Autos and Auto Components

Abstract

The main body of China’s emerging large indigenous firms in the 1980s and 1990s has come from initially large state-owned enterprises (SOEs), such as Shougang Iron and Steel Company, Shanghai Petrochemical Company, and Harbin Power Equipment Company. However, a small number of large firms has emerged in a different way. These firm have both advantages and disadvantages in relation to the initially large SOEs. This chapter examines one striking case, Yuchai Diesel Engine Company in Yulin City, Guangxi Province. In the mid-1980s Yuchai was a struggling medium-sized SOE, ranked 173rd largest engine maker in China by value of sales. By the mid-1990s, led by a dynamic chief executive officer, Wang Jianming, it had risen to be the largest diesel engine manufacturer in the country. In 1995 Yuchai accounted for around 49 per cent of the total market for engines installed in medium-duty trucks in China. Within two years, Yuchai had encountered severe difficulties and by the summer of 1997 it had no production at all for months on end.