Shaanxi Automobile Holding Group is eyeing one-third of its vehicle sales from overseas markets
Shaanxi Automobile Holding Group Co Ltd, the only heavy truck producer in western China, has been expanding its overseas business on the back of its growing market share in the domestic market.
As the country's Belt and Road Initiative brings increasing opportunities overseas, the company, which is also called Shaanqi Holding, will strengthen its sales and service networks and implement a localization strategy to increase its market.
The company sold 8,000 automobiles, or around 10 percent of its total sales, in overseas markets in 2015.
"Our target is to raise the share of our overseas market sales to one-third of the company's overall sales by the end of 2020. Meanwhile, one-third of the overseas sales should be locally produced by then," said Wang Yanhong, general manager of Shaanqi Holding.
He said the quality of China-made heavy trucks has improved a lot in the past decade and many export models are welcomed by foreign clients in Southeast Asia and Africa.
"Many of our products have better performance than their peer group vehicles," he said.
The company has so far exported its trucks to more than 90 countries and regions. It owns three subsidiaries, 37 offices, 24 "4S" stores, 70 initial dealers and 310 service stations in overseas markets.
In some countries like Ethiopia, Iran, South Africa, Malaysia and Nigeria, the company has its own assembly units, which has greatly increased its localization level.
Tian Chao, general manager of Shaanxi Heavy Duty Automobile Import & Export Co Ltd, a subsidiary of Shaanqi Holding, said the performance in the last year was not satisfying in his view.
"Our exports were affected by the price drop in crude oil last year. Russia, the big energy giant that used to be our best foreign market, reduced its orders due to falling oil prices," he said.
The devaluation of the rouble has worsened the export scene.
However, Tian said the crude price will not always stay low and the company has been actively exploring new foreign markets.
"Vietnam, the Philippines, Pakistan and Africa are all potential markets for us," he said. "The company will increase efforts on branding. It's very important. We entered the overseas markets 10 years ago, which was not as early as our European competitors. Thus, some foreign buyers still prefer to choose the second-hand European products than Chinese ones. The major reason is that we don't have strong brand recognition." He said the company will improve its after-sales service by increasing the number of service agents abroad.
Another focus area would be electric vehicles or EVs.
