What is the power of China manufacturing associations?

Chinese industry is booming for many years. During this period, China improves its influence in many sectors, taking advantage of its industrial superpower. But in domestic market, how the powerful manufacturing players have evolved following this rocketing growth? There are many associations which have been created and have hidden influence in industries in China. What is the power of China manufacturing associations?

China manufacturing is a leading sector of China’s economy

“Love for luxury” trend, which is still apparent in China’s market, as well as rapidly shrinking middle class, both contribute to the growth of China’s car industry. According to market research, the market was growing 14% per years during the past decade. It now becomes apparent that pace of growth rate is slowing down due to high market saturation and yuan’s appreciation. According to China Association of Automobile Manufacturers, growth rate is expected to fall to 8% in 2014. However, it is still considerable: China’s car market remains the largest and fastest growing in the world. As well as car manufacturing, China is becoming the largest center of heavy industry in many other areas including shipbuilding. Such emerging cities as Ningbo, Nanjing and Shijiazhuang are regarded as major manufacturing centers and attract much foreign investment in these areas. In this landscape, manufacturing associations have strong role to play to defend the interest of Chinese part and to provide support to these growths.

Support of China manufacturing associations is crucial for China’s car market

As a result, there are many China manufacturing associations, which promote and encourage industries by means of co-operation and market research. Two major associations include the China Association of Automobile Manufacturers (CAAM) and the Chinese Manufacturers’ Association of Hong Kong (CMA). Both organizations are extremely influential in their areas.

China Association of Automobile Manufacturers

The China Association of Automobile Manufacturers was founded in 1987, in Beijing, by the approval of the Ministry of Civil Affairs. The leader of China manufacturing associations frequently releases statistics on market growth, sale volume, and trends in the China’s car market. The organization hosts car enterprises, which were originally founded in China, and is regarded as self-disciplined and non-profit. The association largely contributes to the car market by implementing various functions. Apart from statistical research and broadcast, which it undertakes regularly, the association actively ties global connections. It organizes activities designed to improve the exchange of information and ideas internationally. Moreover, the organization initiates exhibitions and events, which bring together customers and producers. The whole strategy is designed to support domestic car-makers in all aspects including business advice, market research, distribution channels and international partnership.

Chinese Manufacturers’ Association of Hong Kong: Rising awareness of environmental issues

Another influential player among China manufacturing associations, the Chinese Manufacturers’ Association of Hong Kong, serves as a not-for-profit platform for support and development of Hong Kong manufacturers. It has over 3,000 members and partners and has similar to CAAM objectives. The association seeks to improve business environment for Hong Kong manufacturers and encourage international connections for further development. Moreover, it is highly concerned about environmental issues, which many regions of China are currently facing, and regards environmental protection as one of its primary goals. Recently, it initiated “Carbon Audit, Exploring Carbon Footprint” project designed to reduce carbon emissions and raise awareness of environmental issues by means of informative seminar sessions.

By Daxue Consulting _ Market research in China