Financial Overview

-The Company sold 500,000 engines during 2013. The company’s market share has increased by 4 percentage points from the previous year’s level. The improvement stopped the company’s slowing trend that had continued since 2011. The company has become the first company among China-based multi-cylinder diesel engines suppliers that has returned to the 500,000-unit level. (From a press release on December 31, 2013)

-The Company sold 435,000 engines during 2012, maintaining its position as China’s largest engine supplier. According to the company, its market share has climbed 3 percentage points from last year. Its YC6MK engines designed for next-generation heavy-duty commercial vehicles have been supplied for application to more than 60 percent of new buses with overall length of 6 meters or more. Sales of engines compliant with the China lll standards continued to exceed 150,000 units, while those of gasoline engines surpassed 60,000 units. Other major contributing factors included large sales of engines for school buses, which totaled over 10,000 units. During 2013, the company aims to sell over 470,000 engines. (From news　releases issued by multiple sources on March 17, 2013)

Contracts

<Domestic market>
-The Company announced that 17 units of Dongfeng Liuzhou Balong 8x4 trucks powered by Yuchai’s YC6L engines were delivered to a transportation company in Leizhou, Zhanjiang, Guangdong Province in May 2013. YC6L engines have received high grades from local users for their superior fuel efficiency and low failure rates. Since the beginning of this year, more than 30 orders have already been placed for the Balong trucks in Longmenzhen alone. (From a press release, May 31, 2013)

-The Company announced that it has been awarded a new program from Baoding Public Transport Corporation (BPTC) in Baoding City, Hebei Province to supply 298 YC6J hybrid vehicle engines. The first batch of 114 Yutong ZK6120CHEVG1 buses powered by the YC6J engines started operations on March 12, 2013. The remaining engines are being delivered in succession and will be put into operations in late April. (From a press release, April 7, 2013)

-The Company announced that Changchun HuaAo Automobile’s two hybrid electric buses powered by its YC6J210N hybrid engines have been used for actual public transportation in Changchun City since January 6, 2013. According to the bus company, the new buses offer smooth operations, while achieving high levels of fuel-saving effects. (From a press release, January 14, 2013)

<Overseas market>
-The Company announced that it has won an engine program for new buses to be shipped from China to Saudi Arabia. Eight hundred buses mounted with either YG6G or YC6L engines will be exported to Saudi Arabia, starting in July 2013. This business is the largest in scale in the Chinese bus market in 2013. (From a press release, July 25, 2013)

-The Company announced that Xiamen Golden Dragon Van’s eight 12-meter buses powered by the company’s YC6L330-30 Euro lll engines were exported to Sulawesi Island of Indonesia. Test drives were conducted on a 1,300-kilometer route from Makarsa in the south to the Palu in the north. Yuchai YC6L330-30 engine has outstanding performance, which wins customers' acceptance. NEW LIMAN passenger transport company was very satisfied with the test results and decided to purchase 50 more vehicles. (From a press release, April 28, 2013)

-The Company said that 15 units of Dongfeng Yanze WG6120NHM buses equipped with Yuchai‘s YC6G260N-30 natural gas engine were shipped to Thailand in early January 2013. After undergoing an inspection at Don Mueang International Airport, these buses will be delivered to route bus companies in Bangkok in a few days. Following the introduction of tighter emissions regulations at the end of 2011, releases of new buses decreased significantly in Thailand, which also affected Chinese bus manufacturers’ export business. Amid such tough situations, a number of Chinese major engine suppliers have stepped up marketing activities to promote sales of their natural gas engines in the Thai market. Yuchai Machinery is working on developing high performance ECI gas combustion system, establishing a quality after-sales service system, and cultivating excellent local engineers to better meet the requirements of Thai customers. (From a press release, January 28, 2013)

New Company

-Guangxi Yuchai Machinery, a subsidiary of the Company, announced that the company will establish Baotou Beiben Yuchai Engine Co., Ltd. in Baotou, Inner Mongolia jointly with three other companies. The three partners are Baotou Beifang Chuangye Co., Ltd., Beiben Trucks Group Co., Ltd., and Y&C Engine Co., Ltd. The joint-venture company will be capitalized at CNY 600 million and will involve a total investment of CNY 1.51 billion. A new plant will be constructed in three phases on 306,682 square meters of land. When it is completed, it will be able to produce YC6A, YC6L, YC6MK, and YC6K series large diesel engines and gasoline engines. The plant’s annual production capacity is expected to reach 100,000 engines. (From news releases issued by multiple sources on October 24, 2013)

Strategic Alliance

-In April 2013, the Company announced that it will establish an R&D center and a production facility for passenger vehicle diesel engines at the Jining National High-tech Industrial Development Zone, Shandong Province. The company and the authorities of the industrial estate signed an agreement on the project on April 17. (From a press release, April 22, 2013)

Pass the Test

-Y & C Engine Co., Ltd., which is a subsidiary of the Company, announced that its five YC6K12 series engines have passed the product testing based on the Euro standard and acquired the E-mark certification. Cars, motorcycles and related electronic components must have the E-Mark to enter the European market. E-mark is also used on vehicles meeting the Euro emission standards in many countries. (From a press release, August 21, 3013)

Award

-The Company has received the Best Supplier Award for 2013 from Dongfeng Commercial Vehicle Company. The company has earned this award for the sixth consecutive year. Over 20 percent of all vehicles built by Dongfeng Commercial Vehicle use Yuchai Machinery Guangxi's engines. (From a press release on December 23, 2013)

R&D facility

Facility	Overview
Guangxi Yuchai Engineering Research Institute	- Established in 2007, this research institute conducts its development activities in four divisions: Product engineering division; Electronic control technology division; Test engineering division,  and Technology management division. -The focus of its development activities is on engineering technology as practical business solutions to reduce emissions, and developing diesel engines for passenger vehicles.
Combustion engines Union testing Laboratory	-Established in 2009, the new testing laboratory will conduct research and development on combustion technology for diesel engines; along with R&D activities on automotive noise, vibration, and harshness; and on intake systems.
R&D center	-Established in 2011, the center is to conduct joint research and development activities for large turbochargers used in vessels and automobiles.
Practice-Education center	-Established in 2011 with Huazhong University of Science & Technology (HUST).
Guangxi Diesel Engine Engineering Academy	-Established from 2012 to 2015, the Company is solely responsible for the construction.

Patents

-As of Dec. 31, 2013, the Company has more than 1,300 patents in total.

New products

-In January 2014, the Company announced four new diesel engines, the YC4E-48, the YC4S-48, the YC4D2 and the YC6MK, for heavy- and light-duty trucks and mini buses. At the same time, the company has also announced the YCHPT II, the second generation of its plug-in hybrid system. (From a press release on January 18, 2014)

Domestic Investment

-The Company announced that the company and Chongqing RATO Holding (group) Co., Ltd. will jointly establish a production company in the Chongqing Liangjiang New Area. The total investment in this project is expected to reach CNY 3 billion. Construction will be carried out in two phases. The first phase will include construction of a facility to produce 350,000 eco diesel engines per year. The second phase will involve construction of facilities to produce 100,000 pieces of agricultural machinery and 100,000 units of power generators per year. The joint-venture’s annual production is expected to reach CNY 10 billion when the production lines become fully operational. (From a press release on December 29, 2013)

-The Company announced that two new production lines, which will specialize in making pistons and oil pumps for the company, have been completed at its partner companies. A piston production line was set up at Changan Automobile’s Hunan Jiangbin Piston Branch, and an oil pump production line was constructed at Hunan Oil Pump Co., Ltd. (From a press release on November 13, 2013)

-In November 2013, the Company held a groundbreaking ceremony for a large casting parts plant for diesel engines at its Yuchai Foundry center. The plant will be established at a cost of CNY 200 million and will have five lines: cold-box coremaking, phenolic sand molding, phenolic sand regenerating, intermediate frequency furnace melting and purging. The plant will be completed and start trial production in the first half of 2015. The plant’s annual production capacity is 32,000 tons. Production items include large engine blocks, cylinder heads and flywheels.  (From a press release on November 12, 2013)