On Dec. 17, 2016, 2017 SAIC-IVECO HONGYAN Annual Business Conference with the theme on “Winning the Future with Sincerity After 10 Years’ Effort” was held in Chengdu—the “City of Success”. Over 800 people including representatives from the dealers, service providers and automobile modification factories of SAIC HONGYAN nationwide as well as media journalists attended the conference.

This is the first annual conference since SAIC HONGYAN finished it equity restructuring. Lan Qingsong, vice president of SAIC Group, himself attended the conference as the representative of the party of shareholders, meanwhile the new leadership of SAIC HONGYAN officially came to limelight.

Lan Qingsong, vice president of SAIC Group

SAIC HONGYAN Finished Equity Restructuring to Embrace Bullish Market

Since SAIC-IVECO HONGYAN was incorporated in 2007, the disparity of the 3 share-holding parties in terms of cooperation and corporate goals and directions was embodied in the fact that the sales volume of SAIC HONGYAN always failed to reach people’s expexctation in alignment with its product quality.

According to the information officially published on Dec. 16, the 3 shareholding parties reached the agreement on the basis of the analysis on China’s commercial vehicle market and the enterprise’s corporate development plan that, SAIC Group expanded its share-holding by capital increase. Presently SAIC Group holds 59.96% of the shares of SAIC-IVECO HONGYAN, becoming its majority share-holder and acquiring the absolute control of SAIC HONGYAN. Apart from this, the shares held by Chongqing Machinery & Electronics increase to 34% and shares held by SAIC-IVECO Investment drop to 12.08%.

SAIC Group’s Zero-tolerance on SAIC HONGYAN

Lan Qingsong manifested: “The restructuring of SAIC Group on commercial vehicle business will not only improve product line and resource integration, but enable better development for heavy-duty, light-duty engines which have already had a place in its Twelfth 5-year Plan.”

As the share-holding party, SAIC Group holds exceedingly high expectation towards SAIC HONGYAN. Lan pointed out in his on-the-spot address that he was going to be even stricter with SAIC HONGYAN, “People always say that  ‘Carrot and Stick’ is the most perfect management method while I will be holding ‘sticks in both hands’ toward SAIC HONGYAN”.

It can be understood as a “commander’s order” issued by SAIC Group to HONGYAN and the “zero-tolerance” on reversing SAIC HONGYAN’s persistently unsatisfactory market performance. “A genuine warrior dares to confront face-to-face with the cruel life. HONGYAN, with its 51 years’ history, took only 2.1% of market share this year, which is not a high-achiever’s performance. Next year, as the key segment of SAIC Group, HONGYAN will have to accelerate, accelerate, accelerate its market development. And SAIC has the responsibility and obligation to realize the commitment. Suit the action to the words!”

Leadership Reshuffling

The new leadership of SAIC HONGYAN was unveiled in this annual conference. Among them, after the discussion of the party committee of SAIC Group and the approval of 3 parties of shareholders, Lou Jianping was appointed as GM, Shi Yicai as executive vice GM and Tan Sheng as vice GM.

As the 4thGM since SAIC HONGYAN established as a joint venture in 2007, Lou summarized SAIC HONGYAN’s development in 2016 and made comprehensive and thorough elucidations about the market environment and strategic deployment in 2017 in the annual conference.

Lou expressed his high hope for the development of SAIC HONGYAN and indicated he would lead the staff to gradually unfold system building, team building and “base” building and target at realizing “Four Major Breakthroughs” in product, industry, region and customer. He stressed that:

Firstly, the magnitude of the support from the 3 major share-holders to HONGYAN will be unprecedented.

Secondly, the State V products for all series will launch the offensive to commercial vehicle market.

Thirdly, the adjustment of state policy brings it market opportunity which will last till 2018.

Lastly, HONGYAN Spirit is a spirit of blood, of refusing to give in. Team building will be strengthened in 2017.

Though SAIC HONGYAN recorded a relatively satisfying market performance in 2016 with an annual growth of sales volume reaching 173%, Lou set a higher goal for its development in 2017: surpassing the company which is closely preceding it in industry ranking, selling 28,000 whole vehicles, taking 3.7% of market share and materializing the transition from loss to profit; forging “Five Major Abilities” of the company: product ability, marketing ability, management & control ability, systemizing ability and teamwork ability.

Lou disclosed in his address that SAIC Group will combine its capabilities in technologies, products R & D, finance etc. to offer further support to SAIC HONGYAN. “The most important point is there will be more solidarity on the decision making level, response will be more efficient as well, which is a one-hundred-percent good news for HONGYAN. ”

As introduced by Shi Yicai, executive vice GM of SAIC-IVECO HONGYAN and GM of its marketing branch, over the whole year of 2016, the company has sold 15517 heavy trucks, up 78% compared to last year; has taken 2.1% of market share, up 0.5% compared to last year and surpassed the previously 2 preceding companies. Among them, 8300 dump trucks were sold, up 140% compared to last year. Among the 8300 dump trucks, demand for muck trucks increased relatively much in the city construction of cities like Nanchang, Wuhan, Changsha and Shanghai. In regions like Jiangsu, Shanxi, Henan and Sichuan, dual increases appeared in terms of growth and market share in the field of tractors.

It’s reported HONGYAN has introduced its new products adapted to the various new regulations implemented in 2016 in the due time and has successfully grasped the market opportunity, including light-weight 6x4, 8x4 cargo trucks, middle-shaft car transport vehicles, State V HONGYAN GENLYON C500s equipped with 11-liter golden-power engines. They all accelerated the growth of HONGYAN  sales in highway segment. Furthermore, the somewhat back-to-warm dump truck market this year helps HONGYAN to achieve growth far exceeding average industry performance.

In regard of the construction of service network, the number of its service network outlets will reach 623 in 2016, among which 45 are newly built service providers. 10 mainlines for service have been built to meet the needs of highway transport users.

Forging HONGYAN Brand Image with Experiential Marketing

SAIC HONGYAN also intensified its efforts in brand building in 2016. The curtain of 2016 SAIC HONGYAN Cup Truck Drivers Elite Challenge was officially lifted on Sep. 25. The theme of this contest was “Lion Kings’ Fight For Dominion”. Until Nov. 19, along with the company, YUNSHUREN website has participated in, reported the totally 7 stations of games nationwide and witnessed the fluent skills of HONGYAN drivers from various regions nationwide and their enthusiasm for HONGYAN.

The company invited the champion contestants of the 7 stations to the site of the annual conference, which became the other major highlight of this event— “The Elite Gathering of Champions Nationwide”.

The 7 champion contestants has considered themselves as one of “SAIC HONGYAN-ers” and they all felt the warmth brought along by the large family. They also received the honor that qualifies them as “Gold-medal Truck Drivers”. The event this year got further close to target market and enabled many users to promptly experience and feel HONGYAN quality after new models were released, which greatly boosted its market performance in key regions.

The Appearance of All GENLYON 500 Series Shows HONGYAN’s Comprehensive Product Segmentation

Lou Jianping, GM of SAIC HONGYAN, proposed to “think in the way how customers think”. He stressed that, only when setting its sight on customers can a company offer products which match their value most and in turn acquire the maximization of brand value. Outside the conference venue, neatly lined all series products of SAIC HONGYAN 500 to accept “reviews”.

All series products of SAIC HONGYAN 500 in the morning sun

are a new-generation of heavy trucks developed on the basis of the advantages of the previous 100 series products. In the R&D process, designers fully considered the rigid requirements from the reality of China’s road transport and the laws and regulations. They have experienced full-scale upgrade in regards of security, economy, reliability, power and comfort etc. SAIC HONGYAN has conceived the new products for 3 years, with an eye on enhancing the integral operation value of vehicles. The outputs of  engines extends over 7L, 9L, 10L,11L, 12L,13L and horsepower segments from 260-560. With a more abundant product line, broader options for users and stronger adaptability to market, they have become the heavy truck products with most comprehensive power options in the industry.

In 2017, SAIC HONGYAN will consecutively release a series of new products like the north region version, the highland version, vehicles for express delivery logistics, inbound logistics and dockyard tractors etc. to fully meet users’ needs. Lou also disclosed in the conference that the release of a model on a new platform has been set in the company’s agenda for 2017. Meanwhile with the aid of the SAIC Group’s intelligence and digital technology, new internet heavy trucks will be officially released.

The products in display outside the venue include double-flying-wing material vehicles, express logistics vehicles, middle-shaft trailers, light-weight 6x4 Jieka tractors and refrigerator trucks.

The conservative estimation for China’s sale volume of heavy trucks in 2017 is around 750,000. Viewed in terms of various product segments, the sale volume of tractors and cargo trucks will be on a level ground with that in 2016 while there will be a growth of about 9% in the field of dump trucks. Dependent on HONGYAN’s excellent quality and its capable, experienced team culture, and now with the support from industry leader “SAIC Group”, surely SAIC HONGYAN will finally seize the opportunity for fast development.

The “ruthlessness” of SAIC Group, which created countless precedents, is well known in the industry. It’s also powerful in the composition of its overseas export channels. Lan Qingsong, as head of commercial vehicle section in SAIC Group, even went as far as created the legend of “DATONG Speed” and “C2B” mode. And his administrative style of suiting the action to the word is a pressure as well as an impetus for SAIC HONGYAN. Quote his saying in the annual conference: “SAIC is determined to win the future of SAIC HONGYAN”, while the question people expect most for answer is how fast on earth SAIC HONGYAN is able to realize its discourse power in the market.