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January 14, 2022updated 21 Jan 2022 1:05pm

2022 Outlook – Q&A with Yanfeng

In the latest of our series of sector outlook interviews, we take the temperature from the industry on highlights of the year just gone and prospects for the year ahead. Here we hear from Chunfeng Xu, Vice President & Executive Deputy General Manager at Yanfeng Automotive Interiors for Europe and South Africa.

By David Leggett

Chunfeng Xu

2021 was another memorable year for everyone and for all sorts of reasons. We had a bumpy recovery from the worst of the COVID pandemic, but the automotive industry was also hammered by a shortage of semiconductor parts. In your business, what stand out as the biggest challenges you faced over the past year?

The major global challenges in our automotive business and the current industry environment are unchanged. Like every supplier in the industry, we were impacted by customer downtime, program delays or shutdowns of their plants due to semiconductor shortages. Most vehicle volumes all over Europe are reduced.

From a materials and logistics perspective, the industry is navigating record high freight costs (containers are not available or very expensive), rising energy costs and the pricing and availability of materials (especially resins).

Any high spots or particular successes you’d like to share?

As a company, we have mastered the challenges together this year and, most importantly, we have also made good progress with our globalization efforts for our Seating and Safety Systems businesses in Europe and North America. We successfully completed the construction of new manufacturing sites in Serbia and Mexico.  With our new Seating and Safety operations in Kragujevac, Serbia, which will go into production from the 2nd quarter, 2022, we are responding to market demand and expanding our seating and safety product portfolios into Europe for the first time.

I started my assignment for Yanfeng in the European region eight months ago. It has been for me personally the greatest challenge and a unique opportunity to work together within the diversity of cultures of our Europe and South Africa region to support our customers. Looking back over the past months, I am proud of our team that was always willing to go the extra mile and do whatever it took to support customers and ensure delivery even under the most challenging conditions in this pandemic. Supporting our customers while continuing to drive our global business forward across all markets through the ongoing pandemic was not an easy exercise but we managed it successfully and will continue to do so.

How are you feeling about 2022 – both in terms of business prospects and more generally?

Based on what we are seeing in industry forecasts, the semiconductor shortage will continue to impact the industry in the first half of 2022. Supply chains will also continue to face major challenges next year, in the areas of steel, aluminium and plastic resins. Prices are increasing, which will have an impact on all market players. Logistics costs are also on our radar screen. I hope that this will return to normal. In the past, we had worked in a reasonably stable system in which costs were easier to forecast.

I also see reasons for optimism. I am optimistic that we will consistently drive forward our transformation and our globalization as well as accelerate our global business and footprint expansion. We will focus on digital technology integration in core products and new businesses and support our customers on this. Early customer engagement and co-development are essential for our business success but I’m confident that we are in a good position as we collaborate efficiently with our key customers in all our regions.

Sustainability is something that is increasing in importance. We are on track with all our initiatives concerning social, environmental and economic responsibility for our company and our supply chain. We continue to integrate sustainability into our products, processes and facilities.

Is anything emerging as a particular concern in terms of the outlook?

The ongoing pandemic is something that concerns me – especially the rising incidence of COVID in Europe. Every time we felt like we were back to normal, both in the automotive industry and in our personal lives, there has been a challenge. If other waves or variants happen and restrictions return, that would be challenging for us as a supplier but also for our customers.

The inflation rate in Europe, and in Germany in particular, is also something we have to keep an eye on.

Do you have a message for Just Auto’s readers?

With the current pandemic situation, it seems that the world is smaller than ever before. Times are tough and uncertain for everyone. Even if we can’t physically meet or travel anywhere now, we can collaborate and meet people virtually everywhere. We all will have to live with COVID, and we will be able to do so. Global crises have happened many times in the past. If you look at them retrospectively, the world has always changed for the better as a result.

It could take some time to recover from them, but the most important thing is to focus on your ability to maintain a path forward. Stay optimistic and find creative ways to turn hurdles into opportunities. We all learned a lot during the pandemic and are still learning and should come out of it stronger. Use this to improve your life and the lives of others, and to be generous and kind.

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