On July 7, last year, the initial application of Tianrun Crankshaft Co., Ltd. (hereinafter referred to as Tianrun Crankshaft) was approved by the Issuing Committee of the China Securities Regulatory Commission. As the leading product of Tianrun Crankshaft is a heavy engine crankshaft, its downstream customers are domestic heavy truck manufacturers. Therefore, the company's business is affected by the fluctuation of the downstream heavy truck market. Since the second half of last year, the inflection point of China's heavy-duty truck industry has suddenly emerged, and sales of heavy-duty trucks have been negative year-on-year for five consecutive months. In the face of the drastic changes in the industry, Tianrun crankshaft's operating conditions in 2008 are worrisome. In order to understand the company's operating conditions in detail, the reporter specially flew to the company's location in Wendeng, Shandong, for investigation. The company’s staff reported that due to the reduction of large customer orders, the company had incurred a loss in October last year, and the rate of subsequent start-ups has dropped significantly. The employees only work 4 days a week. ã€Site investigation】 Order reduction employees "do four rest three" The reporter learned from a field survey in Wendeng City, Shandong Province, where Tianrun Crankshaft was located. Since the end of October last year, due to the reduction of large customer orders, the company's operating rate has dropped significantly, and employees began to implement a work schedule of four days a week and a three-day break (Monday). Go to work on Thursday, and close on Friday to Sunday). Compared to the sales in the first half of 2007 and the first half of 2008, front-line employees had to work overtime on Sundays. There was a huge difference between them. Sales Manager: Not laid off is not bad The Tianrun Crankshaft is located at No.2 Tianrun Road, Wendengying Industrial Park, Wendeng City. On the day the reporter arrived, the local area is snowing, and the north wind blowing is graded 6. In the snow and snow, the entire industrial park looks particularly deserted. The reporter found the company’s sales manager based on business cooperation. During the chat, he complained to reporters that under the economic crisis, the sales of the entire automotive industry was sluggish in the second half of 2008, and the business of heavy trucks was even lighter. Many downstream engine manufacturers reduced their demand for goods, thus completing the company’s sales tasks. It becomes very difficult. "Since the fourth quarter of last year, the load of our major customers, such as Weichai and Dongfeng Cummins, has been significantly reduced. There are fewer heavy trucks on the road, and even less are the people who buy cars. Large customers to control inventory, to our In order to reduce the volume of goods, our company has to take extraordinary measures to deal with it." He said that since there was no business, from the end of October 2008, the company’s front-line workers implemented a four-day work week. "Starting less, everyone's income decline is self-evident. I often hear the workers confiding to each other: I had no rest during the past 7 days of work. I am now very busy. The environment is not good and I haven't been laid off. I estimate that it may be difficult to resume full production in the first half of this year." Employees: Subscriptions for newspapers are reduced Subsequently, the reporter again “mixed in†with the company’s heavy-duty engine crankshaft production workshop. He saw nearly half of the group’s machines in production and the other half in a “resting†state. The overall operating rate was less than 50%. When the reporter asked a workshop supervisor, he learned that the company now completely arranges production according to the order. If there is no order, the production line will be shut down. “Not only are there fewer orders, but the volume of each order is also reduced. Now, even if some workshops are started, hundreds of crankshafts will be used at a time. In the previous year’s end of the season, it was sometimes started at tens of thousands. ." Another company official also complained that due to the low operating rate, the frontline workers in the production workshop (including workshop supervisors) can only receive 550~650 yuan a month. "Now the company is trying its best to save money, and the company's financial staff told us that there is no special application, and in principle, the company that wants to ask for money (the supplier) must be pushed backwards. Now even the newspapers that are subscribing have been reduced. For the company's "four rest three" rest system, he told reporters that this is a last resort, if the product is produced and sold out, it will only lose more. Secretary-in-Chief: No interviews during quiet period Regarding the above issues, the company’s board secretary Xu Chengfei said in a telephone interview with “Daily Economic News†that he could only say that the company’s overall sales in 2008 were better than in 2007, but they did not answer the actual performance in 2008. When asked by the reporter about the company's 2008 semi-annual report and the performance of the first three quarters and the decline in the operating rate, he refused the reporter’s interview on the ground that it was currently in a silent period and it was not convenient for the public to disclose relevant information. Since then, the reporter also called the company's secretary Xu Chengfei phone no less than 20 times, but has not been able to contact. ã€management analysis】 The biggest risk: Downstream heavy truck market sales decline In 2007, Tianrun crankshaft heavy engine crankshaft in the supporting market share of about 37%, ranking first in the industry. As heavy-duty engine crankshaft production and sales have played a pivotal role in the day-to-day operations of Tianrun Crankshaft, the company in its “Page 20†of the “Prospectus†has taken the market fluctuation risk of the heavy-duty truck industry as the company's greatest possible business risk: “ The operating status of the company is greatly affected by the market fluctuations in the automotive industry, especially the heavy-duty truck industry.†Industry insiders believe that the performance decline of the Tianrun crankshaft in 2005 is likely to be staged again. Downstream sales decline According to the recent research report of Qin Xuwen, senior analyst of Orient Securities Automotive Industry, since July last year, China's heavy truck market has shrunk dramatically. From July to November 2008, sales of heavy trucks increased negatively year-on-year for 5 consecutive months, of which, sales were only 18,490 units in November, which was a substantial decrease of 6,453 units from October. The CICC research also showed that in November 2008, the sales volume of the heavy truck industry was less than the sales volume of China National Heavy Duty Truck, Dongfeng Motor, and any single company in the FAW Group in April of the same year. This was in line with the scenario of China's heavy truck sales in the first half of the year. In stark contrast. If compared with 2005, 2006, and 2007, sales of heavy trucks in November 2008 were less than half of the same period in 2007, about two-thirds of the same period in 2006, and they were close to sales in the same period in 2005 (17,385 units). If the declining trend of heavy truck sales in December continues, it will most likely fall below the sales volume for the same period in 2005. Tianrun Crankshaft specifically pointed out in the "Prospectus" that because the company is located in Shandong, and Weichai Power and China National Heavy Duty Truck are all located in Shandong, these customers in close proximity to the Tianrun crankshaft provide unparalleled regional advantages. However, at the moment, it is precisely because of the close proximity that Tianrun's crankshaft may be able to feel the chill of the industry more easily in the light period of downstream business. According to the monthly sales and sales report released by China National Heavy Duty Truck, since the second half of 2008, with the industry declining, the sales of heavy-duty trucks, which are the industry leader, have shrunk month by month. From March to June of 2008, the sales volume of heavy truck trucks of China National Heavy Duty Trucks Co., Ltd. was 10,000 units in each month, and 13858 vehicles were available in June. By July, sales volume dropped to 5,201 vehicles, which was less than 40% of that in June. From October to December, the company sold only 9,799 vehicles in 3 months, which only accounted for about 70% of the peak period in June. CICC once stated in its “Investment Strategy for the Automotive Industry in 2009†that the sales of heavy trucks in the second half of the year have experienced an unprecedented plunge, which is related to the implementation of State III emission standards to some extent. Starting from July 1 last year, China began to implement the National III emission standards for medium- and heavy-duty commercial vehicles and light commercial vehicles of over 3.5 tons nationwide. As the national III emission standards led to a 10% to 15% increase in the cost of related commercial vehicles, consumers choose to buy ahead of time when there is a demand for transportation, resulting in a high sales volume in the first half of 2008. In the second half of last year, the implementation of the country III emission standards, coupled with the sharp decline in transport demand, commercial vehicle sales have declined. (Note: Commercial vehicles are divided into trucks and buses, while heavy trucks belong to the category of trucks.) It seems that the situation experienced by the heavy truck industry in the second half of last year was strikingly similar to that in 2005. It was also due to the combination of the new national standards implementation and the declining demand. The heavy truck sales were in a slump. Or reproduce the decline in 2005 The downturn in the end market has made businesses in the entire industry chain no longer. CICC mentioned in the “Investment Strategy for the Automotive Industry in 2009†that under the background of a sharp drop in demand, the capacity utilization of the heavy truck industry will inevitably decline. In 2007, the utilization rate of heavy-duty vehicles and engines was all around 90%, but the utilization rate of the industry in 2008 was expected to be less than 50%. Some industry veterans told reporters that the macroeconomic downturn caused by the decline in the heavy truck market is far more than in 2005. If the industry's capacity utilization rate drops to around 50%, the capacity utilization of Tianrun's crankshafts in the next two years will most likely be even lower than the 80% level in 2005. The fact that the reporter saw the fact that the company is still busy seems to confirm the story of the veteran. The person also said that when the company's capacity utilization rate decreased, the company's scale effect weakened, and the main product gross margin would also decline. It seems that the history of the sharp decline in the gross profit margin of the company's main business in 2005 may again be staged. Because the company’s secretaries refused to disclose the company’s operations and performance in 2008 during the interview, the reporter could not be informed of the company’s accurate performance. However, in an interview with a reporter, an informed source who knew the company’s situation revealed that the overall sales of Tianrun crankshafts in 2008 may be better than in 2007, mainly due to the significant increase in sales from January to April 2008. However, since the second half of 2008, the company's business volume has dropped sharply due to a sharp contraction in downstream demand. From October onwards, the company may suffer losses. He lamented: "This crisis has come so suddenly that it was not anticipated by the management and all of us. The company's production was relatively normal in September 2008, but since October, the company has basically no orders, as if it were a world The end of the day was the same.†For this person’s disclosure, the reporter had repeatedly called the company’s secretary of the board, Xu Chengfei, to confirm this, but until the reporter’s draft last night, his cell phone was still in a state of no answer. [News background] Tianrun crankshaft in 2005 "robbery" The reporter found in the reference data that China's heavy truck market experienced an adjustment in 2005, the demand for the entire truck market fell sharply, and Tianrun's crankshaft operation business was greatly impacted in that year. The company's output, capacity utilization, and main business gross profit rate were both The high peak period dropped sharply. In particular, the gross profit margin of the main business plummeted from 26.79% in 2004 to 19.75% in 2005. Until 2007, the gross profit margin of the company's main business did not return to its 2004 level. Relevant data show that in 2005 China began mandatory implementation of the national standard GB7258-2004 (motor vehicle operating safety technical conditions) and GB1589-2004 "road vehicle outline dimensions, axle load and quality limits", which produced heavy truck sales in China that year. With great influence, some models of vehicles are no longer favored, and some consumers have a wait-and-see mood. The annual sales of heavy trucks have dropped by about 40% compared with 2004. “Tianrun Crankshaft Prospectus†also mentioned on page 243: “In 2005, the state promulgated a series of policies and regulatory measures including oversizing overload, regulating vehicle exterior dimensions, loads, and overall quality to regulate heavy trucks. The uncertainties caused by the implementation of the new policy have affected the purchase decision of potential buyers and led directly to a sharp decline in the market demand of the entire truck industry in China in 2005. As a result, the company’s capacity utilization rate in 2005 dropped to 80.56. %, of which the most influential is the company’s leading product heavy-duty engine crankshaft, production and sales fell by about 50%, resulting in the company's main business gross margin decreased sharply compared with 2004.†From the following “Tianrun Crankshaft Capacity Utilization Ratio and Comprehensive Gross Margin Table†from 2004 to 2007, it can be clearly seen that in 2005 the company’s crankshaft output was only 362,500, a significant drop of 19.7% from 2004; the utilization rate of the production was 80.56 %, a significant decrease of 19.77% over 2004; the gross profit margin of the main business also decreased to 19.75%, which is a 7.04% decrease from 2004. From the table, we can also see that the impact of heavy-duty truck market adjustments on the company's performance in 2005 was also very strong. The company’s crankshaft production, capacity utilization, and main business gross profit margin were still lower in 2004 than in 2004. By 2007, the company’s The main gross profit margin has not recovered. Shandong Buluoer Intelligent Technology Co., Ltd. has carved a remarkable niche in the market for manufacturing, wholesaling, importing, exporting and retailing a high-quality range of Welding Accessories. Offered products range consists of Plasma Cutting Machines, Manual Metal ARC Welding Transformers and Welding Machines. Our complete product range is manufactured under the supervision of trained personnel who use the utmost quality raw material. The offered range is largely used for welding purposes in many industries like automobile, construction, pressure vessels, and earth moving equipment, pre-engineered building, and others.
Being a client oriented firm, we offer products as per client need. In addition to this, we have incorporated advanced methods of production, which have enabled us staying on pace with the rising industrial challenges. Also, we have a long list of clients.
Cutting samples
Plate Cutting Machine,Gantry Plasma Cutting Machine,Gantry Cutting Machine,Plate Plasma Cutting Machine Shandong Buluoer Intelligent Technology Co., Ltd. , https://www.buluoercuttingmachines.com
