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“Increase” of Both Performance and Ranking and “Advancement” of Transformation and Brand BAIC Group Ranked into Fortune 500 Again

2015-07-23

On July 22, at 9:00 a.m. EST (July 22, at 21:00 p.m. Beijing time), the latest issue of the United States Fortune magazine formally announced the "2015 Fortune 500" list. BAIC Group, with the operating revenue of USD50.566 billion, had been listed into the Fortune 500 for three consecutive years, ranking 207th. Compared with last year, BAIC Group rises by 41 places, achieving the increase of both performance and ranking.

Xu Heyi, secretary of the party committee and chairman of BAIC Group ascribed BAIC Group’s ranking into Fortune 500 for three consecutive years to the favorable policy that the country energetically developed manufacturing industry and concentrated to support the development of automobile industry; to the enterprise’s strategic positioning and implementation of collectivization, internationalization and globalization; and to the improvement and development of self-owned brand, joint venture brand and the whole value chain. The ranking marks that BAIC Group has become an internationally competitive and influential Chinese brand.

Both independent development and joint venture development make BAIC Group realize scale increase

The Fortune 500 list has always been the most famous and the most authoritative list to measure the world's large companies, which is published annually by Fortune magazine.

In retrospect, in terms of production and management situation, the operating income of BAIC Group for the first time exceeded RMB300 billion to RMB311.56 billion in 2014, with an increase of 15.4% on a YoY basis. BAIC Group’s passenger cars of self-owned brand realized the production and sales of 510,000 vehicles, with an increase of 90.8% on a YoY basis. The operating efficiency of its two joint venture companies reached a new level again: Beijing Hyundai overcame the productivity bottleneck and achieved the sales volume of 1.12 million complete vehicles, with an increase of 8.7% on a YoY basis; Beijing Benz accumulated steadily and achieved the sales volume of 145,000 vehicles, with an increase of 25.4% on a YoY basis. Excellent market performance proves the common development of BAIC Group’s self-owned brand and joint venture brand, and such two brands become the twin engines that drive BAIC Group’s income growth.

In recent years, BAIC Group uses globally advanced technological resources to make self-owned brand construction stand on a higher starting point. In 2009, through acquisition, digestion and absorption and recreation of Saab's core intellectual property rights, BAIC SENOVA launched SENOVA D80, SENOVA D70, SENOVA D60, SENOVA CC, SENOVA D50, SENOVA D20 and SENOVA X65 models, etc., realizing the coverage of the whole series from Class A0, Class A, Class A+, to Class B and SUV. The constantly improved product system provides consumers with a wealth of options; the development idea of high spike from high set strongly promotes BAIC Group’s technical strength of self-owned brand, its product quality and market reputation.

The reorganization of Changhe Auto becomes another highlight in BAIC Group’s self-owned brand development. Since 2014, BAIC Group has smoothly promoted the import of "double brands", and the smooth implementation of new Jingdezhen base planning project, etc. speeds up the market growth of Changhe Auto.

In 2014, the joint venture brands, represented by Beijing Benz, Beijing Hyundai, entered into the fast lane of development. The deepening cooperation between BAIC Motor and Daimler promoted the rapid adjustment of Beijing Benz product structure, and new technology import and productivity layout were smoothly implemented. The launching of Beijing Hyundai ix25 added another valiant warrior to the SUV family of Beijing Hyundai, which continued to improve D+S sales proportion and substantially increased the overall benefits of Beijing Hyundai.

Internet thinking gives birth to the rapid rise of BAIC BJEV

The development of new energy vehicles has become the top priority in the future planning of BAIC Group. In 2014, advocated and supported by Beijing municipal government, BAIC BJEV implemented joint-stock system transformation. New management system and team promoted the breakthrough development of BAIC BJEV in the market. BAIC BJEV sold 5,510 BEVs in 2014, with an increase of 238% on a YoY basis. It maintained an industrial leading position, and ranked among top 4 in the sales volume of global BEVs and 1st place in the sales volume of BEVs in China, which created the first year of history for the new development of BAIC BJEV.

Thanks to its initiative spirit, service concept, and the Internet thinking in the field of new energy vehicles, BAIC BJEV can quickly grab the market. It is understood that as early as in 2009, BAIC BJEV has focused on product research and development. After more than five years’ development, BAIC Group has established two R&D and production bases of new energy vehicles respectively for passenger cars and commercial vehicles, and has built the world's largest electric vehicle production base in Laixi, Shandong.

BAIC Group not only pays attention to the development of new energy products and the control of key technology, but also pays more attention to layout and integration of new energy vehicle industry chain. BAIC BJEV has successively established joint venture companies with German Siemens, American ATIVEA and Korean SK; established Internet marketing stores with JD.com and Tmall.com; established time-sharing leasing company with Foxconn and cooperated with Pangda Group and constructed 4S stores of new energy vehicles and has established the domestic most complete new energy vehicle industry chain and service chain.

In order to solve the problem of difficulty in charging of consumers, BAIC BJEV creates five-in-one charging mode of "Private charging + Public charging+ Mobile charging + Combination of charging and battery change + Charging query". With the implementation of the "Enjoy Together in Blue A+" plan, BAIC BJEV has achieved the comprehensive upgrade of "Product+ Technology+ Service", and established a new energy vehicle industry ecosystem.

With the transformation, BAIC Group rises abruptly on the basis of its accumulation

All these achievements benefit from BAIC Group’s implementation of strategy of “transforming from a traditional manufacturing enterprise to a service-oriented manufacturer and an innovative enterprise". BAIC Group has implanted the "transformation" gene into the group from many aspects such as R&D, manufacturing, and business mode, for a deep and wide range of comprehensive change.

BAIC Group improves the intelligent level of its existing manufacturing system, the depth and breadth in the use of information system, the automation level of production process, and the high-end manufacturing and agile manufacturing capacity. At present, all the BAIC Group’s production bases adopt the automated production equipment of international advanced level, and the car body realizes 100% automation rate in part assembly welding, reaching the standards of international first-class factories. On this basis, BAIC Group transforms from the concentrated production to the networked synchronous manufacturing between different areas. By implanting BOM and ERP information management systems, BAIC Group will achieve information sharing and business collaboration in the process of the product development, production and manufacturing, operation and management, which will make the national and global manufacturing of BAIC Group ascend to a new level. At present, BAIC Group has formed an industrial layout with 9 passenger car production bases and 8 commercial vehicle production bases.

At the same time, BAIC Motor and MBtech set up “BAIC&MBtech” automotive technology center to further enhance BAIC Group’s ability in transforming Benz technology, promote digestion and absorption and re-upgrade of Saab technology, and master the internationally leading technology of making cars. Through cooperation with Italian AgustaWestland and Air Pacific New Zealand, BAIC Group has set foot in general aviation, which creates a new “blue sea” of travel tools with one step ahead.

"Internet+" is the trend of the times. In the future, vehicle-oriented IT technology application will realize the information communication between vehicles and the outside world. To make the car become a mobile computer connecting to the Internet has been listed into the development of the strategic transformation of BAIC Group. At present, BAIC Group has cooperated with LeTV, and they will develop intelligent system of Internet intelligent vehicles, EUI operating system, and IOV system, to build intelligent automobile ecosystem and create more value for BAIC Group.

Meanwhile, BAIC Group builds financial and industrial investment business modules, sets up group's assets management platform, promotes group’s investment layout in the innovative fields such as new technology and new mode, creates new mode of innovative industry and financing in the automobile industry, promotes the investment in the fields of IOV, automobile aftermarket, automobile finance and state-owned enterprises restructuring and makes forward-looking layout for the transformation of the manufacturing service field.

It is understood that in the first half of this year, under the situation of decline in sales growth in the industry, BAIC Group still realized the sales volume of 1.187 million complete vehicles, maintaining a positive growth. So, we have sound reasons to believe that BAIC Group, with bold reform and innovation, and Internet + thinking mode to speed up the strategic transformation and upgrading, can realize the transformation from the product orientation to market orientation, and achieve the change from manufacturing-dominant industrial structure to an industrial structure with simultaneous development of manufacturing and service. BAIC Group will, taking its ranking among the "Fortune 500" once again as the new starting point, and taking advantage of "Made in China 2025" strategy, practice national strategies of "One Belt and One Road" and "Integration of the Beijing-Tianjin-Hebei Region", to further achieve "BAIC dream" to grow from big to strong and go global, and to keep an everlasting enterprise.

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