Cao Dewang responded to the media: there is no trade union crisis will open a new factory in the United States

At the end of 2016, Cao Dewang, who has received much attention for investing $1 billion in the US to build a factory, has once again become a topical figure. On June 12, the New York Times published a report saying that Fuyao Group suffered a crisis from the trade unions in the United States, and was negatively evaluated by workers and the involvement of local trade unions. The report was rapidly fermented in the country, and some media claimed that Cao Dewang had “a $1 billion in exchange for insults, marches, and fines”, which caused widespread concern. On June 20, Cao Dewang, the chairman of Fuyao Group, responded to the incident in an interview with the Beijing News reporter, saying that the above-mentioned report was inaccurate, which led to the spread of the "headline party" style in China. Cao Dewang said that Fuyao did not encounter a "trade union crisis" in the US factory, and Fuyao is still in the United States for site selection and plans to build a new factory.

"I don't want to pay attention to rumors at all."
On the morning of June 20, Cao Dewang, who is in the United States, accepted a telephone interview with the Beijing News reporter. He said that the recent rumors about the Fuyao US factory made him uncomfortable. "I don't want to pay attention to these rumors at all."
A recent report by The New York Times described that Fuyao Group’s factory in the United States faced serious labor conflicts due to employees accusing the company of “racial discrimination”, unreasonable paid leave system, and neglecting the safety of employees’ work environment. Guarantee and other issues. The report also said that based on these issues, the National Association of Auto Workers (UAW) launched a fierce trade union movement, while the US Department of Occupational Safety and Health (OSHA) also violated some of the violations of Fuyao in terms of safety and environmental protection. A fine of $225,000 was imposed.
After the publication of the report, its content was widely quoted by the domestic media and the media, and various interpretations were made for this. A more common guess is that Cao Dewang’s investment in the United States “has encountered setbacks”. Many netizens and some self-media people have written or commented that "Cao Dewang regrets it."
On the morning of June 20, Cao Dewang told the Beijing News that the above-mentioned "New York Times" report had a lot of content that was inaccurate, and that "something was empty," and some domestic media made a "headline party" interpretation based on inaccurate information without any proof. "They have never interviewed me." Cao Dewang said.

“There is no union crisis in the factory”
In response to the New York Times report that Fuyao was "finished" in the United States, Cao Dewang responded that Fuyao reached a settlement agreement with him in March this year, investing about 7 million US dollars to improve the safety-related problems of the factory. To 100,000 US dollars, this part of the money is not enough to have any impact on the company.
Cao Dewang said that in the United States, if a company is really found to have problems with environmental protection, 10 million US dollars and 100 million US dollars are useless. "The first thing waiting for you is that the factory will suspend production and enter the rectification until it meets the standard before it can resume work."
Cao Dewang told the Beijing News reporter that several employees accused of Fuyao were dismissed by the company. Cao Dewang believes that the New York Times only cited several accusations of employees who were dismissed because of their ability to work. "I am irresponsible." “We didn’t have a union at our factory in Ohio, and there was no 'union crisis'.”
Cao Dewang told reporters that most of the employees are not interested in forming a trade union within the company. “The proportion of employees supporting the establishment of trade unions is less than 5%.” Cao Dewang introduced that in accordance with the general rules, the establishment of trade unions within enterprises requires at least half of the employees to vote. At present, the company's situation is "all normal."

“The confidence in investing in the US remains the same”
At the end of 2016, Cao Dewang, who was over 70 years old, was widely concerned about the investment and construction of Fuyao Glass (25.080, 0.00, 0.00%) in the United States. At that time, Cao Dewang publicly expressed his optimism about investing in the United States, saying that "the comprehensive tax burden of China's manufacturing industry is 35% higher than that of the United States." "China is more expensive than the United States except human resources." These remarks triggered a market panic about "Cao Dewang ran away."
At that time, Cao Dewang said in an interview with the Beijing News that the cost of manufacturing in China is too high. In China, VAT is the biggest burden. At the same time, China's labor advantage is gradually lost compared to many developing countries.
"My opinion has not changed." For the recent speculation that "Cao Dewang regrets investing in the United States", Cao Dewang responded to the Beijing News that the production efficiency of the US factory is indeed not as high as that of the domestic factory, but his confidence in investing in the United States remains the same," Making glass in the United States is still very profitable," said Cao Dewang. "The site is still being selected and I plan to continue to invest in the United States."
Fuyao Glass's 2016 financial report shows that as of December 31, 2016, the actual plant in Ohio, USA, has actually invested 654 million US dollars. The main source of funds comes from the company's fundraising and borrowing funds.
In 2016, Fuyao Glass USA Co., Ltd. achieved an operating income of US$104 million and a net profit of US$41.61 million. The company expects that 2017 Fuyao Glass USA Co., Ltd. "will enter a benign development track."

■ Data overseas investment exceeds 50% of enterprises encounter “disputes”
2016 Legal Daily The China Corporate Law Research Institute and Shanghai Jiaotong University released the “2015 China Enterprises Going Out Research Report”, showing that more than 50% of overseas investment companies in China are involved in local civil litigation or arbitration procedures. Among these disputes, 23.7% of the respondents were subject to administrative penalties, and 7.9% of respondents also involved criminal proceedings. A common type of civil case is labor disputes. Among them, 21% of enterprises have encountered group labor disputes. Among them, the proportion of collective labor disputes in South America, Europe, North America and Africa is relatively high.

â–  Viewpoints of labor disputes become the biggest test of Chinese enterprises overseas
Mei Xinyu, a researcher at the International Trade and Economic Cooperation Research Institute of the Ministry of Commerce, said that Fuyao’s glass manufacturing industry is a standard labor-intensive industry with hundreds of millions of investments. In contrast, the fine of $100,000 is “not at all”. Will not have a material impact on the company.
Mei Xinyu believes that although the incident has no major impact on Fuyao, it is indeed a common phenomenon for Chinese companies to encounter "union" problems overseas and labor disputes. There are reasons for differences in cultural and political and economic structures.
He said that in the case of the United States, after the Second World War, the trade union system has gradually become one of the main factors dragging down American industry. The United States wants to revitalize its own industry, and the trade union system is also facing the need for reform. Mei Xinyu said, "For Chinese companies investing in the United States, they should talk about strategies, don't try hard, and should find ways to communicate with local trade unions."
Mei Xinyu previously told the media that under the current labor compensation system of large manufacturing enterprises in the United States, the hourly wages are generally applied to workers. The wages of workers depend on the type of work and working hours, and have nothing to do with the amount of work completed. Low, it is hard to imagine the situation of overtime work in order to complete the production as soon as possible.

â–  Focus [former executives]: "I was discriminated against by Fuyao"
According to the New York Times, Dave Burrow, former deputy general manager of the Fuyao Glass Dayton factory, sued Cao Dewang. It is reported that Burrow claims at least $442,000 to compensate for its losses.
Burrow claimed that he was dismissed because he was "not a Chinese."
[Trade union] is collecting signature support for the union
The New York Times reported that Fuyao is facing a trade union movement initiated by the National Association of Auto Workers (UAW). The trade unions began meeting workers in 2015. In April this year, they increased their public activities and held a meeting near the Fuyao factory, saying that the factory was quite random in the implementation of the rules. At present, UAW has been collecting signature support from Fuyao employees, but has not yet collected the required 30%.
[Cao Dewang] They are not doing their job and are wasting money
In this regard, Cao Dewang said that he was too "devious". He said in an interview in Beijing that he fired two US executives because "they did not work diligently and waste my money." He said that the productivity of the factory "is not as high as our factory in China", "some workers are killing time."
[Fuyao] 4% of workers participating in the event
Fuyao said that there is no union in the Dayton factory. On the contrary, there is a union in the Mangshan factory in Illinois, which is currently operating smoothly. In accordance with local US law, the establishment of a union in a factory must be approved by more than half of the employees in the factory. However, the number of people participating in the UAW activities at this time only accounted for 3%-4% of the entire factory, so it is far from the standard for establishing a trade union.

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