With development of China's automobile industry entering a stage of rapid growth, automotive molding industry, known as “mother of automobile industry”, has also developed rapidly. Expansion of automotive molding industry has attracted a large number of enterprises to enter for competition. In addition to some local old moulding company such as FAW Mould Manufacturing Co., Ltd., Dongfeng Auto Mould Co., Ltd, Tianjin Auto Mould Co., Ltd., some foreign companies and large enterprises in other industries have also expanded their business to domestic automould industry, and it is expected that future competition of automotive molding industry will further intensify.

 

At present, there are more than 300 automotive molding manufacturing enterprises in China, most of which are small in scale, and docking customers are relatively fixed and limited, resulting in low market concentration in the industry. In addition, compared with foreign companies, domestic enterprises were relatively backward in technology and equipment in the past. Therefore, competition of enterprises is concentrated in products with relatively low technical requirements in the field of automotive structural parts and automobile panels. With rapid growth of automould market demand, gradual application of advanced technique such as CNC machine tools, computer software and production equipment in the mold industry, China's automotive molding industry has formed a new competitive landscape.
On one hand, industry competition has begun to upgrade to mid- to high-end products. From perspective of China's top 20 automould customers in 2018, some key enterprises in the industry such as Qianyuan Auto Parts, Secco Auto Parts, Tianqi Mould, Chengfei Integration and Haier Mould, continue to upgrade their industrial structure, gradually transform company's products into mid-to-high-end automotive molding, and gradually grown into suppliers of high-end car companies such as Mercedes-Benz, BMW and Audi. However, at present, there are still few companies in China that have comprehensive competitive strength and are likely to produce high-end molds.
On the other hand, competition from local manufacturers of automotive molding is intensifying. For original automould enterprises,it expand scale of competitive advantage and technological advantages through strengthening cooperation in the past two years. For example, as one of the largest automould manufacturers in China, Tianjin Auto Mould Co., Ltd. co-founded Hebi Tianqi Automobile Mould Co., Ltd to expand its business scale; Chengdu Aircraft Industry Group Co., Ltd., together with Chengdu Aerospace Instrument Co., Ltd. and Zhejiang Geely Group, jointly established Sichuan Chengfei Integrated Technology Co., Ltd., engaged in design, development and production of automobiles and other molds. They want to build the largest automotive molding production base in Western China. Strengthening of enterprise cooperation in the industry and expansion of scale of enterprise will accelerate reshuffle of injection molding industry, and competition among enterprise camps will intensify in short term.
For potential competitors in other industries, some enterprises have also entered into competition through cooperation with industry players. For example, Wuliangye, a well-known wine company, has achieved a diversified business expansion by cooperating to build an automotive molding production base. Addition of competitors outside injection molding industry will also intensify competition in the industry.
It is worth mentioning that in addition to expanding production scale and enhancing competitiveness through cooperation, local enterprises have begun to change their respective “big and complete” development models, form industrial clusters in region, strengthen division of labor among enterprises, form a community of interests and maximize their respective advantages to improve production efficiency and enhance product competitiveness. At present, in Beilun and Huangyan areas of Zhejian, Shenzhen, Dongguan and other places have initially formed a certain automotive molding industry cluster.

In addition to intensified competition of local brands, foreign automould companies have begun to accelerate their deployment in China. For example, Cole Asia Co., Ltd cooperated to form the first joint venture of mold standard parts in China; Honda Trading Co., Ltd. invested US$20 million to establish Yantai Junhui Mould Co., Ltd., which is mainly engaged in the development, design, production and sales of various automotive molding.
Competition of foreign brands has obvious advantages in high-end molds. From comparison of mold prices among China, Japan, Europe and United States, China's mold prices are lower, which means compared with foreign high-end mold products, China's mold products are positioned in low-end. In fact, although China's total mold production has ranked third in the world, design and manufacturing level is generally backward; China's low-tech molds have been oversupplied, market profit margin is small, and high-tech medium and high-grade molds It is still far from being able to adapt to needs of national economic development. A large part still depends on imports. In recent years, annual import value is about 10 billion yuan.

 

In addition, high-end of automould is also an inevitable trend. Since 2011, sales volume of luxury brand passenger cars in China has been increasing, indicating that high-end trend of national automobile consumption has already appeared. In the future, strengthening R&D, design and production capacity of high-end molds for local enterprises can not only effectively resist competition from foreign-funded enterprises, but also seize opportunity of high-end development of automobiles and win more market space. It can be seen that high-end molds will be top priority for automould enterprises, especially local enterprises in the future competition.