A few days ago, Sinotruk had preliminarily completed negotiations to acquire the Shanghai Huizhong heavy truck business before Shandong Heavy Industry. In an interview with the media, China National Heavy Duty Truck Board Chairman Ma Chunji who attended the Hanover Commercial Vehicle Show in Germany stated that Sinotruk has indeed acquired Shanghai Huizhong’s major technical assets such as molds and technology, and has signed an acquisition agreement. In the end, Shandong Heavy Industry failed to reach a consensus with Shanghai Huizhong because of price issues. The difference of 5 million in price resulted in the failure to complete the acquisition and missed Shanghai Huizhong.
China National Heavy Duty Truck:
China National Heavy-duty Truck Group Co., Ltd. is the major domestic heavy-duty truck production base and is also the cradle of China's heavy-duty auto industry. At present, China National Heavy Duty Truck Group is the largest enterprise in China with the largest production and sales volume of heavy vehicles. It is now a provincial-level large-scale enterprise managed by the State-owned Assets Supervision and Administration Commission of Shandong Province.
Shandong Heavy Industry:
Shandong Heavy Industry Group Co., Ltd. is in accordance with the "Company Law" and related laws and regulations, all of the state-owned property rights of Weichai Holdings Group Co., Ltd., Shandong Construction Machinery Group Co., Ltd. and Shandong Automotive Group Co., Ltd. and the Shandong Provincial Transportation Industry Group Corporation. Some state-owned sole-proprietorship companies formed by the transfer of state-owned shares of Shandong Degong Machinery Co., Ltd. are regulated by the State-owned Assets Supervision and Administration Commission of the People's Government of Shandong Province and are the backbone enterprises of Shandong's equipment manufacturing industry. The group company is headed by Weichai Holding Group Co., Ltd. and its registered place is Jinan.
Weichai:
Weichai Holding Group Co., Ltd. is a leading powertrain enterprise group in China. It is China's largest auto parts company and the largest equipment manufacturing enterprise in Shandong Province. It is a key enterprise supporting research, development, manufacture and sales of internal combustion engines. .
China National Heavy Duty Truck and Weichai:
Weichai used to be an important subsidiary of China National Heavy Duty Truck. In March 2004, Weichai Power, a subsidiary of Weichai Plant, successfully went public in Hong Kong; in August 2005, Weichai Power Plant acquired the Hunan Torch through its Weichai investment, and indirectly controlled Shaanxi Heavy Duty Truck and built its own heavy-duty automotive industry chain; In October 2005, CNHTC took back control of the Hangzhou engine plant that had been handed over to the Weichai plant. In January 2006, CNHTC stopped purchasing engines from Weichai Power. On March 20, 2006, the State-owned Assets Supervision and Administration Commission of Shandong formally released the equity relationship between the two companies. In January 2007, Weichai Power announced in Hong Kong that it had formally drawn a clear relationship with Sinotruck on the property rights.
Shanghai Huizhong heavy truck:
Shanghai Huizhong Automobile Manufacturing Co., Ltd. is a subsidiary of Shanghai Automotive Group Co., Ltd., which manufactures commercial vehicles and chassis systems for cars. The company is located in Lujiazui Finance and Trade Zone in Pudong, Shanghai, with a registered capital of US$1.71082 billion. It has seven production bases and four joint ventures. Shanghai Huizhong has three major business segments: light buses, heavy trucks and car chassis systems. Stanner Commercial Vehicles and Special Purpose Vehicles, with annual production capacity of 15,000 units; 15-ton heavy-duty series with annual production capacity of 10,000 units; sedan chassis systems with front axle module and rear axle module U.S. General Motors, Ford Motor Company and Australia Holden Company's car parts.
Shanghai Huizhong heavy truck's embarrassing situation:
The assets of heavy trucks (including heavy-duty trucks, heavy-duty trucks non-integrated vehicles, and semi-trailer tractors) under the SAIC Group currently consist mainly of SAIC Iveco Hongyan Commercial Vehicle Co., Ltd., Shanghai Huizhong Automobile Manufacturing Co., Ltd. and Nanjing Automobile Group Co., Ltd.
Once vowed to enter the industry's top three Shanghai Huizhong heavy trucks, they have to face an embarrassing reality in development: after reaching the historically highest sales volume of 2,595 vehicles in 2007, the production and sales volume has been declining all the way, and the heavy-duty card market looks bright and prosperous. Going further and further away; sales fell to 1,286 units in 2008; it shrank to 694 units in 2009. In the past 10 years, the total sales volume of Shanghai Huizhong heavy trucks was only about 10,000 vehicles.
From the perspective of SAIC's heavy truck sales in January-August this year, SAIC Iveco Hongyan listed in June 2007 has become the group’s largest and fastest growing heavy truck asset. In the first eight months of this year, it sold 24,000 heavy trucks, an increase of over 67% year-on-year. %, the completion of the sales target of 30,000 vehicles throughout the year is a certainty. Shanghai Huizhong's sales of heavy-duty trucks and non-integrated vehicles have all shrunk to double digits, and only semi-trailer tractors have seen a better sales growth. SAIC Motor then prepared to contract the front line for passenger cars and sold the Shanghai Huizhong heavy truck business.
Shanghai Huizhong Heavy Trucks will provide market entry points for high-end products of Sinotruk
Judging from the recent market layout of China National Heavy Duty Truck, the production bases in Sichuan and Fujian are biased towards the China Card or even the light trucks. The mitigation effect is not obvious for heavy trucks with relatively tight heavy truck capacity. After Huizhong heavy trucks are incorporated, their production bases may continue to produce heavy trucks, and the production equipment that will be favored by Weichai will also provide a lot of help for China National Heavy Duty Truck. At the same time, the geographical location of Shanghai will also save some of the logistic costs for CNHTC, such as the nearby matching of the Hangfa engine. In addition, in view of the acceptance and demand of high-end products in East China and the increase in demand for port transportation in coastal cities, it can provide a market entry point for high-end products of Sinotruk.
Shanghai Huizhong heavy trucks can promote Weichai's heavy-duty vehicle matching plan
From the perspective of Huizhong heavy truck's product configuration, it has a “golden industrial chain†background. Weichai engines and Fast transmissions are all configurations of Huizhong heavy trucks. If Shandong Heavy Industry finally wins Huizhong heavy truck business, the market space available for it will be even greater, and we can promote Weichai's heavy-duty vehicle matching program. After all, Shandong Heavy Industry has accumulated enough in terms of product and brand, and sales and service network layout.
5 Million in Loss of Matches, Weichai Heavy-Duty Vehicle Match Plan Fails
The so-called production capacity in the heavy truck market is limited, and the bottleneck is mostly due to the engine. Weichai has a very high market share in the domestic heavy-duty engine market and is technologically leading. Currently, all vehicle companies are busy mastering the engine's matchmaking dominance. Therefore, Shandong Heavy Industry, with Weichai as the mainstay, is currently paying more attention to the complete vehicle and engine support. With the gradual promotion of the 100 billion yuan strategy of Shandong Heavy Industry, the development of the entire vehicle system, which is one of the four major commercial vehicles, has become a top priority.
Therefore, Shandong Heavy Industry placed great importance on the heavy truck business to be sold by Shanghai Huizhong. It plans to purchase a package of Shanghai Huizhong production line equipment and drawings. They previously sent a project team mainly based on Weichai Holding Group Co., Ltd. to Shanghai Huizhong. Evaluation consultation. For Shandong Heavy Industry, the preliminary work of the acquisition project had already been completed by about 90%, and basically the two sides had officially signed the agreement. And it was the remaining 10% that made Shandong Heavy Industry's ducks fly again. In the end, due to the difference of 5 million in price, the Huizhong heavy truck business failed to make a profit, and Weichai’s heavy-duty truck matching plan could only be temporarily stranded. .
Huizhong heavy truck technology comes from Ssangyong, and has full intellectual property rights, through the transaction to transfer the above technology and barrier-free, and Ssangyong technology from Daimler Benz, which is the world's largest heavy truck manufacturer. In the case of the Shanghai Huizhong heavy truck business acquisition, China National Heavy Duty Truck Co., Ltd. cut off the firewood at the last moment and became the final winner. And this acquisition will also be more conducive to the high-end products of Sinotruk to enter the market. East China has always been an advantage market area of ​​China National Heavy Duty Truck. After the acquisition of Huizhong heavy truck business, the location advantage of Sinotruk in this region will become more apparent.
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