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As of May 2006, Beiqi Foton Motor Co., Ltd., which had been in operation for nearly a decade, had produced and sold over 1.5 million units, generating approximately 90 billion yuan in sales revenue. It had become China's largest commercial vehicle manufacturer, boasting the most comprehensive range of vehicle types. Its light trucks had ranked first in the industry for seven consecutive years. Additionally, Foton had established assembly plants in countries such as Pakistan, Ukraine, and Turkey. Since its automobile exports began in 2002, it had exported more than 20,000 vehicles, becoming the top exporter of commercial vehicles in China and earning over $100 million in foreign exchange.
When Beijing Foton Motor Co., Ltd.'s Party Secretary and General Manager Wang Jinyu shared these figures with Fu Dada, it was remarkable that all over 1.5 million vehicles were self-innovated, branded products with full intellectual property rights. Fu Dada asked why Foton had such strong innovation capabilities. An Qingheng, the Party Committee Secretary and Chairman of BAIC, gave a straightforward answer: "The integration of knowledge and innovation in a linked model is a unique approach to independent development and innovation at Beiqi Foton."
Vitality: Enterprise innovation must align with industrial trends
If we consider the engine as the driving force of a car, then enterprise innovation aligned with industrial development brings infinite vitality. On April 28, 2006, Foton signed a strategic alliance agreement with Beijing Weichai Power, China BOSCH, and Austrian AVL in the Great Hall of the People in Beijing. This new international strategic alliance aimed to target the latest global developments in commercial vehicles and introduced a new model of integrated knowledge and linked innovation in China’s automotive sector.
Wang Jinyu explained that the core of “integrated knowledge and linked innovation†lies in achieving mutual complementarity, resource sharing, and collaborative development through cooperation across the entire industry chain. The companies involved are not just partners but a community of shared interests. Innovation is not a solitary effort but a collective achievement.
Foton has closely tied its own innovation with the broader industry, which has led to its success and driven the growth of China’s commercial vehicle industry. This alliance has created significant impact within the Chinese auto industry, promoting joint innovation and win-win development.
The four companies in the alliance each hold strong positions in their respective fields. Foton is China’s largest commercial vehicle manufacturer, Weichai Power is the country’s leading diesel engine producer and a Tier 1 supplier to Foton, while Germany’s BOSCH is one of the world’s largest industrial companies and a secondary supplier. Austrian AVL is a high-tech multinational group specializing in engine research and testing equipment, serving as a third-tier supplier.
“Alliance is a tactic, but ‘integrated knowledge and linked innovation’ is a strategy,†said Wang Jinyu. “It is the core of Foton’s 10-year development plan and future direction.†Foton’s focus is not only on building heavy-duty commercial vehicles and strong brands, but also on integrating the upstream and downstream parts of the automotive industry chain to enhance overall competitiveness.
Over the past 10 years, Foton has manufactured and sold over one million commercial vehicles through independent innovation, contributing more than 3 billion yuan to the national economy. According to industry ratios, Foton has generated a pull effect of nearly 400 billion yuan on upstream and downstream industries.
Market: The foundation of independent innovation
Foton always takes market demand as the cornerstone of its independent innovation, ensuring that innovations are effective and can be successfully transformed into marketable products. This approach has brought significant social and economic benefits to the company.
In R&D, Foton has partnered with foreign institutions like AVL, Lotus, MIM Design, Motorola, Westone, and Eaton. They collaborate with suppliers on key components such as interior systems, transmissions, axles, and engines. In manufacturing, they implement TPS (Toyota Production System) with Japan’s Chunghwa Industries. In brand management, they have signed agreements with Mercedes-Benz, planning a dual-brand strategy in future joint ventures.
Foton has also taken a market-oriented approach in asset operations. Without direct state investment, it has achieved leapfrog development by leveraging state-owned shares. Its asset restructuring has been a success in the Chinese auto industry, revitalizing state-owned enterprises and solving employment issues for thousands of workers.
Each product and brand from Foton is the result of integrating the best available technologies and resources. They emphasize internal system integration and project-based collaboration to strengthen their core competitiveness.
Talent: The heart of independent innovation
Wang Jinyu emphasized that the “integrated knowledge and linked innovation†model relies on learning, absorbing, and applying the most advanced global technologies. The ability to attract global talent and break through key technologies is crucial for Foton’s development.
One such talent is Qi Xuebin, a 41-year-old Chinese-American expert in chassis and braking systems who previously worked at GM and Ford. He joined Foton in 2003 and now serves as Chief Designer and Dean of the Automotive Engineering Institute. Under Foton’s innovation model, R&D teams operate efficiently, focusing on cost-effective and innovative project organization.
Foton has invested 3 billion yuan in technological innovation over 10 years, resulting in 152 patents. Over 80% of new products' value comes from these innovations. Product development cycles have been shortened to 3–5 years, enabling the launch of eight major brands between 2002 and 2005, significantly advancing China’s commercial vehicle industry.
Foton has created a harmonious environment for talents, where returnees and local researchers work together to achieve remarkable results. For example, when Foton proposed a minor change to a U.S. standard for seat adjusters, the company’s ownership of the intellectual property allowed immediate implementation—something rarely seen in other organizations.
Wang Jinyu stated that Foton’s goal for the next 15 years is to provide the Chinese with the best tools to make money and become one of the world’s largest commercial vehicle manufacturers. To achieve this, Foton has developed a multi-generational product structure, an international R&D team, and a robust innovation support system, all part of its “Eleventh Five-Year Plan.â€
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