1、1 Western car manufacturers - from Volkswagen to General Motors - are scrambling for the opportunity to do business with Chinas most important automobile company. But the Chinese have plans of their own - including future car exports. (Reported by Wieland Wagner) Hu Maoyuan, is fond of parties and c
2、elebrations. Only recently, Hu, the head of Chinas biggest automobile manufacturer, the Shanghai Automotive Industry Corporation (SAIC), celebrated the 20-year anniversary of his companys joint venture with Volkswagen with fireworks and high-ranking dignitaries from VWs hometown of Wolfsburg. Two da
3、ys later, Hu gave another party, but this time for one of VWs biggest competitors in China, Rick Wagoner, CEO of General Motors (GM). Wagoner was in China to help Hu inaugurate a project for the production of environmentally friendly cars. In Germany, the only people familiar with the car companys a
4、cronym, SAIC, have been industry insiders. Until now, the Chinese state-owned company, a majority of which is held by the city of Shanghai, has been satisfied playing the 2role of a profitable but unnoticed holding company that enters into joint venture agreements with Western corporations - thus br
5、inging money and expertise into the country - whenever it can. People in the auto industry, however, are slowly beginning to wonder whether the Chinese, following the Japanese and Korean lead, are preparing to launch an assault on the European and North American auto manufacturing industries.It may
6、too be early for such doomsday speculation, Going global SAIC, especially, is dedicated to global expansion. In South Korea, the company acquired a share of that countrys second-largest automaker, Daewoo, and it recently acquired the fourth-largest automaker, Ssangyong. This brand, which has acquire
7、d technical licenses from Mercedes-Benz, provides the Chinese with important technologies for producing its own SUVs. SAIC CEO Hu believes that the current offensive is only the beginning. Next year, the group plans to become a publicly traded company on the Hong Kong Stock Exchange, a move it hopes
8、 will raise $1.5 billion in shareholder cash. It plans to use these funds to upgrade car manufacturing plants at home and to pay for its ambitious global shopping spree. Until now, the auto giant has hardly made an impression 3with its own models. Most of the cars on display in the lobby of SAICS 26
9、-floor headquarters building in downtown Shanghai bear the VW and GM logo. So far, the biggest benefit SAIC has derived from the joint venture companies is financial. When it comes to talking about the future, Mr. Hu is just as secretive as he is about his private life. Like many Chinese executives,
10、 he avoids drawing the ire of the government and party by indulging in too much personal luxury. On the surface, at least, the things that are said about Hu seem statesmanlike. He lives in an exclusive residential complex in Shanghai, alongside government bureaucrats and party functionaries. He supp
11、osedly has never taken a vacation. Its all part of the myth of Chinese senior executives. And even though Hu does play golf and likes to bowl, its all business. His steep rise to the top of his profession is a product of both his ambition and willingness to make sacrifices. In 1968, in the confusion
12、 of the Cultural Revolution, he left high school to work in a factory. It was only in 1983, when he had worked his way up to the job of plant manager, that he was able to obtain a degree in engineering from the University of Shanghai. By now, he is one of the controlling figures in Chinas most impor
13、tant industry. 4Taking on Germany China will soon replace Germany as the worlds third-largest automobile manufacturing country. China produced more than 2 million cars in 2003 alone, an increase of 85 percent. In his position at the helm of SAIC, Hu manages a network of 55 subsidiaries and 63 joint
14、ventures for cars and parts. The group employs more than 60,000 people and produced 800,000 vehicles last year, including more than 600,000 automobiles, generating sales of about $12 billion. There are few types of vehicles SAIC does not produce, but its biggest seller is still the Santana, VWs inde
15、structible model from the 1980s. The car is produced jointly in Shanghai by the Chinese and the Germans, and it dominates the citys streets in the form of taxicabs and police cars. Although the Santana represented SAICs big jump forward, the Chinese soon became hungry for more. To encourage a reluct
16、ant VW to speed up its transfer of German technology, Hu also convinced GM to enter into an agreement in the 1990s. The Chinese strategy of playing off Western automakers against each other was successful. Nowadays, VW has its current Passat and Polo models produced in Chinas high-tech manufacturing
17、 plants. In addition, R Hu knows what Beijings industrial planners expect of him. They want him to transform SAIC into one of three globally operating auto giants in the Peoples Republic. The other two are First Automotive Works, another VW joint venture partner, based in the northern city of Changc
18、hun,and Dongfen. If government planners have their way, this trio will one day dominate the Chinese auto industry, which is currently made up of about 120 manufacturers. Scaling the Fortune 500 SAIC has taken an especially dynamic approach to reaching that objective. The group plans to be selling mo
19、re than a million vehicles per year by late 2007. The SAIC logo, a curved 6S, will appear on 50,000 cars. By 2010, Hu plans to move up into the ranks of the worlds six largest automobile manufacturers. SAIC has already made it to Fortune Magazines list of the worlds 500 top-selling companies - at po
20、sition 461. VW and GM have been eyeing this expansionary trend with increasing suspicion. Only after its partners objected, for example, did SAIC back off from plans to acquire a stake in Chinese automaker Chery. The growing state-owned company headquartered in Anhui Province had built a car that lo
21、oked like a copy of a VW Jetta. In addition, the Americans were accusing Chery of having copied parts of a Korean-made GM model. The companys Western partners are also unlikely to be thrilled by Hus announcement of his plans to utilize the joint venture companies to build SAIC brand name products. I
22、n the Yizheng plant in Jiangsu Province, a five-hour drive west of Shanghai, SAIC employees are currently producing the companys own brand name. The model is called the Sabre, and looks like a station wagon version of the Opel Corsa. A tour of the dimly lit plant highlights two things: the tremendou
23、s hurdles the Chinese have yet to overcome, and their 7obsessive approach to overcoming those hurdles. The plants 1,600 workers earn an average of 180 euro a month. Most of them assemble the basic version of the Santana for VW Shanghai - about 200 cars a day. About 20 engineers are busy working out
24、the details of the Sabre model. 90 percent of the vehicle already consists of Chinese parts, explains plant manager Huang Jian Ping, 35, clearly pleased. In 2005, we will reach 100 percent, he says. In 2003, SAIC produced 2,245 units of the Sabre. Thats why the companys own brand-name vehicles are c
25、urrently only being produced on the plants assembly lines once a month. But Huang doesnt find this discouraging. For us, he says, the Sabre is only the beginning. To wean SAIC away from its dependence on expensive, imported foreign parts, Hu is trying to convince high-quality suppliers to begin manu
26、facturing in China. German mid-sized companies, which so far have been supplying parts to VW Shanghai from Germany, are being urged to move their production to China. Shanghai is playing a key role as a potential manufacturing site. In Anting, a Shanghai suburb, Hu and city officials are in the proc
27、ess of developing an automobile manufacturing city. If 8all goes according to plan, Anting will have been transformed into a sort of Chinese Wolfsburg (VW headquarters in Germany), complete with worker housing, plants, suppliers and research laboratories, by 2010. One thing Hu knows is that he has t
28、o avoid direct confrontation with his Western partners if he wants to achieve his goals. Thats why he likes to use an allegory to encourage increased technology transfer. People in hell, says Hu, are forced to slurp their soup, because each person is trying to eat the soup with a spoon thats too long. But in heaven, he says, they feed each other.
