Weichai Group: A new starting point for a transformation and confidence

In 2014, Weichai Group achieved revenue of 107.3 billion yuan, a record high. Since breaking through 10 billion yuan for the first time in 2004, and surpassing 100 billion yuan for two consecutive years, Weichai has evolved from a single-engine manufacturing company to a multinational corporation group with multiple sectors and integrated global resources.

In an interview with the Weichai Group recently, the reporter found that the one hundred million-dollar-owned enterprises thought most of the time was how to upgrade and upgrade at the new starting point of 100 billion yuan. Tan Xuguang, chairman of Shandong Heavy Industry Group and Weichai Group, told reporters that Weichai has benefited from transformation and upgrading in the past ten years and the future success must also rely on a higher level of transformation and upgrading. He said, "With China's economic development entering a new normal, an unprecedented era of innovation and industry-intensive innovation has come. Weichai to achieve the dream of a century-long business, we must find new endogenous growth drivers."

Innovation is not a slogan and must be integrated into the company's cultural genes

The engine is the plate where Weichai gets its start. In 2014, this segment realized revenue of 42.7 billion yuan, an increase of 7.3% year-on-year, accounting for nearly half of the group. In fact, due to the slowdown in infrastructure, lack of growth in the construction machinery industry, and other factors, the domestic engine industry has experienced a serious overcapacity in the past two years, and companies are generally operating in difficulties. The reason why Weichai's engine business can rise against the trend is inseparable from its continuous focus on innovation and early deployment.

Weichai Heavy Machinery Factory, located in Binhai New District, Weifang City, mainly produces large-scale fishing vessels, cargo ships, and marine monitoring ships and other medium-speed diesel engines. With nearly a hundred machines to be delivered, director Li Yusen and the workers have been busy for the first time in production. He told reporters that these "tons" weighing several tons have a large market demand and huge profits. Due to the high requirements on technical precision and product reliability, only a handful of companies can produce in the international market. In 2008, when most of the domestic engine companies were busy expanding their traditional production capacity, Weichai aimed at this high-end market, and now it has become the only company with a full range of medium-speed engine products for marine power, and it has developed new products in addition to the traditional engine business. Blue sea.

“The era of relying solely on scale and cost competition has come to an end. Only by insisting on innovation-driven strategies and accelerating the adoption of key core technologies can companies have core competitiveness.” Weichai Group has deepened its understanding of the benefits of R&D and innovation and forging competitiveness. People's heart.

In Weichai Power Plant No. 1, Changchun Hui of the plant transformed the requirements of “lean manufacturing and intelligent manufacturing” of the group into concrete practices of “process transformation of equipments”. Workers applied the robots to tighten engine connecting rod bolts and manually lift the crankshaft. Automatic assembly for the robot. In the No. 2 plant, Wang Tongtai, the deputy director of the company, organized weekly “stars for on-site job improvement”, and employees had to come up with a technical improvement every week. At the Product Testing Center, Dr. Chen Wenhua from the “85th” Tsinghua University has been promoted to the position of Assistant Dean of the Institute due to his outstanding work... At present, Weichai has four state-level enterprise technology centers for engines, construction machinery, commercial vehicles, and transmissions. , as well as the world's leading engine product testing center, R & D strength into the international advanced.

Wang Yong, Party Secretary of Weichai Power Co., Ltd., explained to reporters the determination of Weichai to innovate: “When many of our peers are blind to engine noise, Weichai has already started to control noise; when other companies started to reduce noise, we managed to The noise became as pleasing as racing," he said. It is innovation that allows companies to offer differentiated products and services to win market opportunities.

Transformation is not a “change of business” but a pursuit of higher levels of development

Also 10 years ago, after Weichai realized a sales scale of 10 billion yuan, we began to think: How far can a company go with only a single engine business? How can we expand the map if we want to realize our 100-year corporate goals? Diversified transformation and upgrading path.

Looking at the development history of the international industry, it is a trend for engine companies to follow the "vertical integration of industries." Weichai made the judgement: relying solely on the engine business, the company's ability to resist risks is too weak, and it must be diversified and upgraded.

However, diversification is not a blind expansion. It is not where the money is. Tan Xuguang said that in the past 10 years, China’s economy has grown in large scale, real estate, finance and other fields have been lucrative. Before these temptations, Weichai has not been moved. "The transformation of Weichai does not deviate from industry, and we do not "change jobs" in transition". They based on the transformation of the industry, and escalated around the main business, achieving a multi-faceted increase in engine-related business.

According to the “backward integration” integration strategy, Weichai has established a strategic framework that focuses on the whole vehicle as a leader and the power system as the core around the major markets for engine services. In the international and domestic markets, it has taken the lead in carrying out a series of capitals. M&A activities have achieved coordinated development of the five major business lines of powertrains, commercial vehicles, construction machinery, luxury yachts, finance and services.

In the Weichai Group exhibition hall, a small luxury yacht about 5 meters long is placed. The yacht, which costs about RMB 4 million, was manufactured by Italy's Ferretti Yachts, which Weichai Group acquired in 2012. This acquisition project, which was initially questioned by the outside world, gradually merged in recent years and began to contribute to the group. In the process of transformation and upgrading, similar mergers and acquisitions have played an important role in creating an innovative, diversified, international, and open Weichai Group. In the domestic market, Weichai successfully reorganized the Hunan Torch in 2005 and owned Shaanxi Zhongqi, There are more than 40 high-quality companies such as Fast Transmission, Hande Axle, and Zhuzhou Gear. In the international market, Weichai has completed the “trilogy of overseas acquisitions” since 2009. In addition to the merger and acquisition of Ferretti, Weichai also restructured the world’s leading forklift company, the KION Group, as its largest shareholder and acquired its subsidiaries. Linde hydraulic 70% of the shares. During the international financial crisis, the French diesel engine company Baudouin was acquired on the basis of the “copy price”.

From independent engine companies to vertical integration and related diversification, Weichai currently has core resources such as gearboxes, axles, and hydraulic components, and has opened up a number of gold industrial chains such as commercial vehicles, construction machinery, and yachts. Today, the Weichai engine can support the development of the whole vehicle and the whole machine, and it can be supported by a diversified market externally. The company can use two legs to walk and the market space is even wider.

The dilemma is not an impasse, and the development of the enterprise must seek general trend, increase confidence, and exercise internal strength.

Equipment manufacturing industry is highly related to the economic cycle. At present, the overcapacity of the industry and the intensification of competition have made Weichai feel the pressure. At the same time, Weichai also knows its own shortcomings. Tan Xuguang believes that this requires Weichai not only must fully prepare for difficulties in the mid- to long-term, but also must strengthen its confidence, speed up internal reform and innovation, and turn crisis into opportunity.

He firmly believed that the medium to long-term growth trend of the Chinese economy will not change, the traditional growth engine is still strong, and the new development momentum is also accompanied by the gradual emergence of economic restructuring. China's infrastructure supply is still in short supply, and there is a great potential for infrastructure investment; the urbanization rate is still low, and the dual urban-rural structural adjustment will release huge demand. The implementation of the "One Belt and One Road" strategy promoted by China will promote the economic and trade cooperation between China's equipment manufacturing industry and Asia, Africa and Europe.

“The business that we depend on is still in a boom zone and is still in a promising period of strategic opportunities.” Within the group, Weichai’s management has used various opportunities to express these views. Whether it is speeding up the development of large business opportunities in the “post-market” engine, or focusing on energy conservation, environmental protection, and deep plowing and remanufacturing. Whether focusing on smart manufacturing or fully embracing the mobile Internet era, Weichai has taken the initiative to launch a new round of reforms and innovations. . Its goal is to transform from general technology to core technology, from manufacturing to service-based manufacturing, from investment-driven to investment-driven dual-transition, from domestic to global integration, and from product to brand operations.

“Half a hundred miles is a hundred miles. Weichai is on the verge of upgrading and upgrading. We must have no distractions and strive to climb.” Tan Xuguang said that starting from a new starting point, Weichai will definitely become a more resounding China in the international market. Brand.

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