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In the era of meager profits, China's filter enterprises turn to the supporting market

2023-09-05

Filter refers to the air filter, they filter the air, oil and fuel into the engine, so as to protect the engine, but also improve the efficiency of the engine, is an essential part of the car engine. In view of the direct matching relationship between vehicle filters and vehicle (or engine), with the rapid development of China's automotive industry in recent years, the rapid increase in vehicle ownership has provided a broad market space for vehicle filters in our country.


First, the demand for vehicle filters is on the rise


The latest statistics of the China Association of Automobile manufacturers show that in the first November of 2010, the cumulative sales of automobiles were 16.3954 million, an increase of 34.05%, and it is expected that the production and sales of automobiles in the whole year will reach 18 million, an increase of 32%. In recent years, the rapid development of China's automotive industry has driven the market demand for auto parts, and the filter industry is an example. It is expected that the total market demand for automotive filters in China will increase to 1.16 billion sets in 2020.


Second, the car filter market competition is fierce


The huge filter market has attracted the attention of many production enterprises, and domestic and foreign enterprises have joined the current filter industry competition is becoming increasingly fierce. At present, there are more than 1,000 filter production enterprises in China, due to the diversity of vehicle filter product varieties and structure, both suitable for mass production with a higher degree of automation, and can also use small batch workshop production based on manual operation, so most of the production enterprises are small, large and medium-sized enterprises have more than 30, and the industry has not formed a monopoly of super large enterprises.


The fierce competition in the filter market is mainly reflected in the after-sales market, for the following two reasons: First, the filter is a wearing part on the car, which needs to be replaced regularly, so the sales volume in the after-sales market is very large, which directly leads to the number of filter enterprises competing for the after-sales market is far more than the supporting market. Second, there are many manufacturers in China's automobile filter industry, and the scale is generally small, most of them are incomplete production conditions, backward detection methods, and small handmade automobile filter enterprises, these enterprises are basically unable to meet the matching requirements, so they can only compete for the aftermarket. The fierce competition of enterprises makes the brand concentration in the filter aftermarket very low, and the market share of the top 5 filter companies is only 15%. In the supporting market, the market share of the top 5 filter companies reached 40%.


Third, in the era of meager profits, filter enterprises turn to the supporting market


Although the demand for filter aftermarket is large, with more and more enterprises entering this market, in fact, the filter aftermarket has entered the era of meager profits, and the profit margin is still shrinking. Coupled with the appreciation of the renminbi and the price of raw materials, various factors make the already difficult enterprises even worse, how should filter enterprises break out?


Industry insiders said that filter companies to highlight the encirclement must enter the supporting market, due to the high requirements of the supporting market, the entry of enterprises are not many, so the competition is relatively good, and the profit margin is relatively high. However, foreign and joint venture brands seize the market and almost monopolize the supporting market of high-end models of filters, so it is particularly important to improve the technical strength of independent brands.


Fortunately, at present, some domestic filter manufacturers with a certain scale have realized this point, and strive to enter the supporting market, although enterprises will face this or that difficulty to enter the supporting market, but this has become a trend.


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