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Although Cummings has been in China for 30 years, the past five years is undoubtedly another important time in China. Since 2004, the top executive of the world’s largest independent engine manufacturing company has been in frequent contact with representatives of Chinese companies on the other side of the Pacific. Firstly, after cooperating with China's Shaanxi Automobile Group with more than 15 tons of heavy trucks and the establishment of Xi'an Cummins, in Beijing, they announced a high-profile strategic cooperation with Beiqi Foton and established Beijing Foton Cummins Engine Co., Ltd., which annually produces 400,000 world-class light-duty diesel engines.
Cummins’ selection of this partner for him is one of the most successful auto companies in China in the past ten years and is known for its continuous entry into new fields and rapid growth. In its past records, there are many classic cases such as the Austrian Bell light truck and the Auman heavy truck. The cooperation between the two sides is defined as a model of cooperation with the world's top engine manufacturers and Chinese companies with strong complementarity.
Cummins, the first western diesel engine company to produce engines locally in China, has long been a strategic alliance with large-scale Chinese companies for many years, and has a high market reputation in heavy truck, medium truck, and heavy truck markets. Now, they need to find new growth points. Cummins had rarely used light engines for vehicles. For example, the cooperation with Beiqi Foton, which occupies 1/3 of the light truck market, will undoubtedly significantly increase its competitiveness in the Chinese market. For Futian, to realize the goal of globalization and hope to enhance its own power system, the traditional "production transfer" joint venture is not what they want. Fukuda understands that a good engine platform can be used for 20 to 30 years. They do not want to pin their hopes on products that have been in existence abroad for 10 to 20 years.
Based on the common understanding of long-term development, Foton and Cummins are determined to form a new platform that is different from any previous joint venture company, to create new products that can truly represent the advanced technology of future trends.
In October 2007, the project obtained a business license. In June 2009, Futian Cummins held a grand opening ceremony. Under the witness of many government officials, entrepreneurs and the media. Tim Solso, chairman and chief executive of Cummins Inc. of the United States, praised the word and often used the terms “historic†and “milestone†to describe the “marriage†between Cummins and Futian. The joint venture company is expected to become the largest supplier of light engines in Beijing and even in the country. Its design capacity also lays a solid foundation for its growth into Asia's largest light engine plant. In addition to supplying the domestic market, vehicles equipped with new engines will also supply overseas high-end markets. At a higher priority, Cummins has also built new 2.8-litre and 3.8-litre inline 4-cylinder high-pressure direct-injection light-duty diesel engines for joint ventures that have never been put into production anywhere, with a high starting point, high performance, and low emissions. Suitable for light trucks, pickup trucks, SUVs, MPV utility vehicles, small construction machinery, off-highway equipment and power systems.
This has a long-term strategic significance for Foton Motor Company, which has been committed to the international operation of the company.
Three years of growth
“The process of building a brand-new joint venture company is exciting.†Wang Ning, the general manager of the joint venture company, expressed his feelings of inter-death. Prior to this, Schindler China was the second largest elevator company in the world. At that time, his position was executive vice president. Obviously, there is a big difference between elevators and engines. For the initial transition, Wang Ning told the "Car Watch" magazine reporter: "It is this project itself is too attractive." Dr. Wang Ning, who is a returning doctor of German transport technology, is a veritable environmentalist. In his opinion, although there is no shortage of technologies to continuously promote China's environmental protection in recent years, the most mature energy-saving method in the automotive industry is dieselization. "Compared with gasoline, it can save 20% to 30% of energy." Without a doubt, this is a mature technology that is readily available. Cummins and Fukuda's project is based on this.
In fact, he is not a complete layman. During the university, Wang Ning majored in engineering machinery, "in a sense, half of the car," coupled with his long experience in quality management, marketing, and production. In the past three years, Wang Ning and Futian Cummins have grown together.
"Now I am not a person who understands the engine. I learned a lot of new things in the past three years. Now I still receive a lot of fresh things every day. It's very fulfilling." Wang Ning's words can be seen in his humility. It can also be seen that Foton Cummins is indeed a learning enterprise. When starting the planning and construction of Foton Cummins, all the things the management of the joint venture had to face were brand new, new products were developed, new suppliers were newly developed, new factories were built, new process flow, new joint venture teams were established..." You can imagine the situation when people of different cultures started working together at the beginning of the construction.†Talking about this, Wang Ning laughed. “Everybody from Futian, Cummins, or an outside management staff has a common Awareness: Under the joint support and guidance of shareholders of both parties, the joint venture company will be established on the standpoint of the joint venture company.
Because the big goals are the same, there is a foundation for good integration of details. “The new challenges have continued to follow. However, along with the challenges, the full production of the plant, ISF 2.8 and ISF 3.8 light diesel engines have been completed with Futian's Omar can and Ao Ling light trucks, and It has been successfully introduced to the market, and it has also been used in supporting applications with many truck and bus OEMs.
Wang Ning believes that the engine is a very demanding industry. During the initial stage, it needs to go through a period of climbing, and the production needs to be steadily improved. The whole vehicle equipped with the Foton Cummins engine has a market to enter, accept, and digest. At present, 3.8L has been put into production in batches. In the earlier period, it has increased at a speed of more than 50% from the previous quarter, and has shown a stronger upward momentum in the first quarter of this year. In the fourth quarter of last year, 2.8L, all production equipment was installed and commissioned, and it entered the small-batch production stage. The second quarter of this year will begin full-scale production.
International prospects
The steady development of the Chinese market in the past has allowed Cummins to win the "Most understand China" reputation. Now, they will help Beiqi Futian implement its internationalization strategy.
In the previous media reports, such words were quite eye-catching: "Focus has successfully won two world-class light diesel engines, perfected its own power system, and, more importantly, obtained the successful joint venture with Cummins. The permit to enter the markets of developed countries will undoubtedly contribute greatly to its international operation." "The Foton Cummins Engine project is aimed not only at the Chinese market but also at the global market." Western Europe, North America, Japan, South Korea ... these markets It not only has the most powerful consumers in the world, but also has the most effective consumer demand. Due to technical barriers in emissions and other aspects, most of China’s auto product exports are currently concentrated in Southeast Asia, Africa, and some Latin American countries where the auto industry is underdeveloped. In Europe and the United States and East Asia, the high-end market is almost a blank, leaving most Chinese auto companies looking Sigh.
Only by truly entering European and American markets can Chinese auto companies truly realize internationalization and create a more energy-efficient and environmentally-friendly “heartâ€, becoming the most urgent task for all Chinese auto companies that are interested in international expansion. Futian Cummins had long-term considerations at the beginning of the two-party plan. The current production is Euro III and Euro IV. They are developing Euro V and their plans have already reached Euro VI. This can not only effectively support Futian's global strategy, but also can serve as a global resource base for Cummins light diesel engines.
In fact, Foton Motor has not stopped the pace of international development, but to achieve this task, Futian high-end light commercial vehicles equipped with Cummins engines will be indispensable for sharp weapons, allowing them to gain access to the developed markets. Pass." Wang Ning told reporters that Futian light trucks powered by Foton Cummins have been successfully launched in markets such as Mexico and Australia. Other countries such as Russia are continuing to advance. As a global company, Cummins will cover more than 500 distribution agencies and 5,200 dealerships in 190 countries and regions around the world to provide full service to ISF engine users.
“Now, the Foton Cummins ISF engine is being used for application development and vehicle fitting with more than a dozen OEMs outside of China.†In any case, this has given Wang Ning a bright future. "Under the general trend, the prospects for development will be even more impressive and it is worthwhile for us to face more challenges." Wang Ning said.
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