Chapter 329 Fourth-generation LCD screen production line
"Okay, that's all for today. I hope to have the opportunity to get to know each other better in the future, so that it will be easier to promote cooperation."
Wang Yaocheng took the initiative to extend his hand and shook hands with the leaders from Sichuan Province one by one. Seeing that they still wanted to continue the conversation, he said straight to the point;
"I'm sorry, our negotiations are all resolved very quickly. If it works, it will work. If it doesn't, it won't work.
We are not used to being on the negotiating table for a long time. At the beginning of the year, we negotiated the acquisition of Korean Hynix Company with tens of billions of dollars in assets at the airport in more than an hour.
So there is no possibility of cooperation this time, and it would be a waste of everyone's time to continue talking, so that's it.
Looking forward to the opportunity to cooperate with you, thank you!”
After simply closing the door to the negotiation and watching his subordinates see off the leaders from Sichuan Province, Wang Yaocheng turned around and left the hotel conference room, returning to the top-floor presidential suite with ease.
The problem of Changhong in Sichuan Province is really too big. The State-owned Assets Supervision and Administration Commission of the other party still wants to take the lead in the joint venture. This can only drag everyone into the water and die together. There is no second possibility.
Wang Yaocheng has a lot of money, and it may not be brought by the strong wind, so he would not invest it in this bottomless pit.
What's more, Wang Yaocheng only started to acquire TV manufacturers in order to compete with Samsung Group. If he can't implement his own business strategy, what's the use of buying it?
If the consortium acquires Changhong of Sichuan Province, it will invest heavily in renovating the production line, eliminating backward production capacity, and transforming it into a world-class LCD TV production line. The biggest purpose is to compete in the international market.
Whether it makes money or not is secondary. The key is to force Samsung's home appliances to make ends meet, lose their hematopoietic function, and then fall behind step by step in industrial upgrading and technology replacement, losing the most critical product competitiveness.
If this strategic goal cannot be achieved, the acquisition of Sichuan Province Changhong is purely idle and is looking for trouble for itself.
What is the problem with Chang Hong, the leader in the domestic color TV industry?
Changhong, a brand with a relatively long history, is known as the "King of Color TVs", but now it is at the end of its rope. There is one sentence that can describe its situation very well.
Xiao He is also a success, and Xiao He is a failure.
In the early 1980s, Chang Hong's advertising slogan "Rainbow in the sky, rainbow on earth" was familiar to Chinese people and became popular all over the country.
It is a matter of great pride for any family to own a Changhong TV.
Ni Runfeng, chairman and general manager of Changhong Electric Co., Ltd., is a sharp-edged person. After taking office, he launched a large-scale price war in 1989, triggering the first large-scale price reduction in the domestic home appliance industry.
After several rounds of price wars, Changhong Electric defeated domestic competitors and foreign brands, and quickly seized the market with low prices. Domestic color TVs won the favor of the Chinese people with their cheap and high-quality products.
In 1996, Changhong Electric's color TV sales reached 4.4 million units, which surged to 6.6 million units in 1997, with a market share of 35%. For every three TVs sold in the country, one was a Changhong color TV.
Therefore, Changhong Electrical Appliances has gained the reputation of "King of Color TV".
Beneath the prosperity, there is a crisis.
Chairman Ni Runfeng is used to cheating and being domineering, and his business strategies are eccentric.
He is trying to monopolize domestic color picture tubes and plans to capture 70% of the country's color picture tube production, with a quantity of up to 8 million units, which is equivalent to saying that there will be no way for domestic competitors to survive.
In fact, domestic manufacturers can also import from abroad, and this is not a product in short supply.
these two years
Changhong Electric has hoarded a huge amount of color picture tubes, with an inventory of 7.7 billion yuan. Domestic bank loan interest rates are as high as 16%. It is not enough to lose all the profits from selling millions of color TVs.
This put Changhong Electrical Co., Ltd. under a heavy debt burden. Ni Runfeng, who was extremely courageous, started to think about foreign markets again, so he took the initiative to cooperate with apex.
Unfortunately, in the face of experienced veterans in the international market, Changhong Electric's team lacked experience, and the cooperation actually caused the company to suffer huge losses.
In just two years, the company has already incurred a net loss of RMB 3.5 billion, with mountains of color picture tubes piling up in the warehouse, and many hidden debts that have not been reflected.
Indeed, Changhong Electric has more than 10 billion in its current accounts alone. How much of this has been lost?
There are too many loopholes in the accounting accounts of domestic manufacturers, they are not in line with the world's accounting system, and the economic data are not referential at all. If you want to take over, you will face great risks.
The quality of Changhong TVs in the early years was very good, but after the price war, the quality plummeted. The company did not pay attention to quality management, and malicious competition caused shoddy production. All good first-hand TVs were ruined, and the market and reputation collapsed.
Since the beginning of 1998, product sales in three months have been 30% less than the same period in previous years. There has been a sharp decline, and business operations have slipped into the abyss.
It is possible that the leaders of Sichuan Province saw that Wang Yaocheng had a kind attitude and a young and easy-to-talk appearance, so he invisibly raised the price too high in the conference room, making him look like a rare commodity.
I am willing to give up part of my equity. I hope that the State-owned Assets Supervision and Administration Commission can have a say in business operations and personnel appointments and dismissals, and that I can get some important positions in the joint venture. I hope that I can invest heavily in renovating production lines, upgrading products, and hope to create more job opportunities. I hope that
…
hehe!
As the saying goes, the more you hope, the greater your disappointment.
Wang Yaocheng directly terminated the negotiations and asked them to leave.
Even if you don’t know the bargaining chip in your hand, what is the purpose of introducing foreign capital? Is it for corporate development or internal competition for power? Is it for political performance or saving job opportunities, is it to maintain social stability or is it just to focus on business operations?
If you don’t understand these things, negotiations will be impossible to proceed.
Once more things are added to a simple merger and acquisition, and simple problems become complicated, the results will often be unsatisfactory.
Baba came to the house, hoping to bring in powerful capital to put out the fire. The roof of the house was about to burn through, and if the fire was not put out, everything would be ruined.
But when it came to the negotiation table, it looked like a rare commodity, which was really puzzling.
Wang Yaocheng shook his head. When he saw Dong Mingzhu, Zhu Jianghong and others walking in, he took the initiative and said, "Sister Dong, Lao Zhu, I didn't expect the negotiation to end so early. Let's sit down and talk. In the evening, the leaders of Shenzhen City hosted a banquet. Let's go to enjoy the autumn breeze together."
, our private enterprises can save one by one, right?"
"Chairman, you..."
Zhu Jianghong couldn't think of any good words to describe it, shook her head and sat down with a wry smile.
As a woman, Dong Mingzhu is very observant and knows that her young boss sometimes has convulsions, which makes the chairman appear more humane and in line with the characteristics of young people.
If you are too stable, you are an old monster.
"Chairman, this is my deputy Zhang Jindong. He was the general manager of Five Star Electric. After their company was merged by us, he did an outstanding job in the Pacific Appliances Chain Store. He is a talented person."
Dong Mingzhu continued to introduce, "Vice President Zhang often travels across the country and has never seen you before. This time I specially brought you here to get to know the boss."
Even if you didn’t bring me here, I would know that poor Five Star Electric and poor Zhang Jindong were completely crushed by the powerful businessman Dong Mingzhu. Their great business was merged before it even took off.
"Okay, now that we've met, let's sit down and chat casually, and we'll go out for dinner together later. I guess Secretary Luo of Shenzhen City will have some bleeding tonight, so he'll get some hard vegetables for us to try."
Wang Yaocheng made a casual joke: "No matter how poor you are, you can't lose face, and no matter how hungry you are, you can't go hungry. We contribute billions in tax revenue to him every year. We have to eat more this time. It's a rare opportunity!"
“Can I spend more money on meals?”
"The main thing is to pursue a psychological balance, especially since Sister Dong comes here often. If you have any fancy dishes you like, just order them. I'll ask Secretary Hong to come over and say hello. Everything is fine."
"We don't pay much attention to our food. Chairman, what do you think of the investment case of Changhong Electric in Sichuan Province? Is the group really planning to launch a color TV project?"
Dong Mingzhu quickly changed the topic, otherwise the chairman would make endless jokes, which would be too much for everyone.
"Changhong Electric...their leadership is unreliable. I'm not optimistic about this investment."
Wang Yaocheng shook his head. If Changhong Electric was taken over, it would also be handed over to the Huanghe Technology Group. He could make it clear.
After all, GREE Group mainly deals in white home appliances and small home appliances, and also has computers, copiers and office products. The front line has been stretched too long and it is not suitable to continue to add projects.
"Well, the consortium's product line in the field of home appliances currently only lacks TV products. This is a major category of home appliances and a very important source of profits for Samsung Group.
As conceived;
As long as this shortcoming is made up for, more than half of Changhong Electric's home appliance production lines will be upgraded and transformed, with the main business being LCD TVs, focusing on the international market with relatively high profits.
As long as output expands steadily, a comprehensive price war will be launched against Samsung and LG to compete for the world market. This should be a process of repeated battles and fierce battles.
Samsung and LG will be our most important competitors in the world market. As for Sony and Panasonic, they occupy the high-end market and are currently out of reach and have no direct competition."
Dong Mingzhu nodded thoughtfully, understanding what the chairman meant;
"Then...what if there are other suitable domestic manufacturers?"
"The scale cannot be too small. If the scale is too small, the number of skilled workers will be limited, which is not conducive to directly participating in large-scale competition in the world market. Our battlefield is mainly outside. We only take care of the domestic market, and profits are secondary. Skilled technical workers need to work slowly.
It’s not cost-effective to cultivate slowly.”
"I understand."
Zhu Jianghong is very clear about the character of this former subordinate. Dong Mingzhu is a complete career-oriented woman. She never feels that the burden on her shoulders is too heavy and she has the courage to challenge more fields.
The chairman's words aroused Dong Mingzhu's career ambitions again.
"Chairman, I want to report to you that the Fujitsu Complete LCD Research Institute that we acquired has now formed its own fourth-generation LCD production line technology through technical exchanges with other Japanese manufacturers, reaching the level of the current fourth-generation LCD panels.
The mainstream technology level of the production line.
Huanghe Technology Group is preparing to launch two fourth-generation LCD panel production lines in 1998, and the plan has been sent to the Secretariat. I heard that Samsung Group is also preparing to launch a fourth-generation LCD panel production line at the same time. We cannot be later than them."
Dong Mingzhu was keenly aware that the chairman was highly wary of the Samsung Group. When talking about the launch of the new fourth-generation LCD screen production line, he made a strange mention.
Sure enough, Wang Yaocheng waved his hand and said, "Okay, I will approve your plan today, so go ahead and do it boldly! Now, what share does Huanghe Technology Group's LCD screen production capacity occupy in the world?"
"It is currently 7.2%. After the new production line is launched, it can reach 14%, which is ahead of Samsung in the world."
"Not enough. Is it difficult to launch three lines at once? Is the talent reserve sufficient?"
"We have been actively preparing to transfer skilled technicians from the first-generation and second-generation lines, and train new workers on the first-generation line to form batches of talent training teams to provide qualified personnel for high-end production lines.
Skilled workers."
"Then you resubmit the report and launch three new lines."