- •Text bank
- •Slowing down? not these trends
- •Japan tops growth forecasts
- •U.S. And euope hint at economic cooling
- •Growth in china slows as controls take hold
- •Unit II
- •Eu trade gap with asia stirs currency debate
- •Digital dragon
- •Record china trade surplus
- •U.S. Trade gap narrows as oil costs decline
- •The International Herald Tribune, November 10-th, 2006
- •Yen falls against dollar on u.S. Trade data
- •Japan’s trade surplus drops sharply Latest data spur concern that economy may slump further
- •Europe scolds china on trade and currency
- •Unit III
- •U.S. Says chinese tax isn’t enough
- •Wider market access for former eu colonies
- •China raises stakes in eu shoes battle
- •U.S. Paper mill at heart of tariff threat against china
- •Beijing fires back at u.S. Complaints
- •Unit IV
- •Honda takes lead with exports from guangzhou
- •Vw plans to increase chinese car parts exports
- •How danone’s china venture turned sour
- •Domestic car sales veering into the slow lane
- •Toyota looks to expand in america
- •Expanding abroad – and growing at home
- •Tech: slow at home, growing abroad
- •Chrysler to share more parts with mercedes
- •Arcelor mittal looks at brazilian expansion
- •Gm growing in india, reshaping in europe
- •Ge takes a new line in the business of outsourcing
- •German companies look abroad for gains
- •Electrolux to shift plants abroad
- •Unit VI
- •Troubled carriers face some stiff competition
- •Ready for a cargo surge
- •China trade to enrich ports in u.S. East, too
- •Here winners are fast rather than large
- •A renaissance for railroads
- •Western retailers shift their supply chain tasks to china
- •Unit VII
- •Soaring prices boost recycling of computers
- •Asian nations shift policies to offset rising energy prices
- •Rising cost of gas raises fears of gouging
Vw plans to increase chinese car parts exports
Volkswagen is planning to export $1bn of Chinese car parts by the end of this year, providing a big boost to the country’s export plans and increasing pressure on the carmaker’s threatened German component factories.
VW says it expects to increase exports from just $100m to $1bn, taking advantage of labour rates that average a fifth of those in developed markets.
VW has been burdened by a poor supply network in China after its early start – it led the market after setting up its first car assembly joint venture in 1985 – left it stuck with high-cost, low quality suppliers tied to joint venture partners.
A year ago the Government set an ambitious target of increasing exports of parts from just $5bn to $100bn by 2010, putting local companies under pressure to meet developed-world cost and quality standards.
Today large foreign component producers, such as Germany’s Bosch, Japan’s Denso or Delphi of the US, are likely to make up the majority of exports from China. Toyota, the Japanese carmaker, has built a factory in Guangdong province to export engines to Japan, while Ford has been increasing its purchasing from China to lower component costs.
The Financial Times, March 31st, 2006
№ 19
How danone’s china venture turned sour
Corporate China in the 1990s was littered with the wreckage of failed joint ventures between multinationals and local companies but the tie-up between Danone, a French food giant, and Wahaha Beverage, a Chinese firm, was held up as one of the great success stories.
The partnership seemed a good fit at first. When Danone, acquired a 51% stake in Wahaha, in 1996, it considered it a coup. In what has become a painfully familiar experience in China, the company has since run into trouble.
Danone is hardly the first to have been hit. Faced with a geographically vast but promising market obscured by a thicket of complex and contradictory rules, many foreign firms have entered China via joint ventures – and then been left grinding their teeth. Given the inherent instability and culture clashed in many China joint ventures the Danone case will be closely watched by many multinationals.
In theory, the case for joint ventures was compelling. The foreign partner provided capital, expertise, product research, access to international markets and jobs. The Chinese partner provided access to cheap labour, local regulatory knowledge and access to what used to be a relatively unimportant domestic market. The Chinese government protected swathes of the economy from acquisitions, but provided land, tax breaks and at least an appearance of a welcome to attract investment.
In practice, these arrangements have collapsed. China’s hunger for foreign investors has been sated. The availability of labour and land has fallen, domestic capital is abundant, the local market is now understood to be among the most attractive in the world and sentiment has become more nationalistic and self-satisfied. So there is less interest in providing access to foreign partners. Danone faces an uphill battle if it is to restore stability to joint venture, which accounts for 75% of its China operations.
The Economist, April 21st, 2007
№ 20