Sinotruk eyes overseas markets for growth

A global strategy will be crucial to supporting the growth of China National Heavy Duty Truck Group, also known as Sinotruk, in the coming years, according to company executives.

Ma Chunji, chairman of the company based in Shandong province, said their target was to have the overseas market contribute 50 percent of Sinotruk's overall sales revenue by 2020, compared with 30 percent last year.

"Sinotruk has established a strong level of competitiveness in the global market. Our exports will support our overall sales performance," Ma said.

Sinotruk's income from exports increased 13.7 percent year-on-year to 8.08 billion yuan ($1.21 billion) in 2015. It has ranked first among Chinese heavy truck exporters by volume for 11 consecutive years.

Since implementing a "going global" strategy in 2004, the company has transformed itself from a heavy truck producer to a service provider in overseas markets, according to Ma.

A global marketing and service system that is able to provide marketing, sales service and react to clients requests in an efficient and effective manner has been developed, he said.

The company has established six regional service centers in Southeast Asia, the Middle East, South Africa, North Africa, Central Asia and Russia and South America.

It has more than 250 service stations, 225 parts warehouses and upward of 330 sales dealers in nearly 100 foreign countries.

Sinotruk not only encourages its sales staff to learn foreign cultures and languages to better integrate into the local society, but has established trust among clients in overseas markets for its life-cycle vehicle services, according to Liu Wei, deputy general manager of the company.

"Premium after-sales service has played a more significant role in supporting brand building in overseas markets than premium products themselves. Services can create more brand value," said Liu, adding that the company has maintained strict quality standards in foreign markets aimed at supporting its brand building, capital management, talent, technology and market development.

In 2009, Sinotruk established a long-term strategic partnership with German commercial vehicle manufacturer MAN, aimed at upgrading its technologies. MAN obtained 25 percent-plus-one share in Sinotruk Hong Kong for 560 million euros ($627 million) and agreed to transfer its advanced technologies to the Chinese firm.

The partnership allows Sinotruk to produce trucks that meet European standards and enhance its competitiveness in the global markets.

"I can proudly say that Sinotruk's engines and spare parts can compete with those produced by the world's leading truck makers in many aspects, including reliability and life cycles," said Cai Dong, chief executive oficer of Sinotruk. "We know those are preconditions for us to enter into high-end markets in developed countries."

Sinotruk has implemented a multi-brand strategy to strengthen its competitiveness in segment markets, Cai said, adding that it has developed four brands - Sitrak, Howo, Steyr and Hohan - to serve different market segments.

To date, the company has expanded its offering to more than 3,000 truck types in nine categories, compared with the 78 types under one category that it offered in 2001.

It also ranks first among Chinese truck makers for the number of drive formats and engine power. It now has a distribution network covering 96 countries and regions including Southeast Asia, Africa, the Middle East, South America, Central Asia, as well as some developed markets such as New Zealand, Australia and Singapore.

tangzhihao@chinadaily.com.cn

(China Daily 09/05/2016 page44)