Made in China requires precise positioning
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No matter how much it lags behind, the reality is that China must be embedded in the global industrial chain and supply chain, and find precise positioning in addition to low-end manufacturing.
According to the British "Financial Times" report, the global supply chain (intermediate products and services from different places through which it enters finished product production) have changed the world, accounting for nearly 80% of global trade, including about 12 trillion US dollars in the middle Trade in products and services.
John Calverley, head of global subject matter research at Standard Chartered, considers rising wages in China's manufacturing industry as a subversive trend, and the global supply chain has been reintegrated due to the loss of China's traditional manufacturing low-cost advantage.
Standard Chartered's research shows that over the next decade, changes in the nature of the global supply chain will reshape the global trade landscape. China, which is the source of the world's largest supply chain, will spin off a large part of low-cost manufacturing. India and ASEAN may benefit from this low-cost manufacturing migration, and Bangladesh and Africa will also get a share.
China's strategy of building infrastructure around the "Belt and Road Initiative" indicates that the global supply chain will expand to relatively new areas.
A survey of manufacturing industries in southern China shows that 11% of factories in South China Manufacturing Center are planning to move overseas. China has regained infrastructure space in the new geographic space and has become a supplier of equipment and equipment to the economies of ASEAN and other countries.
From the point of view of the mobile phone supply chain, the most dynamic mobile phone companies in the world are mainly based in Asia. The two most important forces are from China and South Korea. As of 2014, 9 companies, including Xiaomi, Huawei, Lenovo, Coolpad, ZTE, TCL, Vivo, OPPO and Jinli, accounted for 31.3% of the global market share. South Korea alone accounted for a 30.1% share of Samsung and LG, close to the sum of the above nine Chinese companies. In fact, South Korean manufacturers have achieved a globalized layout in handset manufacturing. Among them, about 50% of Samsung's mobile phones are produced in Vietnam.
Due to technological advantages, Korean companies such as Samsung and LG not only occupy some terminal markets, but also are the most important suppliers of mobile phone parts and components. Mobile phone LCD screens, flash memory, processors, cameras and other key components, Chinese mobile phone manufacturers need a lot of procurement from South Korean companies. The screen used by Apple iPhone 6 comes from the LCD screen supplied by LG. The better the iPhone 6 is sold, the better the LG product will be sold and share some of the profits from it.
Chinese mobile phone companies have the ability to learn and market and have the ability to integrate platform resources. However, they basically do not have chip-level technology and manufacturing capabilities. The core components rely on imports, such as mobile phone chips or Qualcomm's Xiaolong series, or they can purchase from Samsung. The LCD screen of the mobile phone is also mainly from suppliers such as LG, Samsung, or Sharp. As a result, China has become Korea's largest export market for mobile phone parts.
Taking Apple’s hundreds of suppliers as an example, the top 200 suppliers can meet 97% of the materials needed by Apple Inc., including assembly line production, assembly and raw materials, covering the United States, Japan, and China. And other countries.
Not only does China need to purchase raw materials from around the world to ensure economic security, it also needs to formulate the China Smart 2025 Plan to fill the market gap after the transfer of low-end industries.
With the integration of Japan, South Korea and other countries' supply chains, aiming at the goal of German Industry 4.0, Chinese industry has both the needs of mid-range manufacturing and also hopes that overtaking of corners will catch up with the smart age, which is not easy. China has a smart business platform, but there is no obvious advantage in smart manufacturing. Well-trained engineers lack a practical atmosphere.
After enjoying the advantages of low prices, China needs new irreplaceable comparative advantages: a well-trained labor force, a large team of engineers, and a convenient infrastructure logistics network. Who can master the key to smart manufacturing, who will be able to dominate the supply chain.