SANY GROUP STICKS TO 'GOING OUT' STRATEGY

23 March,2017

Chinese multinational heavy machinery manufacturer SANY Group should stick to developing core technologies while facing uncertainties in global trade, and not all machinery production lines can be moved back to the US, the company's vice president recently told the Global Times.

Despite rising protectionism worldwide, Chinese companies should not be afraid of going out, as increasing trade and closer relations among countries is the trend, said Tian Hong, vice president of SANY Group, during a recent interview with the Global Times in Zhuhai, South China's Guangdong Province.

"Political factors are the first ones to weigh in overseas business and should be taken very seriously," he noted.

As a major machinery and equipment manufacturer in China, SANY was involved in a lawsuit against former US President Barack Obama and the Committee on Foreign Investment in the United States (CFIUS) in 2013 over "national security," which was the first time a US president had been sued by a Chinese enterprise since the CFIUS was set up in 1975.
SANY has been stepping up efforts to develop port-related machinery and equipment, such as ship-to-shore gantry cranes and rail-mounted container gantry cranes, more than 60 percent of which will be exported. "A decade ago, we only exported machines, but now we also export technology and services," Tian said.

In 1996, Tian was in charge of selling cranes to the port of San Francisco, and the Chinese manufacturer needed a lot of help from US consulting firms to make the deal.

"US companies had to review the process, as some core technologies were still controlled by our US counterparts," Tian said.

"Now, things are different. We are not just making machines. For example, we have developed our own electronic control systems, and some components of the large cranes are also completely made in China," he added.

"Some foreign competitors are already ahead of us in automation, such as in the use of automatic guided vehicle to discharge containers, or automate container identification. We are moving in this direction too," Tian noted.

When talking about US President Donald Trump's plan to bring manufacturing back to the US, Tian said he sees it as unlikely in the marine machinery sector. "Although container crane manufacturing has been upgraded in recent years, it is still a labor-intensive industry," he said, noting that labor costs in the US are still much higher than in China.

SANY won a port deal valued at $7.5 million in Saudi Arabia in April 2016, and aims to ship more port machinery to Indonesia and India in 2017.