Auto radiator supplier Delang's secret to overseas market growth

Shanghai, April 17 (Gasgoo.com) Starting as a small workshop in 1989, Shanghai Delang Auto Parts Manufacturing Co., Ltd. was established as a company in 2003 and since then it has grown into a supplier of auto radiators and car intercoolers for BMW, Ford, Volkswagen, Fiat, Chery and many other domestic and global auto-makers. Delang is now a leading professional OEM manufacturer for automobile cooling and air conditioning systems -- automobile radiators and heaters. The company has now 14 OEM projects, and its products are used in 75% of the domestically made sedans; the export rate of its products has topped 60%, and they carry the labels of half of the famous suppliers in Western Europe.

Fang Qianqiu, general manager of Delang, worked as an engineer in Shanghai Behr Thermal Systems Co., Ltd. , an auto-parts maker for Shanghai VW, Shanghai GM and other upscale automakers. He has borrowed some techniques and lessons from Shanghai Behr to improve the product design and quality control in Delang. Not to compete with Shanghai Behr, Fang has oriented 40% of the products of Delang to the down-market automakers and the after-sales market in China, and the other 60% of them are made for export. However, most of Delang's technology and engineers came from Shanghai Behr, which guarantees the technical support, product quality and market share of Delang. About 20% of Delang's production capacity is used for OE / OEM projects, including the one from Shanghai VW, who makes courtesy cars for the Beijing Olympic Games.

Over the past few years, Delang has explored its overseas markets remarkably. Following the rapid sales growth of its products in Europe, South America and the Middle East, the company has now made its foray into North America. Fang Qianqiu noted that Delang's products have entered into the Middle East market by low price and into the European market by high quality. Delang has cooperated with some European clients for over three years, mainly because of the high quality of its products. But in the American markets, many of Delang's current products cannot meet the demands of the clients, and they have asked the company to develop new products for them. So Delang plans to invest more in the product research and development (R&D) to boost its global market expansion.

Of Delang's clients in Europe, Land Rover is a classic Ford brand in Britain. Fang said that the radiators used in Land Rover vehicles before were made of copper, but later the copper price rose and the copper radiators must be replaced by aluminum ones, all of which have been made by Delang. At first the change from copper to aluminum in the making of radiators is technically difficult due to the different properties of the two metal materials. For example, copper can be soldered onto the exterior of the radiator easily, but aluminum can not. After seeking technical innovation and alternative methods, Delang managed to produce and deliver the products that met the requirements of Land Rover. And then all the radiators needed by Land Rover for its after-sales service have been made by Delang. However, this is not a big deal -- each shipment of Delang's radiators for Land Rover is just between 600 units and 1,800 units, but these products are the embodiment of the company's self-developed technologies and professional commitment.
 
The third-phase construction of Delang will be completed in June and the new facility is expected to boost the capacity of the company considerably. With the rising prices of raw materials, the Chinese yuan's appreciation and other pressures, Delang will make some restructuring to improve the profit margin and will continue to use the Toyota Production System (TPS) as part of its management philosophy. At the same time, Delang will invest 3 million yuan ($428,600) in its R&D program this year, including the R&D partnership with a local technological university in Shanghai.