Rail link sharp­ens Europe pic­ture

TCLMul­ti­me­dia to ex­pand Chengdu TV plant ca­pac­ity, grow Euro­pean sales; also plans Russian fac­tory

China Daily (USA) - - BUSINESS - By PENG CHAO in­War­saw pengchao@chi­nadaily.com.cn

TCL Corp, the Huizhou, Guang­dong-based and Shen­zhen-listed com­pany, will ex­pand the an­nual pro­duc­tion ca­pac­ity of its fac­tory in Chengdu, cap­i­tal of Sichuan prov­ince, by 800,000 TV sets by the end of 2017, to ex­ploit a new op­por­tu­nity pre­sented by a Eurasian rail­way ser­vice.

The Chengdu plant’s cur­rent an­nual ca­pac­ity is 2 mil­lion TVs, which are sold mostly in north­west­ern and south­west­ern China.

The planned ca­pac­ity ex­pan­sion would make it TCL’s sec­ond-largest plant af­ter the fa­cil­ity in Huizhou.

“We will make Chengdu our ma­jor man­u­fac­tur­ing base for TVs sold in Europe,” said Liang Tiemin, vice-pres­i­dent of TCL Mul­ti­me­dia Tech­nol­ogy Hold­ings Ltd, a Hong Kong-listed sub­sidiary with fo­cus on man­u­fac­tur­ing and dis­tri­bu­tion of TVs.

So, the new com­po­nents to be made in Chengdu will be trans­ported by train to the com­pany’s plant in Zyrar­dow, 45 kilo­me­ters south­west of War­saw, Poland’s cap­i­tal.

There, they will be as­sem­bled into TVs and sold in Europe, said Liang.

The Zyrar­dow fac­tory is one of TCL’s ma­jor plants in Europe. It is also the big­gest fac­tory set up in Poland by a Chi­nese com­pany, with an an­nual ca­pac­ity of 2.2 mil­lion TV sets.

It can ship prod­ucts to ma­jor Euro­pean cities in just one day and far-flung ar­eas in un­der four days.

Liang said TCL Mul­ti­me­dia re­struc­tured its pro­duc­tion to ex­ploit the 9,800-km non­stop Chengdu-Lodz cargo route of China Rail­way Ex­press, which opened in April 2013.

The line runs through Kaza­khstan, Rus­sia, Be­larus be­fore reach­ing a ter­mi­nal with cargo un­load­ing fa­cil­i­ties in Poland.

Since Jan­uary, 99 per­cent of the com­po­nents of TVs sold in Europe were made in Huizhou and Chengdu and trans­ported on the Chengdu CR Ex­press, said To­masz Olen­der, deputy gen­eral man­ager of TCL Op­er­a­tions Pol­ska, the com­pany’s unit in Poland.

In the past, Olen­der re­called, TCL ex­ported such com­po­nents to Europe by sea, which used to take more than six weeks. Now, the Chengdu CREx­press takes less than two weeks.

“This makes us more com­pet­i­tive, be­cause our cus­tomers in Europe want to re­ceive our prod­ucts very fast,” he said.

Liang said the com­pany had con­sid­ered ship­ping TV com­po­nents to Europe by rail 10 years ago. But the ef­fort did not bear fruit for want of ad­e­quate govern­ment sup­port.

Now, how­ever, the Belt and Road Ini­tia­tive and the launch of the Chengdu CR Ex­press have helped the com­pany re­al­ize its dream as well as boost its busi­ness in Europe.

TCL is nurs­ing am­bi­tious plans for the Euro­pean mar­ket, he said.

Ac­cord­ing to the Chengdu Port and Lo­gis­tics Of­fice, Chengdu is plan­ning to launch an ex­press goods rail line to Rus­sia by the end of this year.

Liang said the com­pany would build a new fac­tory in Rus­sia if the Chengdu CR Ex­press is given the ben­e­fit of a cargo ter­mi­nal close to Moscow.

For, TCL al­ready has a fac­tory in Kalin­ingrad, from where prod­ucts take four days to reach Moscow.

TCL is also con­sid­er­ing to sell more air con­di­tion­ers, re­frig­er­a­tors and wash­ing ma­chines to Europe by mak­ing their com­po­nents in Chengdu and trans­port­ing them on rail to Poland for as­sem­bly, Liang said.

He said rail­way is gen­er­ally more ex­pen­sive than sea for ship­ping cargo, but with the sub­sidy of­fered by the Chengdu govern­ment, it costs less now.

This (ex­press rail ser­vice) makes us more com­pet­i­tive, be­cause our cus­tomers in Europe want to re­ceive our prod­ucts very fast.” To­masz Olen­der, deputy gen­eral man­ager of TCL Op­er­a­tions Pol­ska

PENG CHAO / CHINA DAILY

Work­ers man­u­fac­ture TV sets at the TCL’s plant in Zyrar­dow, about 45 kilo­me­ters south­west of War­saw, Poland. TCL is ex­pand­ing its pro­duc­tion with an eye on the Euro­pean mar­ket.

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