China's heavy truck exports in case of bottleneck overseas localization can not wait
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China's heavy-duty truck products are favored by developing countries in the past two years because of their cost advantages and low emission standards. However, heavy-duty truck exports face bottlenecks in the past two years. The domestic heavy truck products lack core technical support and it is difficult to enter the consumer markets of Western and other developed countries and regions in the West. In addition, there is a phenomenon in which companies depress each other between companies, resulting in chaotic order and difficulty in forming synergies.
Company's disorderly competition and price wars <br><br> Valin Xingma Chairman Liu Hanru said in an exclusive interview with a reporter from the China Commercial Vehicles Network that Chinese heavy truck companies face two major crises while exporting their products abroad and creating brand influence: First, the appreciation of the RMB exchange rate is too fast. Second, China’s commercial vehicle companies compete in a disorderly manner in foreign markets. The price is low, which affects the international image of China’s commercial vehicles.
Industry analyst Gong Yunan also believes that due to the lack of corresponding regulatory mechanisms, there has been a disorderly and vicious competition among heavy truck companies in the price of export products. This not only hinders the healthy export of China's heavy-duty truck products, but also undermines the overall image of China's heavy truck products in the international community.
In addition, the backwardness of after-sales service is also a constraint on the weakness of heavy truck exports. Although some companies have already set up and perfected after-sales service networks in their overseas markets, there are still a considerable number of domestic heavy truck companies continuing the “buy out service†in the past. They only focus on selling cars, and do not pay attention to providing perfect for foreign owners. After-sale service.
Third, the domestic car companies are still making a pure market in terms of exports, instead of being branded like the heavy truck giants abroad, providing users with complete transportation solutions. "It should be said that we must continue to learn the new technologies of foreign car companies. This technology includes two aspects: first, new technologies for products, and second, new concepts in services. This sets a good brand for international brands in the international market. The image is of great help," said Gong Yunan.
Enterprises should implement as soon as possible localization of overseas <br> <br> industry to judge, along with continuing to promote domestic commercial enterprises overseas strategy, the wave of overseas investment in factories will accelerate the wave of strikes. "With this process, car manufacturers in overseas production bases will gradually shift from the current simple assembly plant to the positioning of production bases, sales and brand centers."
Huang Gang, general manager of Dongfeng Commercial Vehicles, said earlier during an exclusive interview with a reporter from the China Commercial Vehicles Network that in the long run, building Dongfeng into a global brand is our long-term vision. However, to achieve such a goal, we need to gradually and progressively. At present, we have entered overseas emerging markets, developing markets, including Southeast Asia, and markets in the Middle East have a certain market share. But then we have to establish a regional marketing center for key overseas strategic markets, including in South America and other regions around the world. And according to the requirements of the local market for local production.
Also on May 7, 2014, China National Heavy Duty Truck Chairman Ma Chunji visited Africa with Mr. Li Keqiang, Premier of the State Council of the People's Republic of China, and signed a cooperation agreement with Nigeria’s Dangote Group. The two parties jointly funded the establishment of “Danggate China Heavy Duty Truck West Africa Commercial Vehicle Co., Ltd.†with a total project investment. 100 million U.S. dollars is expected to be completed and put into operation in the first quarter of 2015. The factory is committed to the production of spare parts for CNHTC products in Nigeria. The final annual production capacity will be 5,000 heavy trucks, and it is estimated that it will produce 3,000 heavy trucks annually when it is completed. With the support of Nigeria, it gradually established a production base for commercial vehicles covering West Africa.
With regard to FAW's liberation of exports, it built assembly plants in Pakistan, South Africa, Russia, and Iran, and exported products to 62 countries and regions including Southeast Asia, the Middle East, Latin America, Africa, Eastern Europe, etc., and formed 319 brand distributors for Shaanxi Auto Import and Export Corporation. In an interview with reporters, Liang Shu, general manager of the company, said that for many years, in addition to expanding product exports, Shaanxi Automobile also actively promoted overseas investment and setting up factories. Currently, Shaanxi Automobile's overseas sales area has covered more than 80 countries. The market is mainly distributed in Africa, the Middle East, Southeast Asia, Eastern Europe, Central and South America and other places.
China's heavy truck companies occupy the African and South American markets <br><br> According to customs statistics, in the first quarter of 2014, China's trucks exported a total of 66,800 vehicles, a year-on-year decrease of 10.91%, and the export amount was 1.061 billion yuan, an increase of 8.68% year-on-year. Among them, the volume and amount of exports in Africa were 25,000 vehicles and $405 million respectively. Although the year-on-year decline, the export volume still accounts for more than 37% of the total truck exports and is the second largest exporter.
Judging from the export of African trucks, diesel trucks are the focus and account for more than 55% of the total, especially 7944 diesel trucks with a total vehicle weight of ≤5t, which account for more than 30% of the total. With the exception of 14t<truck weight ≤20t, the diesel trucks in the remaining tonnage segments all maintained year-on-year growth. Non-road dump truck chassis also grew significantly due to the smaller base.
In recent years, Africa’s economy has developed rapidly and demand for cars has increased. Thanks to the good relations between China and Africa, truck companies such as China National Heavy Duty Truck Group, China FAW Group and Foton Motor have already entered the African market early and have achieved certain results in the African market based on their cost-effectiveness. At the same time, these companies have also set up factories in Africa to carry out local production, accelerating the process of automotive industry in African countries.
In addition to Africa, in recent years, countries in South America, including Brazil, the world’s sixth-largest economy, have maintained strong infrastructure needs. South American countries are particularly fond of heavy trucks in China. With its own advantages, China heavy truck products can fully meet the unique needs of the South American market. Therefore, the number of exported South American products has gradually increased.
It is reported that because the local road conditions are not very good and the damage to the tires is great, the tires are required to be wear-resistant and durable, and they are particularly favored for heavy-duty trucks with high-powered engines. The minimum requirement is 350 horsepower or more.
With the development of South America and the continuous surpassing of China’s heavy-duty truck companies, China’s heavy trucks will certainly grab a larger market share in South America.