Chinese truck maker BeiBen eyes Indian market
BeiBen Trucks Group, one of the largest heavy-duty truck makers from China, is planning to introduce its vast array of vehicles here, hoping that the new government’s focus on infrastructure development will revive the domestic market after two straight years of decline.
The Chinese company has been eyeing the Indian commercial vehicle market the second largest in Asia after Beiqi Foton had set up a plant in Pune in Maharashtra, while another player, Jianghuai Automobile Co Ltd (JAC), is also planning to tap the potential of the commercial vehicle market.
An email sent to the Marion Wu, international business manager at Norinco Group, the holding company of BeiBen Trucks, on the finer details on the India strategy, remained unanswered.
For years, various Chinese auto companies have been vying for a slice of the Indian market. SAIC Motor Corporation Limited (SAIC), one of the largest automakers, is already selling its cars and vans in the domestic market with its local partner General Motors India, while another entity, Great Wall Motors, is planning to debut its sports utility vehicles Haval H5 with product clinics already under way for Indian customers.
With a fair acceptance for the SAIC products in India, other companies are also getting ready to take the plunge. Analysts say with growth tapering off in the home market, Chinese companies are venturing into fast growing overseas markets like India.
“China’s commercial vehicle market has already touched maturity and we see some sort of a stabilisation with almost no, or negligible, growth in the next 4-5 years. On the other hand, since India exemplifies a decent potential on the back of local consumption coming from planned urbanisation and infrastructure within the country, many Chinese truck OEMs want to set up shop in India,” said Amit Kaushik, principal analyst (Autos) at IHS Automotive, a global consultancy firm.
Chinese companies are increasingly focusing on the Indian market with the advantages of similar product range and affordable price options. Beiqi Foton, a government-owned automaker, is also setting up its commercial vehicles facility at Khed near Pune with a cumulative investment of Rs 1,676 crore, while Great Wall Motors, China’s eighth-largest carmaker, is planning to debut its contemporary sporty utility vehicle Haval H5 model, which is the fastest growing segment in India.
BeiBen is part of the Norinco Group of Inner Mongolia China and had emerged from its joint venture with Mercedes Benz many years back. Its vast range of heavyduty trucks, developed in technical collaboration with Mercedes Benz, are well known in China for sturdiness and reliability and have played a crucial role in the modernisation of the country.
According to its global website, BeiBen long-range trucks are widely used in industries and sectors such as aviation, railways, highways, harbours, petroleum, chemicals, water & electricity, forests, fire fighting, banks, and the company also exports them to emerging markets like South Africa, Kenya, Ethiopia, Libya, Turkmenistan, Kazakhstan and Syria.
Though not much has been revealed about the products scheduled for India, sources in the automobile industry say the company plans to undertake customer surveys in major Indian cities by showing details of its vehicles through computer generated slides.
BeiBen with its heavy-duty and dump trucks along with tractortrailer models would compete with global behemoths like Volvo, Daimler AG, Scania and MAN that are here to tap the potential of the Indian market. Medium and heavy commercial vehicle sales for the first quarter stood at 50,415 units, a decline of 10% over last year.
Analysts tracking the automotive market say the Indian commercial vehicle market has bottomed out and is expected to grow in the future. It had dropped by as much as 25% in the March 2014 ended fiscal to 200,627 units sold in the entire 12 months and is expected to bounce back in the ongoing fiscal itself, aided by a massive Rs 38,000-crore outlay in the budget.
People in the automobile industry say the government’s renewed focus on infrastructure and promise to undertake fresh measures to revive the economy have rekindled optimism in the sector.
While domestic sales are on the upswing, like European counterparts that have established India as their manufacturing base, Chinese truck and bus makers are also looking at making India their global production base, and at the same time, make some inroads in the domestic market that’s largely dominated by Tata Motors, Ashok Leyland and Eicher Motors.