When LiuGong opened its parts and distribution centre in Jebel Ali three years ago, it promised that it would be able to provide support to customers in the region far beyond that typically expected by the peers of the Chinese manufacturer. Three years later, it remains the standard by which its rivals are measured when people ask whether Chinese companies are willing to deliver more than a good price to customers.
May saw the facility reach another aftermarket landmark with the unveiling of the LiuGong Middle East Cummins Training Center, a school for those servicing and using engines from GCIC, the joint-venture between LiuGong and US engine powerhouse Cummins.
“According to the agreement, LiuGong dealers can provide after-sales service of Cummins engines to end-users through the LiuGong channel directly.
With the foundation of the LiuGong Middle East Cummins Training Center, we have reached another milestone,” explains LiuGong VP and board director of GCIC Yu Yajun. “LiuGong always commits to partnering with world class component manufacturers like Cummins but the joint-venture has allowed the relationship to grow strong.”
Yajun says the centre’s ability to train LiuGong dealers and their technicians, engineers and service managers not only ensures professional and effective after-sales service, it is also a core element in the LiuGong strategy to strengthen its position and development in the Middle East and North Africa region.
“Customer support is very importance us,” he emphasises via his translator. “The major purpose of the centre is to enhance our dealers and LiuGong Middle East’s staff. The second step will see us expand the service for customers. Right now the capacity of the facility is not enough to service everybody.”
He adds that the company is also considering expanding the training capabilities beyond the engines and other partners to ZF and its transmissions, for instance.
“(For now) this is really about Cummings and the really good relationship with LiuGong. They authorised us to do the customer service through LiuGong dealers. But in accordance with LiuGong’s expansion in the region and our relationship with ZF we do plan to open a similar centre.”
When pressed on LiuGong’s strategy for growth, he turns to what he considers the major reasons for the company’s progress to date.
“LiuGong is much more familiar with local demand,” he says. “We have closely approached the market and our reliability has impressed the customer.
More importantly, we really depend on our dealers and our cooperation has helped support the local customer. Finally by building the warehouse and the training centre we can provide support and build a capability here.”
The agreement between LiuGong and Cummins formalised a long-standing and fruitful partnership between the two companies at the turn of the decade. When the joint-venture broke ground on Guangxi Cummins Industrial Power Co’s (GCIC) 200,000sqm and 50,000 units per year engine plant in 2011, it would have been almost impossible to imagine the sudden pause in the Chinese market that has seen previously strong companies struggle.
The dip has forced many to concentrate on the global market and it was perhaps unsurprising that GCIC used Bauma in 2013 to debut its first engine, the L9.3, an engine especially designed for LiuGong’s wheel loaders. While he explains that the engines are already in the Middle East market, he adds that another product, the QSB7 is also forthcoming for LiuGong’s hydraulic excavators.
“We have a very strong base to develop our products; we have been selling globally for many years and are a strong competitor to all the global brands,” he says. “We all now know what our product level is, and because of (our experience in export markets) we can confidently say that our product quality is very similar to world class manufacturers. Dealers say so and we think so.”
Midway during his answer, he pauses a moment can calls back the attention of his interpreter. The translation may surprise many.
“As we can compete with other brands and have similar quality, we can have a similar price.”
For LiuGong the Middle East and Africa rank alongside Latin America and Russia as the major markets for exports. All of which he believes still hold huge potential for the company.
“These three markets are important to us,” he explains.
LiuGong has machines up its sleeve that could become popular choices in those markets as well as at home. The wheel loader range will move onto the H-series and the excavator range will also be revamped with the upcoming E-series. Tier-2 versions will be available.
“That depends of local demand.”
He explains that the company understands that to do that it must now raise the profile of its brand in markets such as the Middle East and Africa.
“That’s why our new motto is a tough world, tough equipment,” he laughs as it is repeated in English.
The attention of the business media in the week we meet was focused on the potential flotation of the Chinese Ebay, Alibaba, on the New York Stock Exchange. The importance of the move is not lost on Yujan.
“It’s big news. As we understand the IPO will be $100 billion.”
The subject of the company that is more successful than Amazon in terms of sales clearly has him enthused as he intercepts the interpreter to add more insight.
“On the 11 November last year, sales turnover was 30 billion RMB ($5 billion) in one day,” he recalls.
Surely that’s almost as much as LiuGong? He laughs out loud when that question is translated to him; and clearly while the domestic market remains flat, it is an exciting time for Chinese companies prepared to make their mark outside of the once booming market.
“The Chinese market has been ‘adjusted’ by government spending to enhance the economy,” he muses. “However it is still the supermarket of the world. 30% of Chinese products are now used in exports but 70% is still for the domestic market.”
Domestic shows held in China like BICES unveil a layer of smaller Chinese manufacturer that is often unseen in other regions. At the these events, LiuGong is one of the dominant exhibitors alongside other major names and rivals such as Sany, XCMG and Shantui at these event but Yujan suggests it is possible that smaller manufacturers could be squeezed out.
“It is possible, given time,” he notes.
When LiuGong opened its parts and distribution centre in Jebel Ali three years ago, it promised that it would be able to provide support to customers in the region far beyond that typically expected by the peers of the Chinese manufacturer. Three years later, it remains the standard by which its rivals are measured when people ask whether Chinese companies are willing to deliver more than a good price to customers. May saw the facility reach another aftermarket landmark with the unveiling of the LiuGong Middle East Cummins Training Center, a school for those servicing and using engines from GCIC, the joint-venture between LiuGong and US engine powerhouse Cummins. “According to the agreement, LiuGong dealers can provide after-sales service of Cummins engines to end-users through the LiuGong channel directly. With the foundation of the LiuGong Middle East Cummins Training Center, we have reached another milestone,” explains LiuGong VP and board director of GCIC Yu Yajun. “LiuGong always commits to partnering with world class component manufacturers like Cummins but the joint-venture has allowed the relationship to grow strong.” Yajun says the centre’s ability to train LiuGong dealers and their technicians, engineers and service managers not only ensures professional and effective after-sales service, it is also a core element in the LiuGong strategy to strengthen its position and development in the Middle East and North Africa region. “Customer support is very importance us,” he emphasises via his translator. “The major purpose of the centre is to enhance our dealers and LiuGong Middle East’s staff. The second step will see us expand the service for customers. Right now the capacity of the facility is not enough to service everybody.” He adds that the company is also considering expanding the training capabilities beyond the engines and other partners to ZF and its transmissions, for instance. “(For now) this is really about Cummings and the really good relationship with LiuGong. They authorised us to do the customer service through LiuGong dealers. But in accordance with LiuGong’s expansion in the region and our relationship with ZF we do plan to open a similar centre.”When pressed on LiuGong’s strategy for growth, he turns to what he considers the major reasons for the company’s progress to date.“LiuGong is much more familiar with local demand,” he says. “We have closely approached the market and our reliability has impressed the customer. More importantly, we really depend on our dealers and our cooperation has helped support the local customer. Finally by building the warehouse and the training centre we can provide support and build a capability here.”The agreement between LiuGong and Cummins formalised a long-standing and fruitful partnership between the two companies at the turn of the decade. When the joint-venture broke ground on Guangxi Cummins Industrial Power Co’s (GCIC) 200,000sqm and 50,000 units per year engine plant in 2011, it would have been almost impossible to imagine the sudden pause in the Chinese market that has seen previously strong companies struggle. The dip has forced many to concentrate on the global market and it was perhaps unsurprising that GCIC used Bauma in 2013 to debut its first engine, the L9.3, an engine especially designed for LiuGong’s wheel loaders. While he explains that the engines are already in the Middle East market, he adds that another product, the QSB7 is also forthcoming for LiuGong’s hydraulic excavators. “We have a very strong base to develop our products; we have been selling globally for many years and are a strong competitor to all the global brands,” he says. “We all now know what our product level is, and because of (our experience in export markets) we can confidently say that our product quality is very similar to world class manufacturers. Dealers say so and we think so.”Midway during his answer, he pauses a moment can calls back the attention of his interpreter. The translation may surprise many. “As we can compete with other brands and have similar quality, we can have a similar price.” For LiuGong the Middle East and Africa rank alongside Latin America and Russia as the major markets for exports. All of which he believes still hold huge potential for the company. “These three markets are important to us,” he explains. LiuGong has machines up its sleeve that could become popular choices in those markets as well as at home. The wheel loader range will move onto the H-series and the excavator range will also be revamped with the upcoming E-series. Tier-2 versions will be available. “That depends of local demand.”He explains that the company understands that to do that it must now raise the profile of its brand in markets such as the Middle East and Africa. “That’s why our new motto is a tough world, tough equipment,” he laughs as it is repeated in English. The attention of the business media in the week we meet was focused on the potential flotation of the Chinese Ebay, Alibaba, on the New York Stock Exchange. The importance of the move is not lost on Yujan. “It’s big news. As we understand the IPO will be $100 billion.”The subject of the company that is more successful than Amazon in terms of sales clearly has him enthused as he intercepts the interpreter to add more insight. “On the 11 November last year, sales turnover was 30 billion RMB ($5 billion) in one day,” he recalls. Surely that’s almost as much as LiuGong? He laughs out loud when that question is translated to him; and clearly while the domestic market remains flat, it is an exciting time for Chinese companies prepared to make their mark outside of the once booming market. “The Chinese market has been ‘adjusted’ by government spending to enhance the economy,” he muses. “However it is still the supermarket of the world. 30% of Chinese products are now used in exports but 70% is still for the domestic market.”Domestic shows held in China like BICES unveil a layer of smaller Chinese manufacturer that is often unseen in other regions. At the these events, LiuGong is one of the dominant exhibitors alongside other major names and rivals such as Sany, XCMG and Shantui at these event but Yujan suggests it is possible that smaller manufacturers could be squeezed out. “It is possible, given time,” he notes.