ChongqingFAWAutoSalesCompanyINTERVIEWDATE:5May2025INTERVIEWERNAME:PaulGaoIntervieweeNameMr.LiuGePositionGeneralManagerCompanyandAddress116DaPingXiaJie,YuzhongDistrict,ChongqingTelephone/Fax0-13908331000BackgroundMr.LiuusedtoworkatFAW’sSouthwestSalesCompanyinChengdu.HeonlymovedtoChongqinginJanuary.Atthemoment,thereareonlythreepeopleworkingintheChongqingoffice.BesidesMr.Liu,thereisonepersoninchargeofserviceandonepersoninchargeofvehicleinventory.FAW-WuxiDieselFactoryalsohasasalesmanagerwhoworksandlivesinthesameofficeasMr.Liu.Thisisthefirsttimethatthevehiclebusinessandenginebusinesshaveco-locatedtheiroffices.Mr.LiusuggestedthatwetalktoMr.Cai,whousedtobetheDeputyGMatFAWTradingcompany,andnowinchargeofLighttrucksales.HeiscreditedwithturningaroundFAW’smediumandheavytruckbusinessagainststrongcompetitionfromDongFeng.SalesFAWsoldatotalof306JieFangtrucksinChongqing,including90QingDaotrucks.Salestargetforyear2000is275,Mr.Liu’sinternalsalestargetis400-500trucks.FAWhasfourdistributorsinChongqing,Qingdaotruckhasonedistributor.OffourdealersthatsellJieFangtrucksfromChangchu,oneofthemsold150trucks,anotheronesold30trucks,therestdidnotsellmany.TheoneQingdaodistributorsold90QingDaorefittedtrucks.Thisyear,Mr.LiuplanstoreducethenumberofJieFangdistributorsto2,andleavestheoneQingDaodistributoruntouched.Competition:DongFengisFAW’sstrongestcompetitorinChongQing.IthasthestrongestmarketshareinChongqing.Lastyear,itsoldcloseto1000trucks,thisrepresentsalargedecreasefrom1998whenitsold2,800trucks.Mr.LiuattributedDongFeng’sstrongsalesinChongqingtothefollowingreasons:Chongqing’sproximitytoWuhanwhereDongFengisbased.DongFengpaysmuchmoreattentiontotheChongqingmarketthanFAW.FAWonlyestablishedaseparateChongqingSalesCompanythisyear1DongFenghasmanysupplierslocatedinChongqing.Inthepastcoupleofyears,DongFenghasrepaidmanyofitssupplierswithDongFengtrucks,whichweresoldbyitssuppliersatlargediscountintheChongqingmarketDongFengreactedfastertothemarketdemandandintroducedpopularproductsthatmeetcustomerrequirements.Forexample,DongFengfirstintroduced“2tonKing”(afivetontruckindisguise)DongFengtrucksarebettersuitedforuseinChongqing,whereroadconditionsisbad.JieFangtrucksdonothavemuchover-loadcapabilityasDongFeng,especiallyJieFang’srearaxles,whichhavereceivedalotofcriticismfromcustomersDongFeng’sCumminsengineismorereliablethanJieFang’sWuxiandDaliandieselengine.EventhoughtheyaremoreexpensivetoservicethanWuxiandDalianengines,customersaremoreconcernedaboutmakingsurethetruckisrunningsmoothlyforthefirstonetotwoyears,whentheyareexpectedtogettheirinitialinvestmentback(Cumminsenginesnormallycanrunfor100,000KMswithoutmajorproblems)HongYanisalsodoingverywelllastyear.Itsoldover3300heavy-dutytrucksin1999,andthisyear,itplanstosell3,600trucks.Itsstrengthsare:Lowcost.HongYan’stwinaxleheavydutytrucksellsforRMB300K,andsingleaxletrucksellsRMB210-220K.Thiscomparesfavourablytoimports(theyarenotcomparablewithJieFangorDongFengbecauseHongYanhasbiggerpayload)HongYan’ssturdystructureworkswellundertoughenvironmentandroadconditions.HongYanreactstocustomerrequirements.ItsdumperscanbecustomisedaccordingtocustomerrequirementChongqingisaveryattractivemediumandheavydutytruckmarketbecausethereisalotoflargescaleconstructionprojectsunderwayinChongqinganditssurroundingareas.Mr.Liubelievethatinadditiontonormalcargotruck,thereislargemarketindumpertruck,concretemixer,andchemical/oiltankertruck.Topenetratethesemarketsegments,FAWneedstoimproveitsre-fittingcapabilitiesandloweritscost“3in1”Concept:NoneofJieFang’sdealersinChongqinghas“3in1”capabilities.ServiceinChongqingisprovidedby4servicestations,including1locatedinChongqingurbanareas,therestareinruralcounties.ThereisnopartscenterinChongqingatthemoment.ServicestationsneedtoorderpartsfromChengduorKunmingpartscenterOneofthetwoselecteddealersplantobuild“3in1”capabilitiesinordertogetthe1.2%salesrebate.2