Intensifying Geopolitical Impact Makes Regional Supply Chain Layout the New Normal
Category: Company News
The COVID-19 pandemic and international trade frictions have made the global automotive industry acutely aware of the risks of over-concentrated supply chains. Driven by national strategies to ensure industrial chain security, the layout of the automotive parts supply chain is shifting from globalization to regionalization.
Strategies like "In China, for China" and "In North America, for North America" are being widely adopted by major parts giants. Companies like Continental and Denso have announced the establishment of new R&D centers and production bases in major consumer markets, aiming to shorten supply chain distances, reduce reliance on long-distance sea freight, and circumvent potential tariff barriers.
Although this regionalization layout may increase investment costs in the short term, it enhances the supply chain's ability to respond to regional risks in the long run. For local parts companies, this presents both opportunities and challenges. The opportunity lies in the potential for deeper integration into local OEMs' supply chains. The challenge is facing direct competition from international giants in the local market, requiring stronger competitiveness in technology, cost, and responsiveness.
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Guangzhou Xinkangrui Electronic Technology Co., Ltd.
No. 17, Building 7, Changmatou Auto Parts City, Qiaokou District, Wuhan City, Hubei Province
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