Economic Daily： ＂Return of the King＂ in the Cradle of Cars – State-owned Assets Supervision and Administration Commission of the State Council

The picture shows FAW Jiefang Qingdao final assembly production line. (file photo)

Recently, FAW Jiefang Automobile Co., Ltd. has released two pieces of exciting news:

First, not long ago, FAW Jiefang held the real vehicle test activity of Jiefang Intelligent Truck Highway in Changchun and achieved complete success. This is the first time that domestic commercial vehicles have realized the application of intelligent driving functions in the expressway environment, marking an important step for FAW Jiefang in intelligent transportation and walking at the forefront of intelligent networking in the commercial vehicle industry.

Second, from January to July this year, FAW Jiefang sold 183,000 vehicles, and the market share of medium and heavy trucks reached 20.7% and 22.8% respectively, both of which occupied the first place in the industry.

As the company that produced the first car in New China, FAW Jiefang can be called the cradle of China’s automobile industry. However, with the intensification of market competition, FAW Jiefang gradually failed to keep up with the pace of the times, and even fell into the awkward situation of pacesetter and pursuit. In 2012, its main product share fell to 16.4%, the top three positions in the industry were not guaranteed, and the company fell into a trough.

The market is like a mirror, reflecting not only the apparent problems of FAW’s liberated products and lagging services, but also the lack of enterprise innovation ability, slow product iteration, and backward management system hidden behind the market share.

Reform and innovation are the only way out. In the days that followed, FAW Liberation began continuous and in-depth self-reflection and self-adjustment. A whole set of "combination punches" were played, and the company finally ushered in the moment of bottoming out.

From glory to decline, and then to catch up and climb the peak, FAW Liberation staged a realistic version of "The Return of the King". What a thrilling and gripping story is this?

demand-driven

As the old saying goes, the market is not normal. Especially now, the commercial vehicle market has entered a new period of structural transformation – the trend of international competition is prominent, the extensive development model cannot be sustained, and commercial vehicle companies must shape new competitive advantages through various measures such as optimizing structure and product upgrading.

Where is the commanding height of commercial vehicle users? FAW Jiefang’s judgment is – logistics.

In March 2015, Jiefang J6 Pilot Edition held grand regional launch ceremonies in Xuzhou, Jiangsu, Fuyang, Anhui and Linyi, Shandong. This means that FAW Jiefang has once again made a major breakthrough in the field of high-end heavy trucks in our country, and even redefined the highest standards in the logistics industry.

FAW Jiefang Product Management Department line manager Zhang Song told reporters that the rapid development of the Internet and e-commerce has led to the continuous expansion and maturity of the logistics and transportation market. The trend of logistics and transportation intensification and efficiency has been further highlighted, and the requirements for high reliability and high attendance of trucks have become increasingly stringent. At the same time, the user structure is also changing. For example, truck drivers tend to be younger, with high requirements for vehicle comfort and intelligence. J6 Pilot Edition is a strategic product launched by the company to adapt to changes in the demand structure of the logistics express transportation market.

The launch of the J6 pilot version is just a microcosm of FAW Jiefang’s transformation. FAW Jiefang believes that in order to develop, the concept of "what users need, what liberation provides" must be maximized. To this end, FAW Jiefang has developed the J6 northern version with an independent warm air system for the cold weather in the north in winter, which solves the problem that the temperature in the car is lower than the comfort level of the human body; for the characteristics of roads in the southwest, it has launched the J6 southwest model with reserved water tank space on the right side of the chassis. In addition, FAW Jiefang has also launched a series of sub-models such as the "Quality Benefit Edition", the port version, the green pass version and the intelligent muck unloading, express logistics and so

It is not easy to stay ahead in meeting user requests. To this end, FAW Jiefang established a special product management department as early as 2015, and set up 5 lines of traction, cargo, dump, special, and light truck. Each line is responsible for the whole process of product project coordination by the manager, so as to realize the integration of quality cost control in product planning, development, preparation and manufacturing processes, and ensure accurate and fast product development and delivery.

Supported by quality

If the ability to better meet user requests is the first orientation of product development, then reliable product quality is the first bottom line of the market.

On September 1, 2012, FAW Jiefang launched the first of the company’s four major projects – the "Reliability Improvement Strategy Project". Xu Xianzhi, then party secretary of FAW Jiefang, once said: "Reliability improvement is the life project of the liberation brand! Competing with international truck giants, quality is a hurdle that must be overcome."

Facts have proved that it is an extremely correct decision to start the reliability project one step ahead. With the support of the project, FAW Jiefang’s product quality level has been continuously improved, and the key indicator of product quality level – the amount of single-vehicle claims and the frequency of thousands of vehicle claims have dropped significantly.

On this basis, FAW Jiefang has successively launched the fine engineering, long-life engineering (later renamed "commodity power engineering") and "system construction engineering". So far, the company’s four major quality engineering systems have been completed.

"The general idea of the four major projects can be summarized as customer orientation, goal guidance, problem solving and process improvement." Hu Hanjie, general manager of FAW Jiefang, said that FAW Jiefang can quickly complete the transformation from a chaser to a leader. In addition to outstanding product differentiation advantages, the most important point is reliable quality.

Achieve products with quality, develop markets with products, and supplement management changes. FAW has finally found a path that suits it in the process of continuous change.

Underpinned by innovation

When it comes to innovation, there has always been a curse in the industry – if you don’t innovate and wait for death, innovation is courting death. However, for entrepreneurs, how can they keep up with the pace of development of the times without the determination to leave it behind?

On the morning of April 13, 2017, at the Changchun FAW Technology Center Agricultural Safety Test Base, FAW Jiefang’s self-developed driverless smart truck completed its first open demonstration, which was also the first real vehicle demonstration of intelligent driving in the domestic commercial vehicle industry.

Just half a year later, FAW Jiefang became the first commercial vehicle brand in China to complete the actual test on the expressway. According to the data, there are three differences between this test and the demonstration in April: first, the technical level is different, and the "L2 +" level advanced driver assistance system carried in this test is more comprehensive and powerful; second, the testing environment is different. After transferring from the closed FAW test site to the open expressway, the lanes are narrower and there are more curves, and various uncertain factors bring greater challenges; third, the load of the whole vehicle is different. The demonstration in April has only one tractor head. This demonstration adopts the mode of "tractor head + container trailer", which is closer to the actual working conditions.

Hu Hanjie told reporters that to keep an enterprise young, innovation must be unavoidable, including both innovation capacity building and innovation technology reserves. It is because of these two major strengths that FAW Jiefang does not have too much concern in the face of the continuous simulation and replication of industry competitors.

"No one can stop others from copying, but copying means always following us, only following our pace. What’s more, copying also requires time and cost, although this cost is much smaller than the original. For example, we launched a product in three years, and it only took half a year for others to copy it. It seems that we have suffered a big loss. But in fact, when others finally launched a replica, we have already launched the next new product." Hu Hanjie said that the real power is to have a broad vision. Firm originality and continuous originality are the confidence of FAW’s liberation.

In fact, the launch of original products is just one manifestation of FAW’s ability to liberate innovation.

In terms of green development, FAW Jiefang Xichai spent hundreds of millions of yuan to build a green energy-saving factory. During the "Twelfth Five-Year Plan" period, the accumulated electricity savings exceeded 17 million kWh, carbon emissions were reduced by 5,746 tons, and sewage emissions were reduced by about 150,000 tons. During the "Twelfth Five-Year Plan" period, the sales of diesel engines above the National Fourth Standard 160,000 units, carbon monoxide emissions decreased by 28%, hydrocarbon emissions decreased by 30%, nitrogen oxide emissions decreased by 30%, and PM particulate matter decreased by 80%.

In terms of smart factory construction, FAW Jiefang Engine Branch has been building a fully automated production line since 2015. The entire production line is composed of joint robots, truss manipulators, and automatic conveying material channels, which realizes automatic loading and unloading, automatic processing, and automatic detection of key parameters. The construction of the most advanced heavy-duty longitudinal beam production line in China – Jiefang Changchun Base Automatic Rolling Production Line, the automatic coating line and welding production line are large-scale application of robots, and the automation rate of key points is 100%.

In terms of cooperation and development, FAW has made frequent moves in recent years, signing strategic cooperation agreements with internationally renowned enterprises such as Fuchs and WABCO, and cooperating with Aerospace Chenguang and AVIC Plaza Xinfei in China.

Demand-oriented, product-oriented, and management-oriented, FAW Jiefang is moving forward firmly on the road of reform and innovation, and is accelerating towards the corporate vision of "the proudest automobile company and the most trustworthy truck brand". (Reporter, Li Jiping, Correspondent, Li Risheng)