Yuchai's Market Share Increases with Its Decrease lower than Industry

www.chinatrucks.com: In 2012, Yuchai Machinery Co., Ltd. grew amid the bleakness of the commercial vehicle market. At the just-concluded "Yuchai Machinery Marketing & Service Conference 2013", General Manager Wu Qiwei said, "Yuchai sold 435,000 engines, registering a year-on-year decrease, but the decrease was far lower than the industry's overall decrease of over 24 percent. Yuchai's market share rose by 3 percent, recording a sales volume of 110,000 to 120,000 units more than its closest rival, thus keeping ahead in the industry."

Reasons for growing in adversity

2012 is the toughest year for China's commercial vehicle industry. The domestic heavy-duty truck industry retreated continuously from its peak in 2012. In the commercial vehicle power market, thanks to the explosion of the sectors of school bus engine, LNG engine, hybrid system and light bus engine, Yuchai's bus engines have grown in parallel with the domestic bus market.

In 2012, Yuchai launched school bus engines and sold over 10,000 units; in the field of new energy, especially gas engine, Yuchai sold over 20,000 units, including 18,000 buses and 2,000 trucks, registering a growth of over 50 percent. Particularly, in the fourth quarter, over 3,000 units were sold per month; Yuchai made remarkable achievements in hybrid system application; In European and Japanese light bus matching, Yuchai has also made some progress, recording a growth of over 20 percent.

Other fields saw the growth of Yuchai engines, too. Amid the plunges in the marine and the power generation industries in 2012, Yuchai's sales volume was expected to be 25,000 units, up over 18 percent; in the agricultural machinery market, despite the industry's overall decline of around 20 percent, Yuchai's performance equaled 2011 thanks to the growth of tractor power and corn combine power.

Referring to the sales target for 2013, Wang Limin, general manager of Yuchai Sales Co., Ltd. noted Yuchai will secure 470,000 units and challenge 490,000 units.

In 2013, Yuchai will focus on making its products up to National IV and V emission standards. It has been well prepared in production process, supplier system and quality control system. As for marketing, Wu said, in linking up with machinery and vehicle manufacturers, Yuchai's National IV diesel engines and National V LNG engines should be first to be included in product plans of machinery and vehicle manufacturers; Yuchai's products should be first included in product announcements of machinery and vehicle manufacturers; also, Yuchai should take the lead in development and launch.

Segment operations

In 2012, Yuchai launched products including YC6MK bus engine in the Chinese bus market, and seized opportunities such as 12m bus, school bus and LNG bus to keep ahead in the bus power market.

In the trial operations and tests of Yuhang Public Transport in recent year, these buses showed outstanding performance, saving fuel conservation rate by over 25 percent and reducing emission by 60 percent. That is why Yuhang Public Transport placed a second order within less than a year. This is just a typical case. During operations in public transport companies in cities like Guangzhou and Wuhan, Yuchai hybrid system also performed well. Guangzhou Public Transport alone placed an order for 1,200 buses powered by Yuchai hybrid system last year.

In the field of LNG power, Yuchai has enjoyed a market inventory of over 60,000 units. In 2012, Yuchai's independent "ESI independent natural gas control system" drew close attention in the industry. The greatest significance of the system is that Chinese LNG engines will thoroughly shake off the restrictions of imported control systems such as "long improvement period, constrained calibration strategy, high price and long supply period".

In 2012, Yuchai sold 23,000 LNG engines, enjoying a comfortable lead in the industry. Its market share of LNG engines for 8m to 9m buses and LNG engines for 11m to 12m buses exceeded 55 percent and 50 percent respectively. Towards the end of 2012, Yuchai got good news that its YC6GN and YC6JN engines won bids for Nanjing Public Transport and Wuxi Public Transport respectively. In 2013, Yuchai aims to sell 40,000 LNG engines.

In the sector of marine power, Yuchai faced the most severe situation ever. In 2012, the overall demand of the marine market declined by some 25 percent year on year, and the figure was even 50 percent in some places. Given the fact, market competition among manufacturers became fiercer and customers were more critical in purchase.

Facing the bleak market, Yuchai sold over 25,000 units, registering a year-on-year sales growth of nearly 20 percent and a year-on-year market share increase of 8 percent, creating the Yuchai phenomena  of exclusive growth in the industry. This also marks the great stride of Yuchai's marine sector in the challenge following the sales volume of 10,000 units in 2010 and over 20,000 units in 2011.

It is also worth noting that Yuchai has made encouraging progress in passenger vehicle power. Amid the slump in the overall export of the industry, Yuchai maintained strong momentum, with a year-on-year sales growth of over 40 percent. Despite the decline in parts exports on the plunge in exports of machinery and vehicle manufactures, Yuchai's export business grew encouragingly.

In Chile, Yuchai's passenger vehicle engines stood out. Yuchai was not present in Chile yet in 2011, but the sales volume of Yuchai's passenger vehicle engines in Chile approached 700 units in the first ten months of 2012 alone. According to an insider, Yuchai had long planned to export light-duty engines to Chile, Yuchai's Chile office assisted Chinese automakers in obtaining access qualifications and other formalities over the past two years, making full preparations for the "explosion" in 2012.

Similar to Chile are two African countries--Angola and Ghana. Also, Yuchai achieved restorative growth in Egypt.

Yuchai will reportedly launch several special projects specific to segments and set its development theme as "achieving special breakthroughs, taking the lead in launching National IV diesel engines and National V gas engines".

 

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