As the saying goes, "The whole year's work depends on a good start in spring; when people are diligent, spring brings early productivity." In this first month of the new year—a month that starts with a sprint and sets the tone for a decisive battle—all employees of Wanxiang Qianchao continue to embody Lu Guanqiu’s spirit, demonstrate a strong sense of ownership, and carry forward the spirits of model workers and entrepreneurs. Under the firm leadership of the Board of Directors, they take immediate action, stay true to our principles while embracing innovation, and have achieved a “strong opening” in the first month. All subsidiaries are making steady progress together; overall, in the first month, output value, revenue, and total profits increased by 10%, 10.14%, and 15% respectively compared to the previous year, laying a solid foundation for new development in the new year. Companies such as the Constant Velocity Drive Shaft Factory, Wanxiang Precision, and Wanxiang Marelli Shock Absorbers have even taken the lead by proactively preparing for future challenges and pursuing rapid development.

Pioneer the high-end market and inject new momentum.

In 2021, the constant-velocity drive shaft factory saw its revenue increase by 30.2% year-on-year, and its total profit more than doubled compared to the previous year. In January of this year, the company again achieved strong results, with revenue up 13.20% year-on-year and total profit up 43.02% year-on-year. Such outstanding performance is attributable to the company’s proactive and forward-looking market planning as well as its steady and thorough implementation of various optimization and improvement initiatives internally.

Actively exploring new markets and securing more high-end, cutting-edge projects is the cornerstone of the constant and stable development of the constant-velocity drive shaft factory. Under the leadership of the general manager, the company has been visiting customers, opening up new markets, developing new clients, and winning new projects—achieving remarkable results. For instance, with regard to Project B for the international high-end OEM manufacturer, the company proactively planned ahead, making great efforts in enhancing quality, boosting production capacity, and reducing costs. Not only did it deliver existing projects to the customer’s complete satisfaction, but it also secured the right to co-develop subsequent new vehicle models. By continuously breaking new ground and steadily expanding into key strategic international markets, the company has achieved a leapfrog improvement in overall efficiency. Each year, the company supplies over 100 projects to its customers, maintaining full-load operations throughout the year. Employees are united and highly motivated, driving performance to ever-new heights. The battle is fought in the market, but victory is won in the factory. Last year, the R production line—a digital platform for quality inspection—was put into operation at the constant-velocity drive shaft factory, further elevating the automation and digitization of quality inspection processes. This has not only enhanced the company’s competitiveness but also strengthened its position among key international strategic customers. At the same time, the company has continued to improve equipment utilization, optimize costs, and boost profitability. For example, the company organized personnel to retrofit the XG242 grinding machine—a dual-station, ball-race, spherical-surface grinder imported from Germany. After the retrofit, trial runs showed that production capacity increased by 15%, the defect rate dropped by 20%, and each piece of equipment saved 2 million yuan in external renovation costs. With all 11 units fully retrofitted, the company has achieved cost savings totaling over 20 million yuan.

Facing these achievements, General Manager Pan Wenbiao said: “In 2022, we will continue to strive for more high-end international projects and refine our medium- and long-term market development strategy. We must keep tapping into our internal potential in terms of managing people, finances, and resources; boldly promote young talents, expand career development pathways for employees, cultivate both specialized and versatile professionals, and develop a robust talent reserve strategy. We will also continue to strengthen our internal capabilities, make the most of all available resources, eliminate exclusive supplier arrangements and reliance on supporting collaborations, reduce procurement costs, substitute domestic products for imports, and replace imported technologies with domestically developed ones, thereby enhancing efficiency and profitability. Furthermore, we will continue to set benchmarks, build lighthouse factories, and aim to become one of the top three global players.”

In the first month of this year, Marelli’s shock absorber business achieved a 49% year-on-year increase in revenue and a 43.7% year-on-year rise in total profit. Behind this substantial growth is the company’s recent focus on cultivating key customers, expanding its supporting business with existing clients, and securing several new platform projects from OEM customers—resulting in an increase in the proportion of business from key customers from the original 40% to the current 85%. The company has also vigorously promoted the WCM lean manufacturing system, optimizing value streams and reducing process waste. As a result, the rate of lost direct labor hours has decreased by 10%, production capacity has risen by 42.8%, energy consumption per 10,000 yuan of output has fallen by 21%, and material consumption per 10,000 yuan of output has declined by 18%. Additionally, the company has optimized production planning control and logistics management, thereby improving on-time delivery rates to customers.

Promote digital and intelligent transformation to boost high-quality development.

Digitalization is Wanxiang Qianchao’s unwavering development direction. Starting from March 2021, Wanxiang Qianchao launched the digital and intelligent upgrade of its first batch of five factories, including Wanxiang Jinggong, Qianchao Bearings, and Qianchao Supply Chain. The aim is to build future-oriented factories and achieve digital and intelligent operations through the advancement of digital and intelligent engineering, thereby further enhancing Wanxiang Qianchao’s overall competitiveness. By the end of 2021, Wanxiang Jinggong and Qianchao Supply Chain had already achieved phased results, significantly boosting production efficiency. Among them, despite the impact of the COVID-19 pandemic in 2021, Qianchao Supply Chain saw its total revenue and profit increase by 67.31% and 34.79%, respectively, compared to the previous year. In January of this year, it once again recorded substantial growth, with total revenue and profit increasing by 52.69% and 76.29%, respectively, over the previous year.

Wanxiang Jinggong is a prime example of how Wanxiang Qianchao leverages digital intelligence to drive high-quality development. “In 2021, the National Ministry of Industry and Information Technology and the China Federation of Industrial Economics awarded Wanxiang Jinggong as one of the sixth batch of ‘Manufacturing Single-Champion Demonstration Enterprises.’ Hangzhou City designated Wanxiang Jinggong as a ‘Future Factory.’ Moreover, Wanxiang Jinggong’s wheel hub bearing unit digital workshop was recognized as a 2021 Zhejiang Provincial Digital Workshop, a key technological transformation project for enterprises in Hangzhou City, and a demonstration project for intelligent manufacturing in Xiaoshan District. These honors reflect the recognition of Wanxiang Jinggong’s unwavering commitment to promoting digital intelligence and serve as an affirmation of the achievements made in 2021. Driven by innovation, the future looks promising,” said Chen Weijun, General Manager of Wanxiang Jinggong.

In 2021, Wanxiang Precision achieved year-on-year growth of 13.95% and 87.84% respectively in revenue and total profit compared to the previous year. In January of this year, the company continued its outstanding performance from 2021, with both revenue and total profit reaching all-time highs, increasing by 7.24% and 16.20% year-on-year, respectively. The appeal of digitalization and lean production is evident! With a strong start in January, Wanxiang Precision has taken a new step forward in the new year, continuously advancing digital and intelligent technological innovation around the concept of the “Factory of the Future,” achieving product upgrades, technological iterations, and process optimizations. This has enabled the company to enhance per capita profitability, strengthen its competitive edge, and promote high-quality development. These efforts have laid a solid foundation for consistently achieving new milestones in the first quarter and the half-year period, smoothly fulfilling the annual targets and objectives.

In 2022, Wanxiang Qianchao will continue to step up its efforts, further improving labor productivity, enhancing OEE, and boosting gross profit margins. At the same time, we will accelerate the pace of digital and intelligent transformation, completing one central hub—the Digital Performance Control Tower—two major management platforms—the Financial Management Platform and the Human Resources Management Platform—four operational systems—the Market Operations System, the R&D System, the Supply Chain System, and the Production Operations System—and five QC-level demonstration lines—the 5S and Safety Demonstration Line, the Quality Benchmark Demonstration Line, the Dark Factory Line, the Dark Workshop, and the Future Factory. Through digital and intelligent transformation, Wanxiang Qianchao will continuously enhance resource utilization efficiency and production operational efficiency, shorten order delivery cycles, swiftly meet customer needs, achieve sustained growth, and create new glories once again.