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Chinese motorcycles, facts versus fiction in Brasil



Chinese motorcycles, facts versus fiction in BRASIL

Some years ago, a good friend told me that after more than twenty years of existence was considering closing his auto parts company. He did not believe that would be able to beat the competition of products from China. That, he said, had as much quality as ours and with a price "impossible" to compete. In that moment was born my interest in China, despite finding that he was exaggerating in his analysis. In the motorcycle segment the reality was quite different, good prices is true, but the quality was much lower than expected by customers. And none of the brands at the time was getting set up in our market. I began to study more deeply the "China phenomenon", including the language.

During the last two "Brazilian Two Wheels Fair", 2009 and 2011, the massive presence of Chinese companies in the events with "new" releases of the same "old" products, made clear that they would not “drop the bone” so easy. For every company that failed and walked away, two new would come to fight for the place.

After al,l we are the 4th largest consumer of motorcycles on the planet. One of the few who, despite the global crisis, has been growing steadily over the past twenty years and retake the figures of 2008 - the best year of motorcycling industry worldwide.

In 2011 I was invited by a Chinese brand present in Brazil, to provide advice to the reorganization of the, after sales, parts and training areas. During the ten months we worked together I had the opportunity to deeply know the products and the entire operational chain of Brazil-China partnerships, including working with Chinese teams here in Brazil. The more I knew the products and the dynamics of Chinese industry, was more difficult to understand why so many mistakes in operations bikes when compared to other market segments such as electronics, automotive and motorcycle parts. The day that my friend from the beginning of matter called me saying that, finally, his company would close and that the Chinese had won, I decided it was time to go to China. Watch closely and definitely understand because here in Brazil they were just wandering in the motorcycle segment. In forty-five days in China, I went to two halls, was in three major cities, visited five factories, talked with many, many people in the industry, made ​​good friends and finally found what I was looking for.

To facilitate understanding will divide into three distinct scenarios:

1) The industrial capacity.

2) The motorcycling culture and the local market (which after all is the largest market in the world).

3) The ability to assist other markets (including ours)

Industrial Capacity

There is a consensus among international analysts; the history of motorcycle Chinese industry has four distinct and well marked phases. The first, known as "exploratory phase" goes from, 1951 to the late 70s. Custom Army and through the process "reverse engineering" from the German Zundapp KS500, two state armaments: Xingjiang and the Hongdu manufactured approximately 4300 units.

From the 60s the bike to be "reinvented" by the Chinese was the Soviet IMZ-Ural R72, which in turn was the "bastard sister" of the BMW R71. All of them designed exclusively for military use. In 1979, under the political leadership of Deng Xiaoping as China begins to relate to the rest of the world. For the motorcycling industry began a phase of "technological cooperation" and motorcycles for civilian use, as for Japanese industry this season also became known as "that sh… we did”.

The idea of market opening and 1 billion people swapping their bikes for bikes was too tempting and nobody resisted. Given the rules imposed by the Chinese government formed the largest Japanese factories "Companies" with state designated by the Beijing government. For the Chinese the meaning of "cooperation" was the voluntary transfer of technology, licenses, know-how and everything else that was needed as "entrance fee" to the Chinese market. For over ten years this oligopoly is maintained with the international capital and hope that with the Chinese economic reforms have purchasing power and dreamed market of 1 billion consumers would start. In the early 90s, looking for”socialism with Chinese characteristics" the government began to allow local entrepreneurs to start their own businesses, generating jobs, income and ultimately consumption. Then begins the third phase known as "Birth of private companies." The lack of control and information disclosure criteria in industrial preceding years showed its consequences when, in less than five years, more than three hundred produce virtually the same bike with the same engines and even the same names.

At the same time Brazil was starting to import bikes from China and with rare exceptions the worst and cheaper than was available. The demands of the customers and the newly implemented "Consumer Code" took it upon themselves to put an end to this adventure. The domestic market and production grew so much and so fast that, before the turn of the millennium, having never even designed a unique model, China was already the largest manufacturer and consumer of motorcycles in the world.

In 2001 China joined the World Trade Organization, with some industries that have taken a huge leap in quality. They began to meet more diverse international requirements such as ISO 9001, ISO 14000, emission levels and consumption among other. Thus began the process of "searching for new markets" and natural selection took charge of exterminating the most unprepared. Currently, China has "only" 147 factories authorized by the government to export and production capacity is approximately 28 million units / year, but this year should not spend a lot of 20 million. The fifteen largest sector accounting for + / -60% of total production, while some of the smaller producing less than 20,000 units / year. The secret to this diversity is in the "discreet" motorcycle parts industry that grew supported first by piracy official and then the open space for brands that do not take care of its after sales, in other words do not worry about the spares parts.

From a simple radius wheel to a complete engine, passing frame, tank, or injection harness, motorcycle parts manufacturing industry literally everything. More than half of the calls "factory bikes" just "join" the right parts in the right order and call “Motorcycle”. To escape the trap of “piracy” suppliers, brands of the first level are verticalising their productions in the new models. Making "at home" plastic parts, electronic components and frames, for example, is more expensive, but avoids unwanted bids. If in terms of design they still have a long way to go in terms of product and technological production can now be treatedAlpha like “adults”. In the factories I visited - the truth, those who manufacture something - only what I saw were machining centers, next-generation robots in critical functions, laboratories of the highest quality and motivated people working. In absolute I'm saying they are already at the same level of European industry, Japanese or even Brazilian, however, we must admit that they have matured very fast.

The competitor to be beaten by Chinese industry today is ... Chinese industry itself, those in the end of the queue, who assemble 20.000 bikes per year, selling for a “buddy price” and the buyer can put the brand that they want. But, the market is not only done just for “product” but, the whole product / service or even the "experience" that the brand can provide, then my friends they still have everything to learn. In the next issue I'll tell you how difficult it is "riding a bike" in China and what that has to do with the quality of products we receive here.

This is the first chapter and two more to follow soon....

Motociclismo Magazine – Motor Press Brasil- by Arlindo Romero