The recent announcement from Yutong Bus regarding its projected performance for 2024 has sent ripples through the auto industry, showcasing an impressive anticipated net profit of 3.82 billion to 4.27 billion yuan, reflecting a year-on-year growth of 110% to 135%. This remarkable escalation in profit is attributed primarily to Yutong's burgeoning export salesAmidst a sluggish domestic commercial vehicle market, the export sector has emerged as a vital growth avenue for many commercial vehicle manufacturersCompanies such as Foton Motor, Yutong, and Sinotruk have aggressively expanded their foothold in overseas markets, simultaneously accelerating the transformation of their export business strategies.

Remarkable Export Performance

Delving into the reasons behind the anticipated profit increase, Yutong Bus indicated that in 2024, it had sold a total of 46,918 buses, which is an uptick of 28.48% compared to the previous year

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Notably, the export volume surged to 14,000 units, marking a 37.73% increase, while domestic sales also rose by 24.91% to reach 32,918 unitsThis surge in sales has driven the significant growth in net profit.

Yutong attributed its considerable export growth to the increasing competitiveness of Chinese bus products on the global stage, which has propelled the continuous rise in export volume within the bus sectorIn 2024, Yutong's overseas sales reached record levels, with major orders from Latin America exceeding 2,000 unitsFurthermore, the company made its debut in Mongolia with the delivery of 600 buses, while 100 dual-source trolleybuses were sent to KazakhstanMexico received a batch of 274 Yutong buses, and 46 pure electric airport shuttle buses were exported to Spain, alongside significant sales in other countries such as Greece, Denmark, Norway, and the Philippines.

On the domestic front, Yutong reported that the tourism sector has entered a prosperous phase, spurring continuous growth in the demand for travel passenger transport

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In addition, policies promoting the replacement of outdated vehicles with new energy buses have contributed to a swift recovery in public transport demand, positively affecting domestic sales for the company.

Similar sentiments were echoed by Sinotruk during a recent investigation, where the company highlighted an increase in both production and sales in 2024 as compared to the same period in 2023, outperforming overall industry trendsTheir exports also maintained a healthy trajectory, reinforcing their position as one of the key players in the heavy truck segment.

As evidenced by data from the China Association of Automobile Manufacturers, the export of commercial vehicles from China in 2024 showed robust growth, achieving 904,000 units which is an impressive 17.5% increase, despite an overall decline in domestic production and sales.

Evolution of Export Strategies

According to a vice president from a commercial vehicle enterprise, the Chinese commercial vehicle sector has shifted from incremental competition to a more mature stage characterized by expanded market share acquisition

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As domestic demand has softened, many companies have turned their sights toward exports as a secondary avenue for growth.

Leveraging technological innovations and competitive advantages, the scale of Chinese commercial vehicle exports has experienced rapid expansion in recent yearsProjections indicate that by 2030, the export volume of commercial vehicles from China could reach 1.5 million units, constituting 27% of total sales.

In response to this changing landscape, numerous Chinese commercial vehicle manufacturers are quickly positioning themselves in international markets, focusing on joint ventures, mergers, and cooperative efforts to develop local production facilities while transitioning from predominantly export-focused operations to more localized and integrated business models.

Yutong's representatives shared that the company has effectively harnessed its technological and industrial strengths by engaging in KD assembly collaborations across over ten nations including Kazakhstan, Pakistan, Ethiopia, and Malaysia

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This shift signifies a strategic pivot from mere product exports towards a more comprehensive approach involving technology transfers and brand licensing.

Similarly, Foton Motor has undergone a strategic transformation since 2004, evolving through several phases of internationalizationInitially focusing on vehicle exports, they have progressed to establishing a full marketing and service network, localized operations, and international collaborations to better meet local market demands, encompassing a full suite of commercial vehicle products in their global operations.

Surging Demand for New Energy Vehicles

Additionally, according to the China Bus Statistical Information Network, Yutong's sales of new energy buses (over 6 meters in length) soared to 13,795 units in 2024, a remarkable 93.26% growth from the previous year.

Data from First Commercial Vehicle Network indicates that sales of heavy-duty electric trucks surged to 82,000 units, showing a staggering growth of 140%. Sinotruk has reported rapid advancements in the new energy sector, maintaining robust growth and a steady increase in the penetration of charging and battery-swapping heavy-duty trucks, significantly outpacing industry averages.

Changan Automobile emphasized its strategic role in capturing the opportunities presented by the transformation towards new energy and intelligent commercial vehicles

Their subsidiary, Changan Kaicheng, aims to leverage the resources of Changan's passenger vehicle division to foster a range of low-carbon smart logistics commercial vehicles and new energy pickup trucks, projecting total sales of 600,000 units by 2030.

Furthermore, King Long Bus has accelerated its transition towards a green, low-carbon model by focusing on electric, hybrid, and hydrogen fuel technologies while deeply exploring key areas such as intelligent driving and electrical architecture, thereby establishing a comprehensive lineup of new energy products to cover the entire market.

Foton's vice president reaffirmed the sentiment that electrification could give the Chinese commercial vehicle sector a competitive edge in the international arenaThe Chinese government continues to roll out supportive policies aimed at enhancing the development of new energy commercial vehicles