Joint venture project encounters Cummins Jedi fight back

Once localized production of heavy, medium and light engine products, Cummins has the opportunity to become the largest supplier of heavy, medium and light truck engines in the Chinese truck market.

Not long ago, the global engine giant Cummins of the United States and Fukuda, China's largest light truck company, signed a feasibility study on the joint venture to establish a light-duty diesel engine production enterprise (hereinafter referred to as the feasibility study report).

The signatories of the feasibility study report include Beijing Foton Motor Co., Ltd. (hereinafter referred to as Foton), Beijing Foton Environmental Protection Co., Ltd. and Cummins Inc., and Cummins (China) Investment Co., Ltd., and these four parties will jointly establish "Beijing Foton Cummins." Engine Co., Ltd.".

According to this analysis, relevant people have been committed to introducing advanced technologies to Cummins in China. In order to consolidate China’s largest overseas market, its Chinese strategy is quietly changing.

In 2005, the sharp shrinkage of China's heavy truck market and the increase of competitors caused Cummins's joint venture projects in China to face a yellow warning. The potential crisis forced Cummins to bear the “transformation pain” and seek new partners to increase new profit growth while consolidating existing markets.

Joint venture is run

2006 was the thirty-first year that Cummins entered the Chinese market. Currently, Cummins has more than 20 institutions, 8 sole proprietorships and joint ventures in China. Its sales exceeded US$1 billion for two consecutive years, and more than 850,000 engines were put into use. This has become the largest foreign investor in the Chinese diesel engine industry.

The pressure on the Chinese market has made Cummins, who is good at medium-heavy and high-powered engines in the international market, have to intervene early in the field of light diesel engines.

There are two main reasons why Cummins switched to light truck engines: First, the heavy truck market in 2005 has shrunk sharply and the number of competitors has increased. Second, domestic joint venture projects have encountered embarrassing situations.

The former, such as Volvo and China National Heavy Duty Truck, Japan Isuzu and Qingling Motors respectively invested in the establishment of a joint venture; the latter, for example, after the cooperation between Cummins and Shaanxi Auto, Weichai Power, under the leadership of China National Heavy Duty Truck, indirectly controlled Shaanxi Auto, and the partners became Subordinate enterprises of direct competitors make it difficult for both parties to play.

China's truck market began to tilt toward heavy trucks in 2001, and the market for heavy trucks grew by an average of more than 60% per year. As evidenced by the case, Shaanqi, the leader of the time, produced less than 5,000 units of annual production in 2001, but its annual production in 2004 With more than 20,000 units, its growth rate is among the best.

As early as 1986, Cummins started to cooperate with Dongfeng Motor in the way of license transfer. In June 1996, the two parties established Dongfeng Cummins Engine Co., Ltd. with a 50:50 equity ratio. In February 2003, the registered capital of the expanded Dongfeng Cummins Engine Co., Ltd. exceeded US$100 million through a capital increase and the shareholding ratio remained unchanged.

As a result, the Cummins and Dongfeng joint venture products have expanded from the original 3.9-liter engine to the current 3.9-liter, 5.9-liter, and 8.3-liter models, namely Cummins B and C series products. But for the introduction of 9 liters or more of heavy-duty diesel products in Dongfeng, Cummins encountered a problem: With the strategic cooperation between Dongfeng and Renault, the two parties reached an agreement to introduce Renault DCILL engines, so that Renault DCILL engines and Cummins heavy-duty diesel engines will Form direct competition.

In contrast, Cummins is in a weak competitive position. Expert Analysis “In the case of Cummins, finding a second partner is an effective path to solving this problem.”

Finding the destination for light truck products

In the light-duty-card market, Cummins has pre-empted people.

“Fukuda is a key step in the development of Cummins' business in China.” “The feasibility study report signed by Futian is a key step before the two parties sign the joint venture contract.” “The two sides will use capital, equipment, land and technology. Form shares, which were established in the third quarter of this year and put into production in 2008."

According to the feasibility report, Cummins and Foton will establish a 50:50 joint venture to produce a new generation of Cummins high-performance light-duty diesel engines. The products will be used in light trucks, pickup trucks, SUVs, MPV utility vehicles and small non-compact vehicles. Highway equipment and other fields.

To this end, Cummins offers two "real new products" to Foton. According to reports, the two new engines mentioned above (inline 4 cylinder 2.8-liter and 3.8-liter direct-injection diesel engine) have never been put into operation anywhere (including the United States).

As the world's largest manufacturer and supplier of diesel engines with more than 50 horsepower, Cummins has always been a blank in China's light truck market. Until it cooperated with Foton, it had completed this wish. Fukuda chose as a partner to find a satisfactory home for the Cummins 1.3-liter light truck engine in China.

According to the feasibility report, the joint venture has a duration of 30 years, a total investment of 1.946 billion yuan, a registered capital of 1.019 billion yuan, and funds will be available within three years. Compared to last year, Xi'an Cummins Engine Co., Ltd. (registered capital of US$24 million) built by Shaanxi Heavy Duty Truck and Cummins, this shot is more powerful.

The above items are of great significance to Cummins. Relevant persons stated that “the cooperation with Foton is the first time Cummins has entered the field of light commercial vehicles on a global scale and will further improve the diversified structure of Cummins products and markets.” “Fukuda Motors is currently the largest domestic light truck company in sales, Cummins. It is the world's largest independent engine manufacturer. This cooperation will inevitably bring a win-win situation.” “Fukuda chose to cooperate with Cummins, first of all to meet the requirements for the upgrading of domestic emission regulations, and secondly to meet the needs of the global product development strategy.”

Transformation is to expand

Since the 1980s, Cummins has successfully completed the transformation from traditional heavy-duty engine manufacturers to a full range of all-round, multinational independent diesel engine manufacturers.

According to analysts, while Cummins continues its strategic cooperation with outstanding Chinese companies, it will be able to become the largest supplier of heavy trucks, medium trucks, and light truck engines in China’s truck market once local heavy-duty, medium-sized, and light engine products are produced locally. Business. This is the root cause of Cummins’ transformation.

According to reports, Cummins's full range of vehicle engine product introduction path layout has been completed. According to Cummins' latest plan, the following 9-liter vehicle engine will use Dongfeng Cummins as its production base, and its 9-liter-plus vehicle engine will use Shaanxi Steam as its production base. In the Chinese market, Dongfeng and Shaanxi Auto are two key pieces of Cummins.

Cummins is focusing on expanding the production capacity of Dongfeng Cummins, which is planned to increase from the current annual output of 130,000 units to 200,000 units in 2010. It is expected that Cummins' China business will reach 3 billion US dollars by 2010.

Cummins’ sales in China exceeded US$1 billion in 2004, accounting for more than one-tenth of its global sales. In order to consolidate the Chinese market, Cummins will invest an additional US$300 million in the next five years.

In October 2005, the Cummins Global Board of Directors was held in Beijing. This is the first time that the Cummins Global Board has been held outside the United States for 15 years, which reflects the growing importance of the rapidly developing Chinese market in Cummins' global strategic system.
View related topics: Cummins - world-class engine manufacturer

PVC Resin

Polyvinyl chloride (PVC) is a polymer polymerized by vinyl chloride monomer (VCM) in peroxide, azo compound and other initiators or according to the free radical polymerization mechanism under the action of light and heat. Vinyl chloride homopolymer and vinyl chloride copolymer are collectively referred to as vinyl chloride resin.

PVC is a white powder with amorphous structure, with small branching degree, glass transition temperature of 77 ~ 90 ℃, and it begins to decompose at about 170 ℃ [1]. It has poor stability to light and heat. When it is above 100 ℃ or exposed to sunlight for a long time, it will decompose to produce hydrogen chloride, and further Autocatalytic Decomposition will cause discoloration, and its physical and mechanical properties will also decline rapidly, In practical application, stabilizer must be added to improve the stability to heat and light.

The molecular weight of industrial PVC is generally in the range of 50000 ~ 110000, with great polydispersity. The molecular weight increases with the decrease of polymerization temperature. There is no fixed melting point. It begins to soften at 80 ~ 85 ℃, changes to viscoelastic state at 130 ℃, and changes to viscous flow state at 160 ~ 180 ℃; It has good mechanical properties, with tensile strength of about 60MPa and impact strength of 5 ~ 10kj / m2; It has excellent dielectric properties.

PVC was once the world's largest general-purpose plastic, which was widely used. It is widely used in building materials, industrial products, daily necessities, floor leather, floor tiles, artificial leather, pipes, wires and cables, packaging film, bottles, foaming materials, sealing materials, fibers and so on.

According to the different application scope, PVC can be divided into: General PVC resin, high degree of polymerization PVC resin and cross-linked PVC resin. Universal PVC resin is formed by polymerization of vinyl chloride monomer under the action of initiator; High degree of polymerization PVC resin refers to the resin polymerized by adding chain growth agent in vinyl chloride monomer polymerization system; Crosslinked PVC resin is a resin polymerized by adding crosslinking agent containing diene and polyene into vinyl chloride monomer polymerization system.

According to the method of obtaining vinyl chloride monomer, it can be divided into calcium carbide method, ethylene method and imported (EDC, VCM) monomer method (traditionally, ethylene method and imported monomer method are collectively referred to as ethylene method).

Main purpose:

1. PVC profile

Profile and profile are the areas with the largest consumption of PVC in China, accounting for about 25% of the total consumption of PVC. They are mainly used to make doors and windows and energy-saving materials. Their application is still growing by a large margin throughout the country. In developed countries, the market share of plastic doors and windows is also the highest, such as 50% in Germany, 56% in France and 45% in the United States.

2. PVC pipe

Among many PVC products, PVC pipe is the second largest consumption field, accounting for about 20% of its consumption. In China, PVC pipe is developed earlier than PE pipe and PP pipe, with many varieties, excellent performance and wide application range, which occupies an important position in the market.

3. PVC membrane

The consumption of PVC in the field of PVC membrane ranks third, accounting for about 10%. After PVC is mixed and plasticized with additives, a transparent or colored film with a specified thickness is made by a three roll or four roll calender. The film is processed by this method to become a calendered film. You can also cut and heat seal packaging bags, raincoats, tablecloths, curtains, inflatable toys, etc. The wide transparent film can be used for greenhouse, plastic greenhouse and plastic film. The biaxially stretched film has the characteristics of thermal shrinkage and can be used for shrinkage packaging.

4. PVC hard materials and plates

PVC is added with stabilizer, lubricant and filler. After mixing, hard pipes, special-shaped pipes and corrugated pipes of various diameters can be extruded by extruder for downcomer, drinking water pipe, wire sleeve or stair handrail. The calendered sheets can be overlapped and hot pressed to make hard plates of various thicknesses. The plate can be cut into the required shape, and then welded into various chemical corrosion-resistant storage tanks, air ducts and containers with PVC electrode and hot air.

5. PVC general soft products

It can be extruded into hoses, cables, wires, etc. by extruder; Plastic sandals, soles, slippers, toys, auto parts, etc. can be made by injection molding machine with various molds.

6. PVC packaging materials

PVC products are mainly used for packaging various containers, films and hard pieces. PVC containers mainly produce mineral water, beverage and cosmetic bottles, and are also used for the packaging of refined oil. PVC film can be used for CO extrusion with other polymers to produce low-cost laminated products and transparent products with good barrier. PVC film can also be used for stretch or heat shrinkable packaging, and for packaging mattresses, cloth, toys and industrial commodities.

7. Pvc wall panels and floors

Pvc wall panels are mainly used to replace aluminum wall panels. In addition to a part of PVC resin, the other components of PVC floor tiles are recycled materials, adhesives, fillers and other components, which are mainly used in the ground of airport terminal building and hard ground in other places.

8. PVC consumer goods

Luggage bag is a traditional product made of PVC. PVC is used to make all kinds of imitation leather, luggage bag and sports products, such as basketball, football and football. It can also be used to make uniforms and belts for special protective equipment. PVC fabrics for clothing are generally absorbent fabrics (without coating), such as ponchos, baby pants, imitation leather jackets and various rain boots. Polyvinyl chloride is used in many sports and entertainment products, such as toys, records and sporting goods. Polyvinyl chloride toys and sporting goods have a large growth. It has an advantage because of its low production cost and easy molding.

9. PVC coated products

Artificial leather with substrate is made by applying PVC onto cloth or paper and plasticizing it above 100 ℃. PVC and additives can also be calendered into a film, and then pressed with the substrate. The artificial leather without substrate is directly calendered into soft sheets of a certain thickness by calender, and then pressed with patterns. Artificial leather can be used to make suitcases, bags, book covers, sofas and car cushions, as well as floor leather, which can be used as paving materials for buildings.

10.PVC foam products

When the soft PVC is mixed, a suitable amount of foaming agent is added into the sheet to form foam plastic, which can be used as foam slippers, sandals, insoles, and shockproof cushioning packaging materials. It can also be formed into low foaming rigid PVC plates and profiles based on extruder, which can replace wood. It is a new building material.

11. PVC transparent sheet

PVC is mixed, plasticized and calendered into transparent sheet by adding impact modifier and organotin stabilizer. Thermoforming can be used to make thin-walled transparent containers or vacuum blister packaging. It is an excellent packaging material and decorative material.

12. Others

Doors and windows are assembled with hard special-shaped materials. In some countries, it has occupied the market of doors and windows together with wooden doors, windows and aluminum windows; Imitation wood materials and steel building materials (North and seaside); Hollow container.

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Henan Chuange Industry CO.,LTD , https://www.chuangegroup.com