Interpretation of the 2023 Global Top 100 Parts List: China's Comprehensive Rise in Power

Recently, Automotive News released the "2023 Global Top 100 Automotive Parts Suppliers List", which is mainly based on the revenue (sales) provided by suppliers in the automotive industry's supporting market business in the previous year.

Looking at the rankings released this year, it can be seen that the industry landscape of the automotive industry is rapidly changing. Emerging businesses are moving upwards, while traditional businesses are moving downwards. The proportion of business in the fields of electrification, intelligence, and networking in the automotive industry is increasing, and it is becoming an important engine for the transformation and development of traditional enterprises. Next, we will analyze the situation of companies listed in China, Japan and South Korea, Europe, and North America, hoping to discover the changing trends of the global automotive industry chain pattern from them.

1、 Overview of the 2023 Global Top 100 Parts Companies

Overall, the three characteristics displayed on this list are worth paying attention to:

1. Traditional component giants still have strong strength and continue to dominate the list.

The position of the top ten in the top 100 rankings remains largely unchanged. Bosch has won the championship for 12 consecutive years, while Denso, ZF, and Magna still rank in the top four. The most eye-catching achievement this year is that Chinese company CATL has surpassed Japan's Aisin Precision Machinery to enter the 5th place, becoming the first Chinese company in history to enter the top five.

Modern Mobis maintains its 6th ranking unchanged; The ranking of Aisin Precision Machinery has dropped from 5th place to 7th place; Freya has slipped from 7th place to 8th place; Mainland Group's ranking has dropped by 1 place to 9th place; Lier maintains the 10th ranking unchanged.

The top 10 suppliers' total revenue from automotive accessories in 2022 reached 348.35 billion US dollars, an increase of about 10.02% compared to 2021, indicating a significant growth volume. Among them, there are three suppliers with revenue exceeding 40 billion US dollars in 2022, namely Bosch, Denso, and ZF.

2. The number of top 100 enterprises in each country is balanced and relatively matched with the strength of the domestic automotive industry.

If counted by country, Japan holds 22 seats, the United States holds 18 seats, Germany holds 15 seats, China holds 13 seats, South Korea holds 11 seats, France holds 4 seats, Spain holds 3 seats, and other countries hold 1-2 seats among the top 100 companies on this list. The market size and industrial strength of the automotive industry in the host country are basically matched.

Comparing the national statistics of the top 100 global component companies from 2019 to 2023, we found that the situation of listed companies in various countries also follows this pattern. Japan, South Korea, Germany, and the United States have always been traditional powerhouses in the parts industry, maintaining their leading positions. The number of Chinese companies on the list has been increasing year by year, which is consistent with the trend of China gradually leading the global automotive industry's intelligent electric transformation.

3. New faces increase, multiple battery companies make the list

Thanks to the booming development of electric vehicles worldwide, battery manufacturers have continuously improved their rankings on the list, and this year is also the first time that multiple large electric vehicle battery manufacturers have been listed.

Among them, CATL ranks fifth on the list, with an expected global automotive revenue of approximately 33.5 billion US dollars in 2022, a year-on-year increase of 122.2%; Samsung SDI ranks 16th, with a global automotive revenue of approximately $15.62 billion in 2022, a year-on-year increase of 48.5%; SK On's ranking has risen significantly from 68th to 44th, with its global automotive business revenue of approximately 6.04 billion US dollars in 2022, a year-on-year increase of 125%.

Compared with the 2022 list, this year's list has a total of 11 new members, namely CATL, Anbofu, Samsung SDI, Ando, Junsheng Electronics, STMicroelectronics, Ningbo Huaxiang Electronics, Nifco, Jingcheng Engineering Automotive Systems Co., Ltd., Autokiniton, and Outo, among which 4 are Chinese companies. It is worth mentioning that last year, two subsidiaries of Junsheng Electronics, Junsheng Automotive Safety Systems and Preh GmbH, ranked 44th and 92nd respectively on the list. This year, they were integrated into Junsheng Electronics and ranked 40th on the list.

2、 The strong rise of China's component industry

It is gratifying that from the 2023 Global Top 100 Parts list, we can see that Chinese parts companies are rising strongly and rapidly moving towards the direction of growing from large to strong.

From the number of companies on the list, the number of Chinese companies on the list has been increasing year by year.

In the 2023 Global Parts Top 100 list, there are a total of 13 Chinese companies on the list, which is 3 more than the 2022 list. This is also the ranking with the highest number of Chinese companies on the list in history. In addition, CATL was included in the selection for the first time and directly entered the top five, becoming the only power battery company to make it to the top ten.

From a horizontal comparison, the proportion of seats held by Chinese component companies in the top 100 rankings is gradually increasing.

In the 2023 list, Japan, the United States, and Germany ranked fourth among China's top 100 countries, surpassing countries such as South Korea, France, and Spain. There are still many user comments that Chinese component suppliers such as Weichai Group, Yuchai Group, Fuyao Glass, and Wanxiang Group, which are more concerned about, are not on the list. It is likely that the companies did not provide data, but based on their 2022 revenue data, they are fully capable of entering the top 100 list. This also indicates that the number of seats in the top 100 Chinese component companies is currently sufficient to compete with countries such as Japan, South Korea, Germany, and the United States.

More importantly, the value of Chinese component companies on the list is increasing.

Taking Ningde Times as an example, it was first included in the selection list in 2023 and achieved a good result of fifth place. Meanwhile, from the perspective of business scope, CATL, which specializes in power battery business, is a typical enterprise in the era of new energy vehicles.

In addition, Junsheng Group, ranked 40th on the list, has developed rapidly in research and manufacturing businesses such as intelligent cockpit, intelligent networking, intelligent driving, new energy management, and automotive safety.

In addition, although Jinggong Automobile, a subsidiary of Great Wall Motors, is listed for the first time, it has obvious advantages in core components such as intelligent suspension system, intelligent braking system, white body system, intelligent equipment system, and lightweight magnesium aluminum die-casting. With its product and global layout advantages, it has now entered the supplier list of several international automotive companies.

Overall, Chinese component companies have gradually found a suitable development direction under the trend of electrification and intelligence, no longer just following, but starting to carry out more innovative research and development, entering a new era of high-quality development.

3、 Suggestions for the Future Direction of China's Parts Industry

1. The number of top suppliers needs to be increased

Looking at the 2023 Global Top 100 Parts list, although China has made significant progress in industrial competition, it has also discovered many problems. From the list, although we have representative companies like CATL, this one alone has no other branches. In addition, there are only 2 companies ranked in the top 20, accounting for only 10% of the seats. That is to say, the number of top component suppliers in China is still too small.

The sales and ownership of the entire vehicle market determine the market demand for automotive components. According to the degree of specialization, the output value of automotive parts accounts for about 50% -70% of the total output value of the vehicle. We also hope to grow a group of new top suppliers in the era of intelligent electrification, accompanied by the development of China's new automobile industry.

2. The new automotive parts industry still needs to be strengthened

From the classification of listed component companies, Chinese enterprises are still concentrated in traditional business areas such as automotive interior and automotive electronics. At present, apart from representative enterprises such as CATL, there are not many companies that specialize in the core components of new energy vehicles' "three electric" systems. In addition, the rapid development of intelligent connected vehicles will inevitably bring about a large demand for incremental technological components, including sensor components such as cameras, millimeter wave radars, and laser radars, as well as a significant increase in demand for automotive electronic components such as display panels and chips. Chinese component companies should be able to explore even greater market space in these areas.

3. Domestic component companies need to upgrade to high-end manufacturing industry

There are numerous automobile parts enterprises in China, but their scale is generally small, research and development investment is low, and their products are mostly concentrated in the field of low - and medium value-added parts, which is a long-standing problem in the industry. In the context of overall industrial transformation, we should seize the window period for the upward development of Chinese brands, closely follow the industry's development trends, continuously transform and upgrade towards high-end manufacturing, and gradually develop towards the field of high value-added components. Only in this way can we maintain sufficient competitiveness in the global automotive industry chain.

4. Actively participate in global market competition

Most of the companies on the top 100 list have already started their internationalization process, especially the top 20 companies, which have basically completed their global industrial layout. In contrast, the time and mode of Chinese enterprises going global are still in the exploratory stage. Coinciding with the golden period for Chinese car companies to go global, it is also the golden period for our Chinese industrial chain ecological enterprises to go global. We look forward to more excellent Chinese companies in the new era of great navigation, which can explore the world.

The automotive industry chain has never been a one-man show for car manufacturers, but requires the ecological development of the entire industry chain to truly grow and strengthen. In the decades of booming development of Chinese automobiles, the market has risen, but there has been constant controversy over whether China is a strong automobile country. Only when Chinese component companies themselves become bigger and stronger can we truly confidently say that China's automobile industry has come to the center of the world stage.