Sany's bid to usurp Caterpillar

Updated: 2012-10-15 23:35

By TAN YINGZI in Peachtree City, Georgia (China Daily)

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"My job was to develop the strategy to take the great base and rapidly grow Sany's presence in North America," he said.

At Sany America, this means more than doubling sales each year and moving past five established competitors to reach the five-year target.

"It's a very, very aggressive strategy that's not easily done. Historically, it's never been done by anyone in this space," Frank said.

As chairman, he faces two major challenges: technology and distribution.

Specifications on equipment vary by country or region, particularly those with engine emissions. What's required or accepted in China may be quite different from standards elsewhere, Frank explained. Sany America must work with its network of suppliers to modify engines and other parts in a nimble, efficient manner.

As a relative newcomer to the market, finding the right distribution partners and building reliable channels are just as critical.

Sany America already has its selling points, Tang said.

"Sany makes brand-new equipment to meet market demands. We work together with our dealers setting the price, and our quality guarantee doubles the average standards of our competitors," he said.

The subsidiary tries to outdo rivals in customer service, offering warranties valid for two years instead of one year, or 4,000 hours rather than 2,000.

Along with conventional business-development strategies, such as securing dealers, Sany America also has "creative" plans in the works, according to Frank, though he and Tang declined to give details.

"We will take some actions in the near future to quickly expand the market," Tang said. "We are very interested acquiring some key parts suppliers and competitors. As the market is still slow in recovering, there are a lot of such opportunities out there.

"Some competitors are willing to consider the acquisition if the terms are OK," he added.

But the executive admitted there could be hurdles in buying up US companies, including what he calls misperceptions about Chinese companies.

"Though Sany is No 6 in the world, many American clients and peer companies don't know that we are a privately owned, publicly listed company. Here in America, they still have some taboo" about working with a Chinese company, Tang said.

On Sept 28, US President Barack Obama blocked the sale of four wind farms near a US Navy testing compound in Oregon to Chinese-owned Ralls Corp, citing national security concerns. Delaware-based Ralls is owned by two Sany Group executives.