The import tariff reduction of auto parts is limited

After tax reduction, the MFN rate of all auto parts in China is 6%. In response to the tariff reduction of auto parts, a number of listed companies responded to the investor relations interactive platform. Wolong Electric said the decline in import car tariffs had no obvious effect on the company's performance. The technology of precision forging indicates that at present, the company's products exceed 20% export, indicating that the products of the company have strong competitiveness, and the relevant tax rate policy has little effect.

BOC said that the tax rate was unified to 6%, and the cost of imports of most components is expected to be reduced by 3.6%. In 2017, China's main imports of automotive components include gearboxes and their components, engine parts, automotive lighting and signal devices, automotive electronics, etc.

The reporter learned from many listed companies involved in gearboxes, engine parts and automotive electronics businesses that the impact of tariff reduction on business is not obvious.

Car analysts, a medium-sized brokerage, said the tariff reduction had little impact on domestic spare parts, because most of the auto parts were domestically made and only a few of the key parts were imported. Domestic production of automotive parts in the middle end, imported automobile parts to high-end, mainly belong to different categories of competition.

According to the data of the China Commercial Research Institute, the total total import of auto parts in China was about 37 billion US dollars in 2017, and the total cost of the imported spare parts accounted for about 9% of the average material cost of the vehicle, that is, about 91% of the domestic vehicle components made in China.

CICC believes that, for most parts, a decline in tariff rates can not make up for the increase in freight and insurance costs, so it still does not have the import economy. The vehicle manufacturers will try to set up factories nearby as far as possible. The imported parts will elongate the supply cycle, and there is a risk of affecting the production schedule.