Economic Benefits Study Of EZ Engine Cylinder Block Project

Car demand is increasing year by year with china’s rapid economic development,constantly improving people’s standard of living and new requirements for improving thequality of life. In recent years, there is a rapid expansion of production and sales volume inthe automotive industry. In the following10years, the car market in China would grow byalmost7.1%annually, and the sales volume in China would be more than half sales volumein the world and twice of sales volume in America. The car market prospect is capacious inChina. The world’s best-known automobile brands grab sales and market share in China andthey all have plans to expand their production capacity. FAW made a strategic goal whichsays its auto produce and sale volume would reach5million by the end of2015throughcurrent market research predicts. Producing car engine cylinder block, EZ has become afactor restricting the development of FAW. According to FAW’s plan and EZ’s12th FiveYear plan, the productive capacity of car engine cylinder block has to reach1.6million peryear by the end of the12th Five Year plan. EZ predicted the future of car cylinder block andcompare the development with the same business domestic and foreign. To meet thecommands for cylinder block of the market and the car shops of FAW, which needs to reduceimports of cylinder block to low the manufacturing cost and improve competitiveness in thecar market, and to produce the best cylinder blocks and build a famous cylinder block brandin the world, EZ established cylinder block project to avoid the economic risks caused byblind investment.Through the analysis of the market and the competitive situation in the future,comparing technology level with the same business domestic and foreign, choosing theoptimal process plan, purchasing advanced equipment to meet the technology requirement,estimating investment and predicting returns in the future, we conducted project feasibilitystudy to analyze and evaluate financial affairs. Analysis showed that the product, which isprovided for FAW-VW and FAW Car Company, is advanced and has a stable and reliablemarket. The technology is advanced and reasonable, with endurance of the quality. Theproject leads to the better efficiency, cost reduction and easier management. It can satisfy therequirement of environmental protection, occupational safety and health, fire prevention, andenergy conservation. After analysis and calculation, we come to the conclusion below: The finance index and economic index are reasonable, economic benefits and social benefits aregood, the project can proceed.