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Guangxi Yuchai builds an international brand through overseas operations

Known as Asia's most important transnational water system and mother river, the Lancang Mekong River rises in China, and flows through five Southeast Asian countries: Myanmar, Laos, Thailand, Cambodia and Vietnam from north to south via Yunnan Province. The river has bred hardworking Southeast Asian people from generation to generation, and witnessed the good-neighborly and friendly relations between China and the five Southeast Asian countries.

Government support and enterprise operation has become the theme of economic cooperation in the Greater Mekong Sub-region. This region is the largest and earliest overseas market that Yuchai, one of China's largest internal combustion engine manufacturers, has ever entered. After years of operation, Yuchai has made remarkable achievements in this region: By November 2014, the market inventory of Yuchai engines in this region had exceeded 90,000 units including over 10,000 units in Vietnam, and the annual inventory of Yuchai engines in this region is expected to exceed 100,000 units in 2014. Yuchai has become a Chinese enterprise with the largest engine sales and inventory in this region, singing the theme of Chinese power in this region.

Go out and stand out

Benefiting from the good-neighborly and friendly relations between Guangxi and Southeast Asia, Yuchai is a Chinese engine manufacturer which entered Southeast Asia earliest. In the early 1960s, Yuchai 2105 marine engines and generating sets began to enter the Vietnamese market. In the 1990s, Yuchai-powered engines were exported to Southeast Asian countries. To accelerate overseas export, Yuchai established its first overseas office in Vietnam to initiate its overseas operations.

However, European, American, Japanese and Korean auto brands with leading technologies have firmly held the Southeast Asian market and have been preferred by Vietnamese customers till the beginning of this century. The Vietnamese auto market is a "jungle" full of challenges and uncertainties to Chinese enterprises. On Vietnam's underdeveloped highways galloped heavy-duty trucks rare in China. Besides, heavy-duty highway tractors in Vietnam are mostly used long-headed heavy-duty trucks eliminated by Europe and America. In Vietnam's most developed city of Ho Chi Minh, Saigon Public Transport Company founded in 1975 is a subsidiary of Vietnam's largest bus assembly plant SAMCO. Almost all buses operated by the company are made in Japan, Korea, Europe and America.

This is the fact faced by Yuchai's Overseas Business Department when developing the Southeast Asian market. Take Vietnam for example, effects of early development in Vietnam were inconspicuous though the department's marketing team worked out a lot of ways in the early development of the Vietnamese market. Yuchai's engine sales in Vietnam were 100 or 200 units for straight years.

The change the actuality, Chinese enterprises like Yuchai sought to make breakthrough by various means.

At round 10 PM September 28, 2005, the first express bus run from Nanning to Hanoi, capital of Vietnam, ended at the destination--Kim Lien Hotel. That day, three luxury buses loaded with Chinese passengers left Nanning for Hanoi. In Vietnam, affected by the rainstorm triggered by the typhoon, much time was delayed and it was 10 PM when the buses arrived in Hanoi. Though it was late at night, the three Yuchai-powered express buses with Chinese characters attracted wide attention and caused a great sensation when they appeared in the street of Hanoi. Now there have been nearly 700 Yuchai-powered buses crossing the Sino-Vietnamese border line surrounded by mountains as a link of exchange between the two peoples.

Chinese enterprises including Yuchai deepened its operations for years afterwards. In 2007, Yuchai Vietnam Office led the senior executives of a Vietnamese vehicle assembly plant to China to find out the operation of Chinese buses. In 2008, over 200 Yuchai engines were installed on the buses of Beihe Public Transport Company in Hanoi.

To advance the truck market, Yuchai started from engineering dumper and gradually entered the market for deep operations. In the coal mining area in Quang Ninh, Vietnam, nearly 1,000 Chinese engineering dumpers loaded with coal moved forward slowly on rugged dirt roads here every day. As local coal reserves are rich, massive mining needs sufficient engineering vehicles. To enter the market, Chinese enterprise should stay united and improve their service quality. In 2006, Yuchai engines moved into the area in volume. To serve customers well, a lot of staff of Yuchai Vietnam Office stayed here for 15 days.

The outstanding services of Yuchai and Chinese automakers impressed Vietnamese customers deeply and made Chinese engineering vehicles occupy this market in an accelerated manner. Now 85 percent of engineering vehicles in Vietnam are powered by Yuchai.

With Vietnam as the center, Yuchai has constantly extended its territory in the ASEAN market--it has established offices in countries like Indonesia, Malaysia, Thailand, the Philippines and Myanmar to expand its brand share in the market. Its products have gradually entered fields such as automobile, construction machinery, agricultural machinery, generating equipment and shipbuilding in ASEAN countries.

Government support, enterprise operation

Reviewing its experience of operating in the ASEAN market over the past 20 years, Yuchai had deep feelings: as ASEAN countries differ vastly in such aspects as politics, economy, culture and religion, government support is critical to Chinese products' entry into the ASEAN market.

A good government platform is better than a special promotional conference.

The 1st China-ASEAN Expo (CAEXPO) took place in 2004 and Yuchai showed up with a strong lineup. Leading and complete products as well as grand pavilion design attracted attention from ASEAN countries and boosted Yuchai's sales in Vietnam and ASEAN.

Riding the wave of CAEXPO, government and enterprise delegations from countries like Vietnam, Laos, Myanmar and Malaysia visited Yuchai, thus constantly enhancing Yuchai's local influence in ASEAN countries. The number of enterprises visiting Yuchai for investigations and negotiations has been growing, and Yuchai's sales in Vietnam have been soaring with maximum annual sales of over 10,000 units. Since the inauguration of CAEXPO, Yuchai has participated in the exposition for ten consecutive years and benefited a lot from exchanges with ASEAN merchants in ASEAN market development.

Besides CAEXPO, Yuchai has kept enhancing the influence of its products via other various commodity fairs. By participating in international exhibitions, advertising and marketing, Yuchai has attracted an array of potential customers and partners. At China Guangxi (Vietnam) Commodity Fair, China Guangxi (Thailand) Commodity Fair, China Guangxi (Laos) Commodity Fair and China Guangxi (Myanmar) Commodity Fair every year, Yuchai has exhibited handpicked engines suiting these markets, with its booth attracting flocks of local government officials and merchants for visit, negotiation and cooperation agreement conclusion as an eye-catching view. Also, in association with domestic automakers, Yuchai has participated in Thailand's annual Bus & Truck, with its gas engines attracting wide attention from merchants.

Via the platform built by the government, Yuchai has renovated its marketing mode, tailored plans and policies to countries and customers, advanced market development in such aspects as commerce, products, services and technologies, and worked out operable work plans specific to countries and customers. Also, Yuchai has comprehensively practiced the model of agency service, constructed an agency service network with wide coverage and strong service ability in ASEAN countries, and sent service engineers to ASEAN countries, so as to further perfect service system construction and extend the network of product support outlets.

From export with vehicles at first to local vehicle modification, after over 20 years of development, Yuchai has developed from product sales to brand sales, with its products serving a wide range of fields in Southeast Asia such as automobile, agricultural machinery and shipbuilding. Yuchai's product quality, performance, after-sales service and support have been recognized by the Southeast Asian market.

Now cooperation in the Greater Mekong Sub-region is continuing to deepen, all the countries in this region are committed to improving cooperation level, intensifying interconnection and interworking construction, and promoting the integrated development of correlated innovative and open economies. This has created a rare opportunity for the economic development of the countries in this region, and brought a huge opportunity for Chinese enterprises' development in this region. Yuchai will seize the opportunity to continue consolidating its achievements in Southeast Asian countries, enhance its influence and market share in this region and make its due contribution to regional development.

Build the brand by reliable quality

With the gradual deepening of the cooperation between China and ASEAN countries, along the Greater Mekong River surrounded by mountains, Yuchai has been favored by locals gradually. Behind this are Yuchai's careful market surveys in the countries in this region. Yuchai's staff and engines have left footprints on the banks of the river. Based on acquired market information, Yuchai can customize products to satisfy customers to the utmost.

Customers are most concerned about product quality and service. Besides brand marketing planning, service is Yuchai's another important means of winning over customers and developing the market. To better serve ASEAN customers, Yuchai will continue to step up work on customer network, market environment network, distribution network and service network. In terms of service quality, Yuchai will strictly assess service agents' qualifications in such aspects as workplace, equipment and service capacity, export standards, effectively combine "Yuchai style" with "localization", build its service brand and consolidate the international competitiveness of its products. In terms of the structure of exported products, in the next period, Yuchai will rationally adjust the proportion of engines exported with vehicles to self-exported engines according to product features, tap and cultivate overseas OEM markets, promote the efficient interaction between domestic and overseas offices, and drive engine export with vehicles so as to improve the overall level of operation in overseas markets.

The market development of Yuchai Vietnam Office in Vietnam is a model for Yuchai's improving its level of overseas market operation. To improve its service network, Yuchai has established a consolidated parts storage in Vietnam in association with Antai Automotive Parts Company in Thai Binh. Through elaborate planning, the company has achieved annual sales of over 100 million yuan, and fulfilled the promise of delivering parts to northern customers within 8 hours and to southern customers within 20 hours.

In October 2014, China's vehicle exports to Vietnam were up 60 percent year on year. Thanks to outstanding services and product technologies, Yuchai became one of the biggest beneficiaries of the growth. Saigon Public Transport Company compared two buses which have long operated on a long-distance line from Ho Chi Minh to Hanoi: one is powered by a Yuchai engine and the other is powered by a Korean engine with the same displacement. The Yuchai engine has an average fuel consumption rate of 24L/100km, saving 6 liters compared to the Korean engine. As the distance between Hanoi and Ho Chi Minh is 1,500 kilometers, 180 liters of fuel and 1,080 yuan can be saved for a round trip. Now nearly two thirds of buses assembled at the company are powered by Yuchai engines. Even in Thailand in the lower reaches of the Mekong River, there are tens of millions of passengers from around the world shuttling amid mountains and waters aboard every year.

The breakthrough in the marine power market further enhanced Yuchai's local brand influence. On December 15, 2014, over 100 local enterprises gathered in Phnom Penh to celebrate the inauguration of Yuchai's another service outlet in Cambodia. Every year, there are thousands of Yuchai-powered generating sets serving local enterprises in Cambodia to fill the local power gap. "Turn to Yuchai for power"--the stability and reliability of Yuchai-powered generating units have gradually developed a good reputation along the Mekong River and been widely spread along the winding banks. Now in the estuary of the Mekong River--Ho Chi Min, Yuchai engines have become local fishermen's preferred power for ships and generating sets.

Of course independent brand establishment is inseparable from self export. Yuchai International Imp. & Exp. Co., Ltd. was established in April 2014, marking a major step of Yuchai in advancing product export and its overseas market strategy. The company's establishment further broadened Yuchai's export channels. Encouragingly, Yuchai's export advancement measures produced instant effects. By November 2014, Yuchai's engine exports had grown by 42 percent. In the future, the combination of multiple channels will make Yuchai's brand and products take deeper roots in overseas markets such as Greater Mekong River, link Yuchai's "production, sales and service" as a whole, and make Yuchai's terminal customers feel the charm of Chinese power more.

(Li Chunmei/Song Yonggeng/People's Daily Overseas)

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