Auto parts town rides NEV wave for growth

TIANJIN — On the outskirts of Tianjin, far from the container terminals that embody the northern Chinese municipality's industrial might, lies the town of Zhongtang — a place with modest geographic endowments but an outsized reputation.

Amid a bustling boom of complete-automobile manufacturing, the town's specialty is quite prosaic: automotive rubber hoses. Today, it stands as one of China's largest production bases for them.

The town's client roster reads like a who's who of the global automotive industry, ranging from global auto behemoths like Mercedes-Benz, Volkswagen and Toyota to domestic new energy vehicle makers like BYD and Nio.

This impressive lineup earned Zhongtang a coveted spot on China's inaugural list of specialized towns. As China's electric-vehicle boom reshapes global auto supply chains, Zhongtang's component manufacturers are accelerating in lockstep with the market's transformation.

Tianjin Pengling Group, a homegrown firm specializing in fluid lines and thermal-management modules for NEVs, exemplifies this industry transformation. "Our order books are full through the end of next year," said Gao Xianhua, the firm's vice-president.

The firm's financial performance underscores its success: Last year, it recorded profits and tax contributions exceeding 30 million yuan ($4.24 million), and in the first three quarters of this year alone, it nearly matched that annual benchmark. This momentum is particularly remarkable in an industry where component suppliers typically operate on razor-thin margins.

China's auto market — the world's largest for the last 16 years — registered sales of over 31 million vehicles in 2024, including more than 12 million NEVs. The country accounted for over 70 percent of global NEV sales in 2024, with its supply chain dominance fundamentally reshaping industrial geography worldwide.

As assembly plants expand in coastal hubs like Tianjin, which is home to major joint ventures including Toyota and Volkswagen, towns such as Zhongtang have become integral nodes in global production networks.

"'Good soil' is why we've been able to take root and flourish," Gao said, citing the dense concentration of automakers in the region, coupled with proactive government support through matchmaking initiatives, tax incentives, and talent recruitment programs.

Zhongtang's industrial ecosystem is remarkably comprehensive for a town of its scale. Encompassing everything from doors, glass and interiors to brake pads, springs and chassis components, the town hosts nearly all major auto part categories. The town hosts 15 sizable parts manufacturers and expects total output to exceed 4 billion yuan by 2025.

The rapid growth of NEVs has fostered a new generation of suppliers. Many Zhongtang-based manufacturers have experienced rapid growth by producing parts tailored to electric drivetrains and lightweight chassis.

Some local companies have now begun exporting their products overseas, having strengthened their technological capabilities as Chinese NEV brands expand into markets ranging from Southeast Asia to Europe, according to local authorities.

Keeping pace with China's competitive auto sector, Zhongtang's chain-driven development model has enabled this once-unremarkable town to unexpectedly assume a pivotal role in the country's industrial tale, said Wang Yin, associate professor at Tianjin University of Finance and Economics.

Xinhua