Delphi says Chinese suppliers are rapidly catching up and in some cases, surpassing their traditional competitors in the West.
The US giant has a significant operation in China, which some analysts are predicting could become a 31m vehicle market by 2020, while of equal interest to components makers is increased content driven by electrification, alternative propulsion and automated driving.
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“A lot of Chinese suppliers of components have become leading suppliers in the world because of improving systems and R&D; they have gradually caught up and even surpassed Western companies,” said Delphi China president, Simon Yang, at the recent Global Automotive Forum in Chongqing.
“We are cooperating with a lot of Chinese suppliers and the localisation rate of Delphi has exceeded 80%. In 2015, 80% of our materials were procured in China. The reason we can develop rapidly is we have a very clear goal in mind.
“In this process, we will do away with our traditional mind sets.”
Yang added some Chinese companies were “short-sighted,” maintaining in cases where their brands were not sufficiently strong, they would like to take “short cuts,” although this approach would see them left behind after several years.
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By GlobalDataHowever, localised content has clear benefit in China as Yang outlined: “Chinese companies have a lot of advantages and a lot of international companies are jealous,” he noted.
“I am Chinese, I know how Chinese companies operate in China. If Chinese companies can fully grasp their advantages and catch up with their international counterparts, they will succeed.”
Content-driven opportunities clearly abound in China, with Yang noting some 20 domestic companies had ‘promised’ they would introduce automatic emergency braking by 2020, while the increasing popularity of electric vehicles would also provide potential.
“OEMs must cooperate with suppliers to tackle challenges together,” said Yang. “In the future, our customers will have a higher demand for upgrading of their vehicles.
“We believe cars [are] the most complex equipment human beings have ever had. Our automotive industry must adapt. OEMs are using technology to increase the efficiency of internal combustion engines – in the future there will be more stringent emissions standards.”
