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Time and number coincidences always make people have many associations. In 1986, Cummins’ global sales revenue was US$2.3 billion. Today, this figure is the sales that Cummins China planned to achieve in 2008. On July 18, 2008, Wang Hongjie, vice chairman of Cummins (China) Investment Co., Ltd., said in an exclusive interview with Auto Business Review: "Including the joint venture company in China, by 2010, Cummins' sales in the Chinese market will exceed 30. Billion dollars.†Compared to when Wang Hongjie first entered Cummins, this figure has increased by 30 times.
Wang Hongjie, 62 years old, joined Cummins in 1994. He clearly remembered that Cummins had no joint venture company in China at that time. The business was mainly three blocks, one was a mining vehicle, and the other was a technology transfer and license to Dongfeng and Chongqing. Production and sale of some spare parts, and the third one is a generator set. "At that time, sales were more than 100 million U.S. dollars a year. Our office in Beijing Guomao has only 6 employees," said Wang Hongjie. Today, with the joint venture, Cummins employs more than 6,000 people in China and its headquarters in Beijing also employs 750 people.
Cummins is an almost completely localized team in China, with a total of about 40 foreign employees. Most of them are specialized in the production and technology of joint ventures. In 2007, Cummins sold more than US$1.7 billion in China, an increase of 50% over 2006, accounting for 10% of Cummins’ total global sales.
As the top Chinese leader of Cummins China, Wang Hongjie is full of confidence in the head office’s annual growth target of 25%. This is Cummins' fastest growing region in the world. "The actual growth last year far exceeded this target. This year's increase is almost 30%," Wang Hongjie said.
In fact, Wang Hongjie’s contribution to Cummins may be more reflected in profits. The process of Wang Hongjie's entry into Cummins China has now become the standardized training mode for the company's new senior managers. He allowed this multinational corporation to recognize China's role early on and recognize the capabilities of local managers and use it as a driving force for rapid development in China. Wang Hongjie recalled that in the interview before entering Cummins, Cummings senior global asked him, what are you worried about? Wang Hongjie said that I am confident that I have no friends other than English.
"Automotive Business Review": How do you see the process of joining Cummins?
Wang Hongjie: Prior to 1994, foreign companies rarely hired local staff to serve as senior management. Cummings conducted a rigorous interview with me. First, Cao Side, the Asia-Pacific Director, interviewed me. Now he is responsible for our global emerging market business. After calculations, four top Cummins executives interviewed me within half a year and finally decided.
Although I had previously served as general manager of Inner Mongolia Northern Heavy Vehicle Co., Ltd. and also had experience in joint ventures and negotiations, Cummins still hoped that I would go to Cummins headquarters for training and training. In addition, I would like to hold a senior management position in China. Establish a personal relationship with the senior management of the headquarters that is at least known to each other.
I work for one year at the US headquarters and one year at the factory. The plant is located in North Carolina and was Cummins’ largest mid-engined engine plant at the time. In this mode, everyone feels very good when they do it. So later recruiting senior Chinese executives, they basically do it this way.
"Automotive Business Review": What are you specifically responsible for in the United States factory?
Wang Hongjie: It is the same as the director of the traineeship. It is necessary to manage this factory and give you clear goals to accomplish. The task that was given to me at that time was to improve production from 32 to 35 per hour to 42 in half a year. I achieved this goal in less than three months.
"Automotive Business Review": How does Cummins respond to the global market?
Wang Hongjie: Our diesel and natural gas engine products have risen from 1.4 to 91 litres, and the power range covers 31 to 3,500 hp. As long as the customer needs, the products we sell locally can be any model.
There are indeed different stages in different markets, which are mainly affected by the standards and progress of the implementation of local emission regulations. From a global perspective, the United States and Western Europe are leading in emission regulations, followed by Japan, South Korea, Australia, Taiwan and Singapore. These are almost in sync with the first tier. The following are China, Eastern Europe, South America, Brazil, etc. . Cummins products are now sold in more than 190 countries and regions worldwide.
"Automotive Business Review": This makes your product management complex.
Wang Hongjie: For example, the factory I managed in the United States was (in 1995) four models, four-cylinder 3.9-liter, six-cylinder 5.9-liter, and six-cylinder 8.3-liter. There are machinery, electronic control, automotive, construction machinery, shipbuilding, agriculture. There are a total of 3,200 different specification numbers. In order to manage these complex products, the entire supplier system must implement computer networking.
At present, we already have a global production layout, so Cummins began to consider some of the focus and distribution of production. For example, the American headquarters of Columbus's China Horsepower Plant is completely targeted at Dodge Rams. The North Macquarie Zhongmaili Factory focuses on non-road, shipbuilding, and agriculture. Dongfeng Cummins is mainly for trucks and domestic equipment. This change has been implemented in the past two to three years. It has integrated global resources to provide customers in different regions with lower cost and higher quality products and services.
"Automotive Business Review": Then you will transfer more factories to low-cost countries?
Wang Hongjie: This is already done. For example, our joint venture with Beiqi Foton focuses on the supply of light trucks. This plant is the only company in the world that produces these two newly developed 2.8-litre and 3.8-litre light engines and has not produced them in other regions.
This is also a decision after we comprehensively consider the cost, support, etc., but now the appreciation of the renminbi has indeed brought about some pressure.
"Automotive Business Review": What kind of help do you think Cummins, a leading multinational company, will bring to China's economic development?
Wang Hongjie: We have always emphasized the introduction of advanced international technologies to China, localized production, digestion and absorption, and the establishment of local R&D forces. This will not only bring better environmental protection products to China. From an industry perspective, these supporting engines will help Those export companies improve their own strength when they are in line with international standards. Based on my many years of market experience, I feel that our responsibility is not only to promote the advancement of the engine industry, but also to promote the proximity of commercial vehicles, engineering machinery, and shipbuilding companies to the world.
"Automotive Business Review": How many of Cummins' domestic production kits are used as export products?
Wang Hongjie: Each market segment is not the same. In the passenger car industry, 40% of the imported engines will be assembled on export vehicles and exported to developed markets. About 8% to 10% of Dongfeng Cummins is assembled by export vehicles, including Dongfeng trucks, Yutong buses, buses of large and small size, and some construction machinery. In construction machinery, 30% of imported engines are used for export.
"Automotive Business Review": How does Cummins manage the maintenance of these engines?
Wang Hongjie: Cummins has more than 5,000 service outlets and distributors in the world and has service capabilities in many countries. This network has great support for the domestic OEMs in China.
At home, Cummins has 12 subsidiaries and manages more than 300 distributors nationwide. This is mainly for imported models and some products with low relative retention and high technical requirements.
On the other hand, we cooperated extensively with domestic OEMs, such as Dongfeng, Futian, Liugong, Xugong, Sanyi, etc., and trained their existing dealers to achieve the ability to repair Cummins engines. Some of these competent dealers have developed into outlets that can provide one-stop service from vehicle to engine. We have already cooperated with Dongfeng 600, and Fukuda has also cooperated with more than 100, Shaanxi Auto has also developed more than 50.
Dealer training is conducted in strict accordance with our requirements. They are tested and certified, and they are required to invest in tools and equipment in accordance with our requirements and have certain parts stored. This kind of network will be more targeted and close to the end user.
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