After fifty years of development and refinement, tremendous changes have taken place within FAW. In stark contrast to the early days of producing a single model of medium truck, FAW now produces hundreds of models of light, medium, and heavy trucks for every vocation. In the late 1950's, FAW quickly responded to market demand and commenced automotive and bus production, soon making FAW the leading producer of buses and luxury tourist coaches in China. In stark contrast to our early days, overall production volume has swelled from 30,000 units to an annual figure approaching one million. Under an evolutionary development of corporate infrastructure from that of a traditional state enterprise to a profitable and diversified group organization with the right combination of lean and progressive qualities, FAW is solidly in place to become a global player in the automotive industry.
After surpassing the one million unit annual sales figure in 2005, FAW Group Co., Ltd. has set exciting new goals as the company makes use of the latest in information technologies to keep our people and customers connected worldwide, thus ensuring an important competitive edge in the marketplace.
The ground breaking for FAW's headquarters and first production facilities on July 15, 1953 was an historic and exciting time in China's history. The company's first medium duty truck, the model CA10, immediately became a daily sight to people throughout China and a symbol of industrial pride to the country.
FAW's creation was an important part of New China's first five-year plan, and was successfully executed with the support of the former Soviet Union thru an agreement supporting industrial cooperation signed by China's Chairman Mao Zedong and Prime Minister Zhou Enlai with Soviet leaders.
In April of 1950, China's Automobile Industry Preparatory Committee was established by the Ministry of Heavy Industries. Following meticulous research and preparation, the Chinese government's Central Committee authorized a three year plan for the construction of First Automobile Works in Changchun. Chairman Mao Zedong autographed the foundation stone and bestowed the name "Jiefang", meaning liberation, on the model CA10 medium truck to symbolize China's new independent ability to create the tools for a modern national transportation system.
During construction of the new truck plant in Changchun, the Soviet government provided technical support, tooling, and more than 80% of the production machinery. A large number of Soviet advisors were stationed in Changchun during the ramp-up period to help orchestrate factory construction, production preparation, and train FAW employees.
During the 3 year preparation span, talented management and support staff were recruited from all over the country. Thousands of assembly line workers were hired and trained. More than 20,000 workers from the 5th construction division, composed of mechanical and electrical tradesman, were put to the task of transforming the daily arrivals of construction material into a state-of-the-art production facility on schedule. The successful collaboration of all concerned promoted the progress of construction, with completion occurring on July 15, 1956. Indeed, many felt the pace and quality of the work was miraculous.
The period from the start of production in 1956 until the end of 1978 was a critical growth and development period for FAW.
Not long after the production of the CA10 medium truck began, FAW commenced with production of the "Dong Feng" (east wind) passenger sedan and the "Hong Qi" (red flag) luxury sedans. FAW's entrance into the automobile arena to any meaningful level was however to be delayed by two historically difficult periods for the company. The "Great Leap Forward" (1958-1960), a well-intentioned government plan to quickly advance China's general industry, met with unexpected difficulties that temporarily drained available financial and management resources necessary to FAW. As the winds of fortune again turned in the company's favor, including a strategically planned 3 year recuperation span, the 1960-65 business period proved to have the most robust sales demand to date for FAW.
The second difficult period distracting the company from its business focus, known as the "Cultural Revolution", occurred from 1966 thru 1972. In 1972, Chinese Premier Zhou Enlai spearheaded an end to this politically uneven period which allowed the company to return to normalcy and resume the upward trend we have today.
In 1975, the company's progress was further strengthened by the forward-thinking of China's Deputy Premier Deng Xiaoping initiatives for state enterprise reform.
In 1977 and 1978, further reforms were initiated by the Chinese government to assist FAW and other state-enterprises in catching up with the economic targets temporarily pushed back by the environment of the "Cultural Revolution". As a result, despite the previously mentioned setbacks indirectly beset on the company, FAW seized the infusion of forward momentum and pushed forward with new technology, tripling the number of product offerings, and increasing production from 30,000 to 60,000 units.
During the 1970's, FAW produced both vehicles and talent as well. Following the Chinese governments decision to diversify its vehicle production base, the Second Auto Works, now known as Dong Feng Motor Corporation, was created in China's Hebei Province under the orchestration of FAW utilizing many designs and talented individuals as directed from the company to ensure a successful launch.
Plans were initiated in 1979 for a complete redesign of FAW's prominent CA10/30 medium truck. In the midst of the development phase, FAW in 1983 instigated a significant plant modernization campaign to update FAW and match the revolutionary new truck with a modern production facility. Taking a cue from overseas, many Japanese production techniques were incorporated into FAW's manufacturing process to enhance efficiency. After extensive R&D, testing, and production preparation, the new CA141 medium truck entered production at the end of 1988. During the 1983-88 period, the company cemented its new policies of moving the corporation away from the priorities of a traditional state enterprise to that of a modern profit-driven organization. Profitability and sales motivation were infused into the company culture. With the support of China's Central Committee, FAW received enhanced rights for selling product through its proprietary sales channels, for overseas trade, and self-empowerment for enterprise planning. Climaxing this exciting period of new products and corporate revitalization, the company formally opened its doors to international sales for the first time.
The resultant new company atmosphere allowed FAW's employees to act with renewed spirit and energy, and follow the global trend in revising and replacing models at a much more rapid pace than in the past to meet increasing market demands. New light, medium, and heavy trucks were planned in conjunction with a new range of automobiles.
Following a pattern of strong alliance between Jilin Light Truck and Mini Vehicle Corporation and FAW, the Jilin concern was merged in 1987 by China's Central Committee into FAW Group, to make better use of the synergies between the two companies and promote the expansion of FAW's product line.
In 1994, FAW Industry General Corporation was founded based on an alliance between the FAW Automobile Research Institute and FAW's 9th Planning and Designing Institute, which greatly solidified the company's technical resources.
The period between 1988 and 2001 witnessed a renewed focus on enlarging the company's automotive offerings. The company created two separate automotive concerns, that being the FAW Passenger Car Company and FAW-Volkswagen Automobile Co., Ltd. This climax of municipal bus, luxury tourist coach, custom bus chassis, and light, medium, and heavy truck manufacturing, combined with an extensive portfolio of proprietary and jointly-produced automobiles, firmly solidified the position of FAW Group as a top world player. Heavy truck production surpassed that of medium trucks for the first time, and the ratio of car to truck production reached 50%. Overall production finished 5.1 times higher in 2001 over 1988. Corporate income increased 22.8, landing FAW a spot in the top 10 of China's largest companies
Additional cooperation overseas with automotive suppliers and manufacturers, and the expansion of FAW's overseas sales organization, both led to the creation of many significant joint venture companies between FAW Group and overseas partners. Now exporting complete vehicles, CKD/SKD vehicle kits, and oem/aftermarket parts to more than 70 countries, FAW had successfully transformed itself from a famous domestic vehicle manufacturer to a formidable participant in the global automotive arena.
FAW also engaged in an effective campaign to reduce quality defects and improve the cost-effectiveness of factory operations and procedures. Through an internal audit, FAW discovered new ways to streamline internal company procurement and reduce cost. Factory inventory levels were also adjusted to follow a leaner "just in time" philosophy.
In December 2001, FAW convened the 11th session of the Party Representative Conference, the company's annual meeting with representatives of the government's Central Committee, and announced that FAW has successfully completed its third ramp-up phase during the 1988-2001 period, more than doubling production, marketing scope, sales income, profit, and employee income. In 2002, FAW extended its goals and announced changes relevant to China's entry into the World Trade Organization that will assure the company's continued growth in the global market.
FAW is entering into an exciting and dynamic new era. From its humble beginning in 1953, FAW has become a major supplier of automobiles, trucks, buses, and coaches around the globe. Under superb leadership accompanied by an outstanding staff of dedicated people, FAW is proudly poised to become the new benchmark for innovation, satisfying the world with the best automobiles and trucks available.