On the road of internationalization, Yutong recently made another big step.
By the sales volume in export maket, there is no doubt that Yutong Bus is on the top of domestic bus manufactures. However, compared with international passenger bus giants, Yutong is still lack of some competitiveness especially in the core technology of key components and the R & D capability.
But as the leading manufacturer in China, Yutong maintains a cautious attitude and has never stopped developing itself in the process of moving towards the international road.
Although Yutong has continuously reached a series of strategic cooperation with transnational suppliers (such as ZF, ArvinMeritor, etc.) over the past two years. In the cooperation with ArvinMeritor Yutong recently announced, it can be seen an important step into internationalization because of which says that ArvinMeritor will follow a more flexible approach to apply its productions of final drive and brake produced in Wuxi plant to Yutong self-made axle.
It has been heard that Yutong will produce self-made axle and Yutong also has the capacity to produce axle although high-level management has its own strategic considerations as to the timing of starting the production. After all, the cost of self-made axle is higher than the external procurement without mass production support.
But this time, there is such a content of "The transaction of the project which will start by the end of 2009 is expected to have a total of more than 50 million U.S. dollars in the next five years." Through the procurement of the final drive, Yutong will gain more technical support in the core components of the axle and accelerate the pace of mass production of the axle.
In this way, Yutong as NO.1 Chinese brand of bus maker firstly will have a better protection of its own supply chain security. Secondly, there will have more obvious cost advantages. High rate of self-produced parts and components can significantly reduce supply chain costs, increase productivity and enhance competitive capacity. Thirdly, with its own axle, Yutong will also be able to improve the vehicle matching according to different road conditions demand and help to improve the quality and durability of products and finally gain brand reputation and influence.
When the axle achieves to be self-made, Yutong will have more control in most key components except engine and transmission.
Maybe this step will become a milestone for Yutong on the road of internationalization.
