On the morning of March 2, 2024 at 10:00, the SINOTRUK 2024 Science and Technology Innovation Awards Ceremony was grandly held at the Shandong Hall. Tan Xuguang, Secretary of the Party Committee, Chairman and President of Shandong Heavy Industry Group, and Chairman of SINOTRUK, delivered a technological innovation report titled Wholeheartedly Embracing Technological Transformation at the ceremony. The full text is as follows:
Wholeheartedly Embracing Technological Transformation
A Work Report at the SINOTRUK 2024 Science and Technology Innovation Awards Ceremony
Tan Xuguang
(March 2, 2024)
Dear engineers,
Today, were holding the SINOTRUK 2024 Science and Technology Innovation Awards Ceremony to commend major technological achievements and outstanding innovative talents. First of all, I would like to extend warm congratulations to the teams and individuals who have been recognized on behalf of Shandong Heavy Industry Group and SINOTRUK! I would also like to express heartfelt thanks to Jinan Municipal Party Committee and Municipal Government and the people of the city for their long-term care and support!
On September 1, 2018, the Shandong Provincial Party Committee and Provincial Government, as well as the Jinan Municipal Party Committee and Municipal Government, made a historic and strategic decision to restructure Shandong Heavy Industry Group and SINOTRUK! At that moment, the global commercial vehicle industrys attention was drawn to Shandong Heavy Industry and SINOTRUK, as well as to Jinan, Shandong. In just half a month, the stock price of SINOTRUK doubled, indicating the international capital markets high recognition and expectations for its strategic restructuring! Over the past five years of restructuring, SINOTRUK has undergone a profound transformation. The greatest change has been in technological transformation, and greatest success has been in technological advancements!
Next, let me discuss three aspects.
I. The five-year technological transformation has earned global industry recognition
1. Over the past five years, our technological innovation capabilities have reached the forefront of the industry
SINOTRUK has invested a total of RMB 15 billion in R&D over the five years, surpassing the total investment of the 15 years before the restructuring, and gained top-notch capabilities in collaborative design, virtual simulation, automotive electronics and intelligent connectivity, completely changing SINOTRUKs conservative mindset of being reluctant to spend money and not daring to "spend moneylavishly" on technological innovation. The group aims to benchmark against world-class standards to comprehensively promote the reconstruction of the R&D system, and gradually establish a full-process autonomous and forward-looking R&D system, so as to solve SINOTRUKs long-standing problem of relying on imitation and introduction of technology. For the future, the group has increased investment and efforts in frontier and basic research, to fundamentally address SINOTRUKs passive competition problem of lacking a leading and forward-looking technological layout. By integrating the resources of Shandong Heavy Industry Group and the global supply chain, as well as the upstream and downstream industrial chains, and establishing the "Three Institutes and Two Centers", our R&D personnel have made great efforts to completely break the decades-long rigid and closed mechanism of the R&D system. Today, we are able to announce confidently that SINOTRUKs technological strength has reached the forefront of the national industry and can compete for the global commercial vehicle technology stage!
2. Over the past five years, we have reshaped the "Yellow River" heavy-duty truck with technology and ranked No.1 in China
The "Yellow River" brand was created by the people of Jinan with their efforts, carrying the infinite hopes of several generations and appealing to the "industry heart" of the citizens. On September 16, 2020, we released the new generation of "Yellow River" commercial vehicles, reshaping the "Yellow River" heavy-duty trucks and leading the industry with high-tech indicators. We independently developed the first domestic hydrogen fuel cell "Yellow River" snow wax vehicle. On January 4, 2022, General Secretary Xi Jinping boarded our "Yellow River" snow wax vehicle during his inspection of the Winter Olympics, indicating the supreme honor for all of us at SINOTRUK! We have accumulated a total of 2,919 patents in five years, accounting for 65% of the total patents. We have sold a total of 263,000 "SITRAK" vehicles in five years, which is 12 times the number before the restructuring, making the brand our ace in competing with international first-class brands in the overseas high-end market! The new-generation Howo MAX became an instant hit, with a cumulative sales of 27,600 vehicles after its launch in 2022. Howo Tongshuai light truck achieved modular design for the first time, and its market share in the high-end light truck market increased by 7.4 percentage points in 2023. The market share of heavy-duty trucks increased from 16.5% in 2018 to 26% in 2023, ranking number one in China for two consecutive years. The export sales volume exceeded 130,000 vehicles in 2023, a 2.6-fold increase compared to five years ago, making it the largest single-brand global export volume! With products and technologies as the focus, we have survived from the "rat race" in the global market and successfully achieved the dual firsts in the global industry, becoming a strategic force leading the Chinese heavy commercial vehicle industry towards the world!
3. Over the past five years, we have provided strong support for high-quality development with our world-class intelligent manufacturing
Significant equipment upgrades, major process improvements, and major project constructions have accelerated comprehensively. With an investment of RMB 15 billion, we have built the Shandong Heavy Industry Group (Laiwu, Jinan) Green Intelligent Manufacturing Industrial City Project and the SINOTRUK Intelligent Networking (New Energy) Heavy-Duty Truck Project, creating the miracle of starting construction and production in the same year, and setting a benchmark for major project construction in the provinces transformation of old and new driving forces. More than ten major projects, such as the intelligent production line of Zhangqiu Commercial Vehicle Company, the new generation of light-duty trucks and pickup truck intelligent production lines, have been completed, leading the industry in intelligent control capabilities for the product production process. When I first arrived at SINOTRUK in 2018, I saw frontline technicians and craftsmen working in temperatures as high as forty to fifty degrees Celsius, and that image struck me like a sharp needle, piercing into my heart. Five years have passed, transforming from dim, dirty, and messy old workshops into clean and modern workshops; from labor-intensive tactics to intelligent production; from sweating in summer and frozen hands in winter to maintaining a constant temperature throughout the year, our frontline technicians and craftsmen have truly felt the improvement in environment, the convenience of technology, and the warmth of the company! The process equipment of SINOTRUK has been completely transformed, going from labor-intensive traditional manufacturing to becoming the industrys first world-class unmanned factory, which has pre-reserved unlimited potential for future development!
4. In the past five years, we have achieved a qualitative shift in the ecosystem of our technological workforce, from waiting to take action to actively seizing opportunities.
During this period, we have made significant and high-quality recruitment of graduates from "Double First-Class" universities and top talents both domestically and abroad. The number of research personnel has grown from over 2,200 to over 7,400 today. Among them, the number of masters degree holders has increased from 790 to 2,760, and the number of doctoral degree holders has increased from 9 to 79, greatly enhancing the internationalization, youthfulness, and knowledge level of our team. SINOTRUK has implemented stock incentives on a large scale for the first time in its history, covering 140 core technical professionals, accounting for 72% of all incentive beneficiaries. This has completely shattered the mentality of "egalitarianism, envy, mediocrity, and hierarchy", and we are leading the industry in exploring assessment and incentive mechanisms based on virtual value creation. In 2023, the income gap in performance evaluations and incentives for our technological personnel had widened to more than 20 times. With every new reform pilot, every new business platform, and every favorable policy, we have provided everything we can think of, everything we can do, and everything that is best for you, breathing new life into the stagnant old ecosystem. We have ignited the spark of innovation, blazing brightly in the fertile soil of SINOTRUK!
However, while celebrating our achievements, it is crucial to realize, in the era of AI models, big data, and new energy, that we must carefully evaluate our own R&D capabilities. We still have a significant technological gap with world-class benchmark companies, and the development of our three new businesses does not match our industry position. The innovative passion and fighting spirit of our research personnel still fail to meet the requirements of the markets tremendous changes. We must deeply reflect on these issues and thoroughly transform ourselves.
II. SINOTRUK aims to redefine the future of the global commercial vehicle industry with disruptive technology.
SINOTRUK must take on the responsibility of leading the industry and becoming a pioneer in the groups strategic implementation of complete vehicle and machine, in order to achieve the trillion-yuan goal set by Shandong Heavy Industry Group.
1. We must achieve overtaking in bends in the era of artificial intelligence.
In the AI era, if we dont actively revolutionize ourselves, the market will definitely revolutionize us. We must actively embrace artificial intelligence and quickly establish an artificial intelligence research center in the field of commercial vehicles, focusing on 120 business scenarios. We should take the lead in researching the application of AI large models in intelligent driving, human-machine dialogue, generative design, predictive diagnostics, and other areas, and build an AI new technology engineering system. We need to equip SINOTRUKs "SITRAK" and "Yellow River" vehicles with "cloud brains". R&D investment in the next five years should continue to grow at a double-digit rate, with the investment intensity increasing from 3% to 5%, reaching a world-class level. Over 30% of the investment should be used for cutting-edge basic research and AI application research. We want to use intelligent new technology to recreate a new SINOTRUK. The AI era has arrived, and if we dont change, we will perish! The first thing we need to do is to quickly accept new things, and we must not just watch the show! We absolutely cannot pretend to understand without really understanding! We absolutely cannot just talk without taking action!
2. We must proactively redefine ourselves in the era of new energy.
We need to take a dialectical view of traditional energy and new energy. New energy is not a panacea for all problems, and internal combustion engines will still have strong vitality in the next hundred years. Traditional heavy-duty trucks will continue to exist for a long time. The group has irreplaceable core technological advantages in powertrain in the global industry. SINOTRUK needs to seamlessly integrate with the groups overall advantages and build a world-class commercial vehicle brand. The new energy commercial vehicle business needs to have a diversified layout and focus on the "new" aspect. We need to find our own focus points in the rapidly evolving new energy technology roadmap. We are willing to spend more money and reserve more technology. We must not take the wrong path or lose our technological direction! We cannot blindly follow trends, go with the flow, or be confused. We must steadily forge our own path of new energy development and achieve the simultaneous development and mutual enhancement of new energy and traditional energy. In the competition, the one who can have the last laugh will be the winner!
3. We need to build a global innovation chain through independent and self-reliant technological progress.
With a global vision, open thinking, and systematic concept, we must fully utilize the R&D resources of the whole group and the entire industry chain, and build a high-level chain innovation system that can adapt to future global competition. We should focus on areas such as new energy heavy-duty trucks, autonomous driving, and whole-vehicle quality inspection, and strive to create more national-level innovation platforms. We should build overseas body styling centers and whole-vehicle R&D centers to the highest standards, closely coordinate with Weichai Groups top ten global R&D centers, strengthen resource sharing, platform construction, and cooperative research. We should deepen the integration of industry, education, research, and application, collaborate with domestic and international industry chain and supply chain partners, establish a commercial vehicle research and development community, and expand exchanges and cooperation with world-class companies such as Germanys MAN, Bosch, ZF, and Swedens Scania. We need to strive to gain all possible policy support, valuable global resources, and cooperation partners, bring them all back without missing a single one, and include them in our own basket!
4. To embrace the technological revolution, we must first promote the talent revolution.
Talent is the strongest cornerstone for SINOTRUK to build a century-old technological powerhouse. Currently, the biggest bottleneck restricting our rapid development is the shortage of various high-end talents. We must simultaneously attract and cultivate talents on a large scale and with high standards. The research team of the group should double in size to reach 15,000 people. The number of science and technology talents in three new fields should exceed 5,000. The number of strategic scientists, excellent engineers, and industry leaders should exceed 100, and we should cultivate a team of technology commanders who can lead and make a name for themselves at home and abroad. We should take the lead in implementing the "New Level 8 Worker" system in the industry, with over 5,000 highly skilled talents, and spare no effort to create a new ecosystem where research staff can "take on the important tasks and play the leading roles". I still insist that we will do as the R&D personnel want, we will enable as they require, and we will award them for their achievements!
III. Passing down the spirit of engineers from generation to generation
General Secretary Xi Jinping pointed out that the engineer team is an important force in promoting engineering science and technology for the benefit of mankind and promising future, and also a vital component of the national strategic talent force. On January 19 this year, we won the National Engineer Award. This is the highest recognition from the Party Central Committee and the State Council for all engineers in our group! It is the greatest affirmation for the scientific and technological innovation of the group! It is the collective glory of all engineers in the group!
At the Weichai Science and Technology Innovation Awards Ceremony, I comprehensively explained the core of the engineer spirit, that is the pursuit to apply the China power assembly in the whole world, the value pursuit of "not striving for first place equals to fooling around!", the persistent belief of achieving one goal in a lifetime, and the overall consciousness of open and collaborative teamwork.
- Unchanging dream of SINOTRUK to make Chinese commercial vehicles lead the world
In 1960, our group manufactured Chinas first heavy-duty truck under the background of poor industrial and scientific foundation. Chairman Mao Zedong highly praised our work as "the spirit of self-reliance and hard work of our Chinese people!" After 60 years, we have reshaped the "Yellow River" heavy truck with new technology, making our national brand stand tall and firm in the East once again. The engineers of SINOTRUK always bear the dream of "manufacturing heavy trucks for the motherland" in their mind, and have passed down the dream over generations in SINOTRUK, giving us the strength and confidence to strive for world-class status. We shall uphold the dignity of Chinese commercial vehicles, forge ahead with determination, and strive for new heights. Our goal is to make Chinese heavy-duty trucks a global presence, and bring light-duty trucks and pickups out of China to compete and cooperate with international top-tier brands in the global high-end market!
- Value pursuit of "striving for the first" of SINOTRUK, to stand at the forefront of global industry technology
Under the trend of technological revolution and global technological competition, we are not allowed to stop moving forward or to have a moment of slackness. Every engineer of SINOTRUK must have the ambition to be the best and catch up with the top, and the resolution to develop more innovative products that lead, change, and overturn the industry, to create an indisputable technological advantage for SINOTRUK. We must shoulder the burden of leading the Chinese commercial vehicle industry and serving as the industry chain leader, firmly seizing the initiative to make technological development and the fate of enterprise development in our own hands! Only by striving for the first and always moving forward can we make great strides in the fierce market competition and truly conquer all challenges!
- Persistent belief of SINOTRUK in achieving one goal in a lifetime, detailed to drawing and screwing
SINOTRUK has gone through 94 years of trials and tribulations, and many engineers have dedicated their entire lives to its factories, and devoted their painstaking effort and most beautiful youth to their beloved technological career, achieving historic milestones in ordinary positions. The engineers of SINOTRUK must have the spirit of wholehearted dedication, steadfastness in research, endurance in loneliness, and the ability to stay true to their original aspiration, as well as the ambition to become technical experts, industry authorities, and outstanding engineers. The breakthroughs made in technology, research achievements, and developed products are their best endorsements! Achieving something in a lifetime on one platform will be the greatest joy!
- Overall consciousness of SINOTRUK, seamless collaboration throughout the entire chain, inheritance between the elderly, middle-aged, and young
As the era of individual combat has gone, all engineers must embrace an open, trusting, and collaborative mindset to strengthen collaborative innovation, and take their own responsibility respectively at their position, complement each other, gathering a powerful force of collective wisdom. The experienced members of the R&D system should willingly serve as the helper, passing on their experience and spirit without reservation. The middle-aged and young engineers should dare to think and act, shoulder responsibilities, and become the backbone of technological innovation in the company. It is necessary to completely break free from the constraints of the technological system, allowing young engineers to explore boldly in risks! As long as everyone thinks and works hard towards the same goal, SINOTRUK will make technological achievements continuously like the spouting Baotu Spring in Jinan! Our technological vitality will roll ahead ceaselessly like the Yellow River!
Engineers of SINOTRUK!
You are the backbone of the company and the hope for the future. Everyone shall remember General Secretary Xi Jinpings instructions, strive to make technological breakthroughs, and courageously innovate to contribute to achieving high-level technological self-reliance. This is an unshirkable duty for every engineer! It is also the striving goal for a lifetime!
Engineers of SINOTRUK!
Each and every one of you is a protagonist in the century-long scientific and technological undertaking of SINOTRUK. I hope you will stay grounded, persistently innovate, achieve long-term success through years of hard work, absorb nutrients through global cooperation, and grow and excel through project challenges!
Engineers of SINOTRUK!
You are the most innovative, passionate, and energetic young team in the group. I hope you can achieve a wonderful life together from continuous value creation, and strive to make SINOTRUK a world brand and century brand with infinite youthful vitality, struggle, and passion!
Come on, fellows! The future of SINOTRUK will be created by all of you!
Thank you
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