ZHONG TONG SEEKS EX­PAN­SION

ABC (Australia) - - CONTENTS -

Though the com­pany’s been in Aus­tralia for years it has re­mained small by its own ad­mis­sion. Yet now a changed mar­ket brings ex­pan­sion and distri­bu­tion talk for Chi­nese gov­ern­ment-owned Zhong Tong in Oz. Fabian Cot­ter re­ports.

ZHONG TONG bus – one of the top three bus man­u­fac­tur­ers in China and the largest Chi­nese Gov­ern­ment-owned bus com­pany – is ready to ex­pand op­er­a­tions in Aus­tralia, to mir­ror its New Zealand and other re­gional suc­cess, with new three-axle coach prod­uct com­ing soon, it states.

The com­pany has tech­ni­cally been in Aus­tralia since 2001, but has kept a some­what rel­a­tively lower pro­file while it es­tab­lished its base slowly, but now it is seek­ing greater mar­ket share lo­cally due to mar­ket changes, it says.

Cur­rently, Zhong Tong sells all around the coun­try – but it doesn’t have a deal­er­ship struc­ture yet. It has work­shops in Tas­ma­nia, Queens­land and a work­shop and head­quar­ters in Milperra, Syd­ney, NSW. Yet, ex­pan­sion is on the cards, ac­cord­ing to Michael Jiang, manag­ing di­rec­tor of Jiangs In­ter­na­tional Pty Ltd for Zhong Tong Aus­tralia Mar­ket.

“We [are] still try­ing to es­tab­lish devel­op­ments in Mel­bourne, in Ade­laide, and the rest of Aus­tralia. We want to ex­pand. We want to find lots of deal­ers or a main deal­er­ship be­cause we can’t sell the buses di­rectly from China,” he says.

“We have two types of buses, a 9m (37+1 seats) and a 12m, but we are go­ing to bring in a 13m three-axle, hope­fully by the end of this year.”

KEY PLAYER

Speak­ing ex­clu­sively with ABC mag­a­zine, Jiang ex­plains that Zhong Tong is dif­fer­ent to other Chi­nese-ori­gin bus com­pa­nies.

“Zhong Tong is owned by the gov­ern­ment of China. We are in the top three bus man­u­fac­tur­ers in China. First is Yu­tong, then King Long and we are num­ber three.

“We have our reg­u­lar cus­tomers here [in Aus­tralia] who knew the Zhong Tong brand from China, so when they came to Aus­tralia to buy a bus they were look­ing at costs of half a mil­lion [else­where], but a Zhong Tong will only cost you around AUD$260,000 brand new. So we don’t sell the bus for mar­gin, we sell the brand for the ‘mark­ing per­cent­age’.”

Asked why Zhong Tong is now look­ing to ex­pand and what the mar­ket changes that drove this de­ci­sion were, Jiang said:

“Be­fore, China prod­uct used to be smaller and at the ground level, clothes or small stuff, etc. – but now it’s mak­ing ve­hi­cles and equip­ment, con­struc­tion and elec­tron­ics, and sell­ing over­seas. Our qual­ity is [also] there now; we use a lot of top Euro­pean com­po­nents on our buses.”

TOUGH START

“But,” re­flected Jiang, “Aus­tralians are very tra­di­tional. Many years ago I tried to pro­mote our Zhong Tong bus to some of the Aussie bus com­pa­nies. I’d drive it [a bus] to their yards and they’d ask ‘oh, what’s this?’ I’d say I just want to in­tro­duce our brand of bus, would you like to take it for a drive? They’d so ‘no, I’m not go­ing to try it be­cause I like [an] Aus­tralia-made bus’.

“I said a bus is a bus. He said his coach cost about $550,000 plus – but he had to en­dure a two-year wait­ing pe­riod.

“That’s when I knew we had an ad­van­tage be­cause for our Zhong Tong it’s just three months to ar­rive in Aus­tralia as per your spe­cial re­quire­ments.

“So now I hear times are chang­ing, own­ers and op­er­a­tors are chang­ing their mind [about Chi­nese buses].

“Also what’s changed is the en­vi­ron­ment;

peo­ple don’t want to pay a lot to even rent a bus. For ex­am­ple, be­fore it was [around] $2,000 a day, now it’s maybe $1,200 – so the mar­gins have come down: the same for [buy­ing] buses from half a mil­lion. Buses now [cost] less.”

Jiang says that Zhong Tong buses ar­rive here as a whole com­pleted bus, as it holds the Aus­tralian De­sign Rules com­pli­ance ca­pa­bil­ity from the man­u­fac­turer it­self in China.

“We have the au­tho­ri­sa­tion to put the com­pli­ance plates on, so once the bus is im­ported [here] from over­seas it is ready to go.”

GROW­ING CAT­A­LOGUE

“I’ve been here since 1997 and I came here as a stu­dent. I know how to make a good bus. I de­signed the two buses for the Aus­tralian mar­ket,” Jiang said.

“So to­day th­ese two new buses [9m and 12m] have been de­signed for the Aus­tralian mar­ket [and] you will see the dif­fer­ence com­pared to other Chi­nese buses here. This 12m two-axle coach has a 32,000 (BTU) Kcal/H Zhong Tong-branded air con­di­tion­ing – it’s very pow­er­ful for hot Aus­tralian con­di­tions. It uses a Ger­man-sourced com­pres­sor and Ja­panese rooftop ma­chine.

“In this 12m, 56/57-seat [inc. driver’s] coach we use Bri­tish-built 360hp [268.5kW] Euro 5 US-brand Cum­mins en­gines, and an Al­li­son trans­mis­sion. As for the chas­sis we have Wabco brakes, JB axles, a 470-litre tank with 45-litre AdBlue sys­tem [lasts ap­prox­i­mately 3,000km] and a con­trol sys­tem from France.

“There’s also an elec­tronic hand­brake, pe­riph­eral cam­eras, plus in­de­pen­dent sus­pen­sion and ESP [elec­tronic sta­bil­ity pro­gram] in this bus – same stan­dard as a Volvo. The other Chi­nese buses don’t have ESP, but we have per­ma­nent ESP. The dash is also from France.

“It uses a high-stan­dard stain­less steel body and alu­minium doors. It has LED in­te­rior light­ing and we use Span­ish Fainsa-brand seats.

“Safety is our big­gest con­sid­er­a­tion. It’s a large bus so the cam­eras help min­imise the risk for the driver,” Jiang said.

“Own­ers and op­er­a­tors are chang­ing their mind [about Chi­nese buses].”

THE TRAVEL COM­PANY

Zhong Tong also is af­fil­i­ated with a sim­i­larly named travel com­pany, which ar­guably may have caused a bit of con­fu­sion over the years.

“The story is they wanted to be­come a Zhong Tong dealer for Aus­tralia, but they are a travel com­pany. So we are es­tab­lished as Zhong Tong bus, but we use them as a travel agent, or travel com­pany.

“We have a lot of op­er­a­tors in Aus­tralia us­ing our buses. We have Kingstar Coach Man­age­ment, Zhong Tong (travel), Nexus Travel, and some Korean coach op­er­a­tors, Tas­ma­nia Coach­lines and (AAT Kings) A-TEAM Coach Lines – to name a few.

“We sell about 20 buses per year – and that’s di­rect. We have an Aus­tralian deal­er­ship, but we are still look­ing for a full distri­bu­tion net­work.”

FAC­TORY BACK-UP

with a work­shop near Launce­s­ton, Tas­ma­nia and one in Queens­land.

“We have [tech­ni­cal] teams that pro­vide sup­port 24-hours. So if you have some tech­ni­cal fault or the ve­hi­cle breaks down, you just call on the phone [for help].

“Our engi­neers, ev­ery two months, fly to Aus­tralia and stay for maybe a few weeks, and travel all across to see all our bus clients to see if there are any is­sues.

“Our sales and over­sees mar­ket­ing is done in China, but our tech­ni­cal peo­ple visit cus­tomers ev­ery two months. But ideally we want a dis­trib­u­tor our­selves here in Aus­tralia for Zhong Tong, so they can go out and visit our cus­tomers.”

ABOUT ZHONG TONG

“Zhong Tong is Chi­nese Gov­ern­ment-owned and it’s sold all across the world,” ex­plained Jiang. “We sell to Europe, Ger­many, Amer­ica, we sell a lot in New Zealand – in Christchurch, we sell into the Mid­dle East. We sell about 2,000–3,000 buses ev­ery year through just one con­tract [there].”

World­wide, Zhong Tong sells about 35,000 buses ev­ery year, he says. “When the [Chi­nese] Gov­ern­ment gives away free buses as aid to poor for­eign coun­tries, those buses care com­ing from Zhong Tong”.

In terms of af­ter-sales sup­port for cus­tomers, NSW is home to Zhong Tong’s head of­fice in Milperra,

Op­po­site, Top: As Jiang ex­plains, this Zhong Tong 12m two-axle coach has 56/57seat (inc. driver’s) ca­pac­ity, a 360hp Bri­tish-built Euro 5 Cum­mins en­gine, Al­li­son trans­mis­sion, Wabco brakes, JB axles, a 470-litre fuel tank with 45-litre AdBlue sys­tem.

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