STRONG IN CHINA.
DEUTZ has completely re-aligned its China strategy in the last years. Even in the Coronavirus crisis. The company is continuing to forge ahead with the implementation of its growth projects and is already raising its sales targets for the China operation significantly due to the positive buisness development.
Things are going well for DEUTZ in the Chinese market: In the region that is already considered the world’s largest single market for construction machinery, the first months of the current financial year have already been so profitable that the company now even expects sales to double or triple for the entire year 2020. ‘The joint venture with SANY is running very successfully and has been profitable since the day it was founded. We were even able to get new orders that exceed the originally planned volume’, says CEO Dr Frank Hiller.
‘That’s why we’re raising our sales target: We initially assumed EUR 500 million when we launched our China strategy, but now we expect to increase our sales in China to EUR 800 million by 2022.’ It should be noted here that participation in the joint venture with SANY is consolidated according to the equity method, meaning that consolidated sales will not increase to the same extent. However, a positive EBIT contribution is expected in return. It will be additionally boosted by the two other cooperation agreements with Chinese engine manufacturer Beinei and service provider Far East Horizon.
As a special highlight, DEUTZ and SANY have now installed a jointly developed engine in a new truck model for the first time. The Kingway 435 truck type presented by SANY in China once again proves how well the collaboration in the joint venture works and marks DEUTZ’s return to the on-road business. The new truck was virtually presented to the public during a 10-hour live broadcast from the SANY Heavy Truck Headquarters in Changsha, the capital of the Hunan Province. The figures prove that it is already a bestseller: After the unveiling of Kingway 435, 1,000 trucks were sold in just 39 seconds.