Yuchai Machinery (Guangxi) Group Co., Ltd. - FY2007

Business Highlights

Mass-producing new engines compliant with China lV regulations
- In April 2007 the Company announced that it would start mass-production of the YC6L280-40 engine that is compliant with the China lV emission standards. The company's new proprietary engine uses an electronic control fuel injection system with a single pump developed in the U.S.; and the electronic control selective catalytic reduction (SCR) system engineered in Germany. Offering a high level of fuel efficiency, the eco-friendly engine is an ideal engine for urban transport. The YC6L280-40 engines are being supplied to bus makers including Yutong Bus, Dandong Huanghai Automobile, Jinhua Neoplan Vehicle, and King Long United Automotive Industry. 

- In June 2007, the Company won a contract from Jianghuai Automobile to supply 1,000 YC6A260-20 engines for use in large buses sold in Saudi Arabia. From Anhui Ankai Vehicle it was awarded a contract to provide a total of 1,000 units of YC6G260N-20 and C6G300-20 engines for use in large buses sold in Iran. Prior to these award winnings, the Company had already won business to supply 600 engines for use in Jianghuai Automobile's vehicles marketed in New Zealand. As a result, exports over the period of January-May reached 4,200 engines, jumping 106.27 percent year-on-year. By region, sales to the Asian markets constitute around 45 percent of the Company's total total revenue, while sales to Eastern Europe and Africa are also increasing. Eying further business growth in the international market, the company is enhancing its after-sales services for its exported products.   

- In June 2007, the Company and Ural AZ, Russia's leading auto manufacturer, reached an agreement under which the Company would supply 50,000 to 100,000 new YC4W-1.22L Euro lll high-speed direct injection (HSDI) diesel engines to Ural. The two companies will develop strategic ties in a wide range of areas including technology, OEM supply, procurement, and after-sales service. 
It established an office in Russia in 2006. A large number of the company's heavy-duty 6M diesel engines are already being exported to Russia, and delivery of the Euro lll engines will start soon and be used in the nation's public transportation system.

Yuchai Industrial Park project

- In August 2007, the Yuchai Group held a gala groundbreaking ceremony at the Yuchai Industrial Park for the first phase of construction at the Park. Some major projects are as follows: the Group will build a new production facility to manufacture diesel engines for small vehicles and a plant to produce engines and other components. The total investment is estimated to reach 432 million yuan. The new facilities, which will be set up on 24.3 hectares of land are expected to produce engines and other components worth 1,030 million yuan in total. 


<New products>
- In March 2007, a passenger vehicle, which is powered by a low-emissions, electronically controlled diesel engine jointly developed by the Company, Jilin University, and Guanxi University, passed the screening conducted by the Ministry of Science and technology of the People's Republic of China. The new engine,which the Company started developing in 2005, features technology such as turbine pressure boosters, exhaust gas recirculation systems, common rail fuel systems, and direct injection systems. 

<New products>
- In October 2007, the  Company, Jilin University, and Guanxi University unveiled their new hybrid system they have been working on since 2006. The hybrid system, which uses an integrated starter generator (ISG), was developed targeting buses used for urban transportation.

- In December 2007, the Company announced that it had developed the YC6L-50 Euro V engines, which meet the Euro V emissions standards. Offering 240-330 horsepowers, maximum torque of 950-1280N.m, and minimum fuel consumption of 189g/kWh the new eco-friendly engine is optimized for use in buses used for urban transportation.

Investment Activities

Major investment projects
Project Targeted annual production capacity Budgeted amount (in million yuan) Status
Building a new plant at Guangxi Yuchai Automobile Parts Manufacturing
Increasing production capacity of crankshafts

Phase one: 50,000 units/per year
Phase two: 200,000 units/per year
Phase three: 500,000 units/per year
350 million yuan
(Phase one: 50 million yuan)
Phase one was completed and operations already began
(January 2007)
Building a new diesel engine plant at Guangxi Yuchai Machinery 200,000 YC4F diesel engines for light-duty diesel-engine vehicles - The Plant was completed and preparations are under way for launching mass-production. 
(April 2007)
Yuchai Industrial Park project - 432 million yuan Phase one of the project was launched (August 2007)
  Building a plant to make small diesel engines at Yuchai Power Machinery 200,000 small diesel engines 190 million yuan  Construction work began 
(August 2007)
Establishing new plants to make engine components at Guangxi Auto Pass Industry, Yulin Sanyuan Machinery, and Yulin Tianfu Metal Products - - Construction work began 
(August 2007)
Building a new plant to make diesel engines at Xiamen Yuchai Engine, which was established in December 2006 100,000 YC series diesel engines for light-, medium-, and heavy-duty vehicles 450 million yuan
(Phase one: 190 million yuan)
Phase one of the project was launched
(September 2007)