On September 26, FAW Jiefang Automobile Co., Ltd. Wuxi Diesel Engine Works (FAWDE) celebrated the production of its 1 millionth Aowei diesel engine and 10,000th CA6DM3 (13L) diesel engine at its production facilities in Wuxi, Jiangsu Province.
The milestone comes nearly 14 years after FAWDE produced its first Aowei CA6DL diesel engine in December 2013. How was FAWDE able to sell and produce 1 million diesel engines under an independently developed heavy-duty diesel engine brand?
Forward engineering and follow the market
One key reason behind the success is FAWDE’s diesel engine engineering and development capabilities.
That was the same exact conclusion of Qian Hengrong, director and Party secretary of FAWDE.
“What we have achieved is hugely related to the first 6DL we produced in 2003 – at the time China’s first four-valve heavy-duty diesel engine,” said Qian at the ceremony. “FAWDE had forward engineering capabilities for diesel engines then and through 14 years of efforts we have been able to introduce products that always exceed previous generations.”
With those capabilities, FAWDE was able to continuously improve products and sustainably introduce products that met market demand, gaining first mover advantage. For the Aowei series diesel engines, from product launch to breaking annual sales of 10,000 units, it took 6DL three years, 6DM2 (11L) two years and 6DM3 (13L) in less than a year.
In contrast, many of the joint venture produced engines were not able to respond rapidly to market demand because they were not independent developed, and lacked the advantage that FAWDE had. For example in the 11L diesel engine market, FAWDE’s market share increased steadily since 2012: from 41 percent to 47 percent in 2013, 48 percent in 2014, 52 percent in 2015, 58 percent in 2016 and more than 60 percent in the first five months of 2017.
With engineering capabilities, FAWDE was able to continuously innovate technologies. In 2007, it won a national science and technology advancement award, the highest award given for industrial technology innovation. “We stick to continuous innovation to make our engines more fuel efficient, dependable and safer,” said Qian. “FAWDE diesel engines are the most fuel efficient among heavy-duty diesel engines in China and our customers say they save on average 3L-5L more per 100 km than competitors’ engines.”
If forward engineering is the “pass” for FAWDE to produce and sell one million Aowei diesel engines in 14 years, then the quality first philosophy ensures that it remains on a safe pathway to that goal.
“For FAWDE, quality comes first, then sales,” said Qian, who often stresses publicly that quality at FAWDE is a “high tension line” that no one can step over, no exclusions.
“In terms of dependability, FAWDE diesel engines’ failure rate per 1,000 vehicles has reached the levels of international brands,” said Qian.” The 13L engine B10 life has reached 1.5 million km, and we will introduce an engine with B10 life of 2 million km.”
“Tough” has been a keyword used to describe the quality of FAWDE products from its users, and it has received the highest award given in the national industry and manufacturing: National Quality Award. On November 4, 2015, FAWDE was the only company in the internal combustion engine industry to receive the 15th annual National Quality Award.
In the overseas markets, dealers trust so much on the quality of FAWDE products that they are willing to even pay for their customers to use the engines for free. A senior manager with Coopereagle, a South African dealer, says that was the way they earned customer trust. “We have so far sold more than 5,000 FAWDE engines in South Africa, No. 1 in Chinese brand engine sales,” said the manager surnamed Tinus.
Brand strategy boost market expansion
While FAWDE has the product power, it also has a trump card: a brand driven market expansion.
“We always say the small wins because of diligence, the medium wins because of wisdom and the big wins because of a way,” said Qian. “The way of enterprise operation is its brand management. The sustainable development of an enterprise depends on its brand.”
FAWDE therefore created a brand strategy in 2011 with three stages: the first stage is to be famous in China, the second is to be a leader in China and the third is to be famous globally. It is currently entering the second stage.
FAWDE’s brand strategy is clear: focus on diesel engines. “We don’t have any other products but diesel engines so we must make them the best in China,” said Qian. The brand slogan of FAWDE is “National Brand, High Power” and its product characteristics can be summarized by two phrases: fuel efficient and dependable.
In order to smoothly push ahead this brand strategy, FAWDE established a Chief Brand Officer (CBO) position held by Xu Haigen, deputy Party secretary of the company, and asked the entire company to strengthen brand management work. “Every department is a brand constructor and maintainer, and every department head is a brand ambassador,” said Qian.
The company also sent a “Brand Command Behavior Guideline” to all employees. It is basically four phrases: brand positioning must be clear, all work center on it; brand command must be tight and it guides our work; brand communication must be persistent; and product marketing must transform to brand marketing.
(Rewritten by Lei Xing based on author’s article on find800.cn)