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Manufacturers Ally to Enhance Positions
Home electrical appliance manufacturers are banding together to strengthen their market position and avoid the impact of price wars.
On Tuesday, two giants in the electrical appliances field, Hisense Group and Rongshida Group, revealed plans to set up a joint venture .
Hisense and Rongshida are both well-known brands in the home electrical appliance market. The former is a leader in the TV set and air-conditioner market while the latter specializes in refrigerators and washing machines.
The alliance is the first of its kind in China between industrial leaders from different manufacturing fields coming together for mutual advantage.
Analysts predict the alliance will be the prelude to a reshuffle in the industry which has been plagued by price wars.
Yu Shumin, chief executive officer of the Hisense Group, said the co-operation between the two sides will be carried out in three steps.
The two parties will firstly set up a research centre backed by each other's technological strengths.
Then Hisense and Ronshida will share their information and production capacity.
The two sides will further increase their co-operation with a joint development in the fields of home electrical appliances and information technology.
Liu Chuntao, president of the Rongshida Group, says the co-operation has a bright future because each other's structure matches and the two companies share similar management ideas.
The alliance will help Hisense advance into the refrigerator field without a heavy investment and give a full play to Rongshida's advanced refrigerator line.
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