At present, the economic crisis triggered by the US financial crisis has swept the world, and Chinese auto parts and components companies have also been affected. However, judging from the latest statistics, some companies are not affected to a great extent. Weichai is one of them.
According to data from Weichai, by the end of October, Weichai Group achieved operating income of 44.4 billion yuan, an increase of 33% year-on-year; total profit of 34.45 billion yuan, an increase of 25% year-on-year; exports earned US$700 million, an increase of 70% year-on-year. The growth rate of various indicators has maintained the forefront of the domestic industry.
What is the secret of Weichai's defense against the economic crisis? What will be the next step? Recently, the reporter interviewed Sun Shaojun, CEO of Weichai Power Co., Ltd.
Early prevention
At the onset of the economic crisis, Weichai was able to maintain a good momentum of development and was inseparable from their full preparation.
Sun Shaojun told reporters that as early as December 4, 2007, Weichai Power Chairman Tan Xuguang issued an early warning at the group’s leading cadre meeting, advising all staff to recognize the economic environment, firmly grasp the economic trend, and take immediate measures. Strive for internal strength and calmly respond to changes and challenges.
Since January of this year, Weichai has conducted a comprehensive “physical examination†on the strategic direction, cost management, cash flow management, and logistics management of each subsidiary within the group. Especially during the rapid growth of the industry in the first half of this year, Weichai has simultaneously reduced costs, controlled inventory, and strengthened the management of accounts receivable. It has accumulated a large amount of cash and enhanced its ability to resist risks.
In the second half of this year, the economic situation has become increasingly severe. Beginning in September, Weichai sent technical, marketing, and financial professionals to form a research team to visit the United States, Europe, Southeast Asia, and other countries and regions to conduct research and evaluation of international capital markets, product markets, and talent markets. At the same time, various forms of strategic seminars were held to conduct careful research on the trends of domestic and foreign markets and formulate a set of countermeasures for corporate operations.
Ten years of research and development
When the economy is depressed, it is the best comprehensive inspection opportunity for the company's ability to innovate. At this time, the company can best test whether the company's products are close to the market and meet consumer needs. Weichai has achieved good sales performance thanks to quality products. The quality products come from Weichai's years of R&D investment and the accumulation of independent innovation.
Sun Shaojun said that since Chairman Tan Xuguang took office in 1998, he has attached great importance to independent innovation. Under the circumstances that the funds were very tight at that time, he still invested a lot of money in product development. "In 1998, Weichai only had eight simple test benches. Now, the number of test benches has increased to 28, which has reached the domestic advanced level. At present, Weichai has accumulated more than 500 million yuan in hardware for R&D." Sun Shaojun revealed that Weichai is building a new R&D center with a total investment of 1 billion yuan.
In addition to increasing hardware, the number and quality of Weichai R&D personnel are also constantly improving. Through training and introduction, Weichai currently has a relatively reasonable research and development echelon. The number of R&D personnel has increased from 20 people 10 years ago to 200 now, of which more than 150 have a master's degree or above.
In addition, after years of accumulation, Weichai has initially established a complete set of product R&D systems, and established standards for conceptual design, detailed design, mechanical development, complete machine development, and complete vehicle matching. At the same time, the introduction of CAE into the R&D process has shortened the R&D time and reduced the R&D costs.
Work hard to meet new opportunities
The current economic crisis is a challenge for powerful competitive companies, and it is also an opportunity.
At present, the government has introduced a number of policies to save the market, including investment of 4 trillion yuan to stimulate domestic demand, start the rural market, and adjust taxes and fees. Sun Shaojun said: "These policies will be effective in the first half of next year and will be effective in the second half of next year. By then, the auto market will re-enter the high-speed development stage."
In the face of the temporary market depression, Weichai must work hard to lay a solid foundation for a new round of economic growth.
Sun Shaojun revealed that at present, Weichai’s R&D investment will not only decrease but will continue to increase. At the same time, increase training efforts, strive to improve the quality of employees, accelerate the pace of new product development, actively develop more market-applicable products, accelerate the adjustment of product structure and market structure, actively integrate domestic and foreign market resources, and strengthen the industrial synergy of enterprise groups. The effect promotes the development of emerging markets and actively implements a diversified market supporting strategy. He said: "Sales can be reduced, but market share should be increased."
"In the face of the economic crisis, Weichai has the confidence to spend smoothly. What we must do now is to continuously improve our comprehensive strength in terms of products, management, and employee quality to meet the challenges," said Sun Shaojun.
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