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Where are the future wealth opportunities in China's manufacturing industry?

[Print] 2017-02-20 Validity: Unlimited to unlimited 422
If someone asks you, what is the biggest change in the Chinese economy? Perhaps you will say that the slowdown of economic growth, or the excess supply, industrial difficulties and transformation, but they are not the biggest change, the biggest change is - people.
China has seen the emergence of hundreds of millions of consumers who are willing to spend money on quality items only to find that they are not available at home. As mentioned in the topic of "toilet seat" two years ago, everyone traveled all the way to Japan to spend thousands of dollars to buy a smart toilet seat.
The phenomenon raises a new question for China: Who are these people? What do they want? How to provide them with quality products that meet their needs?

We can see that in the past year or two, the voice of talking about consumption upgrading and artisan spirit has suddenly increased, and most of the loudest voices come from China's business community. Entrepreneurs are very sensitive to any subtle changes in the market, and they know that if a market is oversupplied, the demand side can not be effectively stimulated, and new high value-added comes from the reform and innovation on the supply side.
In 2009, China replaced the United States as the world's largest manufacturing country, eight years later, the surging Chinese manufacturing industry in recent years faced with overcapacity, weak growth of the dilemma.
The automobile industry is the classic representative of China's manufacturing industry, in 2009, China became the world's first manufacturing country, but also became the world's first automobile production and marketing country. Today, there are more than 290 million cars in China, nearly 50 cities across the country have more than 1 million cars, and in many cities more than half of all households own a car. The sheer volume of stock data means that growth is reaching its limits.

In this context, who can grasp the needs of these emerging consumer groups, who can seize the next market growth point.
China's young people, those born in the '85's and' 90's, were born and grew up in peaceful times and can choose their own lifestyle as they wish.
They are stepping onto the stage of society and will occupy the center stage in the next 30 years, and are the core consumer power of the future.
They have several distinct characteristics: they spend more than half of their day online; Relying on Internet information for communication and consumption; Eager for high-tech products related to interest; Be willing to enjoy life and respect your own choices; Have a trendy fashion sense. They are young, and most of them probably have cars at home, but they don't have their first car yet. They buy cars not only to meet basic needs, but also to expect new experiences, including new energy, artificial intelligence cognitive technology, and any other attractive new elements.
These characteristics contain two revolutionary technological driving forces for new opportunities in China's manufacturing industry in the next decade: the Internet revolution and the hardware technology revolution.
The Internet will redefine products, channels, technological innovation, and consumers. Through the Internet digital platform, users, products and businesses are brought together to improve the efficiency of resource allocation. And consumers are no longer just consumers, but consumers, producers, investors three integration of ecological participants.

For China's manufacturing industry, the Internet can only help complete part of its transformation and upgrading. The other part depends on the ability to productize technology and the spirit of craftsmanship. Drucker once said that the essence of business is that you produce a pair of leather shoes, sell them to the consumer, and make them feel comfortable on their feet. The essence of manufacturing is artisans, air conditioning, bathroom, mobile phones, cars and other products are so, commercial competition will eventually return to the product itself.
Today's global economic malaise is due to the fact that the industrialization of the technological revolution has not yet been achieved, and the results of the fourth industrial revolution have not yet fully moved from the laboratory to the market. However, new generation technologies, including artificial intelligence, Internet of Things, virtual reality technology, new materials, and new energy, will continue to be transformed into commercial products in the next two to three decades. These products will meet and stimulate a new round of consumer demand and become the commanding heights of future business competition.

In the automobile industry, which has the largest manufacturing volume, Internet, intelligence, and environmental protection are the trends that are constantly being realized. All automakers, like Audi, are looking for breakthroughs in these three areas.
Audi's strategy in China for the next decade is to create future-oriented connected mobility experiences with high-end, customized solutions. With the technical support of the Internet and the Internet of Things, the car itself is a huge mobile device, which can have travel service functions of maps and destinations, weather, news, parking, traffic conditions, weather and other information tips and customized service functions, and in the near future, emergency rescue calls, remote control lock/unlock/flash/whistle and other functions.
On this basis, artificial intelligence is leading a worldwide technological revolution. Equipped with AI technology, the Audi A8 can use laser scanners to determine the surrounding road conditions with more accurate recognition than the human eye, automatically navigate in unfamiliar cities, book parking lots, and identify dangerous road conditions, all without the need for human intervention by the driver. The new energy is to solve the contradiction between high performance and environmental protection, and promote the car to better adapt to the requirements of the environment and natural sustainable development. Faw-volkswagen Audi has initially completed the layout of the e-tron family of new energy vehicles through several models such as A3 e-tron, A6Le-tron and Q7 e-tron, and plans to launch six new energy models in the Chinese market in the next five years.

Intelligent, Internet and environmental protection are the new needs of the middle class in travel, they represent the development direction of the automotive industry, and the implementation of these visions determines the future pattern of the automotive industry.
In the same way, the most important phenomenon in China's business is the rise of the new middle class, which is accompanied by the phenomenon of consumption upgrading and business return to products. That's why we can think of the next five, 10, 20 years as still a huge opportunity for manufacturing. These opportunities are all contained in two elements, one is the Internet, and the other is the spirit of craftsmanship.

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