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Takeover!
by adam at 06:31 AM on June 30, 2005
There's been a lot of talk in the news recently about Chinese companies buying well-known American brand names. First Lenovo bought IBM's entire personal computer business, and now Unocal and Huffy, of all things, are set to go as well. I've heard talk about how Chinese companies don't really know how to establish brand-names, and this sounds likely. When I was in China it was virtually impossible to tell one quasi-brand from another. Companies shamelessly ripped off each other's brands, not to mention the brands of foreign companies. It was impossible to tell what was genuine and what wasn't, and even worse, if you actually discovered a product that you enjoyed there was a pretty good shot that the next time you went back to that same store not only would the product not be there anymore, but the clerks wouldn't even know what you were talking about.
So market research isn't really very well-established yet in China. And if you don't know how to do something, it's classic business to simply buy someone who already has what you need. While I do feel a patriotic pang or two at the thought of a well-known American brand being sold to some unknown foreign company, it's not as though this kind of thing hasn't been going on for years across the Atlantic - so it's not really different if it happens across the Pacific instead.
I guess there are two small problems I have here. First, there's a general facelessness attached to Chinese corporations. We haven't heard of them by name, mostly because the purchasers are more often than not fronts for state-owned banks or consortiums of OTHER companies that we haven't heard of. Second, when someone is buying you just for your name recognition, it's a pretty good bet that they won't be terribly interested in keeping American factories open or honoring pensions (Huffy has already announced that they're taking an enormous dump on the shrinking population of companies that pay into the Pension Benefit Guarantee Corp).
I do have one bigger problem, though. The Chinese companies involved, and the Chinese government generally, are acting like this is all business as usual and are pretending that they don't know why everyone's so pissed off about this buying spree. Government ministers are even complaining that the US government is interfering in normal commerce. Meanwhile, up until a couple of years ago foreign investors weren't allowed to buy companies in China at all. They couldn't open their own factories either - they had to contract with Chinese "joint-venture partners" who would steal their technology and over-produce their designs to sell out of the back door. The Chinese government repeatedly interfered in foreign investment, a couple of times even forcing foreign companies that invested in entire industries with government approval to divest at a moment's notice with no explanation other than general national security concerns.
Let's be honest here - China is not our friend. We abandoned the Taiwanese to establish relations with the world's most populous country, but if there's anyone with a conscience left in the State Department then they've been holding their noses while doing so. The Chinese government changes rules of commerce and even history to suit their tastes, criticises the imperialism of other countries while ignoring their own massive crimes against humanity, and takes the wrong side in almost every conflict related to human rights for fear that their own record will be more closely examined (maybe we distrust them because we see ourselves in there somewhere?). And yet, in response to the massive economic challenge that China's industry poses to the US, we're chosing to give up rather than fight. We take massive loans from the same country whose industry is wiping out American manufacturing one sector at a time to keep our government and military running. We are borrowing from the dealer to buy more drugs and, even worse, to pay the bills.
I don't blame China. They're just doing what everyone does, what America has made a motto world-over: looking out for #1. I blame us. When did we as a society decide that rolling over was ok? Aren't WE the ones that are supposed to believe in competition?
comments (34)
Excellent Post...
Hybrid centralization and capitalism seems the way to go for now... It's funny that there are cries against rolling over and these cries are acceptable in the midst of the greatest liberalism the country is drowining in now... I bet if it were Africa, any sign of patriotism and protectionism would be shot down so fast by the liberals... but of course, it's china...
by LOCKHEED at June 30, 2005 12:14 PM
I fucking despise liberals without a cause
by LOCK at June 30, 2005 12:15 PM
I despise liberals with a cause. *remembering the Battle in Seattle*
by mr efficiency at June 30, 2005 2:29 PM
AWWW...
Someone needs a hug?
by Long Time Lurker at June 30, 2005 2:58 PM
Funny, the British government was all but begging a Chinese firm to buy out the British MG car company here. So much so they were offering millions *to* the firm, to buy it. Heh heh.
Swedes, Germans, Chinese... they seem to pay better, respect the unions, and ignore the minimum wage. British... they tend to export their factories to India or some other place far far away, make millions, and sell up when the going is good.
I went to a WWII thingy on VE day... and noted that all but three of the cars in the carpark there were German/Japanese. Brilliant! Two of the three were American... and there was one lonely British MG... probably bought at a massive discount since MG went under: The Chinese firm wasn't interested.
Eee, I love it!
by Ex Crimson Guard NCO at July 1, 2005 1:18 AM
Ex,
The Swedes and the Germans might respect unions but you can rest assured that despite their supposed adherence to communism the Chinese are dead-set against independant labor unions and bust them whenever they appear.
And I'm more than familiar with the whole MG Rover fiasco, since I drive a 1969 MGB GT, built by union workers at the long-abandoned Abingdon plant. It's a sad thing that there are no more mass-market independant British car firms left. But Jaguar, Astin Marton, MG Rover, et al were all victims of their own massive mismanagement more than any other single factor.
And we should be thankful that the Chinese firm didn't buy MG Rover - they only wanted technology and models. Anyone who thinks that the Chinese had any interest beyond the medium-term in keeping Longbridge open and paying pensions isn't paying attention!
Adam
by Adam at July 1, 2005 2:56 AM
And Lockheed, is there ANYTHING that you won't blame on liberals if given the chance? I'll let you guess the political affiliations of the big profit-takers who help move factories to China.
by Adam at July 1, 2005 3:00 AM
I've awlays been curious about the culture behind the "shameless" copying of competitors' products. Imean I wonder what the litigation and trademark situation is in China.
By the way, I'm sure I've told you this before, but I have a 1969 MGB (convertable), great car.
by chris at July 1, 2005 3:12 AM
No, I know Adam...
...my whole point is, I'm surprised that the liberals are allowing us to RANT against China is all...
...I guess their just too busy fighting for minorities with an IQ of zero and violent histories to get free rides to Harvard because it's all a RICH White MAn conspiracy... everything... omigod... call al sharpton.... LOCKHEED never worked hard all his life to get where he is... he was from the middle class, so he SURELY stole and cheated and even took his SAT scores from a black boy in the hood to get into COLUMBIA... yeah..... that's right...
by LOCK at July 1, 2005 2:28 PM
Bill Cosby? Bill Cosby? Is this classissm or racism?
by Al sharpton at July 1, 2005 2:41 PM
I agree with Lockheed as far as saying that higher education affirmative action in the U.S. is completely botched. It is all about pushing unprepared disadvantaged students into prestige universities, and hurting almost everyone in the process. Students that have worked four grueling years to build competitiveness for a top-tier university get bumped to the next one down, and students that have basically received only babysitting for their four (or three) years of high school are goaded by idealistic (or worse) guidance counselors into putting themselves into ridiculously competitive environments with zero preparation. A lot of those affirmative action students drop out. They would've been better served being advised to go to a state college, or to go to a junior college and transfer to top-tier (which is the Great Secret Backdoor of the higher education system), but instead they're just spat out of the system and left to their own devices. Seventeen and eighteen year-old kids basically become pawns in a big showing-off game. It's cruel.
by jean at July 1, 2005 7:39 PM
Adam :- "But Jaguar, Astin Marton, MG Rover, et al were all victims of their own massive mismanagement more than any other single factor."
I thought Aston Martin was still British owned? And TVR is doing alright. Everything else has gone to the Germans or General Motors. Isn't Lotus a UK company, though? Bah I don't know, can barely look left or right on the roads without some Japanese, French, Italian, or German piece of crap reminding you just what the British people would rather drive. Buy British... they say. Indeed.
Didn't the Germans do a hearty job trying to resurrect the popularity of Rover, it was the Germans I'm sure. I recall a big unveiling of the 75's... and wow did that fall on its arse! Orchestra, smiling Germans... uber coverage... buyers? They were the folk with about three years of life left in em. Poor ol' buggers. I envisage a future Britain with roads full of Daewoo's. w00t! Toasters with wheels.
by Ex Crimson Guard NCO at July 1, 2005 8:13 PM
Isn't China communist? What are they doing with companies, competition, brand names and such?
by anna at July 2, 2005 6:49 PM
I was wondering that same thing just this afternoon, Anna... I just finished a history of eastern civ. class that covered a lot of the regeneration of the Chinese economy, and talked about how the Chinese were discovering kind of a blended, pseudo-Communist economy in which everything is intensely regulated by the state...but no one complains if the business "owner" decides to take a bigger cut. It seems that China is discovering that Communist doesn't necessarily have to mean totalitarian...
by mr efficiency at July 3, 2005 2:04 AM
Or Communism, even.
by mr efficiency at July 3, 2005 2:05 AM
Bah...ignore that...I'm a little blitzed after two weddings today...
by mr efficiency at July 3, 2005 2:06 AM
But the revered rulers continue to reap the main profits I am sure.
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