Shiyan Miaoyu Import & Ex

Three focuses on the commercial vehicle industry market

1, Bargaining power of the Supplier 

    With the intensification of competition in the commercial vehicle industry , the profit of commercial product is more and more thin. At the same time, product cost controlling had become the essential rules of enterprise survival. However, the most important job of product cost controlling is to depress the purchasing cost of the raw material. The price competition between the supplier and the commercial vehicle production enterprises is also very fierce, the outcome of this competition depends on the strength of the supplier and production enterprises. Generally speaking, if the vehicle brand is better and more sales, then it can have a relatively greater pricing power; In turn, if the strength of suppliers is more powerful, product technology content is higher, the market share is bigger, then it will be dominant in price competition.
    Because the high-grade commercial vehicles are basically the product of foreign joint venture in China, the brand also is introduced from abroad, so the foreign parent company also become its suppliers inevitably. In this case, the bargaining power of producers become very weak, some foreign companies use the inequality relations between supply and demand to transfer price and eat the interests of the joint venture. From this perspective, some medium and low commercial vehicle enterprises in domestic have a relatively strong bargaining power.


2, Competitive strategy analysis for commercial vehicle products 

    Commercial vehicle really need to improve the level of technology in our country. But China is a developing country, not a higher technology is more effective. Joint venture enterprise doesn’t have to bring their most high-grade technology, it must combine with characteristics of China’s market, improve the technology of the existing brand vehicle and maintain an appropriate price, only then do the enterprise have the market competitiveness. Unsuccessful joint ventures often desperately engaged in technology transfer, spent a lot of cost and naturally must raise the price, so the outcome was that they lost the market.

3, Expectation of competition pattern for commercial vehicle industry 

     In some cooperation projects which is operated by Sino foreign joint venture, the cooperation model also undergo significant changes, that is from using foreign brands and producing foreign models to running Chinese brands jointly and entering the international market together. This kind of change is based on the current situation of China's commercial vehicle market, China's commercial vehicle market has distinctive demand characteristic and unique product structure, so foreign truck products are not suitable for the Chinese market at the present stage. On the other hand, in this round of joint venture cooperation, the foreign strategy is more flexible than before, but the China's right to speak is gradually enhanced.