Return to 1958 and build a century-old giant

Chapter 965 The Outbreak of the Jeep Incident

He naturally couldn't stay in Shandong Province for long. This time, he came to see the future giant Haier and also wanted to meet some prominent figures from the 80s.
Otherwise, for an investment of this level, he could just send anyone over.

Zhang Ruimin also keenly sensed that Yang Wendong's investment requirements were a rare opportunity for Haier, and for Qingdao City, being able to attract Hong Kong capital for the first time, especially from the most powerful and top-tier consortium among Hong Kong investors, was a very important political event.
Therefore, the three parties worked together to promote this cooperation;

The city of Kiyoshima even sent someone to inquire with Yang Wendong about any other investment intentions, and provided him with introductions to many companies in Kiyoshima, including many well-known local state-owned enterprises.

"Are they planning to sell it all to us in one package?" Yang Wendong looked at the stack of documents, somewhat speechless.
Secretary Xiao Huang said with a smile, "Mr. Yang, it's quite popular in China now for domestic companies to form joint ventures with foreign companies, especially with behemoths like our Changxing Group."

"Don't give too much hope, or you'll be driven crazy by the annoyance later on, and it will be the same in other places."

Yang Wendong flipped through the information in front of him, and after a while, he found a target and said, "This one, Tsingtao Beer, a company that existed during the German ZM era, and its sales in the mainland are not bad."

"You should talk to Fang Xianming and ask him to adopt a joint venture strategy similar to Jianlibao, and then ship some of the beer to overseas channels to earn some foreign exchange for the local market."

Of all the documents in this stack, he was somewhat familiar with only this one; he had never heard of most of the others.
Therefore, there is no need for screening.

Xiao Huang agreed, "Okay."

Yang Wendong said, "Alright, let's prepare to leave for Yanjing tomorrow. We'll take a look at a few factories there, and then our trip to the mainland will be pretty much complete."

The main purpose of this trip to the mainland is to visit and learn about the relocation of the manufacturing industry of my group.
Hong Kong's property market is recovering and will experience explosive growth in the future. The manufacturing industry will soon decline completely. Given the huge scale of Changxing Group, some problems will arise during the relocation process. Therefore, Yang Wendong, the boss, is also paying close attention to this.
The mainland will be the industrial base for the next few decades. Once the industry is stably transferred here, he won't need to worry about this aspect for the next few decades.
At least during his lifetime, the mainland will maintain its status as an industrial Cthulhu.

“Yes, Mr. Yang, all of that has been arranged.” Xiao Huang continued, “However, the two directors from the Ministry of Foreign Affairs and the Ministry of Commerce have asked the president of Xinhua News Agency in Hong Kong to arrange a meeting with you. They know you will be going to Beijing, so they would like to visit you there.”

"The Ministry of Foreign Affairs and the Ministry of Commerce? Did they say anything about it?" Yang Wendong asked curiously.
It's quite normal for the Ministry of Commerce to contact him, given that he has invested in so many industries in mainland China, which are more or less related to the Ministry of Commerce.
But why did the Ministry of Foreign Affairs contact him?
It's important to know that over the years, he has consistently avoided getting involved in the diplomacy of major powers. After all, his group's main market is currently Europe and America, and in the future, it will be the mainland. He doesn't want to offend either of them.
Xiao Huang said, "No, this matter was not reported to Xinhua News Agency, probably due to different levels of authority."

"Alright, let's make the arrangements then." Yang Wendong naturally wouldn't refuse; he had to give him face. As for what the matter was, they'd discuss it later.

The next day, Yang Wendong and his entourage once again traveled to Yanjing by train in a private compartment.
The welcoming ceremony in Yanjing was similar, relatively low-key.

After Yang Wendong arrived at the hotel, he was informed that the two directors from the Ministry of Foreign Affairs and the Ministry of Commerce had arrived and seemed to be in a hurry, so he immediately made preparations and went to meet them.
“Mr. Yang, this is Director Zhao from the Ministry of Foreign Affairs, and this is Director Sun from the Ministry of Commerce,” an intermediary introduced. “Director Zhao, Director Sun, and this is Mr. Yang from Hong Kong.”

"Mr. Yang, hello." Directors Zhao and Sun quickly shook hands and said.
Yang Wendong also shook hands politely and said, "Hello, both bureau chiefs, please have a seat."

After the three sat down, the middleman made an excuse and left.

Yang Wendong asked directly, "Why are you two bureau chiefs looking for me in such a hurry?"

Director Zhao asked, "Mr. Yang, do you watch international news? About Jeep in mainland China and the US?"

"I've heard that it's because of domestic customs that a batch of Jeep parts was blocked?" Yang Wendong raised an eyebrow and asked tentatively.

This event has occurred just as it did in history.
The incident stemmed from the fact that the Yanjing Jeep Automobile Factory, established as early as 1983, originally had localization requirements, but they continued to purchase large quantities of American parts at high prices from the United States, showing no intention of local production.
This practice naturally had a serious impact on domestic foreign exchange, so customs directly refused to allow a batch of parts to enter the country;

Instead of negotiating with the mainland, Chrysler, the company behind Jeep, used overseas media to report extensively, putting immense pressure on the mainland government.

Even more remarkably, a special person was sent from China to the United States to negotiate, but was refused a meeting by Lee Iacocca.

This also resulted in Chrysler, one of the Big Three American automakers, completely losing any possibility of entering the Chinese market in the future.

Therefore, in the past, mainland car enthusiasts could not buy Chryslers unless they bought imported cars. Even Jeep cars gradually became obsolete in the 21st century.

Director Zhao said, "That's exactly the matter. We heard that Mr. Yang is a major shareholder of Chrysler, so we would like to ask Mr. Yang to mediate between us."

Yang Wendong replied, "Director Zhao, it is true that I used to be a major shareholder of Chrysler, but at the beginning of this year, I went to the United States and sold all my shares. I am no longer a shareholder of Chrysler."

Sure enough, if he were still a major shareholder of Chrysler, he would inevitably be drawn into it.
Fortunately, 85 was Chrysler's peak, and he took the opportunity to sell his shares at a high price, thus getting rid of this trouble and killing two birds with one stone.

"What?" Director Zhao was taken aback.

Yang Wendong laughed and said, "That's absolutely true. The news may not have reached China yet. If you don't believe me, I can call the US and ask Goldman Sachs to commission the Securities and Exchange Commission to issue a certificate."

"That won't be necessary. We still trust Mr. Yang," Director Zhao quickly said.
If the other party doesn't want to help, you can simply refuse outright. Even if they're being polite, you can just give them a perfunctory response.
There's no need to lie about having already sold your stocks, because such things can be verified later.

Given Yang Wendong's wealth, he wouldn't stoop to such a level.

Director Song, who was standing nearby, said, "Mr. Yang, although you are no longer a shareholder of Chrysler, you should be quite familiar with senior executives like Lee Iacocca. Could you mediate this matter?"

Yang Wendong said, "It's possible to mediate, but the problem is that Li Aicoka is a very proud person and may not be willing to give me face."
I roughly know the whole story. It's essentially a localization issue. Chrysler was clearly unwilling to take the risks of localization; they only wanted to make money in the mainland. Their methods weren't exactly ethical, but that's how many American capitalists are. Not all capitalists have long-term considerations; and only a few genuinely believe in the future of the mainland.

In 78, China sent professional teams to various countries, but in the end, only Volkswagen was willing to cooperate with the mainland.

Although Peugeot of France and Jeep of the United States also built factories in China at the same time, neither of them wanted to localize their operations and only wanted to earn foreign exchange in China. Ultimately, this led to the complete decline of both companies in China.

Companies like GM, Toyota, and Honda, which refused to cooperate, were able to enter the Chinese market in the 90s. But those who harbored deceptive intentions or even used international public opinion to exert pressure will never be able to enter the mainland market, and they will regret it later.

Director Song said, "Yes, our contract with Jeep also stipulated the time and process for localization. However, we did not expect that after the joint venture factory was opened, Jeep did not think about localization at all, but continued to purchase American parts."

In addition, Jeep's original parent company, AMC, was acquired by Chrysler, and the team that had previously negotiated with domestic companies was replaced, leading to communication difficulties.
Chrysler has always been unwilling to localize its operations in the United States, which means that all parts are imported from the United States at extremely high prices, consuming the country's foreign exchange reserves.
What's even more outrageous is that while breaching their contract, they demanded that we guarantee Jeep sales in China according to the contract—it's utterly shameless.

"Not every Western company is trustworthy; this serves as a lesson for domestic companies," Yang Wendong said, shaking his head.
Lee Iacocca's move was absolutely disastrous, squandering Chrysler's opportunity in one of the world's largest car markets.

It's worth noting that Jeep entered the Chinese market earlier than Volkswagen. If things develop normally, they could also introduce other Chrysler vehicles in the future. In that case, creating a Volkswagen of the same class shouldn't be a problem at all.

Director Song said, "Chrysler is in breach of contract. If we pursue a transnational lawsuit, it will probably take several years. But the other party is using international public opinion to pressure us. There is simply no time to spare."

There's immense pressure domestically right now. Disagreeing could erode global confidence in the mainland; agreeing would result in severe foreign exchange losses both domestically and internationally, and other companies might follow suit, leading to even more serious consequences.

“The international business world is like a battlefield. Chrysler is doing just that. They know they've breached the contract, but they're trying to use public opinion to control everything.” Yang Wendong nodded and said, “How about this, I'll call Li Aikeka tonight and talk to him.”
However, I'm no longer a Chrysler shareholder. Although I knew him before, we'd only met a few times, so he might not give me the time of day.

Lee Iacocca successfully revived Chrysler, even surpassing General Motors in market value at one point. He became recognized as one of the top CEOs in the United States and even the world, and was valued by Wall Street and the White House.

His arrogance has now reached its peak. He might have been more courteous to him when he was a major shareholder of Chrysler, but that's hard to say now.

Director Zhao said, "Thank you very much, Mr. Yang."

Yang Wendong said, "You're welcome."

That evening, Yang Wendong made a cross-border phone call to the United States through the hotel.
"Hello, Eric, are you in the US or Hong Kong right now?" Li Aikeka's voice came from the other end.
Yang Wendong said, "No, I'm in Yanjing in the mainland."

"The mainland?" Li Aike paused for a moment, then asked, "Did you call me because of the problems between us and the mainland?"

Yang Wendong smiled and said, "Brilliant, that's exactly it."

“Eric, you’re no longer a Chrysler shareholder, why get involved in this?” Lee Iacocca said.

Yang Wendong said, "I'm just doing this on someone's behalf. If you don't want to talk, that's fine. Just hang up the phone."

"Fine, I'll listen to what you have to say." After thinking for a while, Li Aikeka on the other end of the line didn't completely refuse to give him face.
Yang Wendong now holds a very high position in the US financial market, has deep ties with Wall Street, and is extremely wealthy.

Meanwhile, it has two to three thousand car retail stores worldwide, including nearly a thousand in the United States;

Although he is no longer a shareholder of Chrysler, the two sides still have many collaborations.

Yang Wendong said, "The mainland is a big country after all. There's no benefit to you making a scene like this. According to the previous contract between Jeep and the mainland, you were already in breach of contract."

Relying on international public opinion is not a smart business choice.

“Eric, the mainland is indeed very large, but it can’t be considered an economic powerhouse. Its total economy is even smaller than Brazil’s. It’s impossible for me to fully commit to industrialization in such a place,” Li Aikeka said. “I think the best model is to assemble in China and then buy parts from the United States.”

Yang Wendong also understood that there was no way to persuade the other party to change his mind, so he said, "What good will this do? If you do this, it will inevitably lead to a decline in Jeep's sales in China in the future."
The power of international public opinion is limited; you can't come every year. Even if you win this year, you might earn tens of millions of dollars, but what about afterwards? If Jeep sales plummet in the domestic market, what parts will you sell then?

After a moment of silence, Lee Iacocca said, "Don't worry about that. I have connections in the White House, so I can naturally ensure Jeep sales in mainland China."

"You're too confident. Do you really think the White House can do everything? Don't forget, the White House also needs to win over the mainland. Besides, the White House changes leadership every four years. Do you know everyone in every term?" Yang Wendong retorted.

Li Aikeka said, "Then what do you want? I can't possibly spend hundreds of millions of dollars to build an industrial chain in the mainland. It would be better to invest that money in South America."

"How about this, you sell me the entire Yanjing Jeep package?" Yang Wendong suddenly said.

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(End of this chapter)