From November 2020 till now, the prices of steel-mill products increased more than 20 percent (a sharp spike). Rubber increased 20 percent. The rate of acceleration in the cost of raw materials (including steel, iron ore, copper and aluminum, rubber) has reached unprecedented levels in the automobiles industries.
The material prices must be passed on to the consumer, which adds even more inflationary pressures to the already volatile global economy. Yet, will consumers will buy it?
"It's all about margins, material costs effect the price of rubber bushing largely," explains Daniel, the manager of GJCT. Our raw material costs keep going up and up and few of us can raise prices as fast as these costs are rising. You can't keep up with it.
We thought that the cost would went down after CNY holiday. Now, it keeps raising. We are trying to do that as fairly as possible and as minimal as possible.
Raw material shortages will continue to cause long delays and higher prices.
The reality is that we cannot absorb it. There is no way to avoid purchasing materials,but there are some things that can be done to offset the higher prices.
Efficiency and effectiveness is the key. That is not going to change. We cannot get enough material. We just can't. Who wins is who uses it most efficiently.
The demand for auto parts, the same as control arm bushings, shock absorber bushings, is increasing with the vaccine widely injected. If we can discuss timely , make decisions quickly,working more effectively, we can make something together, and overcome this change.