(Reporter Liang Li) A number of rail transport routes crisscrossed in Malaysia witness the tremendous achievements of Chinese-funded enterprises catching the train of the "Belt and Road" initiative. CRRC has long been active in the development of infrastructure in Malaysia, and its wholly-owned subsidiary, CRRC Zhuzhou Locomotive Co., Ltd. (hereinafter referred to as CRRC ZELC) made outstanding contributions to Malaysia in rail transportation industry. One of the evidences is that CRRC ZELC was the only Chinese enterprise invited to attend the national Blue Ocean Strategy Carnival hosted by Malaysian Ministry of Finance in September.
CRRC ZELC and Malaysia have been "tied" for more than seven years, but both sides have not suffered "seven-year itch". After signing a value of 8.5 billion ringgit purchase of 22 EMU contract between CRRC ZELC and Malaysian Ministry of Transport on April 11, on August 2, the consortium led by CRRC ZELC and Malaysian infrastructure company signed a contract for 42 trains for Kuala Lumpur Light Rail Line 3.
"Product + Service + Technology + Investment + Management"
"The Malaysia Light Rail Line 3 project is the sixth whole-vehicle sales contract that CRRC ZELC has won in the Malaysian market." Xie Shuangying, Manager of Overseas Business Division of CRRC ZELC, introduced to 21st Century Business Herald reporter that this project is the first overseas export pilotless light rail project led by a Chinese enterprise. CRRC ZELC is the leader for the overall project management, overall vehicle design, non-localized components supply and vehicle manufacturing. Tegap Dinamik Company is responsible for localization, including localized procurement and supply of components and services, while Siemens China is responsible for the design of the vehicle's traction system.
He disclosed that this project will adopt fully automated driverless technology, third rail current collection, fourth rail return and other leading technologies. The vehicles will be formally put into commercial operation by 2020.
Rail transit equipment is a public goods which has character of high frequency of use, high abrasion, and strict maintenance requirements. The inter-city EMU will have quality problem without regular maintenance. In order to solve the trouble, in 2011, China’s first 4S shop for overseas rail transit vehicle——CRRC Kuala Lumpur Maintenance Co., Ltd.was established, which focused on the maintenance services for inter-city EMU.
"Compared with the traditional business model of exporting of vehicle CRRC ZELC has set up a new international operation of combine business model of product + service + technology + investment + management.”Xie Shuangying said.
In terms of localization, CRRC ZELC made many attempts. In response, Malaysian Minister of Communication Liao Chung-lei once said that with the help of CRRC ZELC, Malaysia has achieved to manufacture locomotives locally. The joint venture company provided Malaysia with a great deal of job opportunities and boosted Malaysia's economic development.
Currently, CRRC ZELC has three subsidiaries in Malaysia, more than 300 staffs and 80% of them are local employees, occupied 85% of market in Malyasia.It has now become the largest supplier of rail transit equipment in Malaysia.
"Two of the subsidiaries are focused on providing professional and efficient maintenance services for operators. Malaysian Rail Transit Equipment Co., Ltd. in Perak has the capacity to produce 200 new cars each year. It is the most advanced and largest modern rail transportation equipment manufacturing base in ASEAN region with most complete product line.. "Xie Shuangying said that after the establishment of Malaysia's rail transit equipment Co., Ltd., it filled the gap of Malaysia rail transit equipment manufacturing industry, which greatly improved the overall rail transport industry in the overall Level and the development of the industrial chain, and created nearly 150 jobs, and stimulated the development of local supporting industries and services.
In addition, CRRC ZELC has successfully entered Malaysian market by exporting EMU (electric / hybrid), light rail vehicles, electric locomotives, engineering maintenance vehicles and other products. The products exported to Malaysia by CRRC ZELC use the core components such as self-developed meters track bogie, articulated bogie and DK-2 brake system, and successfully applied for a patent in Malaysia.
China Provide Solutions by the Strategy of “Belt and Road Initiative”
The North-South Line Intercity Railway is one of the busiest public transport line in Kuala Lumpur and it is also the starting point for a "journey of cooperation" between CRRC ZELC and Malaysia. In 2010, the Ministry of Communication of Malaysia signed a contract with CRRC ZELC of nearly 4 billion RMB for inter-city EMUs. The first train was rolled out in 2011, reducing the departure interval from the previous 30 minutes to 7.5 minutes, which has changed the traffic conditions in Kuala Lumpur.
Malaysia has relatively complete infrastructure. The railway network runs through the Malay Peninsula. On May 21, 2016, Malaysian Prime Minister Najib Razakistan submitted the Eleventh Malaysia Plan (2016-2020) to Congress. One of the six major strategies of the plan is strengthening infrastructure and supporting economic expansion, which also means that the competition from Malaysia's domestic will become even more intense.
"The competition is fierce when we first entered the Malaysian market," said Xie Shuangying. The cooperation with Singapore in the dual-source metro project opened the prelude to cooperation with ASEAN countries, the Malaysian market still has its own unique features.
"On the one hand, Malaysia has strict requirements on product quality, technical management and document management. This requires suppliers to be fully familiar with international standards and international practices, and to manage the entire project with a high level of international business philosophy. "Xie Shuangying analyzed to 21st Century Business Herald reporter. On the other hand, Malaysia has a large number of relevant departments in the rail transit market. It’s important to construct relations and channels in Malaysia. It’s also important to have a good relationship with the organization to successful execute the project.
Malaysia plays a pivotal role in the "Belt and Road Initiative" strategy. "Since entering in Malaysian market in 2010,we have received 11 orders. Malaysia has no doubt to be our target market" said Xie Shuangying.
"Rail transit projects are characterized by large investment, long life cycle, high-end technology and construction difficulties.Many countries and regions along the Belt and Road can notdesign, construct and operate rail transit independently. They also face the problem of lack of funds, technology and management experience. Thus the development of rail transport is declined and they can’t meet the growing demand of travelling of local people. "Xie Shuangying also said that with the proposal of the" Belt and Road Initiative" and the support of relevant government departments, all the advantageous enterprises in China's banking and industrial chain, including design, civil engineering, equipment manufacturing, operation and management, will go out together and provide target countries with systematic China solution of financing + standard + construction + operation, which accelerate the progress of related projects and enhance the competitiveness of Chinese enterprises.