Dongfeng’stragety in overseas market

Celebrating 40 year’s, Dongfeng Motor Corporation has attempted the leap forward in progress from quantitative to qualitative expansion in overseas market. Besides continuously consolidating the old business, such as the whole vechile export or CKD export, the corporation has already tried to make a careful layout of their overseas market for achieving their product development and the strategy of localized production.

Zhou Wenjie, Deputy General Manager of Dongfeng Motor Corporation gave us an introduction. He said domestic automotive industry has stepped into international market in 3different phases resepectively. The first is called “Basket Selling”, driven by opportunity, foreign companies come to purchase vechiles by themselves without establishing a long-term scheme; the second is “Trust Management” that means to look for agents in various regional markets and authorize local head dealers to explore local markets; and the third is “Positional Warfare” which refers to setting up of the long-term cooperation plan with the local partner and gradually establishing the sustainable sales network. From now on, Dongfeng is striving to pay equal attention to domestic and overseas market, and promote the strategy of localized production in overseas market.

As far as he is concerned, the market is experiencing golablization, while only dependence on vehicle export may run into some obstacles in long run, for there are still different levels of trade barriers in various regions. Thus, it’s possible only if the condition is mature, Dongfeng will set up own equipment factory in every key regional market, including the localized production in some level. As it is known, Dongfeng Commercial Vechiles Corporation has initially picked up Iran as its factory site, while Dongfeng Motor Corporation would prefer Indonesia.

Considered as the traditional advantage by Dongfeng Motor Corporation, the sales and production of commercial vehicles remain No.1 in the domestic counterparts for 5 consecutive years. From 2008 to date, Dongfeng light commercial vechiles and medium and heavey commercial vechiles successively achieved the goals in exports for main assembly and spare parts. In the newly-made middle-term plan, an important goal is to achieve 10% to 15% of the total sales of commercial vehicles in overseas market and realize technology and capital exports, namely ＂localized production＂.

The latest statistics show, the exports of the entire automotive industry has dropped by 64% from January to August this year, and Dongfeng made no exception in this period. As a whole, Dongfeng had completed 1.5m vehicle exports in 2008, while the figure is less than 6000 so far, this year. (serena)

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