Editor’s Note: Chinese cities have been increasing their industrial restructuring in recent years, changing the country’s economic landscape. On the occasion of its 20th anniversary, Yicai initiated the “20 Cities in 20 Years” research to fucus on key industries in cities and observe regional changes based on field visits and research as well as analysis of industry data from the Rising Lab, Yicai’s research institute for new first-tier cities.

(Yicai Global) June 19 -- Ningbo has long been a center of the auto parts industry in East China, and it is now making the transition toward a focus on electric vehicles.

The auto industry is a pillar of Ningbo’s industrial growth, and the city has invested more and more in the field of new energy vehicles, the head of the Automobile and Equipment Industry Division at the Ningbo Municipal Economic and Information Technology Bureau, told Yicai Global.

“Ningbo has over 5,000 auto parts makers that supplied products for conventional fuel vehicles eight to 10 years ago. These firms are very sensitive to the rise of NEVs,” said Guo Zhiming, president of the Ningbo Intelligent Manufacturing Association, adding that these firms are willing to invest in research and development and to take risks.

For Ningbo Shenglong Automotive Powertrain System, 25 percent of its orders for auto parts are now from NEV makers, and that will rise to 50 percent in 2025, according to Luo Licheng, a director at the firm.

“The EV transition is actually progressing faster than the national plan, and our business strategy is try not to take orders on or invest in conventional fuel vehicles as far as possible,” Luo said.

Ningbo had 856 large auto manufacturing firms as of the end of February, and 636 or 65 percent of them provide auto parts for NEVs. This figure includes 112 firms supplying parts exclusively for NEVs, making up 11.4 percent of the total, per data from the Ningbo Municipal Economic and Information Technology Bureau.

Smart technology is also a key factor in local vehicle industry innovation. Breakthroughs in core technologies in Ningbo over the past five years have moved from basic items such as car lamps and seat belts to intelligent tech and new energy applications, according to statistics.

Low Share

However, only 33 percent of the listed auto parts makers in the city are NEV parts manufacturers, lower than that in the cities of Shenzhen, Wuxi, and Hangzhou. Ningbo has only one local carmaker, Geely Automobile Holdings, and no EV startups. It is also short of power battery producers and battery membrane makers and lags behind other cities in the areas of motors and electric control systems.

Ningbo’s biggest advantage lies in auto parts as it can provide lightweight and intelligent parts for NEVs to help raise the driving mileage per charge, the head of the auto and equipment industry division of the Ningbo economic bureau told Yicai Global.

Ningbo has 24 listed auto parts makers, second only to Shanghai, per data from the Rising Lab. These firms had CNY163.5 billion (USD22.8 billion) in operating revenues and CNY7.8 billion in net profits last year.

Joyson Safety Systems, Minth Group, Tuopu Group, and Joyson Preh made the rankings of the world’s top 100 auto parts suppliers, per data from the Ningbo economic bureau. The city also has 151 firms with an annual output value of over CNY100 million (USD14 million), many of which provide parts to top global carmakers such as Mercedes-Benz, BMW, Volkswagen, Toyota Motor, and Tesla.

Demand from electric vehicle giant Tesla has driven a lot of the development in Ningbo, and Geely-backed EV battery brand Zeekr has also pushed the transition and development of local auto parts makers.

The city set a goal last month to raise its NEV output to more than 700,000 units by 2025, which will make up over half of Ningbo’s total auto-related output.

Editor: Tom Litting