(Yicai) March 4 -- The Chinese government should take steps to improve the auto industry’s supply chain, which is lagging behind the rapid development of the electric vehicle market, and build more leading companies, the chairman of car manufacturer Seres Group said yesterday ahead of the opening of the Two Sessions, the country’s annual policy-making meetings, today.

“After visiting over 100 auto firms along the supply chain, I can see that they are generally small, decentralized and unprofitable,” said Zhang Xinghai, who is attending the Two Sessions in Beijing as a member of the standing committee of the Chinese People’s Political Consultative Conference. “The government should issue policies to enable these companies to integrate, merge and reorganize themselves into bigger firms.”

Government agencies should carry out an in-depth survey to identify private car parts firms that have the potential to grow into leading companies and provide them with the resources they need for research and development as well as assist in financing and taxation, Zhang said. It should also help them to go global by helping them to participate in the division of labor and competition on the global vehicle industrial chain, he added.

China’s auto shipments surged 12 percent last year from the year before to 30.1 million units, retaining its crown as the world's biggest car producer for the 15th straight year, according to figures from the China Association of Automobile Manufacturers. Sales of new energy vehicles soared 38 percent to 9.5 million units.

And China overtook Japan for the first time last year to become the world’s top car exporter, with exports soaring 58 percent to 4.9 million units.

Chongqing-based Seres’ sales jumped 33 percent in 2023 from the year before to 106,703 units. Some 94,380 of these were its Aito marque, co-developed with telecoms giant Huawei Technologies.

Editor: Dou Shicong, Kim Taylor