Guangxi Yuchai Machinery Company Limited - Diesel Engines
Diesel engines are the core products of Guangxi Yuchai Machinery Company Limited (“GYMCL”), a subsidiary of China Yuchai International Limited (“CYI”), a Bermuda holding company which was listed on the New York Stock Exchange in 1994.
The Business
GYMCL is a diesel engine manufacturer in China and also produces diesel power generators, diesel engine parts and special vehicles. GYMCL distributes most its engines directly to auto plants and agents from its primary manufacturing facilities in Yulin City in the Guangxi Zhuang Autonomous Region in southern China. GYMCL operates a number of regional offices in major geographic regions in China and with a sales force of approximately 800 people located nationwide in China, it provides a comprehensive range of services through over 1,500 service centers in China to its customers, including dispatching engineers to provide on-site assistance to major customers in the resolution of technical problems.
The type of engines manufactured by GYMCL range from light-duty (4F, 4D and 4E), medium-duty (6A and 6J) to heavy-duty (6L and 6M).
In 2009, production capacity was approximately 586,753 units, based on a 2.5 shift five-day week.
Research & Development
GYMCL has committed substantial resources to continually improve the technology of its products and maintain the competitiveness of its products. GYMCL’s internal development effort focuses primarily on designing new products, improving manufacturing processes and adapting foreign technology to the Chinese market. GYMCL has committed 3% of its revenue annually to continually improve the technology of its products. In addition, GYMCL plans to continue to acquire advanced technology from Chinese research institutes, foreign engine design consulting firms and foreign diesel engine and engine parts manufacturers. As of December 31, 2009, GYMCL employed over 552 engineers (excluding supporting junior engineers), approximately 263 of whom were devoted to research and development, product enhancement and new designs while the remaining were in the production department and after-sales service.
In 2009 and 2010, GYMCL’s research and development efforts were focused on the development of new products such as heavy-duty engines 6T, 6K and National IV and National V compliant and clean energy products.
Quality Assurance, Control and Safety
All raw materials, external supplied parts and components are checked for conformity with the required quality and specifications. Each stage of the production process is monitored by a quality control procedure and the final product undergoes standard conformity and specification testing using an automated testing laboratory. To promote the safety of its workers, GYMCL has established a safety department to supervise the proper use of equipment, prevent fire and explosions and promote safe practices and procedures in the workplace.