Research On Supply Chain Optimization Of FAW-TOKICO SHOCK ABSORBER CO.,LTD

FAW-TOKICO SHOCK ABSORBER CO.,LTD(FAW-TOKICO), is a joint venture ofthe production of automobile shock absorbers by Fawer Automotive Parts Co., Ltd. whichowns the equity ratio of49%and Hitachi Automotive Systems, Ltd. which owns the equityratio of51%. The company mainly produces passenger cars and commercial vehicles shockabsorber series. Currently, It has provided automotive parts for many famous carmanufacturers and has formed a social marketing network covering the whole country besidethe individual regions. In addition, more than70kinds of shock absorbers of the companyexports to United States, Russia, Singapore, South Korea and other countries and regions.Product quality assurance and production capacity are in the leading and first-class status inthe domestic peers of this industry and it has developed into one of the largest passenger andcommercial vehicles shock absorber suppliers. FAW-TOKICO has a strong localizationsynchronous development capabilities but inevitably faces the fierce competition of all kindsof outstanding multinational companies and domestic enterprises, such as Shanghai SachsHuizhong, Tenneco China and other transnational shock absorber enterprises, Nanyang Cijan,Jiangsu Star and other local shock absorber enterprises. Besides FAW-TOKICO confronts the challenges of procurement costs, product quality and new technology research anddevelopment and resource coordination and management difficulty of cross-regionaldevelopment.Under the condition faceing competition and challenge of the company, the paperattempts to improve the company’s competitive advantage from the point of view of supplychain optimization. Based on the related theory of supply chain, the paper analyzes theorganizational structure, procurement processes, supplier selection and evaluation process,the company’s information construction and the existing supply chain evaluation system ofthe company and attempt to explore the currenttly possible problems of supply chainoperations faced by FAW-TOKICO and identify the deep reasons of the problems. Besides,in response to these problems, the paper puts forward the objectives and principles of supplychain optimization as well as optimization program of FAW-TOKICO. Finally, the paperintroduces the implementation strategies of the program of supply chain optimization tofurther improve the company’s management system thereby enhancing the company’s corecompetitiveness.