On the morning of March 7, Yuchai, CSR and Nanjun made a joint investment to establish CSR Yuchai Sichuan Engine Co., Ltd. (CYSE) in a bid to build a western engine research, development and manufacturing base in Ziyang, Sichuan and shape a model of Chinas machinery building industry in resource integration and market collaboration. The signing and unveiling ceremony was held in Beijing.

Wang Shaoxiong, member of the Standing Committee of the CPC Sichuan Provincial Committee, vice chairman of the Standing Committee of the Sichuan Provincial Peoples Congress and Party secretary of the State-owned Assets Supervision and Administration Commission of Sichuan Province; Li Jia, secretary of the CPC Ziyang Municipal Committee and chairman of the Ziyang Municipal Peoples Congress; Luo Qinhong, deputy secretary of the CPC Ziyang Municipal Committee and Ziyang Municipal Peoples Government; Tian Yadong, mayor of Ziyang; Zheng Changhong, president of CSR; Yan Ping, chairman of Guangxi Yuchai Machinery Group Co., Ltd.; leaders of relevant departments of Sichuan and Ziyang, as well as persons in charge of CSR, Yuchai, CSR Ziyang Co., Ltd. and Ziyang Nanjun Automobile Co., Ltd. were present.

Zheng Changhong, Wang Shaowei, Li Jia and Yan Ping (from left to right) jointly inaugurate CYSE

Yan, Zheng and Li addressed the ceremony. Yan said, The ceremony marks the establishment of the strong combination between Yuchai and CSR. The cooperation with CSR in the engine area is a business innovation under the guidance of the strategic principle of focusing on one business and developing in depth, will broaden Yuchais industrial areas and extend its overall industry chain, make Yuchai preliminarily form the capacity for manufacturing a full series of low, medium and high-speed engines, boost Yuchais competitiveness in the engine industry, be conductive to building Yuchai into a professional engine supplier, and play a positive role in promoting Chinas industrial development.

In the eleventh five-year period, through industrial layout adjustment, industrial resource integration and industrial structure optimization, Yuchai wound up the two-flank domestic industrial layout, built two product chains-engine chain and construction machinery chain, as well as several industrial clusters. In the twelfth five-year period, Yuchai will ensure the sustainable, fast, healthy and coordinated development of the two product chains and several industrial clusters, perfect the domestic production layout and work out the global production layout in strong combination with famous domestic and overseas enterprises including CSR as sell as upstream and downstream assets, in an effort to build the engine chain into the most competitive and valuable golden product chain in the global engine area on the basis of consolidating the lead in the domestic diesel engine chain at the end of the twelfth five-year period.

Zheng said that the combination of CSR and Yuchai was conductive for both sides to integrate marketing resources, improve R & D platforms and further sharpen market competitiveness t promote the fast development of Chinas engine industry.

Li said that the CPC Ziyang Municipal Committee and Municipal Government would firmly establish the concept of environment is productivity, environment is safety valve, and environment is strategic resources, fulfill preferential policies, and provide first-class service support, create a better external environment and build a more favorable development platform for the cooperation between the two sides.

Wang made a speech, extending warm congratulations on the establishment of the new company and heartfelt thanks to the long-term contributions of the three sides to Sichuans economic and social development on behalf of the CPC Sichuan Provincial Committee and Provincial Government! He said, Sichuans people will never forget the remarkable contributions of enterprises like CSR and Yuchai to the post-quake reconstruction of Sichuan. After the May 12 earthquake, CSR intensified investment in the locomotive manufacturing enterprises in Sichuan, invested a total of RMB 520 million to transfer high-power electric locomotive technology to Sichuan and construct an internationally advanced electric locomotive manufacturing base in Ziyang; Yuchai signed the first post-quake order with Ziyang to invest RMB 600 million in constructing Yuchai Ziyang engine industry park. Now, the two enterprises deepens cooperation by joining hands to build the largest engine research, development and manufacturing base with annual sales revenues of over RMB 10 billion in the west of China. This is of great significance to stimulating the development of the provinces supporting industries such as machinery, electronics, iron and steel, and wire materials. Wang said, We will vigorously advance the business of CSR and Yuchai in Sichuan as a major industry of Sichuan.

Gu Tangsheng (M), Luo Yanming (R) and Sun Zhentian (L) sign the agreement on behalf of respective sides

Gu Tangsheng (M), president of Guangxi Yuchai Machinery Group Co., Ltd.; Luo Yanming (R), chairman of CSR Ziyang Co., Ltd. and Sun Zhentian (L), chairman of Ziyang Nanjun Automobile Co., Ltd. signed the Agreement on Joint Investment and Cooperation between Guangxi Yuchai Machinery Group Co., Ltd., CSR Ziyang Co., Ltd. and Ziyang Nanjun Automobile Co., Ltd.; Luo Qinhong (L), deputy secretary of the CPC Ziyang Municipal Committee and Ziyang Municipal Peoples Government and Zhang Zhengqing (R), chairman of CYSE signed the Agreement on Project Construction between Ziyang Municipal Peoples Government and CSR Yuchai Sichuan Engine Co., Ltd.

CSR, Chinas largest rail transit equipment developer and manufacturer, enjoys prominent influence in world rail transit equipment manufacturing. In 2010, it ranked 2nd in the global rail transit equipment industry. Yuchai, Chinas largest engine developer and manufacturer, boasts an annual production capacity and sales volume of over 600,000 diesel engines and over 10,000 small and medium-sized construction machines, and is reputed as the capital of Chinese green power. In April and October 2010, CSR and Yuchai successively signed the Framework Agreement on Strategic Cooperation and Letter of Intent on Joint Investment and Cooperation, the cooperation between the two groups will be conducive to the mutual complementing of the two sides, accelerating the common development of the two enterprises, boosting the upgrading of the core technologies of Sichuans enterprises and promoting Sichuans local economic development.

With a Phase 1 registered capital of RMB 300 million and a total investment of RMB 3 billion, the newly established CYSE will achieve an annual output value of RMB 10 billion and total taxes and profits of RMB 1 billion at full capacity. In three to five years, Ziyang will be built into an internationally competitive and domestic first-class manufacturing base for Yuchais medium-speed engines.

Text by Yan Bing, text/photo by Chang Guoli