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Recently, Dongfeng Commercial Vehicle Co., Ltd., established by Dongfeng Motor Group (hereinafter referred to as Dongfeng) and Volvo Group (hereinafter referred to as Volvo), was officially established with a registered capital of 9.2 billion yuan, of which Dongfeng holds 55% of the stock and Volvo holds 45. % of equity.
Dongfeng and Volvo are each leading companies in the field of heavy-duty trucks at home and abroad. When the two parties marry together, the heavy-duty truck industry slows down. This cooperation is bound to bring more intense competition and profound changes to the domestic heavy-duty truck industry. In this situation, more domestic heavy truck companies have begun to seek market breakthroughs, and increasing R&D investment in new energy technologies, especially natural gas technologies, has become a direction for many heavy truck companies to work together.
Strong alliance
For this cooperation with Dongfeng Motor Group, the president of Volvo Group Europa Pesson stated: “The truck market in China is equal to the sum of Europe and North America, and it is the largest truck market in the world. Volvo Group regards China as a strategic plan. At the top priority, we will pool our strengths and work together to create the most competitive and sustainable international company in the world, and ultimately achieve a win-win situation."
In fact, two years ago, Dongfeng and Volvo had reached a strategic cooperation agreement. After a long period of government approval process, this paper agreement finally became a reality at the beginning of 2015.
At the inauguration ceremony of Dongfeng Commercial Vehicle Co., Ltd. held on January 26, the relevant responsible person disclosed that the joint venture company will develop, manufacture, and sell “Dongfeng†brand vehicles in collaboration with Dongfeng Automobile and Volvo Group's advantageous resources, and the products will cover medium and heavy trucks and passenger cars. , special vehicles and chassis, engines, gearboxes, etc. The joint venture company will also use the technology and expertise of both parties to continuously upgrade and upgrade the product platforms of medium- and heavy-duty commercial vehicles, comprehensively upgrade the commercial planning and R&D capabilities of Dongfeng commercial vehicles, build a world-class advanced commercial vehicle technology center, and build a strategic development plan. Required overseas manufacturing system and overseas sales system.
In addition, the reporter also learned that in the joint venture company, the board of directors consists of seven directors, four from the Dongfeng Motor Group and three from the Volvo Group. The chairman and general manager are appointed by Dongfeng Motor Group, and the vice chairman is appointed by Volvo Group. The first chairman was Zhu Fushou, general manager of Dongfeng Motor Group, and Huang Gang, general manager. Judging from the arrangement of the board of directors of the joint venture company, Dongfeng Motors occupies an absolute right of discourse in this joint venture and cooperation, and the reason lies in the urgent need and desire of Volvo for the Chinese market.
In 2003, the heavy truck business of Volvo Group once had a failed "marriage" with Sinotruck. On June 9th of that year, he tested nine years of Sinotruk and Volvo's "King Knot". The two sides invested a total of RMB 1.6 billion in the proportion of 50% of their respective contributions, and established Jinan Huawo Truck Co., Ltd. with a cooperation period of 30. year. According to the planning of the joint venture partners, the cooperation is mainly to use Volvo's technology to transform high-end heavy-duty truck platforms and form small batch production capacity as soon as possible. However, after the cooperation began, the two sides continued to have contradictions. After the cooperation, the displeasure and contradiction caused both parties to end up with “divorce†in 2009. However, for the Volvo Group, the Chinese market is a market that cannot be lost, and it is necessary to select new partners as soon as possible to restart the voyage.
In the process of selecting new partners, the Volvo Group is also experiencing a huge impact from the global financial crisis and the economic downturn in Europe. The data shows that in 2009 Volvo Group lost as much as 147 SEK. In order to resume growth, the Chinese market is a crucial part. Therefore, Volvo Group finally chose to abandon its controlling position to compel the market.
According to the latest data from the China Industry Association, in 2014, the sales of heavy-duty trucks of Dongfeng Automobile reached 155,000 units, with a market share of more than 20%, ranking first in the industry in medium-heavy truck sales. With the marriage of Dongfeng Motor and Volvo Group, the Dongfeng Commercial Vehicle Company formed by these two giant companies will launch a more aggressive offensive in the Chinese market.
Looking forward to new energy
At the end of 2008, the financial crisis hit the world. At that time, the Chinese government’s “4 trillion yuan†investment was undoubtedly a cardinal pill for China, and the heavy truck industry also ushered in the “Little Springâ€. However, with the economic slowdown, the growth rate of the heavy truck industry declined. The data shows that in 2014, the overall sales volume of China's heavy truck market (including whole vehicles, non-integrated models and semi-trailer tractors, the same below) fell by 3.9% from 774,100 units in 2013 to 744,000 units.
At the time of the market's decline, the marriage between Dongfeng and Volvo highlights both parties' ambitions in the heavy truck market. It also puts pressure on other heavy truck companies. A related person in charge of a large-scale heavy truck company admits to the reporter that the technology accumulation in the truck field of Volvo Group will greatly promote the upgrading of Dongfeng Motor, which will bring greater impact to other companies in the future.
At present, China's top three heavy truck Dongfeng Motors, China National Heavy Duty Trucks and China FAW's annual sales in 2014 were 155,000, 121,300 and 116,600 vehicles respectively. Among the top three, Dongfeng Motor and China National Heavy Duty Truck carried out in-depth cooperation with cross-border heavy truck giants Volvo and German Man Corporation, respectively. In the future, with the deepening of these cooperation, the competitiveness in China and even the world market will be further enhanced.
Companies such as Shaanxi Heavy Duty Trucks and joint trucks in the second- and third-line Corps of the heavy-duty truck industry have not yet entered into joint ventures and cooperation with transnational giants. If cross-border heavy truck resources are relatively lacking, it is necessary to find a way to find a way out. In the face of intensified market competition, companies such as auto and combined trucks have sought to make breakthroughs in the new energy sector and regard natural gas heavy trucks as a breakthrough.
The data shows that in 2011, the sales volume of natural gas (LNG) heavy trucks was only over 5,000 units. By 2012, the sales volume had exceeded 12,000 units, an increase of nearly 140% year-on-year, and almost 30,000 in 2013. In 2014, when the heavy-duty truck industry declined, natural gas heavy trucks have also been adjusted, but industry insiders predict that sales of natural gas heavy-duty trucks are expected to reach 70,000 units in 2015, and may stabilize at around 30% of sales in the heavy-duty truck market in the future.
At present, such enterprises as Shaanxi Heavy Duty Truck Co., Ltd., and joint trucks have increased their investment in natural gas heavy trucks, hoping to gain greater market share in this segment of the market. In 2014, Shaanxi Heavy Gas sold 14,000 heavy truck natural gas vehicles, ranking first in the industry. Zhou Chaoyin, Deputy General Manager of Shaanxi Heavy Gas, stated that in 2015, heavy truck natural gas sales in Shaanxi Province are expected to reach 22,000 units. As the only domestic heavy-duty truck company that currently develops natural gas heavy trucks as its core and strategic products, United Trucks has been deepening its natural gas heavy trucks. Tang Gang, general manager of Jirui Union Heavy Industry Co., Ltd. and general manager of United Trucks Marketing Service Co., Ltd., said that in 2015, the joint truck gas heavy truck plan will reach 4,800 vehicles.
In addition to the breakthrough in the field of natural gas heavy trucks, in the face of the strangling of giants such as Dongfeng Motor and China National Heavy Duty Truck, the second and third line Corps still needs to make greater efforts. However, the "all the way" strategy will also bring continuous benefits to the heavy truck industry.
Zhang Zhiguo, deputy general manager of Jirui United Truck Sales Service Co., Ltd., believes that the joint truck will focus on the market opportunities brought by the “One Belt and One Road†initiative.