Luan Ping: Yuchai insists on one center and three basic points

On January 13, 2010, the Yuchai Machinery 2010 Marketing Service Conference was held in Guangzhou, Guangzhou. The chairman of the board of directors of Yuchai Machinery Group Co., Ltd. and Yu Ping, chairman of Yuchai Machinery Co., Ltd. attended the meeting and gave an important speech. After the successful conclusion of the conference, Muping received a joint visit by a reporter.

Reporter: You just mentioned the internationalization of Yuchai in your speech at the conference. Now the mainstream domestic engine manufacturers have cooperated with international companies, such as German Mann and China National Heavy Duty Truck, etc., taking a vehicle and a pair of engines. Model, does Yuchai have such a development plan?

Luan Ping: From the industrial chain, Yuchai will not easily get involved in the vehicle. Because now the whole vehicle industry understands that the benefits are not good, and we must have sufficient and powerful talents. We will not easily develop the vehicle section without talents. Someone also told me that I would say that the performance of the vehicle segment will only be quick. Tens of billions is very easy to break through, but I think that funding is not a problem. It is only that Yuchai’s talent pool is not enough to develop the entire vehicle segment.

At present, Yuchai is not afraid of the combination of competitors and market difficulties. We insist that technology research and development and product quality are the first priority. Therefore, I have repeatedly stressed that we need strategic alliance partners, but products are the most fundamental and a magic weapon for success. For example, Yuchai United Power 6K heavy-duty engine products, many engine manufacturers have this series of products, but as long as our products are better than competitors, customers will choose us. This is the most fundamental key point, and I think that Yuchai’s advantage is also here.

Reporter: Yuchai's cooperation with Caterpillar?

Fuping: In cooperation with Caterpillar, Caterpillar will provide technology and Yuchai will provide the market. The development of the secondary market in the manufacturing industry is easier than the primary market. Caterpillar's remanufacturing technology can be regarded as a monopoly on a global scale. With more than 1,000 service stations in Yuchai, the network is all over the country and the market is our advantage. We want to sell our products to the United States and use Caterpillar technology to bring Yuchai's entire technology to a new height.

Reporter: Do you mean that remanufacturing technology can be extended to more fields of Yuchai?

Luan Ping: Our cooperation with Caterpillar is exclusive, that is to say, machines below 16L. They can't cooperate with Yuchai when they cooperate with others. And now Caterpillar's attitude is also very resolute, that is, non-Yuchai does not cooperate, they identified Yuchai's products and brands. We talked about the fact that we had talked for two years and we had some disputes during the negotiations. But in the end, we reached an agreement. At present, the entire cooperation plan has been completed, and the cooperation in the early stage is also very smooth. There is more communication between each Other. This is both an opportunity and a challenge for Yuchai.

Reporter: What are the plans for the next step in talent cooperation?

Luan Ping: At present, Yuchai needs internationalized and professional talents under the internationalized development path. This may also be something that we cannot cultivate at the moment and we need to increase the introduction. However, if it is in Yulin, the attraction for talent is not enough. Therefore, we have invested 350 million yuan to build the Yuchai Research Institute in Nanning, and future forward-looking research and development will be focused on Nanning headquarters. At the same time, we also need to build a modern back garden in Yulin to provide talents with the best working environment for research and development. It is not clear to what other companies do. In Yuchai, there is no plan for talent reserve. I think that talent is the most basic guarantee for Yuchai.

Reporter: Yuchai is located in Yulin City, a city that is not well-known in the country. Can we have such an achievement today, precisely because of the importance attached to talent, technology, and product quality?

Luan Ping: Yuchai has her own firm innovation path and corporate culture. I think this is the most important factor, and it is also a center that Yuchai always adheres to. Yuchai’s technical R&D team adheres to Yuchai’s “Green Development, Harmony and Win-Win” culture. It is a double guarantee for talent and technology. Only in this way can we emphasize the quality of products. This is the three basic points.

In this era, companies without corporate culture have no spirit. Our generation of entrepreneurs is more ambitious than previous generations of entrepreneurs. This may be a good thing. However, I think that heroism should be less emphasized. Now it is not an elite era but a team era and requires teamwork. I once told the company's subordinates that a Yuchai person may not be able to represent anything, but a group of Yuchai people together is a group of wolves who can eat all the tigers.

Reporter: Yuchai has always emphasized strategic and forward-looking in product R&D. Will the current strategic plan be?

Luan Ping: Yuchai's engine innovation technology may usher in a blowout in 2010, including hybrid aerodynamics and two-stage booster technology. This is the plan that we have started since 2006. The reserve of products is an enterprise must pay attention to at any time. Each Yuchai product has a defined market age of 3 years, and it is necessary to develop newer products after 3 years. Our air hybrid powertrain is much more advanced than electric hybrid powertrains. Fuel savings can reach 10%, and the current fuel efficiency savings of 5% is considered a great technology. Therefore, this is a very viable technology. It can even be said that it is a highly lethal technology. It will certainly have an overwhelming advantage in the competition with the engine of the same power, and it is very suitable for China's development trend. At present, Yuchai, an air hybrid engine, has started mass production and will be put into the market before the end of 2010.

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