• Choose a category
• All
• Classic-Fiction

By Root 3914 0

AMC was already sending a delegation to work out a deal. Over the next decade they learned to regret their pioneering status. While other companies such as Toyota stayed out of China, biding their time, AMC forged ahead and got nowhere. The partnership structure was awkward: two sets of management, each with its own culture, goals, and values. The AMC experience became so notorious that it eventually inspired a book called Beijing Jeep by the journalist Jim Mann. It’s a story of one misunderstanding after another; the chapter titles include “Getting Nowhere,” “A Very Long Haul,” and “An Outpouring of Grievances.” Even the index conveys a sort of taut frustration—it begins with “Absenteeism” and continues through “Xenophobia,” an alphabetized testimony to cultural differences of the 1980s:

Beatrice Companies, Inc., 236–238

Bechtel Corporation, 65, 105, 299

Beds in Chinese offices, 127

Beijing Automotive Industrial Corporation (BAIC), 91, 254, 263

The Beijing Jeep became a symbol for the problems that beset foreign partnerships in the early Reform years. During that period the Chinese were still figuring out how to do business, and it wasn’t until the 1990s that the economy really took off. American Motors never recovered; their experience was a classic case of being in the right place at the wrong time. And the Jeep Cherokee represented one of their worst miscalculations. They started producing Chinese Cherokees in 1985, which was far too early for a sport-utility vehicle; most customers were still businesses or government bureaus that preferred sedans. When private consumers finally began to appear, AMC tried to target new city buyers by abandoning the Cherokee’s four-wheel-drive feature. They painted a sporty line along the doors, added some purple detailing, and tacked on an urban name: the City Special. This resulted in a cheaper price but a much less useful and distinctive vehicle. Not long after that, China developed a class of moneyed people with outdoor interests, but in their eyes the Cherokee was already outdated and useless. Yuppie adventurers were far more likely to splurge on a Toyota Land Cruiser or a Mitsubishi Pajero. The only reason I drove a City Special was because I had no other option—that was all I could find on the Capital Motors lot.

Unlike AMC, other foreign companies survived the hard years in China, and by the end of the 1990s some of them began to enjoy major profits. The strict industry rules limited competition, and prices could be kept artificially high. Chinese consumers lagged several generations behind other countries, which allowed automakers to bring in outdated technology from overseas. In the 1990s, Volkswagen took a failed plant from Westmoreland, Pennsylvania, where they had formerly manufactured the VW Fox, and moved the main equipment to northeastern China. The car they produced, the Jetta, eventually surpassed the Santana to become the nation’s best-selling passenger vehicle. Margins were huge: in 2001 and 2002, on a per-car basis, Volkswagen and General Motors made more profits in China than anywhere else in the world. When a Buick Regal sold in China, it generated as much as double the profit made on the same car in America. Michael Dunne, an analyst who specializes in the Chinese auto market, told me that during this period he once asked a General Motors executive about profits in China. “We are making more money than God,” said the GM executive.

But the whole system was ripe for change. If a Chinese company could find a way to use foreign technology without getting saddled with a partnership, they could create a more efficient management structure. And there was enormous opportunity in the low-end market, because the expensive joint-venture products had never targeted the fledgling middle class. At the end of the 1990s, the government of Wuhu, a city in eastern China’s Anhui Province, decided to set up a car company of their own. They hired an engineer named Yin Tongyao, who had previously been a star at Volkswagen. Yin had distinguished himself during