> Success Story

Successfully promote the concept of subcontract in Chongqing .

A major problem faced by the small and medium enterprises in Chongqing has been the promotion of their companies and order achievement for production, especially internationally. To solve these problems and to foster the development of these manufacturers, SPX-Chongqing was established on the 15 th April 2004 with the technical assistance of UNIDO. Although it has just been in operation for one year, it has successfully provided its core services.

Firstly, awareness of advantages of subcontracting and partnership exchanges has been widely created among the Chongqing industrial community, particularly in the vehicle and components industry. 42 companies and 5 main contractors registered as members of the SPX to date with increasing tendency to 130 members in the end of 2004. SPX website has been established on basis of UNIDO Exchange, both in Chinese and English.

 Organize Chongqing enterprises to attend the MIDEST

To encourage local companies to access new markets and create alliance at international level, SPX-Chongqing organized 7 companies, 16 people to participate in MIDEST, an international leading subcontracting fair held in Paris in December. During the 4 days of exhibition, the Chongqing delegation met with over 70 international main contractors or decision-makers. After the fair, the delegation visited the UNIDO ITPO in Paris , the headquarter of UNIDO in Vienna , and the famous engine producer Italian Lombardini. The SPX participation in the fair and visits have been very successful. They generate a series of business contacts and industrial networks and collected 10 preliminary orders which totally valued over 100 million US dollars.

2004 March 15 th --- The 1 st purchasing information releasing meeting

On March 15 th , 2005, the first purchasing information releasing meeting of SPX-Chongqing was held with local government's support. Altogether 58 international purchasing orders, totally valued 130 million US dollars, were released. These purchasing orders are obtained through the effort of SPX-Chongqing and UNIDO SPX network. Ten international main contractors sent the orders covering a wide range of machining parts, casting & forging parts, general motors, and tubes. 38 relative local suppliers have come to share this "big cake". At the end, 11 subcontractors are identified to have the capacity and quality system to be engaged in the production. So far all the orders accepted are right in process, and will have substantial consequences before long. Besides, local media also paid high attention to this releasing meeting. 13 media have attended.

2004 April ---Auto Components Outsourcing Seminar

In addition to promoting subcontracting and partnership internationally, the SPX became increasingly involved in inviting international main contractors to outsource their products locally. In April 2004 “Auto Components Outsourcing Seminar? organized by SPX-Chongqing and Chongqing Municipal Government in accordance with UNIDO standard, 17 domestic and international main contractors and 70 local suppliers were present. The representative from the outsourcing offices of Delphi, Visteon, Bosch, TRW and Ford in Shanghai held business discussions with local suppliers separately at the seminar and reached 7 preliminary cooperation agreements. TRW selected 34 suppliers for further negotiation. Among them TRW reached an agreement with Chongqing Hongyu Fittings Plant to have a joint venture with TRW investment of 70 million US$ for the manufacture of automotive brakes. One year later, in April, 2005, the joint venture has been put into production.

In April, 2004, the second "Auto Components Outsourcing Seminar" was held. 30 main contractors from America , Germany , India , France and Asia-Pacific Area participated in the seminar and met with more than 80 local suppliers. Although it was only one day's meeting, both parties gave great praise for the platform provided by SPX-Chongqing. The contractors brought with them enormous purchasing order. Lucas-TVS reached preliminary cooperation agreement of 200 million US$ with Chongqing Wanda Instrument Co. Ltd. The representative from Lucas said they will visit the company soon and make real progress in cooperation. German MAN Truck and Bus (China) selected more than 10 local subcontractors for further contacts and discussions. Michel Paglia, Group Asia Purchasing Director of VALEO, revealed that VALEO will outsource 70% of its components from low cost Asia areas. In 2005, the company plans to select one or two local companies in West China for cooperation or joint venture. During the seminar, Mr. Sergio M. Miranda, representative of UNIDO in China , gave speech on UNIDO's Role in Development of West China. Mr. Patrick Gilbert, Global SPX Program Manager of UNIDO, specified on SPX global network, SPX methodology and Supply Chain Management. Some representatives from purchasing department, such as PAC Group, Reliasoft, Continental Teves, Valeo China , and etc. also described their purchasing requirements, procedures and quality system in details. The participant subcontactors have clearly grasped the objectives of the main contractors and the parameters to be used in order to obtain excellent results.

2005 Dec. 7^th -11^th the 1^st Subcon China 2005

In December, 2005, the first "Subcon China 2005" was organized by SPX-Chongqing and Chongqing Municipal Government. Either as exhibitors or visitors, 38 international companies participated to the event, such as Volkswagen, Intel, Siemens, Bosch, Valeo, Denso, TRW and Mitsubishi; 24 international organizations such as UNHCR, UNICEF, IFC ( International Finance Corporation ) , EU Delegation in China, EU Chamber of Commerce and VDA (Verband der Automobilindustrie) participated. In the event, there were 480 exhibitors and 5,000 visitors, 112 of which are international buyers or main-contractors and 203 are domestic buyers and main-contractors. Specific matchmaking meetings between 130 potential suppliers and 30 international main-contractors and buyers at the event were arranged. In addition, there were eight themes programs in the event. During the seminar , Ms. Fabienne Rond, UNIDO Representative , Mr. Wolfgang Wagner , General Manager of VDA China Mr. Andrew Cook , DABA UK gave a speech on 2005 China International Subcontracting Forum.; Ms. Shannon Atkeson , Senior Investment Officer of IFC Office in China, Mr. Charlie Cheng , Senior Business Development Officer, IFC Chinese Project Development Center gave speech on IFC Policies on Investment in Industrial Projects, etc. In the event, 25 Chongqing local enterprises were selected by international purchasers for advanced cooperation.

Click to download the SPX-CQ Working Report 2005.