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Business / Companies

CNR Changchun aims to double exports to $1b

By Bao Chang in Changchun (China Daily) Updated: 2012-05-31 08:44

CNR Changchun Railway Vehicles Co Ltd, China's largest producer of rolling stock and urban rail cars, aims to double its annual export revenue to $1 billion within five years, General Manager Lu Xiwei told China Daily on Wednesday.

Located in Changchun, the capital of Jilin province, CNR Changchun is a subsidiary of China CNR Corp Ltd, the country's second-largest train producer.

Its product range includes high-speed rail cars and subways.

Exports will generate 30 percent of revenue in the next five years, according to the company.

CNR Changchun "is now strongly competitive in production and manufacturing technology in the international market, and our next step is to make greater efforts to explore foreign markets to maintain good momentum for exports," Lu said.

In April, the company signed a contract with Bangladesh to supply traction inverters and network control systems for diesel railcar trains.

The deal is seen as a signal of China's progress in exporting core rail technology.

Amid a weak world economy, many countries are eager to attract foreign investment to establish joint ventures in their local markets. These ventures are especially attractive when recipient countries can obtain advanced technology and promote local employment.

Lu said the company is researching the feasibility of exporting technology to, and localizing production in, South America, South Africa and Southeast Asia.

"Exports of intangible assets, including capital and technology, could yield higher profits than just exporting finished products, Lu said.

"We have realized that it's very difficult to develop in foreign markets only through product exports, so the trend will be a shift from product exports to technology and capital," Lu said.

Establishing joint ventures in foreign markets helps obtain orders in those markets, Lu said.

CNR Changchun has joint ventures in Iran and Australia that design and produce rail and subway cars.

Taking into consideration the operating risks, locally manufactured products "will be priced higher than those exported", Lu said.

Zhou Chuanhe, deputy general manager for overseas operations, said the company's market share in the industry will grow significantly as it establishes factories overseas.

"We will gradually tap into the high-end markets, as we mature in terms of technology, output and management in foreign markets," Zhou said.

"As China's rolling stock industry develops, Chinese products will account for 30 percent of the global market, competing with other industrial giants including Siemens and Alstom," Lu said.

CNR Changchun's exports now account for 65 percent of the nation's rolling stock exports, with more than 4,000 rail cars so far shipped to countries including Brazil, Australia and Thailand.

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