Founded as a bus repair factory in central Henan province in the 1960s, the Zhengzhou Yutong Bus Company has been driven by China’s growth to become the largest bus manufacturer in the world, accounting for 10 per cent of total global sales.

However, the engine that drove the company’s ascension — China’s prosperity — is now beginning to splutter.

As China accelerated out of a planned economy, Yutong hitched a ride by helping to ferry workers back and forth between their hinterland homes and jobs in the booming coastal regions. More than 67,000 of its buses hit the road last year.

Now, the home market responsible for Yutong’s rise is shrinking. As growth dips and wages rise, the flow of Chinese workers across the country — the largest known migration in human history — is slowing. China’s “floating population”, the county’s official count of migrant workers, last year fell for the first time since the global financial crisis, according to government statistics.

Chinese bus sales dropped in tandem from 604,000 to 598,000 between 2014 and 2015, according to Wind Information. Like many other Chinese companies reliant on domestic markets for profits, Yutong has taken this as a signal to ramp up efforts abroad.

The company’s overseas ventures have thus far focused on the developing world, but now, in line with Beijing’s desire for an innovative and internationally competitive auto industry, Yutong is pouring investment into new technologies such as fuel-replacement and autonomous driving.

From his office on the outskirts of Zhengzhou, Hu Fengju, head of Yutong’s international arm details the company’s two-pronged approach to international expansion.

Burgeoning markets in developing countries are the long-haul plan, he says, as they provide a stark contrast to China’s increasing saturation.

“[Buses] are interrelated with a place’s economic and human mobility levels,” says Mr Hu. “Our long-term focus is on developing countries. European markets are more mature but also have short-term growth potential.”

Chinese automakers face obstacles to entry, however, mostly in the form of local protectionism — much like western companies have faced since China began its partial opening of markets in the 1980s.

But Yutong believes it is up to the challenge, and has plans to expand its sales operations beyond the 130 countries where it currently operates. It also manufactures buses in Venezuela and Cuba — in a move to overcome import restrictions — and has sold more than 6,000 vehicles in each of those two countries.

While developing markets offer long-term potential, mature markets such as Europe and North America provide immediate opportunities if Yutong can prove it is on par — or ahead — of its competition in technical prowess.

In August last year, a Yutong bus drove itself 32km from Zhengzhou to the neighbouring city of Kaifeng, stopping at traffic lights and overtaking as it went, in what Yutong claimed was the first real-world test of a driverless bus.

Li Feiqiang, deputy director of Yutong’s technology research centre, played down the immediate future of such technologies, saying that the primary purpose was to improve safety in regular buses.

It is in fuel replacement technologies that Yutong hopes to be most competitive, he says. “The safety, reliability and endurance of Yutong’s new energy vehicles is already at the same level as petrol-fuelled buses.”

Thanks to an extensive government plan to support the sector, sales of electric buses have soared in China, with more than 92,000 electric buses registered as road-ready in 2015 — 15 times the number in the previous year. Yutong accounted for 20,000 of these, almost three times the sales from the previous year.

Local government subsidies drove this sales growth, but an investigation into fraudulent claims could cut local spending on upgrades of public transport in the short term, which may eat into Yutong’s sales of electric vehicles, according to Zhi Aik Yeo, an analyst at Jefferies.

At the same time as home growth is likely to slow, 2015 also saw Yutong take its electronic technology for its first foray abroad, running a trial operation on the streets of Paris in a bid for a contract to replace 9,200 cities buses with electric models.

Yutong will face stiff competition in its internationalisation of electric buses, but not necessarily from non-Chinese rivals.

BYD, the Chinese carmaker that recently put five electric buses into circulation in London, is better placed to sell such vehicles to international markets, says Zhong Shi, a Beijing-based auto analyst.

“However, if Yutong decides that [electric] are important for its international development and invests more, they are likely to overtake BYD due to their more comprehensive bus-making capabilities,” he adds.

As with all large state-owned company, Yutong’s push abroad began — and is maintained — by a government drive to create national champions that “go out” and become internationally competitive.

As China’s top leaders met at a high-profile yearly meeting in Beijing, CCTV, China’s official state-run television group, chose to feature Yutong’s Cuba operations as an example of “Chinese Brands in Overseas Markets” in a glowing report that praised its efforts.

This favoured position helped Yutong to push up net profits 35.5 per cent year-on-year to Rmb3.6bn in 2015 despite the overall slip in Chinese bus sales — a trend-bucking result that the company says it will repeat in 2016 and 2017.