This week’s newsletter features our guest columnist Yao Wei’s critique of the secrets behind the success of Dayun Automobile Manufacturing, China’s 7th largest heavy-duty truck manufacturer and 6th largest in heavy-duty truck tractor sales.
The most unique thing about Dayun, which literally means “big fortune” in Chinese, is that it is the youngest company and the only private company among the top 10 heavy-duty truck manufacturers. The fact that it has climbed up the rankings to the No. 7 spot in just six years of manufacturing and selling heavy-duty trucks is itself a surprise in the industry filled with tradition and decades-old big name brands like Jiefang and Dongfeng.
If these traditional companies are the Goliaths of China’s heavy-duty truck industry, then Dayun is definitely the David.
What’s more, Dayun was able to be listed on China’s Over the Counter (OTC) market, otherwise known as the “New Third Board” on December 9, 2016 and publicly released data showed it had revenues of ¥3.082 billion ($448 million), ¥3.394 billion and ¥2.386 billion in 2014, 2015 and H1 2016, respectively, while net profit was ¥-82.78 million, ¥-57.1 million and ¥23.19 million during the same periods.
From an outsider to No. 7 in heavy-duty truck sales rankings, Dayun has become a star representing privately-owned heavy-duty truck manufacturers, and there are not that many out there.
The secrets to Dayun’s success so far, as its chairman Yuan Qinshan points out in the feature article, are nothing more than perseverance and determination, and working harder than everyone else especially during tough times when people count you out.
Instead of succumbing to the tough market in 2012, when industry heavy-duty truck sales dropped 40 percent to just 630,000 units and when it had its eighth straight year of loss since he invested more than ¥2 billion to build a heavy-duty truck production base in 2004, Yuan instead chose to invest even more in product innovation and sales network.
Having courage, using the right talent, innovation and integrity were listed by Yuan as some of the key factors behind his company’s success amid an arduous development path and ever tougher competitive environment.
Dayun’s sales target for 2017 of 35,000 units is not conservative considering that will be a full 10,000 units more than what it sold last year. But it would probably still rank the company at the No. 7 spot behind JAC.
It will be interesting to see whether it will get into the mainstream heavy-duty truck manufacturer camp eventually and how long it will take for it to move up the rankings ladder.