Weichai 2010 Strategy: Creating the Power of "Aviation Carrier" for Equipment Industry

The annual Weichai Power Business Conference was held at every stage in Weichai City, Weifang City, Weifang City. It was moved to Jinan, the provincial capital, this year. On the evening of December 6th, when reporters arrived at Jinan Railway Station with an EMU, they found that the entrance hall had been dubbed by representatives from various suppliers and dealers who came to the meeting.

More spectacular scenes occurred at Shandong Mansion, where the Shandong Provincial Government hosted an important meeting. On December 7, the Weichai Power Business Conference was held as scheduled in the main hall of Shandong Building. Surprisingly, Weichai has turned the business conference into an international conference: Of the more than 2,000 delegates attending the conference, more than 200 were Weichai overseas dealers and service providers from 36 countries and regions. . To this end, the conference specially arranged simultaneous translations in English, French and German.

At the same time as the conference was held, in the square outside the venue, the Shandong Heavy Industry Group's product exhibition also opened with a high profile. The dazzling array of products covered areas such as powertrains, heavy trucks, construction machinery and auto parts. Weichai Power , Shaanxi Heavy Duty Truck, Shaanxi Fast, Shandong Shantui and other high-quality brands of equipment industry are among them. It is not difficult to see that in every vehicle, complete machine, assembly and component product, the DNA of Weichai's technology or capital is looming.

At the 2009 business conference held at the same time last year, Tan Xuguang, chairman of Weichai Power, once said in a speech that due to the global financial crisis, we are experiencing a colder winter than in 2005, and have experienced the most severe challenges. One year later, this entrepreneur with unique personality, as chairman and secretary of the party committee of Shandong Heavy Industry Group Co., Ltd., stated at the Weichai Power Business Conference in 2010 that Weichai Group's overall development plan for the next 3 to 5 years It is to realize the grand vision of earning 100 billion yuan in revenue and entering the world's top 500; to create a world-leading equipment manufacturing industry group with core technologies and sustainable development.

The confession of such magnanimity stems from changes in the firewood that occurred in just one year.

Restructuring Shandong Heavy Industries Weichai in the capital, market rush

At the Weichai Power Business Conference 2010, Tan Xuguang gave a set of figures: In 2009, facing the economic crisis that engulfed the world, Weichai calmly embraced the challenges. It is expected that the Group's annual operating income will reach 54 billion yuan, a year-on-year increase of 10%. Total profits exceeded 4 billion yuan, an increase of 40% over the same period of last year.

For the contrarian growth of Weichai, Tan Xuguang believes that the greatest advantage the company has is a more solid and solid product platform. In 2009, Weichai not only launched a large number of its own-developed 10 liters and 12 litre blue engine, but also promoted 300,000 units of 3-litre and 4-litre low-power engine projects, 100,000 units of 5 liters and 7 units. In the medium-to-high power engine project, 300 high-power vessels with 3000 to 10000 hp have entered the commercialization stage. Weichai's product platform has become more large-scale and serialized. According to the market share survey, Weichai Power accounted for more than 40% of the heavy truck market with over 14 tons of load, and more than 80% of the 50 loader market. By the end of 2009, the number of Weichai engines in the market had reached 2 million units.

In order to maintain domestic first-class, internationally leading manufacturing and development levels, Weichai established the first domestic commercial vehicle powertrain assembly engineering technology research center in 2009; at the same time, it will form a new energy power system with 18 scientific research units and associated companies. The Industrial Technology Innovation Alliance has established a new energy company and established a production base of 50,000 sets of new energy vehicles that meet the National IV and National 5 emission standards.

It is through the construction of 10 liter, 12 liter, 5 liter, 7 liter, 4 liter, and 6 liter engines and a new energy power platform, as well as the expansion of passenger vehicles, medium light trucks, loaders, and other supporting markets. Weichai as a whole The characteristics of the series of power suppliers are becoming more and more obvious, and initially form a coordinated and effective market product structure.

In addition, in parallel with the growth in domestic demand, in 2009, Weichai’s product exports also maintained an upward trend: engine supporting exports reached 22,000 units, and the industry’s supporting export share increased from 44.6% in 2008 to 52.4% in 2009; 70 special maintenance service stations have been established overseas, covering the Commonwealth of Independent States, Africa, Southeast Asia, and the Middle East, and have initially acquired the power and capability to serve the world.

Behind the rapid growth of the Weichai engine in the whole machine market, the role of capital promoters can not be ignored. Through the integration of global resources, Weichai has increased the cooperation space of the industrial chain, which in turn has exerted a favorable influence on the market. Among them, on January 23, 2009, Weichai Power's subsidiary, Weichai Power (Hong Kong) International Development Co., Ltd., won a bid of 2.99 million euros for the products, technology, and brands of the French Baudouin company. Chai product support scope; on May 25, 2009, the listed company “Shandong Juli” was changed to “Weichai Heavy Machinery”, which mainly produces 6160 series, 6170 series, 8170 series, CW200 series medium-speed diesel engines and 15kW to 1250kW diesel. Generator set.

In a series of restructurings in 2009, the most influential one was the restructuring of Shandong Heavy Industries. On June 18, 2009, Shandong Heavy Industry Group Co., Ltd., established by three state-owned enterprises, Weichai Holding Group Co., Ltd., Shandong Engineering Machinery Group Co., Ltd. and Shandong Automotive Industry Group Co., Ltd., was established in Jinan. The core of the reorganization of Shandong Heavy Industry is Weichai Group, which is responsible for fulfilling the historic mission of making Shandong's equipment manufacturing industry stronger and bigger. The development plan of each plate of Shandong Heavy Industry is based on the engine and builds the competitiveness of the powertrain system in diversified markets such as vehicles, ships, and power generation equipment. Through this higher level of Shandong Heavy Industry Group, Weichai’s main business has added business segments such as bulldozers, excavators, and forklifts, and it has now four major commercial vehicles, construction machinery, power systems, and automotive electronics components. Class plate.

The product exhibition of Shandong Heavy Industry Group held in Jinan is a demonstration of the actual results of Weichai’s vertical and horizontal development in the capital market.

Force 2010 Locking Equipment Manufacturing Industry Group

The reporter found that the goal set by Weichai at the 2010 Business Conference was significantly different from that of the previous period, namely, the shift from an independent engine manufacturer and a high-powered general-purpose engine supplier to a globally leading, core, and sustainable development equipment. Manufacturing industry group.

According to the planning announced by the 2010 Business Conference, Weichai Group will ensure that in 2010 it will achieve sales revenue of 70 billion yuan and export revenue of 1 billion US dollars. On this basis, the Group has further defined the overall development plan for the next 3 to 5 years, that is, to produce and sell a full range of 1 million engines, 150,000 heavy vehicles, and 1 million heavy-duty commercial vehicle transmissions. This will create a core position for the power system and increase its efforts. Taking advantage of the competitive advantages of post-market services with auto electronics and components as the core, we have fully realized the grand vision of earning 100 billion yuan in revenue and entering the world's top 500.

In the core business of Weichai, the engine segment, in 2010, the Group will plan to sell 650,000 engines of various types with a full range of power suppliers. Among them, 280,000 sets of truck power, 30,000 sets of power for passenger cars, construction machinery Power is 130,000 sets and the ship is powered by 20,000 sets.

Based on the optimistic assessment of the macroeconomic environment next year, Weichai Group predicts that the equipment manufacturing industry, which is closely related to the growth of the national economy, such as construction machinery, commercial vehicles, ships, and generator sets in 2010, will have a better market performance. The market development report made by Zhang Quan, CEO of Weichai Power at the 2010 Business Conference, pointed out that as a strategic industry that provides technical equipment for various industries in the national economy, there is a huge opportunity for development in China's equipment manufacturing industry, mainly reflected in three aspects. :

First, the process of urbanization in China has gradually accelerated, providing strong support for the development of the equipment manufacturing industry. In the 30 years since the reform and opening up, China’s urbanization rate has increased from 20% to close to 50%, but compared with the urbanization rate of 70% in developed countries in Europe and America and 60% in medium-developed countries, there is still a large gap in China, which increases by 8 per year. Judging from the speed of %, China’s urbanization process will take at least 30 years. Within 30 years, as China's urbanization process continues to deepen, a large number of urban facilities will be added, and more and more commercial vehicle and construction machinery and other equipment manufacturing products will be required. According to predictions by major international companies on China, in the next five years, the market capacity of our loaders and excavators will both exceed 300,000, which provides very strong demand support for Weichai products.

Second, the global industrial landscape is undergoing major adjustments. China will become the center of the world's equipment manufacturing industry. The level of manufacturing is shifting from the low end to the high end. It is expected that 60% of the loaders consumed in the world in the next five years will be manufactured in China.

Thirdly, Weichai has formed a unique business operation model in years of market competition, that is, it has fully opened up the upstream and downstream industrial chains, and through the establishment of industrial alliances and other means, it has realized the sharing of resources and cooperation with partners in the same value orientation. Development, in turn, forms the core competence for companies to participate in global competition. One of the performances of this unique business model is that Weichai devotes itself to the full range of strategies for transportation and engineering power, whether it is in the field of transportation power such as commercial vehicles or marine transportation, or in engineering power fields such as construction machinery and power generation. The supplier reflects the basic goals of Weichai serving global partners and serving as a general-purpose power supplier; its second performance is that Weichai is committed to creating a win-win business model, through a bridge of communication with all partners, to capital , products as a link, jointly create value for customers, establish a value system that seeks development in cooperation and achieve win-win in development.

As a new economic growth point for Weichai, in 2010, Weichai will use the “5P Service Project” (ie, the Weichai Value-added Services User Project consisting of exclusive services, exclusive accessories, special oil, exclusive equipment, and professional remanufacturing). ) As the main content, build a post-market service platform. In 2009, Weichai created a revenue of nearly 1.8 billion yuan in the aftermarket through the "5P service project." It will further expand to 3 billion yuan next year. According to Weichai’s plan for 3 to 5 years, when the Group’s sales revenue reaches 100 billion yuan, and the production and sales of engines are 1 million units, the Weichai engine has a market holding of more than 5 million units, and the aftermarket business operated by Weichai will exceed 150. Billion, the value created for partners will exceed 2 billion yuan.

Committed to "two-wheel drive"

Chinese equipment "aircraft carrier" is about to depart

Regarding the status of China's equipment manufacturing industry, in 2006, China Industry News used eight typical cases as facts, and called for the “Helping State-owned Enterprise Reform” banner for multinational corporations, took the lead in China’s machinery industry, and implemented M&A plans. Phenomenon, in-depth analysis and reporting. When the financial crisis affected China's manufacturing industry in the second half of 2008, some professionals pointed out that the financial crisis has formed a forceful mechanism for the industrial upgrading of China's equipment manufacturing industry: On the one hand, a large number of low-value-added enterprises are eliminated from the industry reshuffle. It is a kind of necessity; on the other hand, after this round of reshuffling, the domestic equipment manufacturing industry will have a number of companies with strong independent innovation capabilities and strong capital strength. When problems arise in European and American manufacturing companies, Chinese companies will make cross-border mergers and acquisitions. With less resistance, there may be successful cases of a number of Chinese equipment manufacturing companies undertaking international mergers and acquisitions in the next year or two.

Compared with international equipment manufacturing giants such as General Electric, Siemens, Mitsubishi Heavy Industries, Caterpillar and other integrated manufacturers, China's equipment manufacturing companies are more monotonous in their business, sales and service networks are narrower, and their ability to resist external risks is weaker. . According to data from the Department of Equipment Industry of the Ministry of Industry and Information Technology, from January to September, the increase in industrial value added by the machinery industry fell by 4.2 percentage points year-on-year, and some products even experienced negative growth. New orders for machine tools, power generation equipment, and heavy machinery dropped sharply.

As the basic industry of the national economy, equipment manufacturing industry is the embodiment of the nation’s overall economic strength and technological strength. In the context of the industry reshuffled by the financial crisis, Weichai's business has risen against the market, and Shandong Heavy Industries has been established as the main participant, and the Chinese aircraft manufacturing industry has seen the emergence of the “aircraft carrier”.

From the successful experience of Weichai in the past 10 years, the two-wheel drive development model of product management and capital operation has not only absorbed the merger of the Hunan Torch, but also created three business segments: commercial vehicles, power systems, automotive electronics and parts and components. In addition, through the formation of Shandong Heavy Industry Group in June this year, the company has added bulldozers, excavators, forklifts, and other plates to lay a solid foundation for the core technology and sustainable equipment manufacturing industry groups.

In the absence of more external support, Tan Xuguang believes that the truly successful sharing of advantageous resources and the mutual benefit and cooperation of industry chain partners is the key to a successful business. In 2005, Weichai took the lead in putting forward the idea of ​​focusing on me and linking innovations. Its core connotation is to use the resources of the industrial chain to continuously improve the system's innovation capability, expand the profitability space of the industrial chain, and enhance the ability to synergistically resist risks. In accordance with this concept, Weichai has established strategic partnerships with a number of OEMs.

At the 2010 Weichai Business Conference, the theme that was emphasized was still "coordinated development, integrated innovation, and global service." In Tan Xuguang's words, healthy development is the basic premise. Continuous innovation is a powerful engine. Joint synergy is an inevitable requirement. Serving the world is the ultimate goal. The core is to unswervingly expand the collaborative development platform. Business covers commercial vehicles and powertrains. The three major industrial sectors of auto parts highlight the core advantages of the power system, and further optimize the integration of parts and components resources. At the same time, outside the group, all partners will further explore the core of the accessories, services, remanufacturing, and patented technology products. Market potential, to create greater value for our customers, distributors, service providers.

In the past 10 years, Weichai Group not only emerged and recovered from its predicament, but also created the “snapping of firewood”, and each year it created a “speed for picking wood” at high growth rates. According to analysis by industry experts, after Weichai has initially completed its restructuring in China, the next goal will be to further build internationalized firewood from the perspective of integrating global resources.