At present, precision injection molds and precision injection parts have penetrated into many fields such as automobiles, consumer electronics and household appliances, especially in the field of auto parts, as "replacing steel with plastic" has become the development trend of automobile manufacturing, precision injection molds and precision The development of injection molding parts is the fastest and has been widely used. The huge market demand has also driven the development and updating of precision injection molds and precision injection parts. In recent years, ultra-precision, miniaturization, new materials and complete sets of components have become the key development directions of precision injection molds and precision injection parts.

　　Source: Compiled by PricewaterhouseCoopers

　　1. Opportunities faced by the industry

　　(1) National industrial policy support

　　Because of its excellent performance, plastic products are widely used in real estate, automobiles, household appliances, consumption, packaging, consumer electronics, medical equipment and other fields, and their role in promoting the construction of the national economy and improving the material and cultural life of the people is increasingly apparent. In recent years, the Chinese government has formulated a series of industrial policies to support and promote the development of the plastic products industry in the direction of high performance, high quality and environmental protection.

　　In January 2017, the National Development and Reform Commission issued the "Guidance Catalogue of Key Products and Services for Strategic Emerging Industries (2016 Edition)", emphasizing the development of key basic components for intelligent equipment, including high-speed precision gear transmissions. In June 2016, the China Mould Industry Association issued the "Thirteenth Five-Year" Development Guidelines for the Mould Industry, pointing out that the self-provisioning rate of domestic moulds in the domestic market has reached more than 90%, which meets the needs of the user's industry development for mould products, and focuses on the development of medium and high-end products. Molds (60% of the total molds) and key molds urgently needed for the development of emerging industries. Among them, the proportion of medium and high-grade molds has increased to more than 50%. In April 2016, China Plastics Processing Industry Association issued the "Guiding Opinions on the "Thirteenth Five-Year" Development Plan for the Plastics Processing Industry, requiring the plastics processing industry to seize the development opportunities during the "Thirteenth Five-Year Plan" period and focus on "functionalization, lightweighting". , ecological, micro-molding" technology direction, focusing on breaking through the three major development bottlenecks of raw materials, advanced molding technology and technology, and equipment.

　　From the analysis of relevant policies, the Chinese government emphasizes strengthening the development of high-speed precision gear transmissions, advocates the development of plastic products in the direction of light weight and miniaturization, and encourages the vigorous development of the mold industry.

　　(2) The downstream market space is vast

　　In recent years, benefiting from the growth of automobiles, household appliances, consumption, packaging, consumer electronics, medical equipment and other industries, the domestic demand for plastic products has maintained steady growth. With further breakthroughs in material research, the application field of plastic parts continues to expand, and begins to extend to the fields of aerospace, new energy, advanced manufacturing and new processing technologies, and integrates with emerging industries such as smart home and the Internet of Things. The plastic products industry Has a broad market development space.

　　(3) Continue to promote the use of plastic instead of steel

　　Replacing steel with plastic is a major trend such as "lightweight automobiles, thin and fashionable home appliances", etc. For example, in the field of automobiles, replacing steel with plastics is one of the ways to achieve lightweight development of automobiles. Compared with traditional metal materials such as steel, plastics have the advantages of low price, light weight, easy processing, corrosion resistance, and self-lubrication. With the development and use of various new modified plastic materials, plastics have gradually approached in terms of strength and other related characteristics Traditional metal materials such as steel. The application and proportion of modified plastics in household appliances and automobile industries is increasing, and it has become the second largest category of materials after steel.

　　(4) Opportunities for domestic manufacturing upgrades

　　The Chinese government has vigorously promoted the transformation and upgrading of the economic structure, so that the Chinese economy has begun to shift to a higher-quality growth path. my country has achieved an important position in the global industrial chain. The development of domestic manufacturing has driven the development of supporting industries including the plastic products industry; the development of supporting industries has also promoted the overall level of domestic manufacturing. With the transformation and upgrading of the domestic economic structure, the traditional manufacturing industry urgently needs to develop in the direction of connotation and higher quality, which promotes the continuous increase in the demand for products with high technical content and high added value, and provides a new development opportunity for the domestic plastics industry.

　　(5) National income continued to grow

　　In the past ten years, China has been one of the fastest growing economies in the world, and it will still maintain a relatively high growth rate for a long period of time. With the growth of my country's economy and the improvement of national income, the consumption capacity of urban and rural residents has also been continuously improved. According to the data from the National Bureau of Statistics, in 2021, my country's per capita gross national income (GNI) will further rise to 12,400 US dollars. According to the World Bank 2020 According to the annual standard calculation, when the per capita gross national income (GNI) reaches 12,696 US dollars, it enters the ranks of high-income countries, which is higher than the average level of 9,074 US dollars in upper-middle-income countries; the median per capita disposable income of urban residents is 43,504 yuan, An increase of 7.7%; the median per capita disposable income of rural residents was 16,902 yuan, an increase of 11.2%. The continuous improvement of the national income level provides sufficient growth momentum for the downstream market of the plastic products industry, which in turn drives the continuous growth of downstream market demand. As an important part of the national economy, the plastic products industry will benefit from the continuous and stable growth of national income and has huge development potential.

　　2. Challenges facing the industry

　　(1) The price of raw materials fluctuates

　　The main raw material of the plastic products industry is plastic particles. The price of plastic particles is easily affected by many factors such as macroeconomic growth, stricter environmental protection policies, fluctuations in crude oil prices, fluctuations in the exchange rate of the US dollar, international and geopolitical factors, and plastic products companies basically lack bargaining power over plastic particle companies, and the sales price is adjusted. With a certain lag, the profitability of enterprises is affected by the fluctuation of upstream raw material prices.

　　(2) Fluctuating demand in downstream industries

　　The plastic products industry has many product categories and strong industrial correlation, and is one of the important industries of the national economy. Affected by the slowdown in macroeconomic growth, the demand of end consumers of plastic products and end product manufacturers has fluctuated to a certain extent; due to the cyclical impact of the industry, some industries such as the automotive industry have experienced a decline in demand for a certain period of time. Under this circumstance, the competition in the industry is more intense, and the profitability is facing challenges.

　　(3) Dependence on imports of high-end raw materials and high-end equipment

　　The main raw materials of plastic products are general plastics, engineering plastics, special plastics and modified plastics. The high-end raw materials used in the domestic plastic products industry, such as special engineering plastics, modified plastics and plastic additives, mainly rely on imports, and the import of high-end equipment is highly dependent. The low level of independence of high-end raw materials and equipment is an unfavorable factor restricting the industrial structure upgrading and innovative development of the domestic plastic products industry.