YangzhouFAWServiceStationINTERVIEWDATE:March14th,2000INTERVIEWERNAME:AnneWangIntervieweeNameMr.ZhangChun-pingPositionDirectorCompanyandAddressYangzhouFAWServiceStationEastofYangzhouBridge,YunheEastRoad,Yangzhou225003Telephone/Fax(0514)7257809BackgroundKeyIssuesConclusionsBackgroundYangzhouServiceStationisestablishedinApril1992.YangzhouAutoTransportationGroupisthestation'sparentcompany.YangzhouServiceStationisstate-run.TotalFTEnumberis81.Duetothelimitationofcityconstruction,YangzhouServiceStationrelocateditselfoutoftheurbanareainJuly1999.Totalinvestmentforthenewsiteis2.5MillionRMBapproximately.BusinessrangeofYangzhouServiceStationincludesservicingandpartssales.Itstartstoselltrucksfrom1998,butonlyseveraltrucksaresoldsofar.Lastyearsales/2000target1999(2ndhalfyear)2000Parts1.8MillionRMB2MillionRMBTrucks15trucks150trucksWarranty400,000RMB18%increaseOutofwarranty360,000RMBN/AAllchassispartsaresourceddirectlyfromFAWpartscentre.EnginepartsaredirectlypurchasedfromDalianEngineandWuxiEngine.KeyIssuesTotalpartsinventoryis1.34Millionwith250,000RMBobsolescence.Turnovertimeis2months.Allthoseobsolescenceare141parts.Mr.Zhangwishestofindawaytogetridofthose141parts,eitherthroughpromotionorsimplywrite-off.AsFAWupdatesitstruckmodelveryquickly,YangzhouServiceStationneedsupdatedservicemanual/technicalinformationfromFAWTruckServiceDepartment.Besides,thereisnotrainingfortechniciansinrecenttwoyears.1Mr.Zhangwishestosellmoretrucksin2000.Hesetsupanambitioustargetof150trucks.Inordertoreachthistarget,hehopesFAWcangivesomefavouringpolicies,suchasturnovertrucksandpricingdiscount.Or,helphimtoestablishlongterm,stablerelationshipwithbigdealerswhocanprovidehimsometurnovertrucks.Hourlypriceforserviceout-of-warrantyisverylow.(4RMBperhour).TheServicebusinessisverycompetitiveasYangzhou'ssmallserviceproviderscanofferverylowprice.ConclusionYangzhouServiceStationinvested2.5MillionRMBtorelocateitselftoanewsitein1999.Thestationissmallinscale,buthasallmajorfunctionsrequiredbyFAW.YangzhouServiceStationisthinkingofexpandingitsbusinessandiswillingtobeaFAW3in1dealerinYangzhoumarket.2