Beijing_FAW_Automotive0301.docVIP免费

FAWBeijingAutomotiveCo.,Ltd.,TruckDepartmentINTERVIEWDATE:March1,2000INTERVIEWERNAME:BillHeIntervieweeNameMr.DingChangliPositionManagerCompanyandAddressHaidian,BeijingTelephone/Fax010-88125729BackgroundFAWBeijingAutomotiveCo.,LtdisajointventurebetweenFAWandBeijingYuyuantanmunicipalgovernmentestablishedattheendof1997.FAWowns51%andtheequityandYuyuantanmunicipalgovernmentowns49%.Thisjointventurehasseverallinesofbusiness.Itstrucksalesbusinessisdoingfairlywellwhileitsmanufacturingbusinessisstruggling.Overall,thiscompanyislosingmoney.Accordingtoarecentboardmeeting,FAWwantstogetridofitsequityshareinthecompany.Trucksalesofthecompanywas756in1998and750in1999.TrucksalesrevenuewasaboutRMB70millionin1998and1999respectively.AnnualgrossprofitoftrucksalesbusinesswasaboutRMB1millionandannualnetprofitoftrucksalesbusinesswasaboutRMB700,000.Thebreakdownoftrucksalesin1999was300lighttrucks,300mediumweighttrucks,and150heavyweighttrucks.ThemostpopularmodelwasCA1110PK2LH.ThepricetheygetisAnetworkpriceminus3%.Theyselltosecond-tierdealersandendusers.Thepricetheyselltoendusersisthepricetheygetplus1–1.5%plusfreight.Thepricetheyselltosecond-tierdealersisthesamepricetheyget,orevenless0.5%insomecases,plusfreight.Inthosecases,theyonlymakeprofitonthe1%yearendrebatefromFAW.Thetruckdepartmentofthecompanyhas6employeesandtheyallhavesalesresponsibilities.Thesalesmen’scompensationissimilartoothercompanies.Theyare“Four-in-One”dealeralready.FAWBeijingAutomotiveCo.,Ltd.ownstheFAWfourthServiceStationinBeijing.Theservicestationsellsparts,too.In1999,partsrevenuewasRMB2to3millionandnetprofitwasaboutRMB400,000.ServicenetprofitwasaboutRMB500,000in1999.Theythinktheprofitmarginofsellingnewtruckswillcontinuetobesqueezedinyearstocome.Theyhavetomakeprofitonpartssalesandserviceinthefuture.UnlikethesituationwesawinBaotou,FAWpaidserviceisnotprofitableinBeijing.Ontheotherhand,thecustomerpaidserviceismorelucrativeinBeijing.However,theFAWpaidserviceisalostleaderforthemtobuildservicebusiness.AfterenduserstriedtheirservicethroughFAWpaidservice,1endusersgottoknowtheservicestation,satisfiedwiththeirservice,andcamebackforfutureservices.Mr.DingisveryoptimisticaboutJieFangtruck’sfutureafterChina’saccessiontotheWTO.HethinkJieFanghastherightproductsfortheChinesemarketandJieFang’spricingadvantagewillsustaininfrontoftheforeigncompetition.KeyIssuesTheyviewthemselvesdifferentthanmostotherdealers.TheythinktheyareFAWinBeijing.TheythinktheirfirstpriorityistosellJieFangtrucksandgainmarketshareforFAWinBeijing.That’swhytheyselltrucksatbelowtheircostinsomecases.In1999,FAWprovidedtruckinventoryworthRMB5milliontothiscompany.WiththeprospectiveofFAW’sdeparture,itisfairtosaythatFAWwillnotprovidesuchinventoryanymore.Andthiscompany’ssalescouldbeimpactedbecausetheywillnothavesamplestoshowtopotentialcustomers.TechnicalsupportfromFAWhasproblems,especiallyfornewproducts.Sometimes,newmodelarriveddealer’swarehousewithoutmanual.Sometimes,dealersoldthenewmodelandonlyrealisedlaterthatFAWdidn’tsendtheirthenewparts.Andtheycouldn’tservetheend-usersbecauseoflackofparts.FAW’splanwiththisjointventureisalwaysabiguncertainty.ConclusionThiscompanyistheonly“Four-in-One”dealerofJieFangtruckstodayinBeijing.Theyareprofessionalandhaveextensiveknowledgeofthetruckmarket.NomatterwhatFAWdecidestodowithitsequityinthecompany,thisisagooddealerworthkeeping.2