Innovation by companies in development area creating new business drivers

The innovations being introduced by companies in Weifang Hi-Tech Industrial Development Zone are playing a big role in Shandong's effort to replace old economic development drivers with new ones.

Consider Weichai Group, a Global Fortune 500-listed company that has long been promoting independent innovation to achieve long-term growth. It developed the first in-cylinder direct injection natural gas engine with strong power in China. It also developed the first electronic control system in China.

"We are developing an engine that can reduce vehicles' emission to nearly zero," said Guo Shenggang, deputy chief designer of Weichai Power.

Weichai's leaders are proud of the technologies the company has introduced, as well as its emphasis on research and development. There are some 2,500 R&D personnel in engines alone, and one of Weichai's engines, the LandKing, won the second prize in the 2012 National Science and Technology Progress Awards. Weichai's powertrain system won the grand prize from the National Science and Technology Progress Award last year.

Weichai is also responsible for building a key national laboratory to enhance the reliability of internal combustion engines.

Tan Xuguang, chairman of the board of Weichai, said the company's innovation drive is not limited to a product or production process. Rather, it is developing a new business model, which can be applied to upstream spare parts suppliers as well as to automobile and machinery makers.

GoerTek, a pioneer in micro-loudspeaker, microphone and voice receiver production, is reporting rapid growth in the development of virtual reality and smart wearable equipment.

Xu Dapeng, marketing director of GoerTek, said the company now produces about 70 percent of the world's mid- to high-end virtual reality headsets.

"Though the growth of the smartphone market slowed down in recent years, the market for hardware used in smart products has just begun to boom," Xu said, adding that the company plans to achieve better growth in coming years by exploring opportunities in smart earphones, furniture and wearable technology.

Apart from Weichai and GoerTek, the zone also has many other leading businesses such as Shengrui Transmission Corporation - developer of the world's first front-engine, front-drive 8-gear auto transmission - Foton Shandong Multifunction Plant and Weifang Special Steel.

Officials from the zone said that those leading players' efforts in promoting technology development, developing brand awareness and expanding markets are key elements in the zone's economic transformation.

SME development

As is the case in many other cities across China, small and medium-sized enterprises are forming a development foundation for the local economy.

Hoaco Automation Technology, a precision equipment manufacturer in the zone, has reported breakthroughs in die cutting machines development and production.

Ding Chunhui, deputy general manager of Hoaco, said the company has applied many patented technologies that can help users save costs and reduce their workforce size, as well as improving efficiency and accuracy.

Ding said Hoaco has a market share in China of more than 50 percent. It is also able to provide integrated services covering equipment production, technology support and after sales needs. Shandong Tianrui Heavy Industry, Shandong Yinlun Heat Exchange System and Shandong Novoshine Optoelectronics reported that overall year-on-year industrial output value increased 44.9 percent, 23.7 percent and 57.4 percent, respectively in the first nine months of this year.

Better environment

In 2018, the zone provided a broad range of support to serve companies' ever-changing demands. It relocated residents in shanty towns to provide more room for companies to their expand operations.

This year, the zone unveiled new recruitment initiatives, aimed at bringing in fresh blood. The policies include providing enhanced benefits for urgently needed staff, as well as greater government support for university graduates seeking to start new businesses. Experts from both China and other countries have joined forces with companies in the zone to boost local innovation capacities.

In line with its commitment, the zone also partnered with leading fund management firms such as United States'private equity firm KPCB and China's GSR United Capital to provide companies with various types of financial support.

The zone continues to cut red tape so that companies can achieve more efficiency in their daily operations. It separated business operation permits from business licenses and all business registration processes can now be completed online.

Chu Baojie, Weifang's director of communications and Party chief of the zone, expects that the region will make breakthroughs in replacing old economic drivers with new ones in the next five years. Shandong's goal is for new drivers to lead regional economic development by 2022.