Parts are the key factors that really determine the success or failure of a country’s auto industry. At present, the incompatibility with the entire vehicle industry is that the domestic auto parts industry is facing a great dilemma: the number of companies and the overall quality is not high, exports have fallen sharply, and the domestic market has also fallen into a situation surrounded by foreign capital.

The newly announced “Opinions of the State Council on Promoting Enterprise Mergers and Acquisitions” published on September 6 ranked first in the automotive industry. It is understood that after the "Opinions", the implementation of specific recommendations for industrial mergers and acquisitions - "Guide to promote mergers and acquisitions of automotive companies guidance" is expected to come out.

Compared with the merger and reorganization of vehicle companies, the merger and reorganization of auto parts companies is of greater significance to the expansion of the company's scale and technological upgrading. Without the emergence of large parts and components companies, the cost and quality will not be effectively controlled, and the development of the entire industry will be extremely difficult.

Although there are many manufacturers in the automotive industry in China, most of the companies are small in scale and it is difficult to achieve economies of scale. This is still a big gap with multinational companies. Due to the self-contained distribution system of complete vehicle manufacturing companies, there are many redundant construction projects and a separate management system that makes parts and components companies repeat, with many dispersed factories and small scales. This is in line with the global procurement adopted by the international automotive industry. The trend of system development and modular supply is quite different. Although some large-scale enterprises have gradually shaken off the status quo of heavy production, heavy production, and heavy R&D, they have also seen the fact that independent research and development capabilities of enterprises have determined the company's ability to resist risks to a certain extent, but R&D The increase in the level has been slow. In addition, some small parts and components companies tend to invest less in research and development. In view of this situation, if the Chinese auto industry wants to take a place in the global auto industry competition, it should use the asset reorganization model and integrate existing resources in accordance with the laws of market economy.

Mergers and reorganizations can expand the scale of enterprises and enhance their competitiveness

By taking the road of mergers and reorganizations, enterprises can effectively enable large-scale enterprises to rapidly and cumulatively accumulate capital, and in the short term, develop at a low cost to the group and achieve economies of scale. As George Stiger, an American economist and Nobel Prize winner in economics, said, "A company that becomes a giant by merging its competitors is a prominent phenomenon in the history of modern economy." The company did not grow up through some degree of merger, and almost none of the big companies grew up by relying mainly on internal expansion." Through mergers and reorganizations, the pros and cons are merged at the same time with certain resource advantages of the target company, such as network channels, information, technology, and geographical location. From the perspective of the parts and components industry, China’s corporate technology R&D capabilities are generally weak. Through mergers and reorganization, it is possible to strengthen the company’s own resource advantages and concentrate technical forces to overcome core technologies. In order to regain the disadvantage in the market competition.

Therefore, the integration of China's spare parts industry through mergers and reorganizations is a feasible way. With the introduction of the "Opinions of the State Council on Accelerating the Merger and Reorganization of Enterprises," the merger and reorganization of the auto parts industry is imperative.