The Whole Machine Enterprise Is Facing A Crisis, And The Parts And Components Enterprises Naturally Cannot Escape.

- Nov 26, 2018-

In recent years, the country has continuously introduced a series of subsidy policies, which has attracted the attention of many companies, but this may not be a good thing for the electronics manufacturing industry, especially the parts and components enterprises.

According to the big bit reporter, in recent days, although the state's subsidy policy has caused the company's order volume to rise significantly, there are still enterprises that are called "disastrous" because the company's profits have fallen sharply. The increase in sales and the decline in net profit have occurred in the field of motors. What caused the profit of motor companies to shrink? How should domestic motor companies respond?

Sales increase profit decline

A few days ago, the Beijing News announced that the sales performance of many Chinese housing companies has risen sharply, but the profits have been declining continuously. After the fermentation of events such as Xiong'an New District, this issue has aroused widespread concern in the community.

According to the big bit reporter, not only the housing enterprises, but also many manufacturing companies in China are facing the problem of “declining sales profits and falling profits”.

On the 9th of this month, TCL's net profit in the first half of the year rose by over 70%, while industry professionals broke the mystery and pointed out that TCL layoffs nearly 10,000 people in the past six months, and the layoff rate was as high as 12%. As a global intelligent product manufacturing group, one of the ways to maintain profit growth is actually layoffs, which inevitably makes many companies feel worried.

The whole machine enterprise is facing a crisis, and the parts and components enterprises naturally cannot escape.

Recently, many motor industries have released relevant performance reports. The report shows that the motor industry has experienced a decline in profits or even losses for many years. On August 7, the semi-annual report released by Jiangte Motor showed that the company's revenue in the first half of the year was 1.02 billion yuan, down 22.77% year-on-year, and net profit was about 62.08 million yuan, down 41.97% year-on-year.

The problem of double net drop in revenue and revenue is not a case.

A few days ago, the Ocean Electric China Daily reported that the company's net profit in the first half of the year was 145 million year-on-year, down 26.99%. The semi-annual announcement of Wolong Electric Group showed that the net profit attributable to listed companies decreased by 9.33% year-on-year.

The company believes that: "In the first half of the year, the company's gross profit margin fell to 22.9%, down 5.1 percentage points year-on-year."

Jiangte Motor, Quality Letter Motor, Dayang Electric, Wolong Electric Group are just the tip of the iceberg of China's motor companies. In addition, more companies are also facing the problem of double falling revenues, which makes many SMEs fearful. So, what is the cause of the shrinking profits of motor companies?

The subsidy policy shrinks is the main cause

In order to explore the reasons for the decline in profits of motor companies, Big Bit reporters interviewed a number of motor companies, and learned that the important reason for the decline in profits of motor companies in the first half of the year was the shrinking of state subsidy policies.

Taking new energy vehicles as an example, since the promulgation in 2016, due to the adjustment of subsidy policies, the domestic new energy vehicle market has been relatively sluggish in the past six months, and the performance of many upstream and downstream enterprises in the new energy automobile industry chain has declined to varying degrees.

Jiangte Motor said: "Affected by the national new energy vehicle subsidy policy and access policy, the performance of new energy vehicle-related business in the first half of this year fell by 40%, resulting in a decline in the company's operating income and net profit."

As one of the few motor companies that keep profits rising, Lanhai Huateng still said that the motor business was relatively sluggish in the first half of this year. As the downstream new energy automobile industry is greatly affected by industrial policies, the company's electric vehicle motor controller business development also faces the risks brought by the changes in the downstream industry.

In addition to the state subsidy policy, the reporter found that the cost of spare parts and materials, high labor costs, technical bottlenecks, suppliers' "bottom-free" price reduction, and heavy taxation are also important reasons for the decline in profits of motor companies. According to the person in charge of the quality letter motor, the price of raw materials rose this year, and the gross profit margin was under pressure, which brought great cost pressure to the company.

The national policy has strongly supported the manufacturing industry, and many companies have flocked to it and have successively laid out in this field. However, as the market becomes rough, disordered, and homogenized, companies will face the risk of falling revenues and even bankruptcies.

Therefore, in the face of policies, motor companies need to maintain rationality, cultivate good market resolving power, remember to follow the trend blindly, follow the policy blindly, and increase R&D investment on the other side to cultivate their core technologies to meet greater development opportunities.

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