BAIC Focuses on Creating a First-Class Supply Chain System

At present, Beijing Automotive Co., Ltd. has focused on establishing a two-supply chain system around its own brand passenger vehicle product line. A procurement center of about 170 people, consisting of a parts and components development department, a supplier management department, and a comprehensive procurement department, was established.

The financial tsunami has enabled China to become the world’s largest auto-producer country. In the era of the era, China’s own-brand auto companies have seized the opportunity to gradually occupy more market share with their continuous exploration and development. In the course of exploration, it is not difficult to find that building a strong supply chain system is a necessary condition and a reliable backing for self-owned brands to achieve weak and strong growth. Then, how can the supply chain system be constructed to meet the need for self-owned brand cars to move forward? Recently, many media in Beijing and Procurement Director of Beijing Automotive Industry Co., Ltd. Zhu Qing have conducted in-depth communication and discussion on this issue.

First-line big-name endorsements: International suppliers account for 70% of the total

In today’s era, consumers’ demand for autos is increasingly diversified, which puts higher demands on the supply chain system of auto manufacturers in order to meet the increasing demands of consumers, not only to meet the constantly updated needs of consumers, but also to ensure the supply of products. The quality and supply are stable and control prices. The famous British economist Martin Kristof once said: "The real competition is not the competition between the enterprise and the enterprise, but the competition between the supply chain and the supply chain."

As an automobile company that has been established for more than two years and has focused its efforts on its own brand management, Beijing Auto Group Co., Ltd. has vigorously promoted the platformization and integration of construction, built a group logistics system and procurement information system, and constantly tackled the difficulties of key components. In cooperation with Hainachuan, Beijing Hyundai and Beijing Benz, leveraging the strengths of BAIC Group to strengthen the in-depth cooperation with suppliers, it has achieved many achievements in the supply chain system construction, and gradually reflects the backwardness advantages of Beiqi's own brands.

At present, Beijing Automotive Co., Ltd. has focused on establishing a two-supply chain system around its own brand passenger vehicle product line. The first is a cost-oriented mini-vehicle business supply chain system. Under the premise of guaranteeing the quality foundation, plan for suppliers with strong low-cost capability as the leading suppliers to give full play to the advantages of the existing supply chain. Second, quality is Guided supplier network of high-end products, planning and introduction of modern, Mercedes-Benz and domestic and international first-class industry-leading suppliers as the leading suppliers, and effectively improve the quality and level of the supply chain. The core supplier is an important partner that helps the development of the company. The world's leading brands of vehicle companies have their own core supplier systems. Beiqi AG has top-notch international suppliers such as Bosch, China, Haila, Michelin and ZF. At present, these suppliers provide services to Beijing Auto's own brands, Beijing Benz, Beijing Hyundai and other member companies of Beiqi.

Building on the supply chain system, Beiqi Co., Ltd. has established a procurement center of about 170 people, which consists of the parts and components development department, supplier management department, and comprehensive procurement department. It is mainly responsible for the procurement of parts and components of independent brands and other comprehensive procurement, as well as suppliers. Comprehensive management. Prof. Zhu Qing, Purchasing Director of Beijing Automotive Industry Co., Ltd., told the reporter that “Saab’s passenger car series are principally based on Saab’s original supply and international brand suppliers. The suppliers of international brands basically have factories in China. Over the past, 70% of the suppliers were involved, and the purchase amount accounted for nearly 80%.” In the procurement process, BAIC strives to be in line with international standards. Director Zhu Qing said, “Our procurement process includes potential supplier assessments, multiple price comparisons, parts identification and approval, supplier quality management, etc. A complete set of processes is completely in line with international standards, which is in line with GM and the public.”

Joint ventures provide mature paths: Beiqi System is refined on a modern and Mercedes-Benz basis

The supply chain is a system that includes multiple entities such as suppliers, logistics, and customers. Supply chain management is a management model that embodies the idea of ​​integration and coordination. It requires the member companies that make up the supply chain system to work together to jointly deal with the complicated and volatile situation in the external market. Therefore, in the face of a complex and ever-changing market environment in the era of economic globalization, it is not easy for companies to achieve efficient supply chain management. “In the entire vehicle manufacturing cost, procurement costs accounted for the bulk. In the statistics of vehicle quality problems, the quality of suppliers has taken up the bulk. Therefore, how important supply chain management is to vehicle companies is self-evident. "The director of Zhu Qing felt and felt.

At present, Beijing Auto Group has entered the stage of full-scale operation, and the self-owned brand's flagship product, Shenbao, has made its own brand objective of “Europe Technology, High-end Brand, China Created, and World Market” more prominent. Beiqi Stock Company also put forward higher requirements on the quality of suppliers' products and services. Beiqi Co., Ltd. has established a comprehensive supplier training and management system with the principle of guaranteeing supply quality and optimizing costs.

In addition to the training of world brand suppliers, BAIC has also formed a regional supplier training system. Beiqi Co., Ltd., which has branches in Beijing and Zhuzhou, respectively, has made full use of local resources to provide support. For example, with respect to the production of seats, Beijing Automotive Co., Ltd. chose to supply Beijing Modern and Mercedes-Benz for its production of Johnson and Lier. For the bumper, it used Beiqi molding for Beijing Mercedes-Benz and modern bumpers.

In addition to responding to changes in market demand, the optimization of the supply chain can also effectively reduce the production costs of auto companies. In order to ensure the quality of the supply chain and reduce costs, Beiqi Stock Company has also formed a complete competition mechanism for supplier management. Director Zhu Qing said: “Our bid, at least to meet the requirements of the three suppliers, or more suppliers, tell them models, describe our production, technical requirements, let them enter the competition system. We evaluate the supply The quotation from suppliers is also assessed in terms of technology and quality, including its quality management system.At the same time, we also let suppliers take the initiative to do technological optimization to reduce costs, such as the improvement of material technology and reduce the scrap rate. Moved to Beijing, a series of work to take the initiative to help it reduce costs. This is more beneficial to both sides, but also contribute to the continued development of both parties."

Beiqi AG also has a supplier to evaluate the PSA process. It is to rank potential suppliers in terms of research and development capabilities, quality assurance, production capacity, and logistics. Director Zhu Qing stated, “We followed the public standard TS16949 of the automotive industry and scored the suppliers according to the PSA score table, resulting in three conclusions: full approval, conditional approval, and rejection. There are problems with conditional approval, but these issues are not Very serious, we can give him a chance to improve after adjusting to meet the standard."

In addition, based on the mutual promotion concept, Beiqi Stock Co., Ltd. will also actively disseminate information on outstanding suppliers. Director Zhu Qing said: “The distributors and consumers are very interested in the parts of the foreign brands that are used by their own brands. The dissemination of supplier information can also enhance the quality of our vehicles and increase everyone’s awareness. The promotion of the entire brand is very good.” He also said that “brand suppliers, especially those based on the Saab platform, have at least 50% brand suppliers, which is the minimum requirement.” Helping outstanding suppliers While carrying out information dissemination, Beiqi Stock Company also has higher expectations for suppliers. The director of the company wished that the supplier of “Yanbao” could “drill into the same technology as the entire vehicle company and develop some new products to inject new vitality into the vehicle.”

Sharing the business with suppliers: Building the overall supply chain competitiveness

Development is the hard truth, and change is the main theme. From traditional management to full-scale supply chain management, auto manufacturing companies worldwide will face a complete management revolution. This is not only a management revolution triggered by changes in the corporate competitive environment, but also a management revolution driven by the development of modern information technology.

Through the acquisition of Saab's core technology in Sweden, BAIC has fully introduced Saab's manufacturing experience in the past 70 years into the R&D system, supplier management system, manufacturing system and quality control system for complete vehicles and core components.

At the supplier's annual meeting in 2013, Beijing Automotive Co., Ltd. officially released a quality management system for its suppliers.

Director Zhu Qing said, “All our processes originate from Saab, which is higher than Saab.” Specific to supplier quality management, Director Zhu Qing stated, “It takes about 16 processes. In summary, it can be divided into the following steps: First, before the selection of suppliers, it must be strictly controlled; second, after the fixed point, it enters the project development process, including the assessment of risks, the supplier decides the degree of intervention, and other important contents; and thirdly, in the process of development, The SQE team, the team of supplier quality engineers, went deep into the development of the entire part, from the development stage through to the sample, to the small-scale assembly, to the mass production stage, and participated in the follow-up, including the identification of the current sample, Process review, these are all using SABIC's standard technology of quality management.Finally, every part must be approved by PPAP, that is, the production part approval process.All problems must be resolved and the entire approval must be obtained before the supply is approved. Mass production and supply, this is a complete set of procedures."

The automobile supply chain system is interlocked. Automobile manufacturers and parts suppliers must strengthen supply chain collaboration and jointly pursue maximization of overall benefits in order to form common economic interests and enhance the overall competitiveness of the supply chain. For suppliers with weaker capabilities, BAIC also has a set of supplier development mechanisms. Incorporating Mercedes-Benz and modern practices, BAIC has also developed a quality management manual for suppliers to guide suppliers to better meet production requirements. “In addition to the joint venture brands like VW and GM, only SAIC and BAIC have released their own supplier quality management manuals,” said Director Zhu Qing. “The advantages in this area are mainly due to the management technology derived from Saab. Thanks to the mature experience of a group of managers from Mercedes-Benz and Hyundai."

From the start of research and development of a vehicle model to mass production, quality control continues throughout. This process is both a development process, a procurement process, and a quality control process. Director Ji Qing added that “the quality management processes with the same principle are applied by different companies. Based on the technical gap and the execution strength of the company, the product quality gap will be very large.” Undoubtedly, there are as many as 16 processes. The quality management process provides a reliable basis for how BAIC ensures the quality of parts and components, the procurement of qualified parts, and the quality of the entire vehicle. It is precisely because of its technological advantages and efficient execution that BAIC has created a high-quality car such as Sic Bo.

There is still much room for improvement in the supply chain. For auto companies, it takes a long way to really and continuously do this task. With regard to this, Xu Heyi, chairman of Beijing Automotive Industry Corporation, has long stated his attitude, "Beiqi Group and Beiqi Co., Ltd. will use products as a link to conduct in-depth cooperation with the vast number of suppliers in modularization, generalization, and platform-based R&D and manufacturing of parts and components. Fully realize the exchange and sharing of innovative elements such as technology, human resources, capital, and information so as to promote the independent innovation capability of the entire automotive industrial chain and our common progress.”