According to "The Wall Street Journal" reported on May 30, after years of rapid growth, many Chinese auto parts manufacturers began to appear signs of a slowdown, rising wages and the appreciation of the renminbi and rising prices of raw materials are all they have to face Problems. However, analysts said the industry veteran of some enterprises are still good investment choices. United Securities (LianheSecurities)-Yao Hong analyst in Shenzhen said that this year is the auto parts enterprises adjustment year. Hengjiang strong, the weak weaker.

     China's auto parts industry's profit growth this year has slowed down. China's National Bureau of Statistics (NationalStatisticsBureau) data show that in 2008 two months before the industry-wide profits than the same period last year grew by 37 percent, while the 2007 data than the same period in 2006 increased by 90 percent. The export growth rate also dropped. In the first quarter, auto parts exports increased by 24 percent, lower than the same period last year and 33% in the year 2007 the 35 per cent. Days of the investment advisers (TXInvestmentConsulting) in Beijing, Wang Ming of analysts said that overall export situation is bad. Wang Ming, the last of her car spare parts tracking stocks lowered the rating to overweight from neutral. She said, with steel and aluminum and other raw materials cost increases and the rise in labor costs and the appreciation of the RMB, China's export advantage as has been the past.

     However, some analysts think that people on some auto parts industry is too worried, especially those leading industry companies. Citigroup Inc. (Citigroup) in Hong Kong analyst Zhang Wenlong (CharlesCheung) that China's auto parts business prospects bright compared with India and Mexico, China is still an advantage. Zhang Wenlong said that the increase in labor costs is unlikely to damage the outstanding auto parts enterprises. In China, labor costs accounted for only part of the cost of production of around 5%, while in the United States and the European Union, this ratio is 20 to 30 percent. He said that Chinese enterprises can be relatively high cost of production from the coastal areas shifted to a lower level of wages in western China. As for the price hikes of raw materials, Zhang Wenlong, this is affecting the rest of the world production of the global phenomenon, they have the possibility of increased costs passed on to customers. EMC Corporation (EssenceSecurities) analyst said Sun Muzi, in general, the current situation of the auto parts exporters are not disadvantaged. In his view, if the Chinese enterprises can be forced to integrate some of the cost is heavily dependent on cheap labor from the company, with the ability of technological innovation, well-managed enterprises will be bigger and stronger.