JAC boosts Venezuelan economy

Updated: 2014-08-04 06:31

By ZHU LIXIN in Hefei, Anhui province (China Daily Latin America)

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JAC boosts Venezuelan economy

Representatives of JAC, Venezuela's Transport Ministry and South American company Corpovex sign a $274 million deal in Caracas on July 21. JAC will provide heavy trucks and tractors to the Transport Ministry and Corpovex. [Provided to China Daily]

Anhui Jianghuai Automobile Co, one of China's largest auto makers, is expected to help Venezuela upgrade its rapidly developing economy by providing heavy trucks and tractors needed to transport its goods.

To upgrade its economy, the Bolivarian Republic of Venezuela must first strengthen its capability to transport industrial materials as well as oil, the country's most important product.

"In that sense, commercial vehicles, including heavy trucks and tractors, play a more vital role in the local economy," said Zhang Peng, deputy general manager of JAC International Co Ltd, a JAC subsidiary based in Hefei, the capital of East China's Anhui province.

Venezuela's Ministry of Transport and Communications, the country's top transport authority, plans to establish a national state-owned transportation enterprise, which requires a large number of heavy trucks. And that provides an opportunity for JAC.

On July 21, the auto maker signed a $274 million contract with Venezuela's transport ministry and the national foreign trade company Corpovex S. A. in the capital of Caracas.

The date also marked the closing ceremony of the 13th meeting of the China-Venezuela High-Level Mixed Committee, attended by Chinese President Xi Jinping and his Venezuelan counterpart, President Nicolas Maduro.

Under the contract, JAC will provide Venezuela with 5,239 heavy trucks and tractors within 360 days, with the first batch of vehicles expected to arrive from China before the end of August, according to Zhang, who signed the contract on behalf of JAC.

With the total number of heavy trucks from JAC to be more than 10,000, the deal is said to be the biggest heavy-truck order won by a Chinese auto maker in recent years. A contract for an even larger number of the vehicles is expected to be signed in the near future.

"The country had several options but we are the best choice because we have the broadest service network and the best public recognition," said Zhang.

In the latest market survey conducted in Venezuela in 2013, 93 percent of JAC users said they were satisfied with the company's products.

The auto maker has witnessed rapid development since first exporting vehicles into Venezuela in 2007. In 2012, a JAC assembly plant was established in Barquisimeto, the capital of the State of Lara. It employs more than 600 local workers. The plant assembled more than 4,000 trucks in 2013, mostly light trucks, and it is expected to assemble more heavy trucks in the future.

The new contract also calls for technical service support and training courses for high-level local service managers and technicians to help Venezuela build its own talent pool.

JAC also entered into a strategic cooperation memo at the signing ceremony with Venezuela's top transport authority on building the assembly plant in Barquisimeto into the largest for heavy trucks in the whole Latin America region.

"Our operation principles are high efficiency, reliable technology, good quality, while efficiency comes first," said An Jin, chairman of JAC.

"The emphasis on efficiency helps us avoid bad assets, making us capable of avoiding every financial crisis," said Zhang, who thinks JAC's ever-increasing efficiency is one of the key factors for its sustainable development in Venezuela and the entire Latin American region.

Zhang said JAC is very glad to see that Venezuela has the vision to develop a self-reliant industry and to upgrade its economy, which is also in agreement with his Barquisimeto company's localization strategy, which Zhang summarizes as "using international resources to do international business''.