- Published on Wednesday, 19 December 2012 16:57
The first installment in this three-part series presents the advantages of sourcing from Guangdong.
Strong electronics and car industries, a robust supply chain and an efficient transportation network bolster Guangdong province’s car DVD player sector. The area continues to be China’s largest hub for this line, accounting for 70 and 60 percent of the country’s total output and exports.
Makers in Guangdong tap into the province’s thriving electronics market, which is the biggest nationwide at 41 percent of aggregate shipments, to nurture the in-vehicle DVD player segment. The area’s overseas deliveries of electronics products from January to May 2012 reached $107.1 billion for a nearly 4 percent YoY increase, according to the Ministry of Industry and Information Technology. These covered consumer and automotive electronics, telecom devices, computers, electronic components and home appliances. Exports from other provinces declined during the same period.
China’s car manufacturing sector, meanwhile, acts as a ready market for automotive DVD players. Guangdong-based makers of the latter serve both local and international brands, encouraging businesses to keep improving product quality. Coagent Electronics S&T Co. Ltd, for example, supplies to Honda, Peugeot and Mitsubishi.
Guangdong’s mature upstream network for car DVD players facilitates easy access to raw materials and components, which fast-tracks R&D and manufacture, and helps keep costs low. The cities of Shenzhen, Huizhou, Dongguan and Zhongshan are abundant in plastic, metal sheet, PCBs, LCD panels and other requirement. Xiaolan in Zhongshan is a major hub for SPCC, SECC and other metal for housing. Foryou, a key source of DVD loaders, is based in Huizhou.
Service providers for mold making and other processes are likewise easily found within the province. This enables businesses to subcontract procedures to manage manufacture and costs better or concentrate on development initiatives instead of pursuing vertical integration.
Guangdong’s transportation network helps speed up the sourcing of manufacturing inputs and delivery of finished products. Plans are afoot to expand the system by 2020, with one objective being to connect the main export ports.
The local government hopes to complete the construction of 113km of railway linking Shenzhen and Huizhou in the next 10 years. Work on the Loop Pearl River Delta highway, the bridge connecting Hong Kong, Zhuhai and Macau, and the express rail link for Guangzhou, Shenzhen and Hong Kong is under way.
As small and midsize companies dominate the supplier base in Guangdong, the local government is undertaking initiatives to support the industry. It will give subsidies to qualifying manufacturers and lower employers’ mandatory contribution for personnel’s basic retirement, health and injury insurance.
Further, the construction of bonded port zones such as the Shenzhen Qianhaiwan Bonded Port Area, Guangzhou Huangpu International Logistics Park and Zhuhai Gaolan Bonded Port Zone will provide makers with additional preferential policies when exporting.
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Note: This article "Support infrastructure spurs Guangdong hub for car DVD players" was originally published by Global Sources, a leading business-to-business media company and a primary facilitator of trade with China manufacturers and India suppliers, providing essential sourcing information to volume buyers through e-magazines and trade shows
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