Driving onward in a competitive race

In September 2011, the first model, Luxgen 7 SUV (sports-utility vehicle) hit the market and joined the competition in China's fastest growing auto segment. A year later, its second model, Master CEO, a luxury multi-purpose vehicle rolled off the production line.

"It's quite difficult for a new auto brand to compete in the red-hot sedan segment. Then we took a different tack to tap into the big SUV sector," said Wu. "That helped Luxgen develop a high-end image from the beginning."

Wu told China Daily that his second out-of-the-box strategy was innovative-experience style marketing. "Powerful interaction with our customers can help us in our vision of deeply touching people's hearts, which is what I mean by successful marketing.

"Impressing the market with our 7 SUV, we nicely timed the launch of the Master CEO, which we call a limousine for masters," he said.

Although the Master CEO targeted a niche market with limited sales, Wu said the model reinforced Luxgen's high-end position in the market. "With a clear luxury image created by the 7 SUV and especially the multi-purpose vehicle Master CEO, it was time for Dongfeng Yulon to make a foray into the sedan segment this year with our Luxgen 5 Sedan."

Again to make a difference, Luxgen's 5 Sedan was highly integrated with intelligent technology. "Our 'Pad in Car' intelligence system fully connected the car and the mobile phone," said Wu, whose eyes shine when he talks about the technology.

Dongfeng Yulon plans to have eight models produced on four different platforms by 2015, at its Hangzhou plant, which has an annual production capacity of 120,000 vehicles and 200,000 engines, in the first phase of the project.

To further establish its brand among China's young generation, Dongfeng Yulon managed to get its vehicles used in the Chinese action comedy movie Black&White episodes I and II.

"Dongfeng Yulon planned to first stabilize our brand in the market within three years - something we have already achieved - and then expand brand awareness and acceptance over the next five years. Then continue to reinforce it step-by-step in the coming decade," said Wu. "Even the German automakers spent 20 years forging a strong foothold here in China. We need to be patient."

For Wu, developing a "wow" image is just one part of his brand-building strategy. "Over a long-term perspective, it is fatal to compete with foreign joint venture products simply on basic capability. Luxgen should withstand the test of the market and customers."

According to Wu, when he developed Feeling 30 years ago in Taiwan, Yulon equaled the production standard to Japanese automakers. "And now we are lifting the bar to meet European standards, not only in production but also in management," the president said. For instance, Dongfeng Yulon partnered with Delphi on control systems and cooperated with Magna on transmission. They are both global leaders in the automotive parts industry.

"Quality and technology come before price. We choose the best partners and suppliers from the very beginning to guarantee high quality from the starting point," said Wu. There was no bombast or conceit in his words.

In JD Power's newly released report 2013 China Automotive Performance, Execution and Layout Study, which was published this month, when it comes to the appeal of new vehicles, Luxgen ranks highest among Chinese domestic self-developed brands and was one of the only two among them that was above the industry average.

Now in its 11th year, the study examined how gratifying it is to own and drive a new vehicle, based on owner evaluations during the first two to six months of ownership. The study examines 82 attributes across 10 vehicle performance categories. The study also found that new-vehicle performance has a strong impact on customer loyalty and advocacy. The more satisfied owners are with the performance of their vehicle, the more likely they are to recommend it to others and repurchase from the same brand in the future.

"We always set our eyes 10 years ahead. And we know if we go toward our vision step-by-step, we will succeed," said Wu.

Q+A: Hsin-Fa Wu