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If you compare Sinotruk and Swedish Scania, don't be surprised. Sinotruk has many similarities with Scania. In 2007, China National Heavy Duty Truck Group sold a total of 99,919 heavy-duty trucks with a total weight of over 14 tons, and its market share reached 20.48%, becoming a leader in the domestic heavy truck industry. In 2007, Scania's cumulative global sales reached 94,093; among them, truck sales reached 85,939.
Heavy Duty Trucks and Scania's Similarities and Differences
Judging from the sales of heavy trucks in 2007, SINOCHEM has surpassed Scania. Therefore, from the scale of production and sales, heavy truck has entered the ranks of the world's top five heavy truck manufacturers.
From a product structure point of view, both focus on heavy trucks. Sinotruk mainly focuses on medium- and heavy-duty trucks. Scania also only manufactures heavy trucks and passenger car chassis. Moreover, both companies have formed a relatively complete supporting system, with key assembly products such as engines, transmissions, and bridges.
From these points of view, Sinopec and Scania have similar capital. However, if you look at the profit and exports, the heavy truck is still far from Scania.
In 2007, Scania's sales reached 844.86 billion Swedish kronor (1 Swedish kroner and 1.1 yuan), and the total profit reached 855.4 billion Swedish kronor. In 2007, Sinotruk achieved sales revenue of RMB 37.1 billion and profit tax of RMB 2.8 billion. Scania’s profits are several dozen times that of heavy trucks. (Sina car editor's note: This number may be wrong, is asking the author to verify)
From the perspective of exports, the size of exports is one of the criteria for measuring whether a company is accepted globally. In 2007, China National Heavy Duty Truck achieved export sales of 400 million U.S. dollars, ranking first in the heavy truck industry.
In the first half of 2007, Scania's exports to Central and Eastern Europe reached 8,864 units, which was a year-on-year increase of 80%. Among them, the two major markets of Russia and Poland have become the main highlights. Russia’s sales increased to SEK 16.72 billion, a year-on-year increase of 92%. Poland’s sales increased to SEK 16.62 billion, an increase of 127% over the same period last year.
"In this sense, the two companies are not at all an order of magnitude at present," an industry veteran commented.
Heavy truck opportunities and challenges
Undoubtedly, Scania will become an example for China National Heavy Duty Truck. With examples, there will be a catch-up goal. How far is it from being a famous multinational enterprise?
The following will try to use SWOT analysis to explore the opportunities and challenges of heavy-duty trucks.
S advantage: The domestic heavy truck market share is high, and the quantity is large. After we stopped the engine supply crisis in Weichai, it maintained high growth for several consecutive years. The product line is relatively complete, from heavy-duty cards to heavy-duty cards, there are È ¬ head products. The engine is gradually recognized by the market. A complete supporting system began to form, and transmissions, bridges, and engines were self-produced. Overseas markets have achieved remarkable results. In 2007, heavy truck exported over 14,000 vehicles in overseas markets. This achievement made it the first time in three consecutive years that China Heavy Truck exports and foreign exchange earned.
W disadvantage: compared with FAW, Dongfeng and other companies, SINOBIRC's R & D strength is not much stronger. Engines, transmissions, etc. all require large investment, and the stalls are spread too much, distracting the company's resources. Marketing ability is general.
O Opportunity: The demand for heavy trucks, such as toll collection and changes in transportation structure, has increased significantly. Heavy truck overseas exports are in full swing. Listing in Hong Kong not only increases the financing channels, eases the shortage of funds, but also encourages enterprises to improve their management level and change their operating mechanism.
T Challenge: FAW and Dongfeng veteran teams have launched a new generation of heavy truck products. Their share in the heavy truck market continues to rise, threatening the status of heavy trucks in the heavy truck sector; Shaanxi Automobile and Foton are behind the scenes; new entrants, with huge funds, Foreign technology has developed rapidly.
The gap between Sinotruk and Scania is reflected in the low level of technology and profitability. The fundamental reason for this is that Chinese commercial vehicle companies lack high-end core technology, their product technology content is low, and their added value is low.
In Scania's case, Scania's profits have continued to grow, despite falling orders in the first quarter of 2008. According to reports, orders received in the first quarter fell by 27% to 20,226 units, while net profit increased by 21% to reach 2.5 billion Swedish kronor (US$418 million). Reeve Austin, chief executive of Scania, believes this is due to the increase in sales and prices of high-end trucks.
For China National Heavy Duty Truck, the increase in sales volume is commendable, but the branding and improvement of product technology content are even more important. China National Heavy Duty Trucks should seize the opportunity of listing, increase investment in R&D, and strive to gain a certain amount of product R&D and quality improvement within a few years in order to maintain the rapid development of the company and keep its foundation.
This is the revelation of a hundred-year-old shop to SINOGAS.
View related topics: China National Heavy Duty Truck Breaks Monthly Sales Record for National Heavy Truck Industry
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