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RCEP free trade agreement helps Chinese engine manufacturer gain momentum

23. June 2022

Engine manufacturer Guangxi Yuchai Machinery Group Co, Ltd, or Yuchai, plans to introduce environmentally friendly powertrains for foreign markets in the coming years. The leading Chinese internal combustion engine manufacturer made the announcement recently after the Regional Comprehensive Economic Partnership (RCEP) free trade agreement took effect in early January 2022. RCEP, the world’s largest free trade agreement, involves 15 countries, mostly from Southeast Asia. In addition to the markets covered by RCEP, Yuchai is also looking to expand its presence in Africa, the United States and the European Union. The company is also expanding its research capabilities to offer economical, durable and high-performance engines to global customers. Applications for Yuchai’s engines range from trucks, buses, ships, and power generation to agricultural and construction machinery and manufacturing industries. Yuchai was founded in 1951 and employs about 15,000 people. Currently, the company operates more than 30 subsidiaries with total assets of 50 billion yuan ($7.84 billion). The company has production sites in many provinces in China, including Guangdong, Jiangsu, Anhui, Shandong, Hubei, Sichuan and Liaoning. Vehicles and components must be awarded a CCC certificate in order for the products to be exported to China or manufactured locally.



Due to the central location of the company’s headquarters in Yulin, Guangxi Zhuang autonomous region, within Asian countries, the state-owned Yuchai Company could ship more than 260,000 engines to surrounding countries by the end of 2021. Despite the impact of the COVID-19 pandemic, Yuchai was able to benefit from the China-ASEAN Free Trade Agreement as well as the New Silk Road (also known as the Belt and Road Initiative). As a result, 20,596 engines were shipped to various ASEAN member countries last year. This represents a 63 percent increase over the previous year.

Yuchai company CEO Li Hanyang said that in view of the rising environmental awareness of other countries coupled with the expansion of public transportation and stricter emission standards, the company is well prepared. In late December 2021, Yuchai unveiled China’s first hydrogen combustion engine for commercial vehicles, the YCK05N. In successful test runs, the efficiency of the new unit was comparable to fuel cell powertrains. The new engine is based on high-pressure multi-point injection with turbocharger and can be used in many applications such as municipal and cleaning vehicles as well as logistics and delivery. Furthermore, Yuchai has a hydrogen combustion engine for heavy-duty vehicles, the YCK15N, under development, which is expected to be ready for the market in the first half of 2022.

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MPR Author

About the author: Julian Busch is founder and managing director of MPR China Certification GmbH
Publisher: MPR China Certification GmbH

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