According to a recent report by the Nikkei News, based on the current US-China trade war, the United States is also considering the imposition of tariffs on imported cars and auto parts. Japanese companies are beginning to withdraw their supply chains in China.
Asahi Kasei, a Japanese chemical company, plans to move its Chinese plant that manufactures auto parts back to Japan because its products are listed on the US tariff list.
At the same time, Komatsu, the world's second-largest heavy chemical product manufacturing company, will use hydraulics in the US, Japan and Mexico to produce hydraulic excavator parts, which are currently manufactured in China. Changing the production plan will make Komatsu a huge extra expense each year.
Iris Ohyama plans to transfer the production of air cleaners, electric fans and other electrical appliances sold in the US market from China to a new factory in South Korea, and plans to complete it next year. The above products have not been included in the US for China. Tariff list, but the company is taking steps to prevent risk.
In addition, as early as the 23rd, Suzuki Motor Co., which is also a car company, has reached an agreement with Changan Automobile to cancel the joint venture agreement. Suzuki sold its shares in the joint venture company to Changan Automobile, and it is expected that the sale will be completed within this year.
However, the exit of Suzuki Motor was not caused by the US trade war with China, but the gradual reduction of the demand for small cars in the Chinese market. The market causes the divested enterprises to include the digitalization due to the popularity of smartphones. The market for cameras has shrunk, and the aging of equipment has affected the Japanese Olympus camera in Shenzhen, China. The digital camera production workshop stopped operating in May.
Omron (China) Co., Ltd. has also severely impacted the liquid crystal market due to the surge in sales of OLED screens, resulting in a decline in sales of its main LCD backlights, which necessitated the dissolution of Suzhou Precision Electronics Co., Ltd.
Sino-US trade war makes foreign investment 'run' faster
The withdrawal of Japanese-funded enterprises reflects the fluctuation of the raw material market in the Sino-US trade war, especially in the steel, chemical, and rubber plastics markets. In addition, in the import and export finished products market, mechanical products and chemicals are also restricted. The producer has to make adjustments, including the adjustment of the proportion of the joint venture to its own investment.
Asahi Kasei is an example: As the world's largest supplier of lithium battery separators, one of the world's top 500 companies and one of Japan's largest integrated groups, Asahi Kasei has invested heavily in China for nearly a decade, covering electronic materials, textiles, Chemicals, building materials, microelectronics, pharmaceuticals, medical and other fields. At present, Asahi Kasei has about 35,000 employees worldwide, and Chinese employees account for 10% of the total number of employees. If Asahi Kasei decides to move the factory back to Japan, it will make a few Thousands of Chinese employees were affected.
Another point is that foreign-invested and Sino-foreign joint ventures, including Japanese-funded enterprises, can no longer retain the original set of advantages and dividends in the Chinese market, including cheap human resources, market-oriented products and government preferential support, etc. Chinese local brands are no worse than foreign companies, especially in the field of electronic products.
The withdrawal of foreign capital cannot allow Chinese manufacturing to sit still
The withdrawal of foreign capital is a kind of protection for itself. What impact will it have on China's plastics chemical industry? Some analysts believe that China's manufacturing industry, such as the plastics chemical industry, will show its strong side because of the withdrawal of foreign capital. Especially after the market and human dividends disappeared, 'why should be made in China' will be the focus of discussion.
In response, the Ministry of Commerce has responded that foreign investment will help China's economic restructuring, innovative, high-quality foreign investment will be the focus of China's introduction into the future. This is in line with Zhao Jungui, vice president and secretary general of China Petroleum and Chemical Industry Association. In the '2018 (11th) China Plastics Industry Conference's speech coincides.
Zhao Jungui emphasized in his speech that the current investment growth in the whole industry is weak, and it has been declining for three consecutive years. In the short term, the investment growth trend of the chemical industry is difficult to change. The contradiction of the petrochemical industry still exists, and the high-end and differentiated products have a large gap.
It is necessary to strengthen the transformation and upgrading of the traditional petrochemical industry, focus on global development, and accelerate the construction of a petrochemical industrial system with Chinese characteristics. That is to say, the plastics industry itself seeks development and innovation, in order to avoid the harm caused by the foreign capital after the big move, China Manufacturing can develop steadily.