Strong car parts are strong cars. With the gradual liberalization of the country's after-sales system for automotive parts and components, capital seems to have smelled the enormous potential of this area. Throughout 2014, industrial investment funds have focused their attention on the auto parts industry.

In early December 2014, Chongqing Hi-tech Venture Capital Investment Co., Ltd. was established in the Liangjiang New District of Chongqing. According to reports, Chongqing is planning a 2,780-square-kilometer motor city. Chongqing will gradually improve its support, and it is expected that a reasonable mix of auto industries will be formed in 2017. For some time in the future, Liangjiang New Area will take new energy vehicles and smart cars as important directions and starting points.

In recent years, new changes in the automobile field, such as intelligence, car networking, and new energy vehicles, have brought better access to capital. According to Chen Shou, vice president of Hunan University, in the development of these new technologies, the power of individual companies is often very limited, and technological changes need to rely on multiple resources to advance together. Chen Shou believes that financial capital at this time will often become an important link to integrate various resources.

In July 2014, BYD announced that it had set up the Kedi New Energy Automotive Industry Investment Fund in Shenzhen Qianhai with a total capital of RMB 1 billion, focusing on the construction of charging pile facilities throughout the country. In the next three to five years, China Science and Technology Investment will implement the charging facilities layout for 88 new energy vehicle pilot cities approved by the State Council, and it will expand to more cities in the future.

It can be said that China's auto parts industry is plugging in the wings of capital. According to Wang Da, chairman of Chunhui Investment Management Co., Ltd., as a venture capitalist, they have been actively looking for overseas mergers and acquisitions for domestic auto parts and components companies that are in urgent need of transformation and upgrading. In 2013, Chunhui Investment helped domestic auto parts manufacturers to acquire 4 international parts companies and participate in joint investment. The combination of the automobile parts industry and financial capital is the only way for the second transformation of domestic auto parts companies, and the business opportunities contained in it are unlimited.

Chen Shou, vice president of Hunan University, believes that finance is a catalyst and multiplier. Only from the perspective of capital and trading platforms can the industry of auto parts and components develop better exponential amplification effects and even geometric series amplification effects.

Zhang Xin, executive director of the Guotai Junan Investment Banking M&A Financing Department, encourages auto parts companies to choose new three-tier platforms with lower barriers to entry and more convenient investment and financing.

According to statistics from the China Association of Automobile Manufacturers, the scale of China's auto parts for repairs reached 1.6 trillion yuan in 2014, and it has maintained a high growth rate of nearly 30% every year for nearly 10 years. At present, there are a total of 81 auto parts listed companies in the A-share market. The total operating income for the first three quarters of 2014 was 274.333 billion yuan. Since 2014, nine auto parts companies, such as Beit Technology and Peng Yu, have been listed on ipo.



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