a bombardier perspective on doing business in china andres friedman analyste principal, stratégie...
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A Bombardier Perspective on Doing Business in China
Andres Friedman
Analyste principal, Stratégie et développement d’affaires
Chaîne d’approvisionnement
BOMBARDIER AERONAUTIQUE
March 2006
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Bombardier
Corporate office based in Montréal, Canada
Workforce of some 59,550 people worldwide as at
January 31, 2005
Revenues of $15.8 billion US for fiscal year ended
January 31, 2005
More than 95% of revenues generated outside Canada
Listed on the Toronto Stock Exchange (BBD)
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Bombardier’s manufacturing facilities
Australia
Austria
Belgium
Brazil
Canada
Czech Republic
Denmark
France
Germany
Hungary
India
Italy
Mexico
Norway
People’sRepublic of China
Poland
Spain
Sweden
Switzerland
United Kingdom
United States
A worldwide presence
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Bombardier regional aircraft
Bombardier* Q100/200* Bombardier* Q300* Bombardier* Q400*
Bombardier* CRJ200* Bombardier* CRJ700* Bombardier* CRJ900*
* Trademark(s) of Bombardier Inc. or its subsidiaries.
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Bombardier business aircraft
* Trademark(s) of Bombardier Inc. or its subsidiaries.
Bombardier*Learjet* 40
BombardierChallenger 800
Bombardier*Challenger* 604
BombardierLearjet 60
BombardierGlobal 5000*
Bombardier* Global Express*
BombardierLearjet 45
BombardierChallenger 300
BombardierLearjet 45 XR
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Transportation, a full spectrum of railway solutions
* Trademark(s) of Bombardier Inc. or its subsidiaries. ** Trademark(s) of third parties.
FLEXITY* Outlook (Linz, Austria)
Light Rail Vehicles
MOVIA* - Guangzhou Metro Line 2 (China)
Metros Commuter Trains
Regional Trains
Voyager** DEMU (UK)
Intercity Trains
ICE** 3 EMU (Germany/Netherlands)
High-speed Trains Locomotives
Low-floor freight wagon
Freight Wagons
Electrostar* EMU (UK)
Interregional Trains
EMU M-7 (New York, USA)
Double-Deck Coache(Germany, Denmark, Israel, Luxembourg)
TRAXX* F140 AC (Switzerland)
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Total Transit Systems
Transportation, a full spectrum of railway solutions
* Trademark(s) of Bombardier Inc. or its subsidiaries.
Mitrac* TC 1000 Traction Converter for Medium Power Application
Propulsion and Controls
Wayside Equipment
Rail Control Solutions
Fleet Management (London, UK)
Services
Bogies
Monorail (Las Vegas, USA)
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Bombardier in China
Rail transportation
4 business offices• Beijing, Shanghai, Guangzhou,
Hongkong
3 joint ventures• Metros (Changchun)
• Inter-city cars (Qingdao)
• Propulsion (Changzhou)
Strong market presence• Beijing, Shanghai, Zhengzhou,
Shenyang, Guangzhou
Aerospace
2 business offices• Beijing, Hong Kong
Existing supply relationships:• Xian Aircraft Corp.
- CL-415 components
• Shenyang Aircraft Corp.- Q-Series doors
Strong market presence• No. 1 in regional aircraft
- 35 aircraft with 7 operators
• No. 1 in business aircraft- 44% of installed base
2,100 employees
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Bombardier Transportation in China - Locations and employees
QingdaoQingdao
ShanghaiShanghai
Hong KongHong Kong
BeijingBeijing
ChangchunChangchun
ShenyangShenyang
GuangzhouGuangzhou
Bombardier Transportation China Representative Office
Bombardier Transportation China Representative Office
CBRC Joint Venture 合资企业: CBRC Established: in 1996 成立于 1996
年
CBRC Joint Venture 合资企业: CBRC Established: in 1996 成立于 1996
年
BSP Joint Venture 合资企业: BSP Established: in 1998 成立于 1998 年
BSP Joint Venture 合资企业: BSP Established: in 1998 成立于 1998 年
Bombardier Transportation China Representative Office
Bombardier Transportation China Representative Office
Bombardier Transportation ChinaRepresentative Office
Bombardier Transportation ChinaRepresentative Office
Bombardier Inc. Representative Office
Bombardier Inc. Representative Office
Bombardier CPC Propulsion System Joint Venture(BCP)
庞巴迪 BCP 牵引系统合资企业Established: in 2003 成立于 2003 年
Bombardier CPC Propulsion System Joint Venture(BCP)
庞巴迪 BCP 牵引系统合资企业Established: in 2003 成立于 2003 年
ChangzhouChangzhou
Bombardier Railway Transportation Equipment (Shanghai) Co. Ltd.
Established: in 2003
Bombardier Railway Transportation Equipment (Shanghai) Co. Ltd.
Established: in 2003
Bombardier Transportation Engineering Service (Beijing) Co. Ltd.
Established: in 2005
Bombardier Transportation Engineering Service (Beijing) Co. Ltd.
Established: in 2005
Bombardier Transportation Railway Equipment (Qingdao) Co. Ltd.
Established: in 2005
Bombardier Transportation Railway Equipment (Qingdao) Co. Ltd.
Established: in 2005
IPO (Shanghai) IPO (Shanghai)
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Hong KongHong Kong
BeijingBeijing
Bombardier Aerospace in China
Xi’anXi’an
Dash 8 Q100/200/300 DoorsSous-contract (SAC)
depuis 1986
Dash 8 Q100/200/300 DoorsSous-contract (SAC)
depuis 1986
ShenyangShenyang
Bombardier Aerospace Beijing Office
Bombardier Aerospace Beijing Depot
Bombardier Aerospace Beijing Office
Bombardier Aerospace Beijing Depot
CL215/415 Parts sous-contracts(XAC)
depuis 1980
CL215/415 Parts sous-contracts(XAC)
depuis 1980 Bombardier Aerospace Flexjet Asia pacific
& BBAD bureau de vente
Bombardier Aerospace Flexjet Asia pacific
& BBAD bureau de vente
ShanghaiShanghai
Bombardier Aerospace Shanghai Regional Aircraft Customer Support Office
Bombardier Aerospace Shanghai Regional Aircraft Customer Support Office
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Still transitioning from a
planned to a market economy
State sector is still important
Still a political aspect to many
large purchasing decisions
Central Government
approvals necessary for large
projects
Personal relationships remain
very important
Unique Environment
Economic growth
Emerging consumer society
Installed industrial base
Commitment to modernize and
improve = sales opportunities
• Industry
• Infrastructure
• Military
Many new and/or improving
suppliers – (Global Sourcing)
Unique Opportunities
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Xuzhou – Lanzhou (1400km)
Qingdao – Taiyuan (770km)
Beijing – Harbin/Dalian (1860km)
Beijing – Shanghai (1300km)
Intercity Transport Systems (2000km)
Beijing – Shenzhen (2230km)
Hangzhou – Shezhen (1600km)
Hangzhou – Changsha (880km)
Nanjing – Chengdu (1900km)
Notes
Dedicated Passenger Line
Existing Line
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China Urban Transit Market Overview
Existing
Beijing Shanghai Guangzhou
Shenzhen Nanjing
Wuhan
DalianHong Kong
Chongqing Changchun
Tianjin
Under Construction
Shenyang Xi’an Qingdao Suzhou
Hangzhou
Planning
Harbin Anshan Shijiazhuang
Chengdu Changsha Wenzhou
Kunming
Xiamen
Macau
State Criteria for Urban Metro Project
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Bombardier Aerospace is exploring several partnership opportunities in China
Bombardier is considering sourcing major aero structures from suppliers in China• Cost optimization
• Supplier development for future programs
• Better positioning for eventual market access
For example, active discussions are being held with the Shenyang Aircraft Company (SAC), which already supplies components to Bombardier, Boeing and Airbus
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Challenges and considerations:Ability to manage a fast and flexible supply chain
Supplier capability• Manufacturing at a high production rate
• Meeting western certification standards
Transportation environment• Inbound/outbound logistics
Business environment• Customs and other regulatory procedures
• Import/re-export of sub-components
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Some things we’ve learned
China: a big market opportunity, a big sourcing opportunity
China is not just for low-tech, high labour-content products
The Canadian Embassy and the Bureau du Québec à Beijing can be very helpful
• Understanding the market, making introductions, securing government interest/approval for your project if required
Importance of knowing basic Chinese history, culture, and business practices
Importance of “personal” relationships
• Chinese do business with the person first, then the company
Importance of understanding hierarchies and decision-making power
Three most important things: patience, patience, patience