He Guangyuan: treat state-owned and private

　　【Editor’s Note】 On July 15, China's auto industry has passed 57 years, and the seventh Changchun International Auto Show grandly opened on this day. Meanwhile, annual meeting of China Automotive Association of Engineering was held grandly. As high level and comprehensive academic exchange activity in China, China Automotive Association of Engineering has become an important platform of academic exchange for China's auto industry and relevant industries. After many years of careful cultivation, it has been an international academic exchange event. Following is the record of Sohu Auto's interview of He Guangyuan, former minister of Ministry of Machinery Industry.

　　Minister He said that the biggest weakness of China's auto industry lies in core auto parts& components, and he visited a number of private auto parts &components enterprises in order to call for various sides giving more help for these enterprises.

　　Moderator: I am concerned that you and some experts as well as leaders of China’s auto industry recently visited a number of private auto parts& component enterprises. Combining development level of China automotive technology currently, if it can be understood - now distance between entire vehicle manufacturing in China and international entire vehicle manufacturing is being narrowed constantly, however, in terms of development of auto parts &components enterprises, especially core technology involve auto parts &components, China still lags behind obviously.

　　He Guangyuan: I agree with you on this point of view very much. To sum up, auto parts &components is the weakness for China’s auto industry, especially the key auto parts& components, the gap is even greater. Although there are many manufacturers in China, their strength is not strong and lack of core technologies. As a result, they can only rely on resemblance, and we must pay great attention to this field in the future.

　　Chinese government should support the development of China’s auto parts industry as soon as possible, particularly critical core technologies, such as automatic transmission, automotive electronics, because the proportion of electronics of the car is increasing. For example, engine emission standards are getting higher and higher now. The engine should reduce fuel consumption and emissions, including exhaust gas treatment equipment and so on. China must solve the key technical problems of these core components.

　　I was anxious to go to Liaoyang where a private entrepreneur developed a diesel engine's high pressure common rail system. This private enterprise took up civil engineering and building roads so that made a lot of money and have a certain economic strength. He thought doing something for society's most urgent need in our country. He is an old farmer and is very great.

　　You know, high pressure common rail technology now largely monopolized by other countries’ enterprises. One is Bosch and another is Denso in Japan with some in the United States. However, main manufacturers of high pressure common rail technology are Bosch and Denso, and price of their products are surprisingly expensive, and you must let him give you complete set. Not only the price of common rail system is high but also they want to give you complete set and have to calibrate to do matching experiments. You must pay the cost of matching experiment, and the price can be 8 million even 10 million. You must pay it first and they can do matching experiment for you. After the experiment they can sell it to you, and the price is still high. Chinese enterprises suffer great here.

　　However, this private entrepreneur in Liaoyang has managed to master this technology and began doing a small volume matching. Now his company has been doing matching for Chaoyang Diesel Engine Plant. He said, I am doing matching experiment for you now, and you are My God, so my product must meet your requirements. I can not take your money, as a result, he not only takes no money, but the price is low.

　　Now they are also doing matching experiment for Great Wall Automobile in Baoding. He said the Great Wall now is using equipment of Bosch, and if the matching test is successful it will be replaced by Liaoyang's. The first phase production capacity is 50,000 and the second phase is 400,000, which is hugely expensive and 1.8 billion has been spent. A private entrepreneur can take such a big risk, so he is admired.

　　Moderator: Do you think the future of auto parts enterprises lies on these private enterprises?

　　He Guangyuan: I hope that Chinese government does not have any bias on this issue, and to support private, state-owned enterprises equally. (Translator: Qinghua Wade)

　　See original Chinese report Please click:

　　http://auto.sohu.com/20100715/n273529460.shtml