Sinotruk makes inroads, achieves success in global marketplace

The China National Heavy Duty Truck Group, also known as Sinotruk, is eyeing opportunities created by the 18th Shanghai Cooperation Organization Summit held in Qingdao and making inroads into the markets of its members.

In February, the company won a vehicle procurement bidding contract to become the sole heavy duty truck provider for road construction projects totaling 710 kilometers in Kazakhstan by China Xinxing Construction and Development General Corporation.

Sinotruk will provide a first batch of 146 dump trucks and tractors for the project, according to the contract.

Employees of the China National Heavy Duty Truck Group, also known as Sinotruk, are flanked by trucks that have been exported to Kazakhstan. Photos Provided to China Daily

Heavy duty axles displayed by Sinotruk at an auto show in Shanghai draw interest from foreign buyers.

Wang Bozhi, chairman of Sinotruk, led a delegation to visit Xinxing after the contract signing, and expressed the company's willingness to strengthen cooperation with Xinxing in other projects around the world.

To prepare for the vehicle procurement bidding in Kazakhstan, Sinotruk sent overseas representatives to conduct detailed market research on the prices of sand and gravel, earthwork transport costs, local workers' wages and tax policies.

Sinotruk initiated its communication with Xinxing after winning the bid for its construction projects three years ago, providing Xinxing with details about its sales, network and after-sales services solutions and bespoke projects.

The company said that it had won Xinxing's trust with its sales data, after-sales services network and product quality, adding that winning the bid was testimony to its brand and market competitiveness in the largest Central Asian country by area.

The project will show Sinotruk's capabilities for large-scale infrastructure construction projects in the region, the company said.

This is another major deal that Sinotruk has reached in SCO member markets.

Sinotruk signed a strategic cooperation framework agreement with the administration and the operator of Gwadar Port in Pakistan in August 2017, another important step forward in the company's global expansion.

It has exported a total of nearly 50,000 trucks to SCO members, and remained China's largest seller of heavy duty trucks in Central Asia and South Asia, where it has realized a full coverage of its sales, services, and parts-supply networks, according to the company.

Headquartered in Jinan, capital of East China's Shandong province, Sinotruk has representative ofices in other SCO member countries - Russia, Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Pakistan and India.

It has a total of 350 market development and maintenance employees working in these countries. Also, Sinotruk has registered new companies in Russia and Kazakhstan and employs locals in company management.

Sinotruk said it looks forward to taking advantage of the SCO platform to promote industrial capacity cooperation with foreign countries and localize its assembling operation. It is currently engaged in three knocked-down assembly projects with SCO members, which will create jobs for locals, enhance the competitiveness of its products and boost relevant industrial upgrading and development in the host countries.

Sinotruk exported 12,004 heavy duty trucks from January to April, up 30 percent yearon-year, the fastest growth period in the company's history.

Sinotruk's heavy duty trucks, which have reached Euro V emission standards, have entered the markets of Ireland, Brazil, New Zealand and China's Hong Kong.

It is the first Chinese truck brand that has not only entered the Western European market, but also assembled trucks according to its knocked-down model in the region.

Last year, Sinotruk exported 33,700 heavy duty trucks, up 26.8 percent compared with 2016, which accounted for 49.2 percent of China's heavy duty truck exports, up 2.3 percentage points year-on-year. Some 11 percent of its total sales went to international markets.

According to comparable statistics, Sinotruk's revenue from exports (export delivery value) in 2017 was 10.09 billion yuan ($1.58 billion), up 15.7 percent year-on-year, which has made Sinotruk the largest heavy duty truck exporter in China for the past 13 years.

Founded in 1956, Sinotruk produced China's first ever heavy-duty truck. It introduced a heavy-duty truck project from Steyr, Austria, in 1983, becoming China's first company to import heavy-truck manufacturing technologies from abroad. The company was listed on the Hong Kong Stock Exchange in 2007.

Over the past decade, the company has expanded its business from just a truck manufacturer to an exporter and international service provider. It has set up six regional headquarters, covering Southeast Asia, the Middle East, South Africa, North Africa, Central Asia and South America.

The company has more than 590 service centers, 72 representative offices and 15 knocked-down assembly factories in its overseas sales network, covering more than 100 countries and regions.

It is betting big on the overseas market, with the expectation that half of its total sales will come from outside of China by 2020, according to the company. The rising demand in Africa and countries involved in the Belt and Road Initiative has played an important role in beefing up its exports.

"We made it a corporate strategy to go global as early as 2004, and we have been China's largest heavy truck exporter for 13 years in a row, totaling more than 300,000 units," said Yang Zhengxu, president of Sinotruk International, a subsidiary dedicated to its overseas operations.

Lan Junjie, general manager of the manufacturer's international department, said Sinotruk has set a firm goal to increase its presence in developed countries.

(China Daily 06/09/2018 page5)