Trade Solutions for the Automobile Industry
19 April 2005
David KohSenior Vice President, Trade ServicesHSBC China
Trade Outlook In China
295.2
412.8
561.4
325.6
438.4
593.4
0
100
200
300
400
500
600
700
2002 (A) 2003 (A) 2004 (A)
Year
US
D B
n
Exports
Imports
Growths of China’s import and export have been strong
China Auto Market Development
China is largely on track in implementing its WTO obligations, reducing import tariff, relaxing import quota and local content requirement.
Growth remains high in 2004 despite being lower than 2003
Recent price cuts have not yet provided the desired boost in overall sales
Sedan manufacturers continue to increase production capacity
All of the world’s top automakers have JVs in China
The market continues to consolidate as the number of manufacturers continue to reduce
China Auto Trade
4.7
8.2
14.4
16.3
0
2
4
6
8
10
12
14
16
18
2003 2004
US
D B
n
Export
Import
Import and export continue to grow, esp. export
Auto components are playing a larger role than auto vehicles in both import (67%) and export (75%) of auto industry
Total import and export of autos still account for only a small fraction of total auto market (4-5%) and China’s overall trade (2-3%)
Japan, Germany and South Korea remain the major car exporters to China
US, Western Europe, South East Asia are major overseas markets for export of China’s auto components
China Auto Trade Development
Our Trade Solutions
Exports:
• Electronic DC Advising and DC Safe Custody
• DC Confirmation
• DC Bill Negotiation / Collection
• D/A, D/P Bill Collection / Discounting
• Forfaiting / Non-Recourse Discounting
• Receivables Financing / Factoring
Imports:
• DC issuance – FCY & RMB
• Loan against imports
• Shipping Guarantees
• Avalization
Integrated Trade Solutions:
• Supply Chain Solutions
• Structured Trade Finance
• Project and Export Finance
Domestic Trade:
• Domestic DC
• Bank draft discounting
• Commercial draft discounting
We provide a full range of trade services:
Trade Solutions: Supply Chain Solutions
• New approach by the Bank in partnership with our major customers
• Provides continuous support to our customers and their suppliers in a fast growing and evolving environment
• A tailor-made solution unique to each customer’s business needs
The Auto Industry’s Supply Chain
Plastic
Leather/Fabric Dashboards/ Interior
components
Rubber Windshields Glass
Sheet metal/Rolled
Steel
Panels/ Doors/ Rims
Car seats
Tires - OEM
Electronic components
Engines/ Gear boxes In-car electronics
DistributorDistributor
BuyerBuyer
HSBC Trade Services
• A continuous presence in China since 1865
• Largest branch network among foreign banks: 10 branches and 2 rep offices in key commercial centres
• Extensive local experience
• Comprehensive range of world-class trade services
• Supported by an international network of 9,800 offices that spans 77 countries and territories
Our Branch Network in China
Shanghai
Dalian
Qingdao
Shenzhen
Wuhan
Guangzhou
Tianjin
Suzhou
Branches
Xiamen
Beijing
Chengdu Chongqing
Representative Offices (approved to be upgraded to full service branches in 2005)
An Awards Winning Trade Bank
Best Trade Finance Bank The Asset2003 - 2005
Best Trade Finance Bank in AsiaGlobal Finance2002 - 2005
Best Regional Trade Finance Bank Asiamoney2004
Best Regional Bank for AsiaTrade Finance2004
Best Trade Finance Bank Cargonews Asia2003, 2004
Best Trade Finance Bank FinanceAsia1997 - 2004
Thank You!