Problems And Countermeasures Of Localization Strategy In China-US-owned KMS Engine Company

With the development of the 13 th Five-Year Plan(2016-2020),China's opening to the outside world continues to expand,the investment environment is improving day by day,and the demand for foreign-funded enterprises to invest in China keeps increasing.By the end of the fourth quarter of 2020,the inflow of foreign capital into China reached $163 billion,indicating that China has become a hot land for many multinational companies to compete for.After entering China,foreign-funded enterprises are faced with differences in national culture and other factors,which severely restrict their performance development.In order to grasp the Chinese market and maintain good performance growth,foreign-funded enterprises have implemented localization strategies to varying degrees.Diesel engines are widely used in China and are located at the core of their industrial chain.KMS,an American company,is a world-renowned diesel engine enterprise.After entering the Chinese market in 1979,it has applied its own advantages and become the industry leader in Chinese diesel engine market.This paper analyzes the investment profile and localization process of KMS company in China from 1979 to 2021,and analyzes the motivational factors of KMS's localization strategy.KMS's localization in China of macro environment and competitive environment was analyzed with PEST and Porter's Five Forces analyses;discuss the localization process of KMS company in China in terms of research and development,production,marketing,after-sales,logistics and human resources.There are mainly the following problems in the localization of KMS company in China: a relatively high proportion of investment in localization research and development;High level of localized production cost;Low level of localized marketing;Lack of localized service capability;the localization degree of logistics needs to be improved;the level of localized management of human resources is low.Based on the localization strategy theory and the actual analysis of KMS company,the following optimization suggestions are put forward: moderately reduce localized research and development investment;optimize the processes to reduce localized production costs;improve localized marketing channels;strengthen localized after-sales service system construction;build a multi-logistic localization;strengthen the localization of staff management.The research results of this paper can enrich the localization process system of diesel engine companies,provide certain suggestions and methods for the localization process of KMS company in China,and also provide a reference for the implementation of localization strategies of China's diesel engine multinational companies in the host countries.