It can be foreseen that China National Heavy Duty Truck and the MAN will be a strong force, will have a significant impact on the pattern of commercial vehicles in China.

On July 15, China National Heavy Duty Truck (Hong Kong) Co., Ltd. (referred to as China National Heavy Duty Truck) and the world's third-largest heavy truck manufacturer Germany MAN SE Group (abbreviated as MAN) signed a share transfer agreement, MAN will have China National Heavy Duty Truck 25 % of the equity has become the second largest shareholder of Sinotruk.

The acquisition has triggered strong industry concerns. As China's largest strategic heavy truck company, why is China National Heavy Duty Truck Co., Ltd. “transferring equity”? What is the mutual benefit of the cooperation between the two parties? How does MAN MAN's transfer of truck and engine technology affect the future development of China National Heavy Duty Truck? How will cooperation support MAN Man's expansion in China?

China National Heavy Duty Trucks wants technology, MAN wants the market

The two parties signed a series of cooperation agreements including the "Shareholders' Agreement, Technology License Agreement, Share Purchase Agreement, and Convertible Bond Subscription Agreement." According to the agreement, MAN Man transferred to China National Heavy Duty Truck the complete TGA truck, the technology of D08, D20, and D26 engines and related parts and components that meet Euro III, Euro IV, and Euro V emission standards; MAN acquired 25% of China National Heavy Truck Co., Ltd. One share of the equity involved 6.048 billion Hong Kong dollars.

It is worth mentioning that before this, Sinotruk raised HK$9 billion after listing in Hong Kong in November 2008. The net proceeds from this transfer were approximately HK$5.189 billion.

Ni Guixiang, Vice Minister of China National Heavy Duty Truck Propaganda Department, said in an interview with the author: “In 2007, the two companies began to negotiate this matter. This cooperation is a win-win cooperation, we have the technical needs, and we all want the financial crisis. Take up more market."

Obviously, the basis for cooperation is that CNHTC has obtained funds and technology; MAN has obtained the market.

At present, 70% of the 500,000 heavy-duty vehicles on the road in China are owned by Steyr Technologies. This truck technology was acquired by China National Heavy Duty Truck in 1984 from Steyr, a subsidiary of MAN. China National Heavy Duty Truck Technology Innovation is imminent.

“If there is no entry of MAN, their future development will encounter a big problem.” Jia Xinguang, an automotive analyst, said, “The biggest weakness of China’s heavy-duty development after Weifang Diesel and the separation of China National Heavy Duty Truck in 2006 It's engine technology."

What MAN Man values ​​is the vast space and huge growth of the Chinese market.

MAN Man pointed out at the signing ceremony that the purpose of this equity investment in Sinotruk was to establish a firm foothold in the world’s largest and fastest growing Chinese heavy truck market. MAN Man issued a statement saying that the shares will help him expand his business in emerging markets.

Join forces to change the pattern of commercial vehicles in China

After the acquisition was completed, the shareholding ratio of China National Heavy Duty Truck Group had dropped from 69.35% to 51%. MAN Mann became the second largest shareholder of China National Heavy Duty Truck with 25% of its share capital plus one share.

According to the agreement, MAN has the right to nominate four directors out of all 17 directors of the board of directors, of which one is an executive director. Regarding the impact this change may have on the management of the company, an insider of Sinotruk, who declined to be named, told the author: “Our company will introduce advanced European management methods and management experience, which is beneficial to the company.”

Online surveys show that most netizens believe that this cooperation will threaten the safety of China's heavy-duty auto industry. For this statement, the person does not agree: "China National Heavy Duty Truck has maintained its absolute controlling position and there is no threat."

Regarding the possible impact of this cooperation on the competitors, he said: "Because of the implementation of the technology, it will take some time, so the impact on the competitors is not easy to say."

Although Sinotruk responded in a low-key manner, it is foreseeable that Sinotruk, in conjunction with MAN Manqiang, will have a major impact on the pattern of commercial vehicles in China: First, Volvo and China Sinotruk suspend cooperation and may instead seek cooperation with Dongfeng. Cooperation; Second, MAN, together with China National Heavy Duty Truck, will form an impact on Shaanxi Heavy Duty Truck and Weichai Power Alliance.

The main engine of Shaanxi Heavy Duty Truck F2000 is from MAN MAN F2000 model technology. Although TGA and F2000 are not the same technology platform, they are all from MAN MAN. After MAN has transferred TGA truck technology to CNHTC, there will be a melee battle in China's commercial vehicle sector. pattern.

The author was informed before the press release that Volvo and China National Heavy Duty Truck have reached an agreement, and Volvo will withdraw from the 30-year Huarong joint venture project. Ni Guixiang confirmed to the author: "With this matter, both parties have now agreed, but for the time being there has been no written statement."

In addition to technological upgrading, cooperation will also increase Sinotrans’s international influence. Ni Guixiang said: "Cooperation will have a very positive effect on the export of China National Heavy Duty Truck."

Of course, there are different voices. A Morgan Stanley analyst published a report stating that the effect of Sinotruk and Mannman's joint venture will take two to three years to appear regardless of sales volume or profit. In the short term, the company will still have to face the challenge of market competition leading to falling prices. They also expressed concern about the ability of both parties to cooperate.



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