Wanxiang comfortable stateside
Updated: 2016-06-21 10:32
By Hua Shengdun in Washington(China Daily USA)
$25 billion global auto-parts maker's US plant one of 40 worldwide, first studied local risks
Wanxiang America, a subsidiary of China's largest auto-parts manufacturer, feels at home in the US.
"Often times, we debate about who we are. And today, instead of saying we are a Chinese company, which is where we are originally from, I would say we are indeed a USA company," said Ni Pin, president of Wanxiang America, on Monday.
Ni spoke at the SelectUSA summit, where more than 150 Chinese delegates were looking to expand their businesses into the US. Ni took part in a panel discussion on risk-taking and resilience, hosted by the Washington Hilton Hotel.
Wanxiang Group has become a global company with $25 billion in revenue, owning more than 40 auto-manufacturing plants worldwide. One in every two vehicles made in the US is equipped with components made in Wanxiang's US plants. It has operations in 26 US states and employs more than 13,500 people.
Ni's company is well acquainted with taking risks in the US market, having first invested here in 1994. Since then, the company has played a positive role in the US economy, buying out failing companies and turning them into profitable businesses.
The most publicized and controversial example was when Wanxiang America bought the A123 battery company in 2013.
In 2012, the year before Wanxiang America bought A123, Ni recalled, "the company had lost about $200 million to $300 million. Less than 18 months later, we turned the company into positive cash flow."
Despite the success coming during his leadership at the helm, Ni refuses to take credit for the turnaround.
"The magic really came from the China market," he said.
Even in 2015, Ni said that more than 60 percent of his company's output is shipped to China, the largest auto market in the world.
However, the company's output is all that China receives from Wanxiang America. Ni said that the company has a policy to reinvest all of its profits back into the US.
The reinvestments of Wanxiang's profits have created a $6 billion portfolio of US real estate. Wanxiang's US real estate unit includes office towers, shopping centers, warehouses and resort homes, making it the second-largest Chinese real estate investor by number of properties held in the US.
Ni's success in America did not come easily. He said that one of the most challenging adjustments for doing business in the US was getting used to its strict legal system, compared with China's model of constant reform.
"If you want to be successful in business in China, you have to be brave in terms of pushing the envelope," Ni said.
Allan Fong and Chunying Cai in Washington contributed to this story.
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