GLOBAL STAGE
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But are the Chinese OEMs ready for the global stage? “No,” is the dismissive stance taken by European and North American players when questioned about the threat from the East. “Not so,” says Ryan Carmichael of growth strategist Frost & Sullivan. “The Chinese CV OEMs have expanded by leaps and bounds over the past five years. Their production rates are staggering, accounting for about half of the global total. This may be beginning to wane as, domestically, there is likely some sizeable over-production.
“However, the Chinese have made it known that they are aggressively targeting overseas markets to provide an outlet valve via exports. Southeast Asia, usually controlled by Japanese and South Korean nameplates, is seeing the initial push of Chinese OEMs [as well as Indian] to offer lower-priced products to these emerging economies [think Vietnam etc] and so the rise of the Chinese OEMs is not limited to domestic production, either for domestic consumption or export.
“There have been major movements to expand into other markets; most notably would be Sinotruk [CNHTC] in Brazil, as well as moves into the Middle East and Africa. This will be in conjunction with MAN, which should serve to aid Sinotruk in quality improvements in key areas like chassis and powertrain.” Carmichael points to the value of the joint venture regime for the Chinese partners. “Daimler has been active in China and has partnered with FAW, [and will do likewise with Beiqi Foton for heavy trucks]. Already a market leader, FAW stands to gain considerable technical expertise from the union.
“Navistar may be successful in its partnership involving NC2 [Navistar and Caterpillar] and JAC in bringing vehicles to market in China, as well as establishing shared powertrain development facilities.”