Taxi firm contractors urged to exploit Chinese market

3 July 2002
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04 July 2002 | David Arminas

The maker of the famous London black cab is encouraging its UK suppliers to get involved in cab production for its Chinese manufacturing partner.

Coventry-based London Taxis International (LTI) signed a 20-year deal with China Brilliance in January to manufacture the cab in China for the mainland, Taiwan, Hong Kong and Macau markets.

It expects more than half its suppliers to reap the benefits of the deal, but has warned them that they face stiff competition from local suppliers in China.

LTI recently held a seminar for more than 50 suppliers, supported by the Department of Trade and Industry and the Society of Motor Manufacturers and Traders, to interest them in visiting China in September.

Mike Lycett, LTI's supply chain director, said the company's UK suppliers will benefit from a two-way deal, initially focused on low-complexity, low-risk parts from China, which will be used to build cabs in Coventry.

China Brilliance is also likely to need development support on more complex electrical and mechanical systems, for which UK suppliers will be able to compete with local firms.

"It is still finalising its marketing plans to confirm its sales volumes, but the numbers China Brillliance is talking about are significantly higher than the 3,000 taxis a year we make in the UK," Lycett said.

The deal is the first time LTI has ventured into China and the first time Lycett himself has dealt with the Chinese.

"One of the biggest issues for us is simple communication. In terms of how the Chinese select some of their suppliers, there is not a great deal of difference with the UK.

"But quality is an issue. However, there are lots of original equipment manufacturers out there now, which is encouraging," he added.

SMjul2002

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