Anhui Mingyao Machinery & Equipment Application Technology Co., Ltd.
According to the latest forecast by the China Association of Automobile Manufacturers, by... By the end of 2012, China's automobile production and sales are expected to surpass 20 million vehicles. The key phrases related to automobiles in the "2012 Government Work Report" are: "control the increase in volume, promote restructuring, emphasize energy conservation, and drive upgrading." China has a very clear vision and direction for the development of the automotive industry: "enhance industrial concentration, encourage mergers and acquisitions, promote industrial structure upgrading, and accelerate the development of new-energy vehicles." Clearly, the automotive industry is steadily advancing toward the macroeconomic regulatory targets set by the state. Currently, China has more than 150 vehicle manufacturers, including SAIC, FAW, Dongfeng, Changan, BAIC, Chery, Geely, Lifan, and BYD. During the 12th Five-Year Plan period, the development of complete vehicles far outpaced that of automotive fasteners. The coming period will thus be a phase of rapid growth for automotive fasteners—a golden opportunity to expand fastener production.

　　Statistics show that the number of Chinese automotive fastener companies included in the statistical scope currently stands at... There are over 100 enterprises, broadly categorized into two types: one comprises large-scale fastener companies with substantial operations, each equipped with dedicated departments responsible for manufacturing; the other consists of specialized enterprises that focus exclusively on non-standard automotive fasteners. With the rapid growth in overall demand, the latter type has been developing rapidly in China. Due to the relatively high value-added nature of these products, this segment has become one of the most fiercely competitive areas. Among them, there are more than 20 joint-venture enterprises, with a total workforce of approximately 65,000 and total assets amounting to roughly 12 billion yuan.

　　Some joint-venture and wholly-owned automotive enterprises possess strong financial and technological advantages in most of the key markets for non-standard automotive fasteners, and have established numerous automotive fastener technology centers and R&D institutions across China. State-owned and privately-owned automotive fastener companies, leveraging their cost-competitive edge, have secured a foothold in certain segments of non-standard engine fasteners as well as in most standard-component markets. By closely emulating foreign products and actively absorbing and assimilating advanced technologies, these companies have developed the capability to supply components tailored to the domestic market. However, they still lack independent R&D capabilities for high-tech, non-standard engine fasteners and remain poised for breakthrough progress. From low-strength fasteners ranging from Grade 4.8 to Grade 6.8, or high-strength fasteners ranging from Grade 8.8 to Grade 12.9, it can be summarized that the market is dominated by lower-grade products, lacking value-added services along the value chain, and the core technologies of these products exhibit a clear externally driven nature.

　　It is worth noting that insufficient attention to the automotive fastener industry was a factor in China’s accession to the WTO. One of the shortcomings left by the development of China’s automotive industry over the past 10 years is that the development of automotive fasteners has lagged behind the overall development of the automotive industry, making this a major weak point for China’s automotive sector. The current state of China’s automotive fastener industry is as follows:

　　First, automotive fastener companies have weak independent innovation capabilities. Most of them simply imitate foreign products, lacking original research outcomes and brands and products with independent intellectual property rights. They also lack an effective system for technological innovation, with R&D efforts largely confined to internal company operations and small-scale collaborations with partner firms—making it difficult to translate these achievements into industrial-scale production. The fundamental technological research on automotive fastener materials is remarkably weak. There are no dedicated steel grades for non-standard fasteners, making it difficult to achieve economies of scale with small-batch production. Moreover, material technical standards are inconsistent, and basic technical data as well as industry statistical data are scarce.

　　Second, automotive fastener companies lag behind the development of China’s automotive industry. For instance, fastener companies affiliated with automakers such as FAW and Dongfeng Motor are wholly dependent on the OEMs’ R&D capabilities and their pace of product upgrades and replacements, resulting in a complete reliance of fastener R&D and production on the OEMs’ own R&D capacity and technological advancements. Meanwhile, some sizable private automotive fastener companies find themselves in a delicate “marginalized” position within the broader automotive production supply chain. During this challenging survival phase—when R&D efforts are fraught with difficulties or even stalled—they must continuously accumulate technology and experience while paving the way for the future development of the automotive industry.

　　Third, equipment and testing standards are lagging behind. As the automotive fastener industry continues to develop, fasteners are placing increasingly higher demands on both equipment and testing capabilities. With regard to equipment and testing, most Chinese automotive fastener companies—except for a few joint-venture enterprises that possess relatively strong capabilities—face significant shortcomings. Overall, both the equipment and testing infrastructure remain relatively backward, and the skill levels of testing personnel are also not high. For some automotive fastener companies, the need for specialized processing equipment, coupled with a large array of related testing devices, inadvertently lays a solid foundation for enhancing product value.

　　In particular, the inconsistent reliability of quality represents a significant shortcoming for the automotive industry, which relies heavily on automated assembly. As for automotive fasteners... The gradual implementation of “zero-defect” requirements has led automakers to place increasingly stringent demands on the quality of automotive fasteners—for instance, they now require defect rates to be controlled within the range of 60 to 90 parts per million (PPm). Achieving this level is extremely challenging. Even at a very strict standard, where human inspectors carefully select components to keep defect rates at 150 to 200 PPm, the results are already considered quite impressive. In reality, ensuring high-quality automotive fasteners involves an integrated system that encompasses materials, equipment, processes, and testing—rather than simply relying on manual removal of defective items. The development of fully automated eddy-current inspection machines and various types of sensors capable of automatically detecting and classifying defects and cracks represents a significant step toward achieving the ultimate goal of “zero defects.” However, these advanced technologies come with substantial investment costs, and widespread adoption will take time. It’s likely that such solutions will see significant progress over the next three to five years.

　　Fourth, there is a significant gap between China’s current capabilities in securing resources such as materials and logistics and the world’s advanced standards. Today, some of the world’s leading large-scale automotive fastener manufacturers have their own specialized materials and proprietary technologies. In manufacturing powerhouses like the United States and Japan, automotive fastener companies have achieved large-scale, automated, and digitalized production. They have matured in CNC technology, network technology, and digital control technology, sharing these across all stages—from design to production—and have reached a high level of informationization in production management. As for China’s automotive fastener enterprises, there is still room for development and improvement in terms of ensuring adequate supplies of materials and logistics.

　　Problems in China's Automotive Fastener Industry

　　Looking at the promising prospects for the development of China’s automotive fastener industry, overall, the current state of China’s automotive fastener industry still falls short of adequately meeting the needs of China’s automotive industry and continues to face a series of significant issues that remain to be addressed. Although demand is substantial, the market is dominated by mid- and low-end standard products, while high-end and specialized products are relatively scarce and of uneven quality. Moreover, service and operational support remain inadequate.

(1) There is a shortage of high-end, specialized fasteners. Although standard fasteners—used extensively in automobile manufacturing—generally prevail and are often in oversupply, the development of specialized fasteners—such as those designed to prevent loosening, facilitate easy installation, enhance assembly efficiency, and improve vehicle safety—is relatively slow. These specialized products often require the development of unique technologies and equipment, or even entirely new technologies and equipment—for example, automatic glue application, automated assembly or combination of washers, and continuous supply systems. Fortunately, in recent years, such technologies have made significant progress, enabling faster and more efficient responses to the evolving needs of automobile manufacturing.

(2) There is a shortage of high-end products. Non-standard fasteners are critical components for automotive connections. From a technical standpoint, Chinese fastener companies all have the capability to supply such products; however, for various reasons, the domestic production rate of these products remains less than encouraging. With the exception of automobiles originally designed in China, for vehicles that have adopted imported technologies, the supply of non-standard fasteners still largely relies on imports. The low domestic production rate of non-standard fasteners stems not only from intellectual property rights and monopolistic profit-seeking practices by foreign companies, but also from insufficient confidence in Chinese products among those who control procurement decisions. Moreover, the technological and managerial gaps between Chinese fastener companies and their international counterparts are also major contributing factors. To ensure the healthy development of the entire automotive industry and reduce excessive dependence on foreign suppliers, automotive fastener companies must focus on strengthening their internal capabilities.

(3) Insufficient service support. As fasteners supplied to meet general market demand, companies have relatively relaxed requirements regarding delivery deadlines, related technical support, and services. However, in the automotive industry—characterized by high-speed, automated mass production and stringent cost control—rapid, timely, and convenient supply, even “zero inventory,” have become essential prerequisites for China’s automotive industry. To meet these demands, Chinese fastener enterprises face increasingly severe challenges in terms of technology and product quality. Moreover, during this period of rapid growth, both in terms of material resources and human capital, fastener technology (including product standards and selection, performance characteristics, production-line assembly, failure analysis, etc.) remains insufficiently widespread. Consequently, collaboration, coordination, and service provision among enterprises have become particularly critical. Currently, automotive fastener companies have begun to develop and explore various service models—from providing individual fastener sets to offering mechanical fastening solutions, customized services, and remote monitoring. In the future, the proportion of revenue generated by services within automotive fastener manufacturers will gradually increase.