Meet the future
Chinese bosses meet to discuss progression
In an unprecedented move the main movers and shakers of the Chinese motorcycle industry will meet in Shanghai on May 6th to help conduct the first China International Sourcing Conference.
It has been no secret that the Chinese motorcycle industry has been struggling to emulate its previous dominance due to widespread urban banning of motorcycle riding in China and the Indian motorcycle industry’s march in to markets traditionally controlled by China. This has caused an unlikely alliance between China’s ruling motorcycle elite in which for the first time in history the owners and managers of some of China’s huge motorcycle companies will get together with foreign experts as well as each other to brain-storm and plan the future of the industry.
The conference is the brainchild of ChinaMotor Magazine and organised by them with the Chamber of Commerce for Motorcycles and will bring together (on the neutral ground of the Shanghai exhibition centre) Chongqing motorcycle royalty Zuo Zongshen (founder and owner of Zongshen Motorcycles) and Yin Minshan (owner of Lifan) with managers and owners of other giant motorcycle groups including Qianjiang and Keeway. Add to this mix CEO of Ducati Asia-Pacific Mirko Bordiga, CEO of Harley Davidson China Sean Jiang and representatives of Polaris, Victory and Indian motorcycle companies as well as the American Motorcycle Industrial Association and this conference has the capability of being a catalyst for big change in the industry, a change that all now agree is sorely needed.
As well as industry types many ‘top level’ buyers have been invited to share their knowledge and experience and offer advice and criticism on the Chinese industry. Zo Fu defends this decision “at first some participants weren’t too sure about sharing strategy information with buyers, but David McMullan persuaded them that if we are serious about making a leap forward that the buyers input was essential. Due to this there will be an expo for sourcing products and buyers from all around the world are welcome to attend.”
Although not described as ‘crisis talks’ the conference will discuss the future of the Chinese motorcycle industry in terms of how to progress in a way to confirm China as the number 1 motorcycle manufacturing country for the next 10 years, and in essence is a ‘10 year plan.’
“There is also the situation where many Chinese motorcycle companies have to upgrade their quality and emissions. Even in our stable market of South America the Chilean government is insisting on only importing motorcycles to the standard of EURO III. The EURO III certificates of conformity are not needed but the motorcycles have to be able to pass a EURO III examination in Chile. This is the way that many other countries will go soon.”
Zo also factors in global law changes stating “countries that have previously imported motorcycles of any quality without conformity stipulations are changing. Iran is now looking to change its laws and insist that motorcycles should have electric fuel injection instead of carburetors. After that will come global rulings on ABS brake systems and who knows what else.”
Up until now the Chinese infrastructure for dealing with European customers has not been quite what it should be. For example, if a factory has a South American customer and that customer receives a faulty motorcycle in one of his containers the factory and the customer will come to the arrangement that a free new motorcycle will be supplied with the next container. This is not the case with a European customer who will want the correct product air-freighted to them as soon as possible. This takes most of the Chinese factory’s profit away in one move. This is one of the considerations that will be brought up at the conference along with how best to deal with the North American market. 5 years ago the US market looked to be a lucrative venture for many Chinese motorcycle companies. Fast forward half a decade and there is quite a different story. Consumer confidence in Chinese products is at a low causing many Chinese motorcycle companies (and indeed American companies that has cooperated with the Chinese industry) severe financial losses. Previously the Dealer expo at Indy was heavily populated by Chinese companies looking to crack the market; now very few bother to attend.
This any many other quandaries are due to be discussed in May. The main hope is that the collected experience of the participants can serve to give the whole industry the jump start that it needs. Zo Fu of ChinaMotor Magazine puts it this way. “Basically it’s sh*t or bust for the future. We can carry on as usual but we won’t make ground on the bigger boys, and we really want to. It’s now time to push on and make sure that we live up to the expectations that were abounding in global motorcycle magazines just a couple of years ago. I remember relatively recently that the likes of MCN and Dealernews were running headlines like “the Chinese are coming’ and frightening the rest of the industry. Now is the time to live up to the hype or settle for the cheap commuter market will which eventually be worn away by India and even Indonesia. There is certainly a paradigm shift coming.