Private Suppliers Thrive in China's Automotive Shock Absorber Industry

Sales of new cars in China topped 13.79 million units in 2009, up about 48% from the previous year, boosting China ahead of the United States to become the world's largest auto market.

Shock absorbers are among the most important of auto suspension parts, so it is no surprise that China's shock-absorber production is growing along with its auto industry. Thanks to a steady improvement in quality, domestic automakers are increasingly adopting Chinese-made shock absorbers in their vehicles. For the same reason, exports are soaring as well.

More than 100 major Chinese companies now supply good-quality automotive shock-absorber products, mainly for passenger cars, and a much smaller number of suppliers focus on shocks for commercial vehicles.

Industry experts explain that the main function of shock absorbers is to make vehicles more comfortable to drive and ride in, a consideration that is generally neglected in commercial vehicles. In many cases, in fact, shock absorbers are removed from commercial vehicles in China so as to increase loading capacity.

Some Chinese commercial-vehicle makers, however, have introduced new high-end models equipped with six or more shock absorbers in recent years, and this is expected to grow into a trend that accelerates the development of shock absorbers for commercial vehicle.

One company that is at the forefront of shock-absorber development in China is the ADD Industry Co., which exports about 90% of its products. This makes it China's largest shock-absorber exporter. The firm engages in technical cooperation and contract production arrangements with leading international shock-absorber brands, such as Tenneco Automotive and Arvin Meritor of the U.S. and Alko of Spain.

Another prime example is the Zhejiang Zhongxing Shock Absorber Mfg. Co., a specialized shock-absorber developer and manufacturer with a product line covering nearly 1,000 car models worldwide. The company now employs around 1,000 people and has an annual capacity of around six million units. It is able to develop around 500 models a year.

Zhongxing is committed to quality and sells its shock absorbers with a 60,000-kilometer or two-year warranty. About half of its products are supplied to major international brands on an original equipment manufacturer (OEM) basis.

Quality Guaranteed

The Zhejiang Shiny Automobile Parts Co., another major player in the line, supplies products with quality guaranteed by ISO 9002-, QS 9000-, VDA 6.1-, ISO 14001-, ISO 9001: 2000-, and ISO/TS 16949 certification.

Zhejiang Shiny boasts a sound in-house manufacturing capability that encompasses stamping, cold extrusion, finish stamping, cold forging, precision processing, and heat treatment. The most advanced inspection and testing equipment is used to assure the highest product quality and durability.

Zhejiang Shiny supplies a variety of parts and accessories, including shock absorbers, for many Chinese and international car models including Buick, Volkswagen, Audi, and Hongqi. The company is an original-equipment (OE) parts supplier to international makers of autos and auto parts, as well as other industrial products, including the Shanghai Automobile Gear Factory, Shanghai General Motors, Shanghai Volkswagen, Torrington Wuxi, First Automobile Manufactory, Gold Cup, and Shanghai Hitachi Electrical Appliances. It also supplies items to Siemens, American Teleflex, and Delphi operations in Europe, North America, and Southeast Asia.

The company has developed over 1,500 models of shock absorbers for popular European, Japanese, American, and Korean cars, and exports them to major markets such as Europe, America, and Southeast Asia.

The Ningbo Tuopo Group Co. is another seasoned Chinese auto-parts maker that supplies high-quality shock absorbers as well as interior parts, accessories, and other suspension system parts. The firm has developed more than 2,000 product items which are supplied to major customers such as Shanghai GM, Shanghai VW, FAW-VW, Shanghai GM Wulin, Beijing Benz-DaimlerChrysler Automotive Co., Changan Ford, Jianglin Motors Co., Dongfeng Peugeot Citroen Automobile Co., Brilliance Auto Corp., GM North America, Audi Germany, and VW Germany.

To consolidate its own position in the shock-absorber business, the Ningbo Nanfang Shock Absorber Manufacture Co. has developed more than 3,000 shock-absorber models for Japanese, Korean, and European car makes. The firm exports many of its products to Europe, Southeast Asia, and the Middle East, where they must meet the stringent technical demands of German and Japanese customers. In China, Nanfang is a major OE supplier to several independent automakers.

Other major Chinese shock-absorber suppliers include the Shanghai Sachs Huizhong Shock Absorber Co., which offers a wide array of absorber models for most popular car and motorcycle models, and Hangzhou Founding Traffic Parts Co., an OE supplier to domestic carmakers and foreign customers as well.

Fueled by both domestic and foreign capital, the development of private enterprises in China has been accelerating strongly. Statistics indicate that private companies now make up 49% of all auto-parts enterprises in China, and that they account for about 20% of the industry's total production value. With competition growing more intense by the day, however, these private auto-parts makers will have work harder than ever to reinforce their low-cost advantage and find more niche markets if they are to continue thriving in years to come.