e-works releases 2014 Top 10 Chinese manufacturing hotspots
Mar. 19, Beijing--2015 Chinese Digital Enterprise Portal e-works announced the successful conclusion of 2015 Chinese Industrialization and Information Integration Forum.
Cosponsored by China Association of Mechatronics Technology and Application, e-works has invited MIIT leaders, manufacturing experts, economists, manufacturing enterprises CEOs and CIOs, and consulting experts attended the forum. Together they discussed transformation and upgrading of Chinese manufacturing enterprises under the new normal and Premier Li's Chinese manufacturing 2025 planning. Professor Peigen Li, the fellow of Chinese Academy of Engineering interpreted the 2014 top 10 Chinese manufacturing hotspots.
2014 Top 10 Chinese manufacturing hotspots are as following:
1. Chinese manufacturing needs to rebuild competitive advantage urgently in the "new normal"
China has been mostly relied on factor-driven development in the past, especially the factor of demographic dividend and investment. Now Chinese economy is stepping into a "new normal" featuring a more advanced form, much complicated division of labor, and with a much reasonable structure. Shifting to the new driving factors is the guarantee of the new normal. We have to move from factor-driven and invest-driven model to innovation driven. Chinese manufacturing needs to adapt the "new normal" of Chinese economy urgently.
2. Industry 4.0 boosts intelligent manufacturing
It is no doubt that China has been a big manufacturing country for years. Now we are in a critical period of manufacturing transformation and upgrading as China is stepping to a great powerful of manufacturing. Industry 4.0 featuring intelligent manufacturing is the fourth industrial revolution. As Industry 4.0 is sweeping the whole country, intelligent manufacturing is sought after by manufacturing enterprises.
3. Chinese high-speed railway, model of re-innovation
Chinese high-speed rail has not only gotten great innovation achievements in key technologies but also built up world first class high-speed railway technology system with independent intellectual property rights. It has built up a successful Chinese model of technology import, digesting, and re-innovating, which is very important.
4. Manufacturing and internet enterprises interpenetrated with each other
One obvious phenomenon in manufacturing industry in 2014 is that manufacturing enterprises and internet companies interpenetrated with each other. For example, Xiaomi became a shareholder of Midea, Alibaba Group cooperated with SAIC, Baidu cooperated with BMW, Huawei signed strategic cooperation agreements with Dongfeng Automobile. Just in one year, so many internet companies and manufacturing enterprises took hand in hand. Will this kind of cooperation become a new trend? And what will this bring to us?
5. Xiaomi puts smiling curve into practice
Xiaomi started from scratch and in five years its market value reaches 5 million US dollars with 1 million US dollars of annual sales. Its quick success has been one of the most hottest topics in the industry. Xiaomi is a manufacturing enterprise with internet spirit. The secrets of its success are internet spirit and the theory of smiling curve.
6. Promoting servitization and building new growth points
In last two years, Chinese manufacturing cost was suddenly increased as the rise of labor cost and raw material price, appreciation of the RMB, and cuts of export tax rebates. Confronting with squeezed profits and sluggish economy, the only way out for Chinese manufacturing is driving transformation and promoting servitization. When we narrow the gap with international markets can we again make the world feel the power of Chinese manufacturing.
7. Booming robots is not the remedy for missing domestic core technology
It is estimated that China is going to have 300,000 robots in 2020. The output value of robots and system will reach about 100 billion RMB and will drive 30 billion RMB components and parts market. The huge potential of robots market makes manufacturers eager to have a go. However, there are many practical issues need to be addressed. For most manufacturers, the coming of robots era will be a hard journey.
8. The rise of manufacturing customization
In recent years, Chinese consumers are not satisfied with products designed only by manufacturers any more. They hope to express their idea through internet to make manufactures produce products meeting their needs. However, diversification of customer requirements definitely brings product diversity. In 2014, with the growing demand of customization, traditional mass production model has changed. Chinese manufacturing customization is in the making.
9. Kunshan accident to admonish overall security management again
Production safety accidents are frequently haunted with Chinese booming manufacturing. These deadly lessons make manufacturers focus on security management issues again. It needs government regulation as well as building prevention measures in manufacturing enterprises. Information technology is an indispensable part. Manufacturers care about how to utilize information technology to guide safety production.
10. BCG reports show that Chinese manufacturing cost advantage gone
One of the recent Boston Consulting Group (BCG) reports shows that as a low manufacturing cost country, China is losing its advantage. Mild wage growth, efficient production technology, low energy price and lower dollar exchange rate make nearly no difference of cost in producing some products in U.S. More and more American enterprises and other multinational companies will choose to start production in the U.S.
For Chinese version please click here.
Professor Peigen Li
2014 Top 10 Chinese manufacturing hotspots are as following:
1. Chinese manufacturing needs to rebuild competitive advantage urgently in the "new normal"
China has been mostly relied on factor-driven development in the past, especially the factor of demographic dividend and investment. Now Chinese economy is stepping into a "new normal" featuring a more advanced form, much complicated division of labor, and with a much reasonable structure. Shifting to the new driving factors is the guarantee of the new normal. We have to move from factor-driven and invest-driven model to innovation driven. Chinese manufacturing needs to adapt the "new normal" of Chinese economy urgently.
2. Industry 4.0 boosts intelligent manufacturing
It is no doubt that China has been a big manufacturing country for years. Now we are in a critical period of manufacturing transformation and upgrading as China is stepping to a great powerful of manufacturing. Industry 4.0 featuring intelligent manufacturing is the fourth industrial revolution. As Industry 4.0 is sweeping the whole country, intelligent manufacturing is sought after by manufacturing enterprises.
3. Chinese high-speed railway, model of re-innovation
Chinese high-speed rail has not only gotten great innovation achievements in key technologies but also built up world first class high-speed railway technology system with independent intellectual property rights. It has built up a successful Chinese model of technology import, digesting, and re-innovating, which is very important.
4. Manufacturing and internet enterprises interpenetrated with each other
One obvious phenomenon in manufacturing industry in 2014 is that manufacturing enterprises and internet companies interpenetrated with each other. For example, Xiaomi became a shareholder of Midea, Alibaba Group cooperated with SAIC, Baidu cooperated with BMW, Huawei signed strategic cooperation agreements with Dongfeng Automobile. Just in one year, so many internet companies and manufacturing enterprises took hand in hand. Will this kind of cooperation become a new trend? And what will this bring to us?
5. Xiaomi puts smiling curve into practice
Xiaomi started from scratch and in five years its market value reaches 5 million US dollars with 1 million US dollars of annual sales. Its quick success has been one of the most hottest topics in the industry. Xiaomi is a manufacturing enterprise with internet spirit. The secrets of its success are internet spirit and the theory of smiling curve.
6. Promoting servitization and building new growth points
In last two years, Chinese manufacturing cost was suddenly increased as the rise of labor cost and raw material price, appreciation of the RMB, and cuts of export tax rebates. Confronting with squeezed profits and sluggish economy, the only way out for Chinese manufacturing is driving transformation and promoting servitization. When we narrow the gap with international markets can we again make the world feel the power of Chinese manufacturing.
7. Booming robots is not the remedy for missing domestic core technology
It is estimated that China is going to have 300,000 robots in 2020. The output value of robots and system will reach about 100 billion RMB and will drive 30 billion RMB components and parts market. The huge potential of robots market makes manufacturers eager to have a go. However, there are many practical issues need to be addressed. For most manufacturers, the coming of robots era will be a hard journey.
8. The rise of manufacturing customization
In recent years, Chinese consumers are not satisfied with products designed only by manufacturers any more. They hope to express their idea through internet to make manufactures produce products meeting their needs. However, diversification of customer requirements definitely brings product diversity. In 2014, with the growing demand of customization, traditional mass production model has changed. Chinese manufacturing customization is in the making.
9. Kunshan accident to admonish overall security management again
Production safety accidents are frequently haunted with Chinese booming manufacturing. These deadly lessons make manufacturers focus on security management issues again. It needs government regulation as well as building prevention measures in manufacturing enterprises. Information technology is an indispensable part. Manufacturers care about how to utilize information technology to guide safety production.
10. BCG reports show that Chinese manufacturing cost advantage gone
One of the recent Boston Consulting Group (BCG) reports shows that as a low manufacturing cost country, China is losing its advantage. Mild wage growth, efficient production technology, low energy price and lower dollar exchange rate make nearly no difference of cost in producing some products in U.S. More and more American enterprises and other multinational companies will choose to start production in the U.S.
For Chinese version please click here.
