1. Customer barrier

The world's major vehicle manufacturers or auto parts suppliers have a set of strict quality system certification standards in the process of selecting upstream parts suppliers. Under normal circumstances, auto parts suppliers can become candidate suppliers of Oems or auto parts suppliers after passing the relevant parts quality management system certification audit; Oems or auto parts suppliers shall audit the production management links of upstream suppliers according to their respective supplier selection criteria; Finally, before mass production of relevant supporting parts, strict product quality advance planning (APQP) and production parts approval procedures (PPAP) must be implemented, and repeated trial assembly and verification must be carried out. Once the cooperation between the two parties is established, the OEM or auto parts suppliers usually do not easily change their supporting parts suppliers, and the strict certification standards of the downstream of the industry have formed a high entry barrier for new competitors in the auto parts industry.

2. Technical barriers

Aluminum alloy precision die casting parts in the automotive field have complex shapes, high material properties and accuracy requirements, and the parts design, die manufacturing, die casting, machining, process optimization and other links in the production process require long-term technology accumulation. Therefore, die casting enterprises in the industry need to have strong material development and preparation technology, die casting technology, and even product design, mold design and manufacturing capabilities in order to meet the quality requirements of vehicle manufacturers and first-level auto parts suppliers, so as to occupy a favorable advantage in the fierce market competition.

3. Financial barriers

Die-casting industry capital investment is large, the need for continuous research and development investment, in order to consolidate product quality, to ensure the advancement of technology. The purchase cost of smelting equipment, die casting equipment, mold production equipment, machining equipment and precision testing equipment is generally higher, especially the production of high-end precision parts, in order to ensure the accuracy, strength, machinability and other technical indicators of the product to reach a higher level, parts production enterprises need high-end processing equipment, need more capital investment. The financial strength of enterprises in the industry is put forward higher requirements.