The deep root of the current supply chain dilemma lies in the lack of systematic thinking for high-quality global development. Some leading enterprises only pursue short-term market share rather than building a symbiotic and win-win ecosystem. These enterprises have failed to take on the responsibility of industry leaders, and have not been able to help small and medium-sized suppliers improve their competitiveness through technology sharing, profit feedback, and other means. They also lack the collaborative consciousness of "working together to conquer the world". On the other hand, international giants such as Toyota and Apple have already formed a community of shared interests through mechanisms such as the "Supplier Joint Research Program" and "Technology Assistance Fund", which is precisely the key that Chinese enterprises need to learn from.
The effectiveness of the "anti internal competition" policy is an important reason for the month on month improvement in PPI in July. The "internal competition" of low prices under the imbalance of supply and demand is the core crux of suppressing the sustained low growth rate of PPI in this round.
Insurance companies should follow the principle of fair competition to carry out urban commercial medical insurance business, continuously improve the diversification level of products and services, and shall not engage in low price disorderly "internal competition" or monopolistic or exclusive sales. It is not allowed to violate the principles of commercial insurance operation, pre-set the payout ratio or set up a fund pool, and it is not allowed to adjust the payout conditions of signed insurance contracts for the current year.
Recently, subsidies in the food delivery industry have attracted widespread attention from society. Many industry associations and merchants have spoken out, hoping to stop the internal subsidy promotion behavior such as "zero yuan purchase", build a good industry ecology, and achieve mutually beneficial and win-win development for all parties. On August 1st, Meituan, Taobao Flash Shopping, Ele.me, and JD.com collectively released a statement calling on the industry to standardize promotions, eliminate unfair competition, promote the establishment of a fair and orderly industry order, and promote mutual benefit and win-win outcomes for all parties.
From the perspective of user count and business growth rate, the food delivery market has basically reached saturation, and major platforms are caught in a zero sum game. Therefore, fierce competition has further reduced the profit margins of various platforms. Compared to that, the instant retail market is a blue ocean. It can be said that e-commerce has entered the second half of its transformation and development, with one of its key focuses being instant retail.
In the field of lithium batteries, the manifestation of "involution" is the market situation that has already reached the "floor price". According to the latest price data released by True Lithium Research on July 24th, the average price of square lithium iron phosphate power cells, which are the mainstream in the market, has dropped to 0.32 yuan/Wh.
At present, as domestic demand becomes the driving force and stable anchor for economic growth, it is not a bad thing for platforms to leverage domestic demand capacity through new models. From this perspective, there is no need to view this round of fierce competition among giants with the mindset of "low price=internal competition". It is better to let the market return to the market and let the value of market competition overflow more towards "promoting consumption".
The essence of anti involution is to let business return to business. In this regard, enterprises need to improve product quality, innovate and strive for victory, and local governments should also return to their respective positions. The decision-making level clearly has a profound understanding of this. When last year's Central Economic Work Conference discussed the comprehensive rectification of "internal competition", it was precisely about "regulating the behavior of local governments and enterprises".
When we talk about the price war in the automotive industry, what we really want to express is our deep expectation for the high-quality development of China's automotive industry. The price war itself is not scary, what is scary is losing direction, depleting resources, and losing confidence in the price war.
Large enterprises and other operators are not allowed to abuse their advantageous positions in terms of funds, technology, trading channels, industry influence, etc. They require small and medium-sized enterprises to accept obviously unreasonable payment terms, methods, conditions, and breach of contract liabilities, and default on payments for goods, projects, services, etc. to small and medium-sized enterprises.
The competition among enterprises has expanded from the competition of a single product to the overall collaboration and innovation of the supply chain ecosystem.
At the regulatory level, it is necessary to establish a governance mechanism that coordinates the interests of multiple parties to prevent the strong party from excessively squeezing the weak party; The leading enterprises in the industrial chain should also play a leading role, working together with small and medium-sized enterprises in the supply chain to expand value increment, rather than constantly accumulating suppliers in a zero sum game.
Implementing ultra long payment terms for component companies from automobile manufacturers; By leveraging supply chain finance, home appliance companies can provide suppliers with a "one fish, two eats" solution; Moving on to consumer electronics giants to pass on costs, pushing the profits of contract manufacturing companies to extremely meager levels.
The collective commitment of car companies not to exceed 60 days in terms of payment terms has made many industry insiders feel excited, as the upstream and downstream of the automotive industry chain have long suffered from long payment terms. But in an optimistic atmosphere, more people remain calm, pointing out that there are still many unavoidable difficulties in solving the problem of long payment terms.
The adjustment of accounting policies can have a ripple effect and create new competitive variables. In the short term, cash flow, supply chain stability, and compliance with payment terms will become more critical competitive factors, which is conducive to promoting orderly competition in the industry.
The price war that lasted for two years was like a brutal economic civil war without gunpowder, fiercely ongoing in the automotive market. Experts call for a "price war" as a means to quench thirst with poison. The automotive industry must return to value competition, pursue long termism, promote industrial technological innovation, and achieve healthy, sustainable, and high-quality development.
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Economic Observation Network News According to CCTV News, on the 7th, it was learned from the State owned Assets Supervision and Administration Commission of the State Council that 33 construction companies have jointly issued an "anti internal competition" initiative in the construction industry, jointly promoting industry transformation and abandoning "internal competition". The "Proposal" aims to consolidate industry consensus, maintain fair competition, promote the formation of a good industry ecology, and resolutely resist "internal competition". At the same time, it is proposed to accelerate transformation and upgrading through technological innovation, pursue intrinsic and long-term value, avoid piecing together scale, blind expansion, excessive debt, and not set up a "shell structure" to waste resources, and jointly maintain market order.
Economic Observation Network NewsOn June 12th, according to the Ministry of Industry and Information Technology, 17 key automobile companies including FAW, Dongfeng, GAC, and SAIC recently issued a statement committing to suppliers' payment terms not exceeding 60 days. How to view the commitment of automobile companies? What measures will be taken to promote the construction of a collaborative and win-win development ecosystem for "whole vehicle components"? The relevant person in charge of the Ministry of Industry and Information Technology stated that the voluntary commitment of automobile enterprises to "payment terms not exceeding 60 days" is of great significance for building a "whole vehicle parts" collaborative and win-win development ecology and promoting the healthy and sustainable development of the industry.
The Ministry of Industry and Information Technology supports vehicle enterprises in fulfilling relevant commitments, continues to guide vehicle enterprises to establish long-term and stable cooperative relationships with supply chain enterprises, promotes integrated innovation and coordinated development of large, medium and small enterprises, actively creates a good situation of "big rivers with water and small rivers full", continuously improves the resilience and safety level of industrial and supply chains, and also makes new contributions to the development of the global automotive industry.
Economic Observation Network NewsAvita Technology announced that it will unify the payment terms for its suppliers to within 60 days. This move aims to implement the latest deployment of relevant departments such as the Ministry of Industry and Information Technology and the State owned Assets Supervision and Administration Commission to ensure the stability of the industrial and supply chains and promote the high-quality development of the automotive industry.
Avita stated that a unified payment term is an important measure to fulfill corporate social responsibility, which helps alleviate the financial pressure on small and medium-sized suppliers, improve the efficiency of fund circulation, promote the coordinated operation of the upstream and downstream of the industrial chain, and build a more resilient industry ecosystem.
On the night of June 10th to the morning of June 11th, four automobile manufacturing companies, including Geely Automobile Group Co., Ltd., Chongqing Changan Automobile Co., Ltd., BYD Auto Industry Co., Ltd., and Chery Automobile Co., Ltd., successively issued statements promising that the payment term would not exceed 60 days. Up to now, 8 automobile manufacturers have made commitments on this matter.
Economic Observer Network News: The China Iron and Steel Industry Association released an article on the 9th titled "Safeguarding the overall interests of the industrial chain and jointly resisting 'internal competition'. The article points out that the comprehensive rectification of "internal competition" is a systematic project, which can have a ripple effect on the whole. Relying solely on a certain industry cannot escape the dilemma of "internal competition". The steel and automotive industries should base themselves on the industry itself, unify their understanding, and form consensus. Both steel and automobile companies must recognize that industry interests are higher than corporate interests, and that corporate interests stem from industry interests. They must accelerate the transition from a "quantity based" to a "price based" approach and strengthen the collaborative governance of the upstream and downstream of the industrial chain.
There is no winner in the 'price war', let alone the future. We propose that the steel and automobile industries should gather consensus, practice hard, strengthen self-discipline, and jointly break through the "internal competition", promote the healthy and sustainable development of the industry chain through technological innovation, and maintain a fair and orderly market order through practical actions. Only in this way can the automotive and steel industry chains achieve "quality assurance and effective win-win", truly realizing high-quality development, embodying the spirit of Chinese manufacturing, and contributing Chinese strength and wisdom to the healthy development of the world economy
Economic Observation Network NewsAccording to the website of the Ministry of Industry and Information Technology, recently, Li Lecheng, Secretary and Minister of the Party Group of the Ministry of Industry and Information Technology, presided over a Party Group meeting. The meeting requires the solid promotion of three centralized rectification measures, namely, "insufficient awareness and ability of legal administration in the system rectification", "comprehensive rectification of the 'internal competition' problem in the new energy vehicle industry", and "focusing on rectifying the problem of using virtual numbers to defraud and disturb the public". Efforts will be made to solve prominent problems in the ideological style, ability level, and work methods of party members and cadres, and to coordinate and promote the deepening and implementation of the department's systematic study and reform work.
Economic Observation Network NewsAccording to the Daily Economic News, Li Shufu, Chairman of Geely Holding Group, attended the "China Automotive Chongqing Forum" held in Chongqing via video conference. He stated that there is a serious overcapacity in the world's automotive industry today, and Geely has decided not to build new car production factories or engage in redundant construction. Geely will make full use of the global overcapacity and carry out pragmatic cooperation and resource restructuring as much as possible. By doing so, we can utilize a mature quality assurance system and skilled technical workers, while also increasing the utilization rate of overcapacity among peers, and participate in global market competition with a friendly attitude.
Economic Observation Network NewsOn May 31st, the China Association of Automobile Manufacturers released the "Initiative on Maintaining Fair Competition Order and Promoting Healthy Development of the Industry". The China Association of Automobile Manufacturers pointed out that in recent years, China's new energy vehicle industry has developed rapidly, with new car sales accounting for over 40%. The industry is running steadily and steadily, and market vitality continues to be released. But for a period of time, the industry's profitability has declined, and the "internal competition" represented by disorderly "price wars" is an important factor in the decline in efficiency. Starting from May 23rd, a certain car company took the lead in significantly reducing prices, and multiple companies followed suit, triggering a new round of "price war" panic. The disorderly "price war" intensifies vicious competition, squeezes corporate profits, affects product quality and after-sales support, hinders industry development, and harms consumer rights. New energy vehicles lead the transformation and upgrading of the industry, and it is crucial to maintain the healthy development of the industry. The China Association of Automobile Manufacturers has proposed that enterprises should abide by the principle of fair competition and operate in accordance with the law; Advantageous enterprises do not monopolize the market; Do not dump at a price lower than cost, and do not engage in false advertising; Enterprises need to conduct self-examination and rectification. The association hopes that the entire industry can jointly maintain a fair competition order and promote sustainable development of the industry.
Economic Observation Network NewsAccording to China Energy News on May 28th, Fu Chengyu, former chairman of Sinopec, stated that one should not do anything that harms long-term interests for short-term gains. Chinese executives must change their mindset and not blindly lower prices when competing abroad. Chinese people should use China's unified concept, and we are one family to the outside world. In an industrial chain, big entrepreneurs should be able to drive more people to live a happy life and lead more enterprises to develop together.
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