On the back of the Belt and Road Ini­tia­tive, TCL has ac­cel­er­ated its ex­pan­sion ... ”

China Daily (Latin America Weekly) - - Business - Contact the writer at fan­feifei@chi­nadaily.com.cn

En­cour­aged by suc­cess in Europe, Chi­nese consumer elec­tron­ics ma­jor TCL Corp is step­ping up ef­forts to ex­pand its pres­ence the world over, par­tic­u­larly in Rus­sia, the Middle East and Africa.

Nearly 50 per­cent of its rev­enue al­ready comes from out­side China. Over­all sales rose 8 per­cent year-on-year to 52.2 billion yuan ($8 billion) in the first half of this year, gen­er­at­ing a profit of 1.66 billion yuan, up 111 per­cent.

The Viet­nam fac­tory tar­gets the South­east Asia mar­ket, the Mex­i­can fac­tory aims at North Amer­ica and Cen­tral Amer­ica, the joint ven­ture fac­tory in Egypt cov­ers the whole of Africa and Cen­tral Asia, and a sim­i­lar fac­tory in Brazil serves South Amer­ica.

TCL is ex­pect­ing its TV sales from a fac­tory in cen­tral Poland to reach 3 mil­lion units within the next three years. That would make it one of the top three elec­tron­ics man­u­fac­tur­ers in Europe by 2020.

“On the back of the Belt and Road Ini­tia­tive, TCL has ac­cel­er­ated its ex­pan­sion in Euro­pean coun­tries by set­ting up fac­to­ries and co­op­er­at­ing with lo­cal part­ners to gain more mar­ket share,” said Liang Zhen­peng, a consumer elec­tron­ics an­a­lyst.

The ge­o­graphic ad­van­tage of TCL’s plant in Poland has en­abled the elec­tron­ics gi­ant to make head­way in Europe, a key mar­ket.

The plant was orig­i­nally es­tab­lished and run by Thom­son SA, a French elec­tron­ics com­pany. When TCL ac­quired Thom­son in 2004, the plant was also trans­ferred to TCL, said Chen Chuan­lun, the fac­tory’s gen­eral man­ager.

The fac­tory cov­ers an area of 105,000 square me­ters, with four pro­duc­tion lines that man­u­fac­ture tele­vi­sions whose screen sizes range from 22 inches to 80 inches.

It only takes 2 sec­onds to pro­duce one TV set and when a consumer elec­tron­ics an­a­lyst all pro­duc­tion lines op­er­ate, they can pro­duce 1.39 mil­lion TV sets per shift and 4.2 mil­lion units in three shifts.

“Orig­i­nally, mar­itime trans­port from China to Poland took 38 days, which greatly im­peded the com­pany’s ex­pan­sion in the Euro­pean mar­ket. But, un­der the Belt and Road Ini­tia­tive, the China-Europe freight trains short­ened the trans­port time to only 16 days. TCL also linked its fac­tory in Chengdu with that in Poland,” said Chen.

The Poland fa­cil­ity, ge­o­graph­i­cally in the middle of Europe, em­ploys about 200 work­ers. The goods made here can be de­liv­ered to the far­thest Euro­pean coun­try — Por­tu­gal — in just four days, and most other Euro­pean coun­tries in three days.

“Lo­cal work­ers have worked in our fac­to­ries for more than 10 years, so they can con­stantly col­lect the most ad­vanced prod­uct in­for­ma­tion in Poland and even from across Europe, which will be sent back to the R&D cen­ter in China,” Chen said.

Based on cus­tomer feed­back and sug­ges­tions, do­mes­tic de­vel­op­ers de­sign or make prod­ucts, Chen added.

More­over, Pol­ish work­ers tend to be loyal and com­mit­ted, with an an­nu­ally at­tri­tion rate of just 1 per­cent.

Ac­cord­ing to Chen, ev­ery year the com­pany sends work­ers pro­duc­ing good per­for­mance in the Pol­ish fac­tory to at­tend a year-end com­men­da­tion cer­e­mony in China.

They get to visit Shen­zhen China Star Op­to­elec­tron­ics Tech­nol­ogy Co Ltd, a sub­sidiary of TCL, so they could feel a sense of be­long­ing with the whole TCL fam­ily.

Boosted by the Pol­ish fac­tory, TCL ranked third in terms of mar­ket share in France and has made break­throughs in Ger­many, Poland, the United King­dom and Spain.

TCL will also con­tinue to strengthen mar­ket­ing and brand-build­ing in Europe. “Our TV sales in Europe have im­proved this year, while smart­phones saw a drop in sales ... We hope to in­crease our brand aware­ness and ex­pand mar­ket­ing chan­nels by virtue of IFA Elec­tron­ics Show 2017, one of the world’s big­gest trade shows for consumer elec­tron­ics, which was held in Ber­lin from Sept 1 to 6,” said Li Dong­sheng, chair­man and chief ex­ec­u­tive of­fi­cer of TCL.

“I am con­fi­dent that not only our sales but prof­itabil­ity will grow in Europe in the next one or two years,” Li said.

“We have speeded up the ex­pan­sion of over­seas operations mak­ing the most of op­por­tu­ni­ties pre­sented by the Belt and Road Ini­tia­tive, and will pay at­ten­tion to en­hanc­ing the qual­ity of in­ter­na­tional operations and man­age­ment in the fu­ture.”

In­dus­try data showed TCL shipped 20 mil­lion LCD TV sets around the world last year, half of them smart TVs. That makes it the world’s third-largest liq­uid crys­tal dis­play TV maker.

In the first quar­ter of 2017, TCL also ranked among the top three for global TV ship­ments, with a mar­ket share of 7.3 per­cent, ac­cord­ing to mar­ket re­search com­pany IHS Tech­nol­ogy.

Founded in 1981 in Huizhou, Guang­dong prov­ince, TCL has be­come one of the largest consumer elec­tron­ics man­u­fac­tur­ers, pro­duc­ing mo­bile phones, tele­vi­sions and home ap­pli­ances, among other consumer goods.

Liang Zhen­peng,

XINHUA

Qual­ity-con­trol in­spec­tors at work at TCL’s fac­tory in Viet­nam. One of the ear­li­est Chi­nese en­ter­prises to ex­pand over­seas, TCL en­tered Viet­nam in 1999. Its mar­ket share in the South­east Asian coun­try has ex­ceeded 16 per­cent by 2015.

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