A single channel to the troika Red Rock exports can double next year


In 2012, SAIC Iveco Hongyan (hereinafter referred to as Yihong) exported a total of 1,850 heavy trucks, an increase of 551% year-on-year; in 2013, Shangyinhong exported 4,900 heavy trucks to foreign countries, an increase of 165%; in the coming years, Shang Yihong has even reached the annual scale of exporting 13,000 heavy trucks.


Is this goal ambitious or is it high?


At the 2013 SAIC Iveco Hongyan 2013 Business Annual Meeting, executives such as Xiong Weiming revealed the answer to this question.


From single channel exports to troika pull


In recent years, with the rapid decline of the domestic heavy-duty truck market, all manufacturers have used overseas exports as one of the means to reduce losses and avoid domestic risks. Of these, Shangyin belongs to a typical latecomer.


According to customs data, in 2011, there were only 284 units of Shangyinhong's exports, and the scale of exports was among the top eight in the entire industry. By the end of 2012, Shangyinhong's exports had already reached 1,850 units, jumping to the top 8 in the industry, and the year-on-year increase of 551%, ranking first in the industry.


Cao Zongqiang, general manager of SAIC Iveco Hongyan Sales Division, believes that Shang Yihong’s export sales volume can achieve over 500% growth in 2012, mainly benefiting from overseas strategic adjustments. Before 2011, the export of Shanghai Yihonghong heavy truck mainly relied on self-operating; in 2012, Shangyihong export changed from a single channel to multiple channels, and it was jointly driven by self-operated exports, dealer exports, and the “Troika” acting as the export agent for shareholders. . This "strategic turnaround" has greatly promoted Shang Yihong's export performance in 2012 and will further affect the company's export performance in 2013 and in the coming years.


According to reports, in 2012, there were already many Red Rock dealers investing in overseas stores. For example, Jiangsu Hongyan Technology has established an integrated sales and service shop in Ethiopia, Nigeria, and Sudan, and set up a KD assembly plant in Djibouti; Dubai and Nigeria established a branch company; Chongqing SAIC established an integrated sales and service shop in Myanmar and established a 4S shop in Laos. The expansion of these dealers abroad has created favorable conditions for the export of Hongyan vehicles.


"This year, the domestic market is in the doldrums. Many dealers do not make money selling cars, but they also face great risks. However, the income of dealers doing overseas markets is generally good. This income is not only higher than the domestic bicycle profits this year, but also compared to 2010. China's heavy-duty truck market when the most popular domestic sales profit is even higher." Xiong Weiming, general manager of Yihong I told reporters.


On the other hand, in September this year, Shang Yihong signed an export agreement with its shareholder, Italian Iveco, which will be sold through the Iveco global network. In the next few months, there have been many groups of Hongyan Jieshi heavy trucks with the IVECO trademark “borrowing to the sea”.


The 12th Five-Year Plan to reach 13,000 Export Scale


"We plan to export 4900 vehicles next year," Xiong Weiming told reporters. This goal is also inspired by the simultaneous export of multiple channels in 2012.


“In these 4900 vehicles, Shang Yihong’s self-exports are 1600, Iveco's exports are 2,500, and dealers’ exports are 800.” Cao Zongqiang added that Hongyan will continue to encourage powerful dealers to go abroad. To expand overseas markets, and plans to expand the staffing of Shanghai Yihong International Business Department from 8 to 32 people, and establish Shang Yihong’s own overseas office.


"Next year, Iveco will assist us in the development of the Red Rock models that are specifically designed for the export market, including right-hand rudders and European ECE-certified models. Some countries in Africa and Southeast Asia require the right-hand steering wheel, and some countries still have ECE certification requirements." Xiong Weiming said: "This car will be launched next year. This is an important reason why we expect the rapid growth of exports in 2013."


In fact, the signing ceremony held at the business conference also gave the best interpretation of Xiong Weiming's export strategy. At the business conference site, Shang Yihong and Iveco signed a supply agreement for the export of 2000 heavy trucks in Algeria. Under the agreement, Iveco will use its distribution service network in North Africa to export 2000 Red Rock heavy trucks to Algeria. And, this export order will be completed in 2013.


Xiong Weiming believes that the huge advantages of China's heavy trucks in terms of cost performance will support the sustainable development of Shanghai Yihong in the coming years. "Our unit price of 250,000 yuan is sold to some countries, plus freight and tariffs are only 400,000 yuan. In Europe and America, the price of a heavy truck origin is at least 700,000 yuan, and it will take more than 80 yuan to export to an exporting country. This extremely high price/performance ratio is the main reason for the popularity of heavy trucks in China."


"In the company's five-year plan, our maximum annual export volume will reach 13,000," said Xiong Weiming. According to the five-year planning target of 80,000 heavy trucks produced and sold by Shanghai Yihui, the export sales accounted for approximately 16.25%. This medium-term goal that does not seem high (such as Sinopec's export share target of more than 20%) can be successfully implemented?


The key depends on the next year.



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