A few days ago, some media reported that a relevant person from the Shaanxi Provincial State-owned Assets Supervision and Administration Commission stated to the media on May 10: “The Shaanxi Provincial Government has agreed in principle to Weichai Power’s 100% controlling Shaanxi Heavy-duty Truck Co., Ltd. (Shaanxi Heavy Gas). It was an important strategic choice for Dashan Heavy Duty Truck.” Later, the reporter called the Shaanxi Provincial SASAC and the Weichai Power Board of Directors respectively on the above information. Both of the units were undecided about this. As of now, Weichai Power, a listed company, has not made a statement on the above news. However, reporters learned from industry insiders that if this news is true, Weichai Power's change from 51% to 100% will be a major reorganization event for the company, not only predicting that Weichai Power will fully enter the whole industry. The vehicle manufacturing industry has a profound impact on heavy trucks and the entire automotive industry.

As a Shandong company that started production of heavy-duty engines for commercial vehicles, Weichai Power has been one of the important manufacturers of high-power high-speed diesel engines in China. It supplies diesel engine products to domestic truck and construction machinery manufacturers, mainly heavy-duty vehicles and construction machinery. Supporting the final products such as ships, large passenger cars and generator sets, and expanding the supporting market from single heavy-duty vehicles to construction machinery, large passenger cars, ships, generator sets, etc. The business has also been further expanded to foreign markets. The products are exported to India. , Vietnam, Russia, Southeast Asia, the Middle East, more than 30 countries and regions. On March 11, 2004, Weichai Power (Stock Code 2338) was successfully listed on the Main Board of the Hong Kong Stock Exchange. According to the 2009 annual report released by Weichai Power, last year, Weichai Power achieved a total operating revenue of 35.525 billion yuan, an increase of 7.24% year-on-year; total profit reached 4.679 billion yuan, a year-on-year increase of 70.75%. In 2005, through mergers and acquisitions and asset restructuring, Weichai Power acquired the Hunan Torch, which holds a 51% stake in Shaanxi Heavy Gas. Therefore, it obtained a stake in Shaanxi Heavy Gas in the vehicle heavy truck manufacturing segment, which also directly into Weichai Power. The vehicle manufacturing opens the door to convenience.

With regard to the trend of full-scale control of Weichai Power and the full-scale entry into the vehicle manufacturing industry, the industry is relatively bullish. Zhang Xin, senior auto industry analyst of Guotai Junan, and Xia Shujun, senior independent commentator of the commercial vehicle industry believe that through the full control of Shaanxi Heavy Duty Truck, Weichai Power has realized its desire to enter the vehicle manufacturing industry, and Shaanxi Heavy Industry will usher in a broader The two sides have truly achieved a win-win result.

Zhang Xin analyzes that if the company is fully controlled by Shaanxi Heavy Gas, it will play a very good role in Weifang Diesel's hope to make a difference in the heavy truck industry and resolve the conflict with the controlling shareholder. As Shaanxi Heavy Gas, the future also ushered in a greater space for development, and Shaanxi Province has also received a lot of economic project support.

Xia Shu, a senior independent commentator in the commercial vehicle industry, believes that the entire holding of Weichai Power is a win-win result. He analyzed that for Shaanxi Heavy Duty Truck Co., Ltd., it won the financial support of Weichai Power and solved the difficulties of insufficient funds for a long period of time. It also obtained full support of Weichai Power's technology and resources. “Because Weichai Power has great advantages in key assemblies such as truck engines and other key technologies, the support of Shaanxi Heavy Duty Truck's technology and resources will effectively promote the enhancement of the technology and quality of Shaanxi Heavy Gas Products.”

Xia Shu further analyzed that once all of Weichai Power's holdings of Shaanxi Heavy Industries Co., Ltd. will certainly have a certain impact on the heavy truck industry, and even a great impact. However, judging from the current situation, it is not enough to shake the current pattern of the domestic heavy truck industry. From last year's heavy truck production and sales rankings, China National Heavy Duty Truck still ranks first, followed by Foton Motor, followed by Shaanxi Heavy Duty Truck.

As far as the current industry structure of the heavy truck industry is concerned, Zhang Xin believes that Weichai Power's entry into the vehicle manufacturing sector will have little impact on the industry. The main problem facing Weichai Power's future development lies in further improving its performance and market share, and balancing the relationship between its own partners and other commercial vehicle companies that will be competitors in the future.

As Weichai Power is currently the largest supplier of engines and transmissions in China, its market share in products is still in an absolute dominant position. Some companies will inevitably worry that Weichai Power will tilt its supply to its own company, Shaanxi Heavy Duty Truck. In fact, for other commercial vehicle partners that cooperated with Weichai Power, Weichai Power entered the vehicle manufacturing industry. It became an extremely important supplier partner and became a competitor. This dual status will obviously make these companies feeling anxious.

Among other commercial vehicle partners that cooperated with Weichai Power, the reporter learned that some commercial vehicle companies have begun to supply their own engines and transmission products in an effort to change the pattern of Weichai Power's dominance and restraint.

“Weichai Power's products will still account for most of the domestic market share. From the current industrial structure, other commercial vehicle companies that are trying to match their own engines or transmission products have not yet formed a true supporting capacity. In addition, the heavy truck industry The engine and transmission are recognized by the market, and they also need a long period of market recognition. It can be said that at least in five years, the Weichai power dominates the situation is still difficult to be shaken by other companies." Xia Shu told reporters, "Currently For Weichai Power, what is needed is to find a good balance in the future, and this point will have to withstand more tests."
View related topics: Weichai Power: Expanding Auto Parts Gold Industry Chain


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