent intellectual property rights, and the performance can compete with Swiss Lime products.

“This year, we introduced an automated assembly line from Europe to achieve unmanned assembly of products and avoid man-made failures. The consistency and reliability of our products have been greatly improved, and we can achieve zero defect in assembly.” Ningbo Yinzhou Yonglin Wang Linhu, chairman of Electronic and Electrical Appliances Co., Ltd. (hereinafter referred to as “Winglin”), stated that Bosch is still a manual and semi-automatic assembly line. At this point, Yonglin even walked in front of Bosch. He pointed out that Yonglin has a more proactive and meticulous after-sales service than Bosch, and it will not be as costly as a foreign-funded enterprise to collect millions of development fees. “If vehicle companies and engine plants give us a chance, they will find Domestic advantages".

In addition to providing more opportunities for domestic applications, in Wei Anli's view, it is more important to focus on basic research and industry scale.

The state should increase its emphasis and support in this area. Decentralized, sesame-salt investment is definitely not acceptable. It is necessary to select leading companies in the industry, continue to invest and give priority to their basic research, and then they must be excellent. Companies drive the scale effect of other companies.

“This is a natural law: China is the second largest economy in the world. In such an era of information and intelligence, how can we give up signal capture to such an important link? It is nothing more than fast and slow. In fact, in the driverless, mixed There are many opportunities for breakthroughs in domestic power and many innovation fields. It is believed that there will be such a group of young entrepreneurs who have a lot of enthusiasm for the moment, and a day when large-scale domestic recaptures of lost land will come soon, Wei Anli said.