Iveco Import Car Returns to China Commercial Vehicle Market

The Voice of Economy reporter contacted the Italian Iveco China office. However, the relevant responsible persons went to the 2012 Hanover Commercial Vehicle Show in Germany and could not be interviewed. However, Han Likai, Marketing Manager of Iveco China, once stated that China's commercial vehicle market has developed very well in the past few years, and Iveco wants to seek greater development in China.

Iveco has two joint venture companies in China, one is Nanjing Iveco Automobile Co., Ltd. established in 1996, and Nanjing Automobile Group Co., Ltd. and Italian Iveco Co., Ltd. jointly invested 3.7 billion yuan to establish. One is SAIC Iveco Hongyan Commercial Vehicle Co., Ltd., which was established in 2007. It is understood that it has invested more than RMB 2 billion to build a production base with an annual output of 40,000 vehicles in the northern New District of Chongqing.

As early as 2005, Iveco began operating imported cars in China. However, after the signing of the joint venture framework agreement between Iveco and SAIC in 2005, Iveco trucks' sales to China have basically stopped. By 2007, SAIC, Iveco, and Hongyan formed a joint venture company. Iveco China has basically stopped the import of original vehicles and shifted its focus to the joint venture in China.

With the advent of the global economic crisis in 2008, many European and American multinational commercial vehicle companies have adjusted their investment in China, but Iveco is very cautious. Until 2011, after the new global CEO and general manager of China Wang Ning took office, Iveco began to actively adjust its strategy in China to expand the Chinese market to deal with the impact of the economic crisis.

Jia Xinguang, executive director of the China Automobile Dealers Association, said that Iveco should hope that there will be more complementarities between the imported car business and the joint venture company. At the same time, opportunities for the high-end commercial vehicle market in China are emerging.

Jia Xinguang: Iveco has actually cooperated in China. SAIC Iveco and Nanhua Iveco have cooperated. This means that he also has to open up an import channel. Actually, multinational corporations are basically absent from passenger cars. After the completion of the car competition is fierce, so he is now turning to commercial vehicles, like Volkswagen, General Motors are deployed in the production of commercial vehicles. In the past, our commercial vehicles were mainly low-priced ordinary vehicles of this type. Nowadays, the market for special-purpose modified vehicles is increasing, providing a good opportunity for the production of high-end commercial vehicles, so he is interested in this market. Now.

In the field of commercial vehicles, North American commercial vehicle company Navistar and German commercial vehicle company Daimler have long found a joint venture company, the Nuggets China market. It is worth noting that, since 2011, the sales volume of commercial vehicles in China, especially local heavy trucks, has been declining. However, many insiders are still optimistic about the potential of China's commercial vehicle market, especially the high-end heavy truck market.

In the first eight months of this year, cumulative sales of domestic heavy trucks decreased by 31% year-on-year, but the number of imported high-end heavy trucks increased. It is expected to reach a sales volume of more than 10,000 vehicles throughout the year, of which Mercedes can occupy more than half of the market. Jia Xinguang, executive director of the China Automobile Dealers Association, said that China's commercial vehicle market has been affected by the impact of the macro-control, but the entire industry is also restructuring and transformation, there is room for development.

Jia Xinguang: In the past two years, the commercial vehicle market has fallen, mainly because the market for commercial vehicles has a close relationship with macroeconomic regulation. Therefore, this decline is also a normal phenomenon, not that the industry itself has a problem. However, on the other hand, when the market declines, it will have to make some internal adjustments, product structure adjustments, pushing energy-saving and new energy sources, including some new energy and new technology products, and promoting enterprise transformation to better adapt to market competition.

Affected by the European debt crisis, the business of Iveco's Italian headquarters is not optimistic. In May of this year, Iveco’s subsidiary announced the closure of a factory in southeastern France. Recently, Iveco announced plans to close five factories in Europe during the year and concentrate production capacity at a production base in Germany.

In order to promote Iveco's imported car business in the Chinese market as soon as possible, Iveco China has already dug many sales talents from competitors such as Mercedes-Benz and Volvo. However, Jia Xinguang, executive director of the China Automobile Dealers Association, believes that, to a certain extent, Iveco also faces competition from domestic brands of commercial vehicles.

Jia Xinguang: Our several big groups still have a strong foundation for the production of commercial vehicles. The other one is now starting to comprehensively strive for cooperation abroad, so that the competitiveness of domestic commercial vehicles is actually very strong. Then there is our export situation of commercial vehicles is also very good, so I think the situation of commercial vehicles is better than the situation of the car market for independent brands.