The cooperation between diesel engine enterprises and vehicle companies


At present, there is no unified cooperation model between domestic diesel engine companies and vehicle manufacturers. When talking about the reasons for this, industry experts believe that different models are formed during the historical evolution and will change with the development of China's auto industry.

In the era of planned economy, China’s auto plants and engine plants have their own responsibilities, and the supporting problems are completely solved by the state. China's internal combustion engine companies mainly support agricultural vehicles. In the transition from a planned economy to a market economy, some of the central enterprises were decentralized to localities, and the state no longer provided them with supportive issues. Therefore, industry consolidation occurred, such as Dachai and Xichai entering FAW and Chaochao entering Dongfeng. In the process of integration, there are still some independent development companies such as Weichai, Yuchai, and Shangchai. As China enters the era of market economy, the model of cooperation between diesel engine companies and vehicle companies is also more diversified.

Now, companies such as Yuchai and Yangchai, Yunnei, Changchai, etc. supporting light vehicles still exist as independent suppliers. Chaochai is a holding subsidiary of Dongfeng Motor Corporation. Xichai is a branch of FAW Group. Its original brother company, Dashicha, now has a new identity and is a joint venture between FAW Group and DEUTZ. Dongfeng Cummins, Xi'an Cummins, and Chongqing Cummins are joint ventures between Cummins Inc. and different partners in China. Weichai is a special case that is considered by many to be a difficult-to-copy model and has achieved control over the automaker.

Ni Hongjie, chairman of China National Internal Combustion Engine Industry Association, believes that the development of internal combustion engine companies is a dynamic process, and the cooperation model with vehicle companies will change in the future. He said: “From a worldwide perspective, whether it is a commercial vehicle company or a passenger vehicle company, large-scale automobile manufacturers hope to have their own engine factories. According to the needs of domestic and foreign market competition, the reorganization of Chinese companies’ assets will certainly accelerate. This is good for the development of the country and the enterprise. From the perspective of the association, we hope to promote such a situation."

Join the vehicle company for stable support

In the process of the development of the Chinese auto industry, many independent diesel engine companies have entered the auto group in order to seek a stable supporting relationship.

In the era of planned economy, some enterprises were decentralized from the central government to localities. Under the circumstances that the entire industrial structure has changed, the original automobile manufacturer only needed to find a stable supporting diesel engine plant, so there was a round of diesel engine plants and automobile plants. Reorganization boom.

Xichai joined FAW in this round of restructuring. After experiencing “three in two outs”, he eventually became a specialized branch under the liberation of FAW.

As a FAW plant, Xican mainly provides FAW equipment. The assembly of the Jiefang J6 heavy truck that was released shortly ago is the Aowei and Aoba diesel engines produced by Xichai. Xu Wuying, a staff member of Xichai, told the reporter: "The two engines were jointly developed by Xichai and FAW Technology Center. We are in line with FAW's total development plan for product development."

At first, Xichai entered FAW to find a stable supporting market. It turns out that Xichai did achieve this goal. An industry expert told reporters: “Xichai is reasonable to enter FAW, and it is still part of FAW, and there is nothing wrong with it. However, with the increasingly fierce market competition, FAW will restrain Xichao. This depends on how the company operates. Is Xicca allowed to face the social market? If so, how can the price be determined?"

Xichai apparently also realized this problem. Xu Wuying said: "There is a good vehicle manufacturer to rely on, but can not completely expect the vehicle factory. We should adapt to the market, the market economy or to find a variety of ways of cooperation."

In May of this year, Shanghai Volkswagen Bus and Xichai reached a cooperation agreement to assemble the 4DF3-15E engine of the plant. In July and August, the company purchased a total of more than 40 Xiamen Xiamen passenger cars equipped with the plant's State III diesel engine. Today, there are many bus companies that cooperate with Xichai. Apart from the Xiamen Golden Trip, they have cooperated with Xiamen Jinlong, Dandong Huanghai, Zhengzhou Yutong and Ankai.

“We have established long-term cooperation relationships with many automakers, but certainly not in the same relationship with us and FAW. We will be able to support other companies on the premise of satisfying FAW,” Xu Wuying said. Our products for other OEMs are independently developed based on Xichai."

After reorganization, Chaochai joined the then-famous Dongfang Automobile and now is Dongfeng’s holding subsidiary. Although he is also affiliated with the vehicle manufacturer, Zhang Guijun, director of the Publicity Division of the Dongfeng Chaochai Party Committee Working Committee, believes that Daw Chai’s self-development space is greater.

In terms of expanding the external market of the Group, Chaochai has recently launched a new initiative. On September 26, Chaochai and Anhui Jianghuai Automobile Co., Ltd. jointly invested in the establishment of an engine company. The proportion of the shares of the two companies was 90% for Dongfeng Chaoyang Diesel Engine Co., Ltd. and 10% for JAC. It is reported that the products of the joint venture company will remain unchanged, and Jianghuai Automobile Co. and the South Market will be the main products. After it is put into production, it will reach an annual production capacity of 50,000 diesel engines.

Why do they have this move? Zhang Guijun said that it was market pressure. "Now that companies must survive, there must be a market with multiple demands, and they must only stare at one family, certainly not at all. In addition to our subsidiary, Dongfeng has its own engine plant, Dongfeng Cummins. In addition, Yuchai also occupies a large proportion. ”

The relationship between Chaochai and Jianghuai Company is different from the relationship between Chaochai and Dongfeng. Zhang Guijun said: “Zhaochai is a holding subsidiary of Dongfeng, which is related to assets. Jianghuai Automobile Co., Ltd. and its major supporting companies have established Jiangqi Group. We are closely associated with Jianghuai and Huaihua and have no assets relationship.”

Compared with Western companies, the management of diesel engine plants by Chinese auto companies is not yet open enough. It is understood that most western auto groups have only capital management for subordinate diesel engine plants, and management in R&D and operation is very open.

Ni Hongjie predicts: "In the future, due to the needs of domestic and foreign market competition, asset restructuring will certainly accelerate." He also reminded: "Can not engage in administrative orders as planned economic times, local governments should not only consider the local one, but also according to the market It depends on the specific circumstances of both parties."

Relatively more independent diesel engine companies in China

In order to seek stable support and to ensure the development of the company, many diesel engine companies have chosen to rely on OEMs. This is also true from a worldwide perspective.

In the field of commercial vehicles, there are four major engine plants in the world, namely Cummins of the United States, Deutz of Germany, Perkins of the United Kingdom, and Detroit Diesel Engine Plant of the United States. With the integration of the global automotive industry, most of the world’s engine plants have reorganized with OEMs, in addition to Cummins and Deutz. Today, Perkins in the “Big Four” has entered the Caterpillar Group, and Detroit Diesel Engines has joined the Mercedes-Benz Group.

Relatively speaking, there are still many independent diesel engine companies in China. Ni Hongjie told reporters: "China has so many independent diesel engine plants, it can be considered a feature!"

China's commercial vehicle industry developed very slowly more than 20 years ago, but the internal combustion engine industry developed relatively quickly. There were many diesel engine factories very early on. At that time, they mainly provided agricultural vehicles and construction machinery. With the integration of the automotive industry, some diesel companies have entered the vehicle industry and many still exist as independent suppliers. Ni Hongjie believes that the integration of China's auto industry has not yet been completed. In the future, more diesel companies will join the vehicle industry. Because the core technology of the car is on the engine, the big auto companies need their own engine plants; the engine plant also hopes to have a Stable supporting objects. The reorganization of advantageous assets will benefit the development of the country, industry and enterprises.

Can an independent supplier develop well? Ni Hongjie believes that it cannot be generalized. Yuchai, as an independent supplier, has developed very well. For the reasons, he analyzed: "First of all, Yuchai has a long-term cooperative relationship with Dongfeng. Second, Yuchai has a wide range of supporting facilities. Third, Yuchai has strong research and development capabilities, sufficient technology reserves, and can continuously meet Market demand.” At the same time, he stressed that for diesel engine companies, having a strong R&D capability is crucial.

There are few supporting enterprises like Yuchai, and most diesel companies still choose a certain area as their main market. Fan Jianming, Manager of Yangchai Culture Communication Center, told reporters: “Yangchai is focused on supporting light vehicles because this market is in line with our product advantages.” Nanjing Iveco Yuejin Automobile Co., Ltd., which has a matching relationship with Yangchai for more than 30 years, will have 4 Ten thousand cars were exported to Russia one after another, of which 60% used Yangchai III engine. In addition, Beiqi Futian and Jianghuai Automobile Company are the main supporting customers of Yangchai.

Most of the diesel engine plants supporting light vehicles are independent suppliers. In addition to Yangchai, there are Yunnei, Laidong, and Quanchai. An industry source told reporters: "Generally speaking, the production capacity of light vehicle companies is limited. It is very uneconomical to establish a diesel engine plant, so the light vehicle industry has retained such a structure."

After all, diesel engines are not end-products, and diesel engines have certain difficulties if they want to become bigger and stronger independently. Fan Jianming said that if the time is ripe, Yangchai may also be a joint venture with the vehicle manufacturer.

Sino-foreign joint ventures to introduce technology favored

As Ni Hongjie said, the integration of China's auto industry has not yet been completed, and the model of cooperation between diesel engine plants and auto manufacturers is still changing.

When Xichai entered FAW, Dachai was also assigned to FAW. However, FAW and Germany's famous engine manufacturer Deutz formed a joint venture with Deutz FAW (Dalian) Diesel Engine Co., Ltd., each with a 50% stake. Since then, Dachai has turned from a wholly-owned subsidiary of FAW into a Sino-foreign joint venture.

Before the joint venture, Dachai, like Xichai, mainly supplied the internal market of FAW Group. What changes will happen after the joint venture? A staff member of the company who asked not to be named told reporters: “The joint venture has just begun and many things are still inconclusive, but there will certainly be changes. In the past, we have not involved much in the field of passenger cars and construction machinery, and we have passed Deutz products. We will develop a broader market."

In 2002, Dachai introduced Deutz technology. Through years of cooperation, the formation of a joint venture between the two parties can be described as a matter of course. However, the reporter learned that Germany has offered a joint venture initiative, but still feel a little surprised. The person explained to the reporter: “Deutz is currently selling well in the international market. They urgently need to find new partners to expand their production capacity. After our new factory is built, the products can fully meet their quality requirements. The domestic labor cost advantage is also an important reason for them to find cooperation with us."

After their joint venture, they will adopt a dual-brand strategy. In terms of product development, Deutz only needs to make some adjustments to the product according to market changes. Dachai's products are still based on independent development, but they will draw on the German side's development methods.

Many people are very optimistic about the joint venture between FAW and Deutz, and people in the industry call it a half century and a century. Compared with the original, what are the advantages of Dachai, a Sino-foreign joint venture company? “Through a joint venture, we can have more mature world-class products and use Deutz sales network to push our products to the international market. And in the process of cooperation, we can introduce their quality control methods and management tools. This is very good for us to develop at a higher level," said the staff member who asked not to be named.

China’s huge auto market has attracted Deutz, one of the world’s four largest commercial vehicle engine plants, and has also attracted Cummins.

As an independent supplier, Cummins relies mainly on technology exports for the international market, which is particularly prominent in the Chinese market.

Chongqing Cummins is the starting point for Cummins' local production in China. In 1981, Cummins and China National Heavy Duty Truck Group formally signed a license agreement to begin production of Cummins diesel engines at the Chongqing Automobile Engine Plant.

Holding vehicle factory Weichai model is unique

Referring to the cooperation model with the auto manufacturers, we must mention Weichai. Weichai has a unique model that many people believe is difficult to replicate and has achieved control over the automaker.

Ni Hongjie said: “After leaving Sinotruck, in order to make up for the lost market, Weichai needs to find new partners.” Weichai, which was listed in Hong Kong in 2004, has achieved control over Shaanxi Zhongqi by absorbing the merger of Hunan Torch. . The group owns Weichai Power, Shaanxi Heavy Duty Truck, Fast, Hande Axle. Many people believe that Weichai has a gold industrial chain.

This coincides with the idea of ​​Tan Xuguang, Chairman and CEO of Weichai Power Co., Ltd.: “Weichai has the highest quality industrial chain, and the synergy effect is very good, and there is no internal competition.”

In the recent semi-annual report, Tan Xuguang put forward three principles: strategic unification, resource sharing, and independent operations.

Sino-foreign joint ventures to open up markets and introduce one of the technologies should not be less

In 1995, the original permit production plant officially became a reciprocal joint venture between Cummins and its Chinese partner. In 1996, Cummins and Dongfeng Motor Company formed Dongfeng Cummins Engine Co., Ltd. In December 1999, Dongfeng Motor Company transferred its holdings to Dongfeng Motor Co., Ltd., each holding 50% of the shares. At present, Dongfeng Cummins has an annual production capacity of 180,000 units, which is Cummins' second largest engine production base in the world. After that, there are many joint ventures such as Xi'an Cummins. "Cummings has established a joint venture with Chinese companies to build factories in China by providing technology." Ni Hongjie told reporters.

Holding vehicle factory is unique

He explained: "In terms of brand strategy, Weichai Power is a brand, and Shaanxi Heavy Duty Truck is a brand. If we must establish Weichai Power Shaanxi Heavy Duty Truck, it is a waste of resources because it is not a 1+1. The relationship between the two is that the grand strategy is Weichai Power, and the sub-strategy is Shaanxi Zhongqi. The sub-strategy supports the grand strategy, and the grand strategy must include the sub-strategy.”

Compared with other companies, Weichai does not have strong control over subordinate companies. Weichai and Shaanxi Zhongqi have more of a relationship based on capital. Therefore, Weichai can release Shaanxi Zhongqi's hands and allow it to operate independently.

“Weichai Power has come to the present day entirely because of the result of market-oriented operation. We are the only company in the industry in China that has formed a complete industrial chain in the capital market.” Talking about Weichai's performance in the capital market, Tan Xuguang is very Sayfully: "Weichai has restructured and merged with the Hunan torch, and it has become the largest shareholder in the first step; in the second step, the Chinese securities market has defined it as a Weichai model."


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