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Chinaplas: New momentum arising from transfer of manufacturing within China and overseas

Chinaplas: New momentum arising from transfer of manufacturing within China and overseas2019.01.02

With unrelenting and extensive globalization of economies and the continuous realignment of global industrial specialization, investment by countries including China in regions such as Southeast Asia has been growing rapidly. In China, one of the largest manufacturing bases in the world, the central and western regions are under accelerated development, proactively undertaking the transfer of manufacturing industries from the east coast. In order to build a wide network of quality resources and fully explore the new momentum in the industry, Chinaplas 2019 aims to act responsively, embracing new opportunities, and tapping into emerging regions.

The assembly of a typical car in China requires parts from more than 20 countries across four continents. The parts and components of an aircraft come from 1,500 large companies and 15,000 SMEs. Manufacturing nowadays has a high degree of specialization and an extensive network. From the Canton Fair to the Import Expo, China says it is committed to attach the same importance on “reach out” and “bring in,” facilitating global economic interactions. The manufacturing industry of China has been increasingly active in outward relocation or expansion.

The plastics and rubber industries have been placing more resources overseas, accelerating the pace of investment and factory establishment. For example, injection molding machine manufacturer Haitian set up factories in Vietnam, India and Turkey in 2010 and 2018, and has application centers in Indonesia, Thailand, Brazil, Mexico and Japan. In 2017, fellow Chinese injection molding machine builder Guangdong Yizumi Precision Machinery commenced production at its new Indian factory and opened a showroom in Vietnam.

Also in 2017, injection machine maker Ningbo Shuangma Machinery Industry established its Indian factory. Compounder Kingfa Sci. & Tech. Co. and extrusion equipment Guangdong Liansu Machinery Manufacturing Co. Ltd. set up factories in India.

As for end-user industries, mobile phone maker Xiaomi Corp., plans to set up three smartphone factories in India. Meanwhile big names in the appliance sector in China, such as Haier, Kingclean, Gree and Hisense, are considering Southeast Asian and Middle Eastern countries as locations for setting up overseas factories.

Chinaplas is responding proactively to these market changes. This year, the show organizer is paying close attention to Southeast Asia. The Chinaplas team has visited influential associations in the region, such as SME Corporation Malaysia, the Thai Housewares Trade Association, the Thai Tool and Die Industry Association, the Thai Auto-Parts Manufacturers Association (TAPMA) and the Electric Vehicle Association of Thailand. These associations all agreed to pass on information about Chinaplas to local enterprises.

In addition to extensive overseas promotion, Chinaplas is sparing no effort in promoting local industries. Recently, the China Central and Western Regions Plastics Industry Alliance joined as a new member and became a supporter of Chinaplas. The alliance, which was founded in May 2018, is implementing the principles and policies of the “Guiding Opinions of the State Council on Central and Western Regions Undertaking of Industrial Transfer” and fostering communication and interaction among stakeholders in the plastics industry in the central and western regions.

“We have joined hands with the alliance for the purpose of promoting the development of the plastics industry in Central and Western China,” explained Ada Leung, General Manager of Adsale Exhibition Services Ltd., the organizer of Chinaplas. “The coastal regions in the east have a notable leading role in innovation and development, but the supply of resources such as land is tight and the labor cost is high, whereas the central and western regions, after 40 years of reform and liberalization, have a significantly improved economic level, rich resources, and optimized infrastructures and investment environments, which can be an important force to undertake industrial transfer in China. As the manufacturing industry in the eastern coastal area advances into the central and western regions, the industry clusters in the latter are brought to the next level. We can feel deeply that these regions are becoming more prosperous and vibrant.”

In recent years, the development performance of the central and western regions is particularly notable. In 2017, the export value of laptops from Chongqing (the largest municipality in Southwest China) amounted to RMB 28.51 billion (about $18.5 billion), making the city the world’s biggest cluster for the devices. Hewlett-Packard, the world’s largest computer manufacturer, set up its manufacturing plant there.
Chongqing is also an industrial base for automotive in China with many brands including Changan Automobile, Changan Ford, SCMW, Lifan, BAIC Yinxiang and DFSK boasting a presence. Wuhan (a city in central China), which is rapidly developing an industry cluster for automotive and parts, manufactured 1.89 million passenger vehicles in 2017.

Henan province in central China produced more than 250 million smartphones in 2017, becoming the largest global production base for smartphones. Hefei city in Anhui province, meanwhile, is a production base for household appliances in China, where OEMs such as Meiling, Royalstar, Haier, Midea and Whirlpool are located. According to Chinese statistics, the export volume of the central and western regions amounted to RMB 1.95 trillion (about $280.8 billion) in the first three quarters of 2018, corresponding to an increase of 13% and a growth rate 6.5% higher than the overall rate for China.

The central and western regions are being developed rapidly, driving a strong demand for plastics and rubber. According to statistics, in 2017, the growth rates of plastic product production in Anhui and Henan provinces were 11.2% and 7.2%, respectively. The year-on-year growth rate of plastics production in the twelve provinces and regions in the west was 8.4%. The central and western regions are in the rapid growth stage, with production growth rates higher than the national average.

The organizer of Chinaplas has put in additional effort in promotional strategies and implementation in China’s central and western regions, as well as visited important enterprises, including Dongfeng Peugeot-Citroën Automobile, Dongfeng Motor, Dongfeng Yanfeng Automotive Trim Systems, Faurecia, and Haima Automobile Group in pursuit of a deeper understanding of their needs and opinions.

Chinaplas 2019 has a continuously expanding network of partners. The show will return to the China Import and Export Fair Complex, Pazhou, Guangzhou, and run from May 21 to 24, 2019, with an exhibition space of more than 250,000 square meters and more than 3,400 exhibitors from all over the world, attracting over 180,000 professional visitors from 150 countries and regions. 


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