Automobile & Parts

 

1. Introduction to the Project
1.1 Project Background
1.1.1 Product introduction
The project mainly produces some autombile parts such as machine tools, metal plates, engines, hydraulic systems, bearings and seats, etc.
1.1.2 Market prospect
Automobile components and parts production enterprises form into professional components and parts group after separating from finished automobile enterprises, which is becoming a global trend. Most of the international famous automobile and components and parts enterprises have established joint venture or sole proprietorship enterprises in China. Over 1,000 technical joint ventures have been introduced. A batch of domestic automobile components and parts enterprises with high technological content, good profits and large scale are gradually growing up. As the international automobile industry begins implementing “global purchase” strategy for components and parts and international transnational automobile enterprises carry out localization strategy, domestic market will appear enormous gap in automobile components and parts.
Since 2000, the proportion of Chinese components and parts industry in the whole automobile industry has increased year by year. In 20 1 5, domestic automobile components and parts industry accomplished total industrial output value 420 billion yuan, accounting for 3 6 % of whole automobile's total industrial output value. With respect to constant fall of profits in finished automobile industry, the components and parts industry has kept the profit margin higher than average level of automobile industry. In 20 1 5, the profit margin of Chinese automobile industry is 6. 5%, but that of components and parts industry is 7 %. Period of the Eleventh Five-Year Plan will be the golden period of development for Chinese automobile components and parts industry. According to the prediction of CAAM, domestic automobile production output and inventory will increase by a large margin during the “12th Five-Year Plan’ , the demand for components and parts will double at that time, domestic production value of automobile components and parts will reach around 10 00 billion yuan.
China's automobile components and parts industry is staying in a strategic opportunity period that participates in international competition for becoming the international purchase center of automobile components and parts. On the one hand, the world is facing a new round of transfer of automobile industry, China is the key area for these automobile developed countries to perform industrial transfer; on the other hand, some automobile newly emerged countries are seeking for the cooperation with respect to automobile components and parts. These provide us good opportunity for fully utilizing the foundation of automobile industry has formed in Jilin Province, forming a batch of automobile components and parts backbone enterprises and famous-brand products with actual strength as soon as possible to meet the demand of international market.
1.1.3 Technical analysis
The technology of the project is planned to be determined according to the technical route choice of the local matching enterprise. The production technology of the products of the project is mature and the equipment and production line can be domestically purchased.
Ningjiang District is a burgeoning petrochemical city on Songnen Plain, having abundant resources, convenient traffic, favorable geographical location, complete infrastructure, high-level living standard and comfortable and preferential environment for government affairs, providing good opportunity and reliable guarantee for the development of automobile supporting industry.
1.1. 4 Advantageous conditions of project construction
 (1) Location advantages
Developing automobile supporting industry should consider traffic, land, water, electricity, energy and other issues, Ningjiang District has certain advantages in these aspects. Ningjiang District is located in the conjunction part of Jilin Province, Heilongjiang Province and Inner Mongolia, middle of Changchun-Harbin Economic Belt, both one of middle city groups of Jilin Province and the neighbor of Heilongjiang Harbin-Daqing-Qiqihar Economic Corridor. As far as location, if taking Songyuan as center, drawing a circle with 200km as radius, Songyuan has become the important traffic hub and logistics center integrates 8 cites and 14 counties of three provinces in northeast and the Inner Mongolia Autonomous Region, radiates a population of over 31 million. Ningjiang is situated within the rational transport radius of Changchun FAW, Hafei automobile Group, Daqing Oilfield, Jilin Oilfield and other national large-scale enterprise groups, having location advantages with particularly favorable natural conditions in developing automobile accessories. On the basis of the existing automobile sales, vehicle maintenance and repair market, Ningjiang seeks for cooperation with the major factory - Changchun FAW capable of finished automobile production to develop and construct automobile components and parts production enterprises, both the business opportunity and prospect are very attractive.
(2) Resource advantages
The place where the project is located has plentiful water resource, sufficient electricity resource, it has three large rivers, one small river and one lake, water flow transits the border over 40 billion cubic meters. The city has water resource reserve 1.557 billion cubic meters, able to meet the demand of various high consumption water industries; the city has thermal power installation capacity 900,000KW, the 1.2 million KW thermal power unit under capacity expansion by Datang Changshan Thermal Power Plant will enable thermal power installation capacity of the city to reach 2.1 million KW; in addition, land resource is abundant, compared with other cities, the price advantage is distinct. Limit of construction project land transferring fee is collected based on the most preferential policy, one discussion for one matter; in the aspect of human resources, in addition to ensure the enterprise to have ordinary labor force, the established Songyuan Vocational and Technical College has annual recruitment of 4,000 students, providing strong support for the demand for senior management personnel and senior technical workers of the enterprises, and there are also Sunjin Technical College, Yuancheng Vocational Technical College and a batch of technical secondary schools. Ningjiang has signed Framework Agreement of Talents and Scientific and Technological Cooperation with Beijing Branch Institute, Shenyang Branch Institute and Changchun Branch Institute of Chinese Academy of Sciences, sparing no effort to provide talent and scientific and technological support for the development of enterprises.
(3) Traffic advantages
In the district where the project is lcoated, there are 5 railways and 6 national and provincial artery roads crossing through, it takes only 120 minutes to get Changchun Airport or Harbin Airport from the downtown. Water transport conditions of Songyuan is also richly endowed by nature, walking upward along the Songhua River can reach Jilin City, going downstream can pass Harbin City, Jiamusi City, crossing Heilongjiang and entering the Sea of Japan. Songyuan Bridge, Songyuan-Zhaoyuan Expressway, Songyuan Section of Daqing-Guangzhou Expressway has been under full construction. Projects of Songyuan-Taolaizhao Cross-River Railway and Songyuan Airport Construction are being boosted vigorously. All these projects have provided excellent traffic transport conditions for project construction.
(4) Policy advantages
Ningjiang District where the project is located has the advantageous and easy investment environment. The Party committee and government of the district insist in the principles of “businessmen, local economy and common citizens” making profits, devote to the control of the investment environment, make efforts to create the social atmosphere of favoring, comforting, supporting and enriching the businessmen and continuously optimize the investment environment. The Party committee and government of the district have successively promulgated a series of preferential policies such as Preferential Policies on Inviting Businessmen to Open Companies and Capital Attraction of Ningjiang District, Songyuan City and Rewarding Measures of Inviting Businessmen to Open Companies and Capital Attraction of Ningjiang District, Songyuan City, etc. In addition, the “one-station” good-quality, warm-hearted and considerate services are provided in the inviting businessmen to open companies, capital attraction and handling certificates for the investors. More preferential policies are given and the more comprehensive good-quality services are provided for the major investment projects and the projects greatly promoting the industrial development according to the principle of “discussion on one item of the major project”.
1.2 Content of Project Construction and Scale of Production
1.2.1 Content of Project Construction
It mainly produces 0.1 million sets of automobile tools, metal plates, engines, hydraulic systems, bearings, seats and other automobile components and parts.
1.2.2 Scale of Production
Construct the production line with annual production capacity 100,000 sets of automobile tools, metal plates, engines, hydraulic systems, bearings, seats and other automobile components and parts, mainly construct production workshops, warehouses, offices, dormitories and other buildings.
1. 3 Total Investment of the Project and Funds Raising
1. 3 .1 Total Investment of the Project
Total investment is 300 million yuan, including fixed assets investment 200 million yuan, circulating capital 100 million yuan.
Table 1: Summary Table of Total Investment of the Project   Unit: RMB10,000
No.
Expense Name
Amount of Investment
Proportion of Total Investment %
Remarks
1
Construction investment
20000
66.7
 
2
Interest incurred during construction
 
 
Not temporarily considered
3
Circulating capital
10000
33.3
 
 
Total Investment of the Project (1+2+3)
30000.00
100.00
 
Note: "RMB10,000" in the Table shall be RMB.
1. 3.2 Funds Raising
The funds required for the project shall be raised independently. 
1. 4 Forecast of Economic and Social Benefits
1. 4 .1 Major Indexes for Forecast of Economic Benefits
After the project reaches the output and efficiency, it will achieve the sales income of 520 million yuan, the total profit of 75 million yuan, the internal financial yield rate of 21% and the investment recovery period of 5.5 years (after the tax).
Table 2: List of Major Indexes for Forecast of Financial Benefits        
No.
Name
Unit
Index
Remarks
1
Business income
RMB10,000/a
52000
Normal year
2
Total profit
RMB10,000/a
7500
Normal year
3
FIRR of all investments
%
21
After income tax
4
FNPV (Ic=10%)
RMB10,000
42500
After income tax
5
Period for recovery of all investments (after tax)
a
5.5
Including 1 year of construction period
6
ROI
%
19
After income tax
Note: "RMB10,000" in the Table shall be RMB.
1. 4 .2 Analysis of Social Benefits
After project construction completed, it will provide new job opportunity, and the implementation of project will drive traffic transport and development of relevant industries. According to preliminary estimate, it can directly increase 200 people for employment, indirectly increase 800 people, having certain promotion effect on the development of economy of Songyuan City.
Total investment of the project is 300 million yuan, most of building materials and part of equipment used for project construction will also be supplied from project location, which will bring about develop opportunity for construction industry and equipment manufacturing industry. After the project is implemented, salary, fuel fee, water and electricity fees, repair fee and other operating expenses will reach 10 million yuan every year, which will directly promote regional economic development.
The implementation of project will boost the development of automobile components and parts industry of Songyuan City, more properly meet the constantly increasing demand for people's living quality, meanwhile, local residents can obtain high income from meals and drinks, entertainment, traffic, post and communications service and other consumption items. Under the driving of automobile economy, the city's industry, catering industry, post and communications industry will generate multiplier effect, promoting the comprehensive and good development of regional economy.
1.5 Ways of Cooperation
Joint venture, cooperation, shareholder, or other forms, interview is allowable..
1.6 What to be Invested by Foreign Party
The investing party can hold stocks through land, plant, equipment and cash, etc..
1.7 Construction Site of the Project
Yadahong Industrial Concentration Zone, Ningjiang District, Songyuan City.
1.8 The On-going Condition of Project
Pre-stage work has been finished.
2. Introduction to Project Undertaker
2.1 Basic Conditions
Unit name: Management Committee, Yadahong Industrial Concentration Zone, Ningjiang District, Songyuan City
Legal address: Yadahong Industrial Concentration Zone, Ningjiang District
Corporate ownership form: public institution
2.2 Introduction to Project Undertaker
Yadahong Industrial Concentration Zone was approved by the people's government of Songyuan City and established in June 2003, promoted to provincial-level industrial concentration zone in September 2005, having total planned area 28.2km 2.
Meanwhile, Yadahong Industrial Concentration Zone closely follows a series of policies and measures for enlarging domestic demand issued by the state and province, positively applies for projects, strives for supporting funds from superior authority, which has reported infrastructure construction, enterprise service platform and rural grid transformation projects. In 2009, it invested 40 million yuan to further improve supporting infrastructure. First, strictly control the engineering of continued construction of southern section of Changhong Avenue (1,727m) and western section of Jianye Avenue (1,000m), start constructing expansion engineering of northern section of Changhong Avenue (3,750m). Second, properly plan water supply and drainage pipe network, complete the water drainage engineering, as well as greening, beautifying and lightening engineering for newly built roads of southern section of Changhong Avenue and western section of Jianye Avenue. Third, accomplish expansion engineering of electric power and communication lines, meeting the enterprise development demand. Fourth, fulfill engineering of park entry of natural gas. Fifth, make good first-phase preparations for construction of comprehensive service building in concentration zone. Until now, initial zone has finished infrastructure investment 100 million yuan, hardened road surface 30km, built water supply and drainage facilities 34km, power transmission and transformation lines 18km, installed 2000 capacity program-controlled telephone lines and broadband internet lines, various infrastructure are complete, reaching the standard of “Seven Accesses and One Leveling”.
2.3 Contact Method
Contact Unit: Investment Promotion Bureau, Ningjiang District, Songyuan City
Mail Address: No. 18, Wenhua Road, Ningjiang District
Postal Code: 138001
Contact Person: Liu Xin 
Tel: 0438-3183311   
Fax: 0438-3183388
 
Contact information of city (prefecture) of project
Contact Unit: Economic and Technical Cooperation Bureau of Songyuan City
Contact Person: Han Baidong
Tel 0438-2706617   13514384757
Fax 0438-2706617
E-mail 870550387@sohu.com
 
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