"If we compare the process of Chinese auto parts companies investing in the United States to the Long March, we are still at the starting stage. If we look at China's auto parts companies in the United States in a rational way, we are currently following people's opinions. Of course, this is a must-have process and the future must be picking watermelons."
This is the September 19th, the vice president of purchasing of Liaoning Shuguang Automotive Group Co., Ltd. Mao Haiyan said in an interview with reporters.
Mao Haiyan has been responsible for procurement work at the Shuguang Automotive Group and has been in contact with suppliers of parts and components such as Fuyao Glass, Wanan Group, and Dawn Axle etc., and he has a lot to do with the development of spare parts suppliers and the status quo of overseas investment. Experience.
A rational view of investing in America is the key to feeding itself
In December 2012, Wanxiang invested 257 million U.S. dollars in the acquisition of bankruptcy battery manufacturer A123 Systems Inc., becoming a well-known acquisition case. On March 21, 2014, Wanxiang also successfully acquired the American electric car manufacturer Fisk, which was even more talked about. Mao Haiyan said: "The reason why Wanxiang invests in the United States is more successful is because they started investing in the United States in 1992. Then they cleverly used their investment platforms in the United States, such as through project cooperation and a small amount of participation in US companies. They were fortunate to catch up with the US economic crisis and had a better time to achieve control over the American company, but after controlling, they did not convert the company in the United States to a Chinese company, but took advantage of the platform of the American company. Successfully acquired Fisco.†On July 17, 2014, Fuyao Glass acquired PPG’s Mt. Zion, Illinois, USA plant. The total investment of this project has exceeded US$400 million, making it the most successful Chinese auto parts company to enter the U.S. market. Generous. It is reported that Fuyao Glass was also a registered company in the United States in 1994 responsible for the sales of Fuyao Automotive Glass in the United States, Canada and other countries.
Mao Haiyan believes that most Chinese parts and components companies are still investing in the United States. Basically, they all set up sales companies, foundries, or acquisitions of US companies. In fact, these investments are basic stages, but they are also steps that must be taken. So how can we shorten this process?
“Fuyao Glass and Wanxiang Group have invested in the United States in front of other independent parts and components companies. Compared with international companies, their systems, legal system, and scale management are still much worse.†Mao Haiyan thinks that Fuyao Both Wanxiang and Wanxiang are basically private enterprises. Although listed companies regulate them, they need to be standardized in terms of cost management, product development planning, and other system management.
At present, only one component company, CITIC Dika, has entered the list of the top 100 auto parts supplier suppliers in 2013. Mao Haiyan said that CITIC Card is still relying on the market size, not the overall strength of the company. In order to become an internationally renowned parts and components company, independent parts and components companies must reduce the gap between international companies in terms of product development, product verification, raw material selection, establishment of enterprise technology standards, etc., and then focus on improving content and system management. The comprehensive strength. Not to say that winning an international business or building a factory in the United States is in line with international standards. In recent years, blind overseas investment failures are not uncommon.
Looking ahead, go overseas to invest in some overseas markets, and that's right. However, it must be clear that overseas companies and OEMs in overseas markets will not give core business to foreign parts companies. What they can release are some of the processed parts. Ultimately, our auto parts companies must use the U.S. market, train more competitive talents to send to China, improve the quality of their domestic products, and enhance their international competitiveness.
Comprehensive strength, can enter the "US threshold"
When the reporter asked what kind of parts and components companies had the conditions to invest in the United States, what preparations they needed to do, Mao Haiyan believes that the US auto industry has its own entry threshold. These thresholds, including auto parts companies, must have comprehensive strengths in product development, production, verification, and after-sales service capabilities, which means that companies have a strong overall strength in building factories abroad; they have a thorough understanding of the relevant standards of the US automotive industry; they understand American culture. Do a good job of local production. Therefore, domestic parts companies must have long-term plans to invest in the United States. In fact, they can learn how foreign companies enter the Chinese market. Their early planning is very detailed.
At present, there are some auto parts leading enterprises in China that have relatively uniform overall strength. Corporate leaders are also interested in “going out†and have followed relevant industry organizations to visit the United States on a number of occasions. However, these companies still have delayed investment in the United States. Why is this? Mao Haiyan believes that if a company intends to expand its overseas business, it must first understand as much as possible about the market conditions of the investing countries, take the initiative to collect overseas market information, and understand the local market conditions, either through consulting companies or through overseas establishment. The office can even send a team of experts to the local area to understand the investment situation. The second is the talent strategy. To invest in the United States, you must have your own talent strategy. At the same time, you must use appropriate local talents to understand the local labor laws. The third is the capital strategy. For example, if a company wants to invest in an R&D center or build an office in the United States, it needs to have a 3-5 year capital plan. Fourth, business leaders must have overseas vision and investment ideas. As we all know, employees in China are walking down. The only thing that looks up is the leadership. Therefore, business leaders must have clear overseas strategies and goals. In addition, most of the company’s overseas companies operate independently and have less contact with the company’s headquarters, which makes them more isolated. Companies must set up incentive mechanisms to encourage their domestic employees to strengthen their ties with their overseas branches. They must regard the overseas strategy as an important strategic plan for the entire company, rather than the subjective meaning of some of the leaders.
China's auto parts companies invest in the United States
Fuyao Glass Co., Ltd. was incorporated in 1994 and is responsible for the sales of Fuyao Automotive Glass in the United States, Canada and other countries.
In 2001, Fuyao (North America) Co., Ltd. was incorporated in the South Carolina of the United States, and it completely replaced the original American Green Glass Industry Co., Ltd. in Fuyao's auto glass sales business in North America.
In November 2010, the company invested 6 million U.S. dollars to complete the acquisition of Fuyao Automotive North America, INC. (Fuyao Glass North America Co., Ltd.), a company based in Michigan, USA. It is a subsidiary of Fuyao Group based in the North American region of Detroit Motor City. Value-added service center owner. Currently, the company directly or indirectly provides Fuyao's glass products and fast customer service to over ten models including GM, Chrysler, Hyundai and Kia Motors.
In October 2013, in order to better participate in the international market, to respond to increasingly fierce market competition, to meet the growing demand for the company’s automotive safety glass in the US automotive market, and to increase service capabilities, the seventeenth meeting of the company’s seventh Board of Directors After deliberation and approval, the company plans to set up a wholly-owned "Fuyao Glass America Co., Ltd." in Ohio, USA to build a project for automotive safety glass.
In 2014, Fuyao Glass acquired PPG's Mt. Zion, Illinois, USA plant. This marked the start of the Fuyao Group's US auto glass project. The total investment of the project has exceeded US$400 million. This is the internationalization of Fuyao Group. An important step in the strategy is also the greatest means for Chinese auto parts companies to enter the US market.
In the late 1990s, Wanxiang began to acquire small and medium-sized American auto parts companies that were near bankruptcy.
In 1992, Wanxiang dispatched personnel to the United States to open up markets and achieved the personnel to go out.
In 1994, the establishment of a universal U.S. company in Chicago in the United States enabled the company to go global.
In 2002, Lu Guanqiu purchased Nasdaq’s listed company Scheler Co., Ltd. in one fell swoop, setting a precedent for Chinese township enterprises to acquire overseas listed companies.
In 2003, Wanxiang America successfully acquired the “100-year-old†U.S. company, the inventor of the wing-shaped universal joint drive shaft, and the world’s largest tier one supplier, Rockford. With a 33.5% stake, Wanxiang became the largest shareholder of Rockford. This is the 26th company that Wanxiang has acquired and acquired overseas.
In 2006, Wanxiang lost to a New York-based private equity fund when it was bidding for US Global Control Systems, but in 2008, under the impact of the financial crisis, the fund was forced to liquidate. The liquidators of private equity funds have found Wanxiang and hope to sell them. The management also came to the door and hoped to save the company. In 2009, Wanxiang Group successfully acquired this company.
In 2007, it acquired DANA, the world's largest manufacturer of power transmission components. Although the business is not directly related to Wanxiang, it receives a premium after taking over and selling it to private equity after consolidation.
In December 2012, Wanxiang invested US$257 million in the acquisition of bankruptcy battery manufacturer A123 Systems.
On March 21, 2014, Wanxiang Group stated that the entire process of financing the US$149.2 million acquisition of American electric car manufacturer Fisco has been completed.
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