BBAC is Ready

　　——2014 BBAC Supplier Day

　　On July 7th, 2014 BBAC Supplier Day, under the theme of “BBAC is Ready”, has been held at BDA, Beijing. Mr. Frank Deiss, President and CEO of BBAC, Mr. Chen Hongliang, SEVP of BBAC, and Dr. Klaus Zehender, Executive Vice President MBC Procurement and Supplier Quality attended the conference and communicated with about 260 formal and potential suppliers of BBAC coming from all over the country about future cooperation model, standard and management methods together, presenting BBAC’s development strategy, laying a solid foundation for promoting a close cooperation, giving new motivation for the acceleration of BBAC’s development.

　　Build up an international supply system, realize high localization rate

　　On March 28th, 2014, BAIC signed an agreement with Daimler under the witness of Chinese president Xi Jinping and German Chancellor Angela Merkel. The agreement calls for a further expansion of capacity of BBAC joint venture. According to the agreement, the investment of q total of roughly 4 billion euros will be invested in BBAC by 2015, in which about 1 billion euros will be used specially for enlarging the capacity of more energy-efficient sedan and engine. This represents that the well performance in the market resulted from higher localization rate already highly recognized by both parties, and their deeper strategic cooperation also aims to drive BBAC into a high speed development phase.

　　Mr. Frank Deiss, President and CEO of BBAC, pointed out at the meeting that, “we are well prepared, with the huge market, advanced plant, best products as well as remarkable team, just like the Chinese saying, we have ‘Right time, favorable environment, and united people’. Well prepared BBAC is striding to the goal of ‘becoming an international, benchmark Chinese premium vehicle enterprise”

　　It is said that along with the production launch of the new Mercedes-Benz long-wheelbase C-Class vehicles, the localization rate of BBAC will be over 60%. A high localization rate will not only considerably enhance the competitiveness of BBAC’s products, at the same time, will bring more challenges and chances to BBAC’s supply system. Mr. Chen Hongliang, SEVP of BBAC, said “Take the production of a vehicle as an example, more than 70% of components are outsourced, taking up 80% of the purchasing cost. Therefore, effectively managing the 70% outsourced components and effectively optimizing the 80% of the purchasing cost, are the basis of improving the competitiveness of the products. And the key of the solution is to optimize the management of the supply system. Thus, the competition of company and product is also the competition of the supply chain.”

　　Dr. Klaus Zehender, Executive Vice President MBC Procurement and Supplier Quality, expressed his expectations for Chinese suppliers from the aspects of logistics, quality, maturity, cost, etc., hoping that the suppliers can provide more and better technology optimization suggestion under the premises of compliance and integrity. Also, according to the 2020 strategy of Daimler, Chinese supplier network may welcome more opportunities to cooperate with more Daimler plants all over the world.

　　We can say that in the Chinese automobile production industry, which is in the global economic integration itself, suppliers pay a more and more important role. To enhance the competitiveness of products, it is necessary to raise the localization rate, which can not be realized without the support and cooperation of our supplier partners. BBAC is on the high way of development, trying to build up an international supply chain which has innovation and competitiveness. We will step forward shoulder by shoulder with our suppliers and win the future together.

　　BBAC is confident and prepared

　　Besides interpreting the supply system and BBAC’s strategy, the conference also awarded 12 outstanding suppliers, to honor and encourage suppliers, enhancing their confidence. The next day, there will be two forums, “Potential Supplier for MFA2 Forum” and “Supplier for Export Business Forum,” where the suppliers can get more opportunity to join in the international competition. 

　　The amount of Chinese luxury-car customers is booming with leaps and bounds. Mercedes-Benz already has 300 dealers in more than 100 cities around the country, and the number increasing annually. And BBAC undoubtedly is crucial to Daimler strategy, as a top plant Daimler established in China, which already owns research and development, engine and vehicle production ability.

　　In terms of research and development and production, BBAC took a leap from purely assembling vehicles to producing core components, embodying that Daimler is passing on key technics to BBAC. And at the same time, NGCC Plant, MRA2 Plant, and some other new projects are under construction. Along with the expansion of the product line, and by carrying out the policy of developing and bringing the products into the market simultaneously with Daimler, BBAC made an early move in the campaign of winning the Chinese market. BBAC is well-prepared for greater challenges!