Chinese enterprise helps power India

BEIJING - After countless hours being bounced and shaken on dilapidated roads around India, Xu Huadong finds the country "interesting."

"There is a huge gap between the rich and poor, but most people seem happy regardless of their wealth," says the chairman of Chinese machine and generator manufacturer Power HF.

"They also have a very good habit of saving. If some thing is wrong, they like to repair it, and will repair it many times. This provides a good opportunity for maintenance services."

Power HF, based in Weifang city, East China's Shandong province, has exported 38,500 engines to India for use in telecom base stations across the country. If those base stations break down, more than 100 million Indian mobile users will be affected.

The firm has also set up a network of 174 service stations employing more than 1,500 local people across India to provide 24-hour maintenance services.

Founded in 1920, it has developed into one of the leading manufacturers of the off-highway diesel engines in China.

Its business in India started in 2007, when the Reliance Group, one of the top three telecom companies in India, ordered the engines.

In 2005, China's engine and generator industry saw a trend of excess production capacity as a result of massive investment at a time when Power HF was seeking opportunities overseas.

Like many other Chinese manufacturers, most of its business then was limited to exporting. The big order from India prompted a rethink.

"Buyers of complicated products like engines must need after-sales service. Most Chinese enterprises still depend on exporting products to make money, but international experience tells us that service is the source of more profit," says Xu.

Already well traveled, Xu conducted a thorough market investigation before deciding to open a service business in India.