Reborn in 1982: I Became the Richest Man by Repairing Cars

Chapter 160 The Establishment of Shanghai Dazhong is of Extraordinary Significance (Two Chapters Combined)

Time flies.

Especially when people are busy, they wish there were 48 hours in a day.

"Master, the domestic auto industry is indeed about to undergo a major transformation."

"First, BAIC established a joint venture with an American automaker to form BAIC Jeep, and yesterday, a Shanghai-based automaker established a joint venture with Volkswagen to form Shanghai Volkswagen."

"No wonder you told us to learn how to repair the Santana. It seems that the Santana may very well replace the SH760 as the most popular sedan in China in the future."

After reading today's newspaper, Fan Weimin couldn't help but come up to Jiang Hui and talk about the current state of the domestic automobile industry.

"This trend is inevitable, as Shanghai's automobile manufacturing plants have always undertaken the main task of domestic passenger car production."

"The current positioning remains unchanged."

"Compared to the SH760, the Santana's advantages are too obvious."

Jiang Hui has personally repaired and had in-depth experience with both cars, so even without systematic assistance, he can easily feel the differences between them.

"Is there a big difference?"

"I think both cars look pretty good."

After Fan Weimin said that, Jiang Hui felt it was necessary to give him a proper lesson in basic literacy.

"You've only seen the surface. I've dealt with these two cars for so long, I could talk about their differences for a whole day."

"Take the engine for example. The SH760 uses a 2.2-liter inline six-cylinder engine that is similar to the Mercedes-Benz 220. The specs look impressive."

"The dual carburetor configuration is not up to standard, and the engine is prone to overheating after running for 120 kilometers."

"And it's notorious for being a gas guzzler," with fuel consumption reaching 25 or even 28 liters per 100 kilometers. Given current fuel costs, which company could afford that?

Upon hearing this, Fan Weimin instinctively replied, "So fuel-inefficient? When I repaired the SH760 last time, I noticed its engine was noisy; now I know that's the problem. What about the Santana?"

These days, most cars are owned by the government, so many people don't pay attention to fuel consumption.

Fan Weimin is similar.

"The Santana is different. The batch produced by Volkswagen in Shanghai now, although it is still assembled with all imported parts, has a 1.8-liter inline four-cylinder engine with a power of 87 horsepower."

"With a five-speed manual transmission, the fuel consumption is only 8 to 9 liters per 100 kilometers, which is more than half that of the SH760."

"Moreover, its engine technology is mature and has a low failure rate, unlike the SH760, which has frequent problems with the camshaft and rocker arm assembly, breaking down after a while and being troublesome to repair."

"And then there's the comfort," Jiang Hui paused, then added, "You've ridden in both of these cars. The SH760 looks wide, but it has a column shifter. It has heating in winter, but no air conditioning in summer."

"When it rains, if you want to open the window to let in some fresh air, the small triangular window on the left front will splash all the rainwater onto the driver's legs, and it is common for him to be soaked to the bone."

"The Santana is different. Although the configuration is not complicated, it is solid to sit in. The chassis has a front MacPherson independent suspension, so it is not very bumpy on rough roads. Moreover, the configuration will be gradually improved after mass production."

Fan Weimin frowned, recalling his previous experience repairing SH760s, and nodded repeatedly: "That's right, Master. Last time I repaired an SH760 for a government agency, it took me an entire afternoon just to adjust the carburetor."

"Moreover, its parts have poor precision, and many parts have to be manually polished before they can be installed."

"The parts for the Santana are much more organized, and it's easier to repair them."

Jiang Hui sighed, a hint of emotion in his eyes: "That's the difference."

"SH760 is a well-established domestic brand. Back then, it was a symbol of status: eating White Rabbit candy, wearing a Shanghai watch, and riding in a Shanghai train."

"But its technology was stuck in the 1960s. Our industrial base was weak and we couldn't upgrade it in a comprehensive way. By 1984, its output had reached its peak, and it was time for it to be replaced."

95

"Master, will the SH760 be completely discontinued in the future?"

Fan Weimin was a little curious, after all, this car had been running in the country for so many years, and many people had an emotional attachment to it.

"Production was going to stop sooner or later," Jiang Hui said calmly. "Look at what the newspapers say, Volkswagen in Shanghai has already started mass production of the Santana."

"The old saying, 'With a Santana, you can go anywhere without fear,' will only become more and more popular."

"Even if the SH760 is improved later, such as by adding air conditioning and improving the steering system, it will still not be able to keep up with the Santana."

"If we learn how to repair Santana cars now, then Santana cars will dominate the market, whether for company use or taxis, and we can keep up with this trend."

Fan Weimin suddenly realized, and a look of understanding appeared on his face: "I understand now, Master. No wonder you forced us to memorize the parts parameters and maintenance procedures of the Santana before. It turns out you had already seen through this trend."

"I'll go back and read the Santana's maintenance manual again, and try to understand every detail thoroughly."

Seeing his anxious look, Jiang Hui smiled and waved his hand, "Don't rush, take it one step at a time."

"The localization of Santana production will be gradually promoted. Although most of the parts are currently imported, domestic production will gradually be completed in the future, making maintenance more convenient."

"Remember this: in our line of work, you have to adapt to industry changes. If you can't keep up with the trends, you'll be eliminated sooner or later."

17

Fan Weimin nodded emphatically and turned to walk towards the repair workshop.

Jiang Hui also went to the Wudaoying Parts Factory to discuss future arrangements with Li Shigui.

Considering the localization of the Santana, Jiang Hui felt that he could also consider participating.

Otherwise, it would be very difficult for the auto parts industry to grow and expand.

"Shigui, have you been following the changes in the domestic auto industry lately?"

"There's something of life and death that concerns our factory, and I want to talk to you about it."

Upon hearing this, Li Shigui's expression turned serious. He quickly pulled Jiang Hui to the office next to the factory, poured two cups of hot tea, and handed them to Jiang Hui: "Master, what's the matter?"

"You're making it sound so serious, is there a problem with the parts in our factory?"

During this period, Li Shigui devoted himself entirely to the factory and really didn't pay much attention to the major events outside.

If the parts produced can't be sold, that would be a huge problem.

"You're half right," Jiang Hui said slowly, taking a sip of hot tea. "The parts we're producing for Beituo right now won't have to worry about selling in the short term."

"But it's hard to say what will happen next. If sales of BAIC Jeep don't go well, BAIC Gear will have the capacity to produce gears for BAIC Tractor."

"Our supply will definitely be cut, and we will need to find another way out."

Upon hearing Jiang Hui's words, Li Shigui immediately asked, "Master, you don't have a good outlook on BAIC Jeep's future?"

"I see that the relevant departments are very enthusiastic about joint venture cars. Last year, they even got a Shanghai-based car manufacturer to sign a contract with Volkswagen."

"You're right, I don't have a good outlook on BAIC Jeep, but I do have a good outlook on Shanghai Volkswagen. Shanghai Volkswagen was officially established yesterday."

Jiang Hui didn't hide anything from his apprentice.

"Next, with the large-scale production of Santana sedans by Volkswagen in Shanghai, the decline of their original SH760 model was inevitable."

"I estimate that the SH760 will be completely discontinued in a few years, so we don't need to put too much effort into the production of SH760 spare parts."

Regarding the parts business, apart from Beituo, Jiang Hui's factories can only produce spare parts now.

Whether used in one's own repair shop or sold to other repair shops, it is still a decent business in the current climate.

After all, many state-owned parts factories don't pay much attention to this aspect.

However, with the changes in the automotive market, the prospects for business development in this area are rather limited.

To expand and strengthen the auto parts industry and supply components to OEMs is an inevitable path.

This is something that no major auto parts manufacturer can bypass.

After hearing Jiang Hui's words, Li Shigui sighed heavily: "Master, we can still try to communicate with BAIC Jeep, but it will be difficult with Shanghai Volkswagen."

"It will be very difficult for us to transform into a supplier for the general public in Shanghai."

"Transformation is necessary, but it's not without opportunities."

Compared to Li Shigui's pessimism, Jiang Hui was not too worried.

"I'm here today to discuss how to become a supplier for Volkswagen in Shanghai by taking advantage of the localization of the Santana."

"A supplier for Volkswagen in Shanghai?"

Li Shigui's eyes lit up for a moment, then dimmed again. He shook his head repeatedly, "No, no, how could we be qualified? The Shanghai automobile manufacturers already have their own suppliers; we can't get involved at all."

Jiang Hui had anticipated his concerns and patiently explained.

After all, Li Shigui would still have to handle many of the subsequent business himself.

Jiang Hui didn't have the energy to manage everything.

"I've considered all of what you've said."

"First of all, although Volkswagen in Shanghai is currently assembled entirely with imported parts, the country has made it clear that it will promote the localization of Santana. China Automotive Parts & Equipment Co., Ltd. has also been established to be specifically responsible for investment, planning and deployment in the parts industry."

"Every year, a large amount of money is invested to support domestic auto parts companies, which is the biggest opportunity for us."

He paused, then continued, "Secondly, you said that Shanghai car manufacturers have their own suppliers, which is true, but most of those suppliers are old factories that produce SH760 parts."

"The technology and equipment are stuck in the 1960s, and can only produce some parts with low technical content and simple processes."

"The Santana's parts standards are more than one level higher than the SH760's, and those old suppliers simply cannot meet the requirements."

"I am very familiar with the Santana and know clearly that there are many parts that domestic suppliers cannot produce and can only import. This is our entry point."

Li Shigui was somewhat tempted by what he heard.

He had confidence in his master's judgment.

"Master, which parts can't they manufacture? Can we really manufacture them?"

Jiang Hui pondered for a moment, then slowly said, "I'll give you a few examples, and you'll understand."

"For example, the roof drain of the Santana. This part looks simple, but it has extremely high requirements for materials and forming process. It needs to be rolled into shape using special aluminum profiles."

"It also requires processes such as surface powder coating and adhesive injection, which domestic suppliers simply do not have the technology and equipment for."

"We currently rely entirely on imports from Germany, which is very costly."

"The glass brackets for Santana cars require extremely high precision, with an error not exceeding 0.1 millimeters. Although our factory's equipment is not advanced, our workers are skilled. With a slight improvement to the equipment and strengthened quality control, we are fully capable of producing them."

"Another part is the Santana's hood support rod. This part needs to have high strength and good toughness. It needs to be able to support the weight of the hood and be durable and not easily deformed."

"The struts produced by domestic suppliers are either not strong enough or prone to rusting, and they simply do not meet the standards of the general public."

"Our factory has specialized forging equipment and specialized heat treatment technology, which enables us to produce front cover support rods that meet the requirements."

At this point, Jiang Hui added, "I also learned that Volkswagen organizes retired experts to come to China to help domestic auto parts companies solve technical problems in order to promote localization."

"Moreover, as long as we can produce samples that meet the standards and pass their acceptance procedures, we can become a qualified supplier."

"At that time, we will not only be able to secure orders from Volkswagen in Shanghai, but also improve our factory's production level with their technical support. Why not?"

Li Shigui remained silent for a moment; although he was only the head of the parts factory.

But he has a strong sense of ownership and genuinely hopes to make the factory bigger and stronger.

"Master, these things sound like they can be done, but aren't the risks a bit too great?"

"We need to spend money to upgrade equipment, introduce technology, and train workers."

"If we fail to pass the public's inspection in the end, we will lose everything."

"Furthermore, can we really solve those technical challenges?"

"For example, the aluminum profile rolling process you mentioned, we've never even heard of it, let alone produced it."

Jiang Hui understood his concerns and softened his tone: "There are indeed risks, but we can't just sit and wait to die."

"Think about it, if we don't transform, we'll miss a great opportunity."

Since Jiang Hui had already put it this way, Li Shigui naturally wouldn't object anymore.

"Alright, then I'll try it as you said, Master."

Seeing that Li Shigui had relented, Jiang Hui smiled and said, "I've already thought it through. Let's start with the glass brackets."

O

"The technical difficulty of this part is relatively low. Our factory's existing equipment can be used with slight modifications, and the required raw materials are also easy to obtain."

"We'll first organize workers to produce samples, then send them to Volkswagen in Shanghai for inspection. As long as they pass inspection, we'll get our first order. Then we'll gradually expand production and start venturing into other parts."

"Okay, whatever you say!"

Li Shigui nodded heavily. "I'll make the arrangements right away. First, prepare the raw materials for producing the glass brackets, then train the workers and improve the production equipment."

"By the way, Master, we also need to establish strict quality control standards. The public's requirements are so high, we can't be careless."

"You've thought this through very thoroughly," Jiang Hui nodded approvingly. "Quality is key. We must strictly adhere to Volkswagen's standards in production. Every part must undergo rigorous testing; there can be no room for carelessness."

"Next, I'll accompany you to Shanghai to personally visit the quality and purchasing departments of Volkswagen."

"Let's learn about the process of introducing new suppliers to Volkswagen in Shanghai, and understand the acceptance standards and procedures for parts, so that our samples can pass the acceptance on the first try."

The two then discussed the specific implementation plan in detail, taking into account every aspect from equipment improvement and worker training to raw material procurement and quality control.

Li Shigui became more and more confident as they talked, and the worry on his face disappeared: "Master, to be honest, if it weren't for you, I really wouldn't know what to do."

"With you here, I feel confident. We will definitely seize this opportunity to help Wudaoying Parts Factory grow and become a qualified supplier for Volkswagen in Shanghai!"

Jiang Hui smiled and said, "This is not my achievement alone; it requires the joint efforts of everyone in the factory."

"Our workers are all very skilled. As long as they have the right direction and technical guidance, there is nothing they cannot accomplish."

"Now, the country is vigorously supporting the automobile industry, and the localization of Santana is an inevitable trend. As long as we keep up with the trend and seize the opportunity, we will definitely be able to find a path that belongs to us."

That afternoon, Li Shigui convened a mobilization meeting with all the factory workers, informing them of his plan to leverage the localization of Santana and become a Volkswagen supplier in Shanghai.

At first, the workers were hesitant and worried, but after Jiang Hui and Li Shigui explained in detail, they gradually understood the necessity and feasibility of the transformation and expressed their willingness to go all out and work hard with the factory.

Subsequently, the factory began to take intensive action.

Li Shigui was responsible for contacting raw material suppliers, purchasing the steel and auxiliary materials needed to produce glass brackets, and improving the existing production equipment.

After the prototype was produced, Jiang Hui even waited for a Santana to come in for repairs and disassembled the original parts for detailed comparison.

Ensure that all parameters are highly consistent.

After that, he prepared to visit the purchasing and quality departments of Shanghai Volkswagen.

Before setting off, he made a special trip to BAIC to learn more from Liang Hongyu.

You know what, it's rare to find a private company taking the initiative to visit and contact a large car manufacturer these days.

"Director Jiang, to be honest, I've never encountered anything like what you've done before."

"All of BAIC's suppliers are state-owned enterprises, and they supply us according to the arrangements of the State Planning Commission."

"So I've never received any private enterprises before. Besides, as you know, private enterprises have only emerged in the last few years."

Liang Hongyu never expected that Jiang Hui would contact him today to discuss this matter.

"However, I think you have a good eye for Volkswagen's Santana in Shanghai."

"I've done some research on that Santana recently, and it's definitely quite different."

"Leaving aside the SH760, even the revamped BJ212 still lags behind in many aspects."

Liang Hongyu and Jiang Hui were very familiar with each other, and he would say things without hesitation, whether they were appropriate or not.

"Yes, in the past, more than 90% of the cars in China were SH760s produced by Shanghai automobile manufacturers."

"Now that they've partnered with Volkswagen to produce the Santana, the SH760 is probably out of the question."

"At that time, more than 90% of the cars in China will be Santana, so I think I should seize this opportunity to enable our parts factories to supply Santana."

Jiang Hui didn't hide his thoughts and told Liang Hongyu directly.

"Your ability to plan ahead in this way is absolutely justified."

"Volkswagen in Shanghai should also be hoping that its component manufacturers can supply them with domestically produced Santana parts."

"But I estimate that they will not be able to find suitable suppliers for at least 80% of the parts in the short term."

"If you take the initiative to come to their door at this time and indicate that you can provide suitable parts, they will definitely be very interested."

"Whether it's a private enterprise or a state-owned enterprise is not the main point for them at this time."

Based on his own experience and understanding, Liang Hongyu also offered some of his own judgments.

This is somewhat of a reference point for Jiang Hui.

However, that's not the most important point. "I also knew a few people at the Shanghai automobile manufacturing plant before."

"Although I don't know if all of these people have transferred to work for Volkswagen in Shanghai, they should be aware of the situation."

"I'll make a few calls later to ask around, at least to find out the current quality and purchasing department head information of Volkswagen in Shanghai."

"It's best to arrange a visit time with them in advance, so that you won't wander around like headless chickens when you get there."

Upon hearing Liang Hongyu's words, Jiang Hui immediately smiled.

This was one of the main reasons he came to visit Liang Hongyu today.

In China's automotive industry, there are only a handful of manufacturers that can truly compete.

FAW, Dongfeng, Shanghai Automobile Manufacturing Plant and BAIC are among the best.

The meetings convened by the ministries will definitely be attended by people from all these factories.

Over time, everyone naturally got to know each other.

That's how Liang Hongyu got to know the people at the Shanghai automobile manufacturing plant.

Within the system, people inevitably need to communicate with each other, so they generally give each other face.

Unless it involves a very critical issue.

"Then I'll have to trouble Minister Liang."

"This has been a huge help to me."

No matter when, if a parts supplier goes to an OEM to discuss business, it will be very difficult to close the deal if they don't even know which way the door opens.

Having an acquaintance help make the connection can save a lot of trouble, regardless of whether it works out or not.

To some extent, having an acquaintance is like giving you a endorsement.

People can trust you to some extent.

Jiang Hui was well aware of the help this would bring him.

"Don't be so polite with me, it was just a small favor."

Soon, Liang Hongyu started making phone calls.

After some communication and confirmation, we were able to help Wudaoying Parts Factory figure out the ins and outs.

"When you go to Shanghai Volkswagen, just tell the gatekeeper you're looking for Liu Yongjun, the head of the purchasing department."