Can the Central Bank Cut Interest Rates Relief to Small and Medium-sized Parts Enterprises in Dilemma

The impact of the financial crisis Mannion to the global giants industry, and the automotive industry is even more in turmoil, according to a media data show that the world's largest car market - North American market sales fell by 26.6%, creating the most amazing record of decline in 50 years . The world's auto giants have also burst into the news of bankrupt production cuts, production, so that the entire automotive industry has fallen into a deep crisis vortex. At present, the U.S. financial crisis and global economic turmoil are still continuing. The domestic auto market has been affected by a wide range.

The automotive and parts industries have also been hit hard. The financial crisis has left the entire automobile and parts industry in a passive state. In this downturn period, the country introduced a policy of introducing fuel taxation and a sharp rate cut by the central bank, which has caused various industries to gradually pick up in the financial crisis.

Expand domestic demand for fuel tax policy

On the New York Mercantile Exchange, light crude oil for delivery in January fell 3.73 US dollars to settle at 50.77 US dollars a barrel. The North Sea Brent crude oil futures on the International Petroleum Exchange in London fell 3.58 US dollars to settle at 50.35 US dollars a barrel. The impact of a series of negative economic data has caused the international oil price to suffer a sharp setback on the 25th day after a 9% jump in the previous trading day. The New York market has fallen by nearly 7% and returned to the level of 50 US dollars per barrel.

As the international oil price plummets, the price of domestic refined oil is likely to be lowered in the near future. However, the introduction of the fuel tax will undoubtedly have a great stimulating effect on the automobile market. Once the fuel tax is implemented, it will promote the research and development of new energy vehicles and promote the market, and small-displacement fuel-efficient cars will receive more people. s concern. Therefore, the majority of auto parts companies can increase their efforts in the research and development of energy-saving emission reduction components and actively develop this immature market.

According to the person concerned, the collection of fuel tax. The overall requirement of the fuel tax reform is "fair, standardized, economical, and lightening." To be fair, it is to reflect the principle of using more oil and more burden in the future. The norm is to change the charges of various types of tolls or roads, the maintenance and management of roads, and the maintenance and management of waterways. The relevant fees are changed to fuel consumption taxes, and more oil is used to pay more taxes. Reducing the burden means that under the current level of domestic and international oil prices, the burden on all parties after the introduction of tax and fee reforms is reduced, because international oil prices are now lower than domestic ones. Through such a norm, it also blocked all kinds of arbitrary charges.

The Central Bank cut interest rates sharply by 1.08%

The central bank announced on the 27th that starting from December 5th, the deposit reserve ratio of large deposit-taking financial institutions such as ICBC, Agricultural Bank, Bank of China, China Construction Bank, Bank of Communications, Postal Savings Bank, etc. will be cut by one percentage point, and the The RMB deposit reserve ratio of financial institutions is two percentage points. At the same time, it continued to implement preferential deposit reserve ratios for Wenchuan earthquake-stricken areas and rural financial institutions. This time, the central bank fell by a record 11 years, and since the central bank announced the first time in four years on September 15 to cut the benchmark lending rate, the central bank has cut interest rates four times in a row and has reduced deposits for the third time in less than two and a half months. Gold rate. It was also the second time after the central bank announced a double-rate reduction on October 8th.

In contrast to the past, the rate of interest rate cut by the central bank of 1.08% was uncommon for ten years. According to past practice, the rate of interest rate cuts by the central bank was 0.27% each time. Prior to this, the sharp rate cut of the Central Bank dates back to October 23, 1997, when the interest rate cuts. The central bank lowered the one-year deposit and loan interest rates by 1.8 and 1.44 percentage points respectively. For this "double down", the central bank stated that it is to implement a moderately loose monetary policy, ensure that the liquidity of the banking system is fully supplied, promote the steady growth of money and credit, and play a positive role of monetary policy in supporting economic growth. According to calculations, this double down can add about 400 billion yuan of loanable funds to commercial banks, which is more than the 380 billion yuan in loans for the whole year that was drawn up last year in 2008.

Some experts pointed out that the central bank’s interest rate cuts are very favorable to the auto industry and may stimulate sales in the coming months, but it may also trigger a new round of price wars.

Financial pressure on auto companies is expected to ease with the tightening of monetary policy in 2008, the decline in consumer demand for cars, a large number of car companies have a large number of inventory, funding pressures followed. The continuous rise in raw material prices and the inability to raise the price of cars have exacerbated the plight of the auto industry. Some companies that produce small cars with low added value bear the brunt of this. Through the statistics of WIND information, it is found that the steel industry as a raw material for automobiles and auto parts has benefited significantly from the automotive sector; at the same time, small and medium-sized component companies will have the opportunity to obtain more abundant capital flows and the development of enterprises will be benefited. Therefore, the interest rate cut will firstly ease the financial pressure on some auto and parts industries.

Steel industry cut interest rates can reduce loan costs

Last week, the domestic steel price continued to significantly reduce the momentum of the price has been contained, sheet prices have finally stopped falling and there is a certain degree of rebound, the steel price fall no doubt greatly boosted investors' confidence in the steel industry's future recovery, and this time the central bank substantially Reducing interest rates will reduce the company's future investment costs and will further boost the demand for the steel industry.

The central bank’s interest rate cut of 108 basis points will undoubtedly be of great benefit to the troubled steel industry. The iron and steel industry is a fund-intensive industry. Due to declining demand in the earlier period, iron and steel enterprises have a lot of pressure on their inventory and cash flow is tight. This time, the interest rate cut will make the loan cost lower, which will help relieve the company’s financial strain. Firms with tight cash flow and high asset-liability ratios may benefit from greater interest rate cuts, but for large companies such as Baosteel and Wuhan Iron and Steel, the demand for funds will benefit substantially. These will bring greater benefits to auto vehicle manufacturing and parts companies.