In 1978, I was admitted to Harbin Institute of Technology

Chapter 272 Even negotiating a 500 million yuan cooperation in China is difficult; look at the foreign client's extravagance in buying technology for 1 million US dollars.
"Xie Wei, these conditions are far too harsh. A loan of 500 million, to be repaid in 3 years, with an interest rate of 24%, that's almost usury; and for the other 500 million investment, you want 40% of the shares..."

Even Chen Rongjie, who had always thought Xie Wei was a good person, felt that Xie Wei was now more ruthless than a capitalist.

Factory 122 lacked the funds to invest in production.

Xie Wei proposed that the Harbin Institute of Technology's Office of Industry and Commerce provide 1000 million yuan in funding, including 500 million yuan in loans and 500 million yuan in investment.

The loan itself requires paying 360 million in interest over three years.

Who would be willing to do that?

Even though Zhang Mingqiu and the others knew Xie Wei's conditions from the beginning, their mouths still twitched when they heard them again: That's really ruthless!

Even bank loans don't have such high interest rates.

Even capitalists would weep upon hearing this.

"Xie Wei, whether it's the interest or the shares, it's just too high. Add to that the school's 8% technology share, and your share reaches 48%. And the production equipment, factory, workers, and sales are all provided by us..."

Lin Tao suppressed his anger at Xie Wei and patiently explained, hoping that Xie Wei would not make such harsh demands.

"Secretary Lin, it's true that you provided the production equipment, factory buildings, workers, and even sales. But tell me, how much asset does Factory 122's automobile project currently have? If we don't produce cars, all that equipment in the factory will be idle, and we won't even be able to pay the workers' wages..."

Xie Wei remained calm.

He has extensive experience in these negotiations.

However, compared to international capital, it is nothing but a drop in the ocean.

"But……"

Lin Tao wanted to say something more, but factory director Huo Guoqiang even prepared to get up and leave.

Xie Wei interrupted Lin Tao directly: "Secretary Lin, the conditions seem harsh, but what's the reality? The Hongguang 1.0 hasn't even completed all the tests yet. Besides a few hand-built prototypes, there's nothing. As for production equipment, what do we have besides the machining equipment we can use in the factory? No matter how things develop, the factory's military production capacity must be guaranteed..."

Faced with Xie Wei's questioning, none of the leaders of Factory 122 knew how to refute it.

Even if military factories are to shift their focus, they must first ensure their military production capacity.

Especially factories like Factory 122, which are major domestic helicopter manufacturers.

If the production of civilian products affects the production capacity of military products, it may even lead to the complete abandonment of civilian product production.

“Even our current skilled workers can’t all switch to car production! With this 500 million investment, we can build a new production line from the beginning, gradually increase production, train a technical team, and accumulate car manufacturing experience… Even if this car doesn’t have a market and can’t be sold, what loss will Factory 122 suffer? Not only will we not get our 500 million loan back, but our 500 million investment will also be wasted!”

Xie Wei spoke eloquently.

That sounds like it makes a lot of sense.

Whether it was the school leaders or the leaders of Factory 122, they all felt that something was wrong, but they really couldn't find a reason to refute it.

"The risk is so high, and what about the returns? We have a 500 million loan, and even our 500 million investment will have to pay loan interest..."

Before anyone could respond, Xie Wei continued.

According to him, the 500 million yuan investment by the school-enterprise office not only risked losing everything, but also did not yield the expected returns.

The more everyone listened, the more reasonable Xie Wei's request seemed.

High risk means high reward, otherwise who would be willing to take the risk?

Although there are currently a small number of minivans imported from Japan in China, no one can guarantee how well they will sell.

"Xie Wei, you were the one who proposed making this type of car... but the interest and equity are still too high..."

Even as the top executive of a state-owned factory, Director Huo was somewhat unsure of himself at this moment. He deeply agreed with what Xie Wei said, but considering that it was Xie Wei who proposed the minivan project, he felt that he could use this as leverage to ask the other party to lower their demands.

"Director Huo, you're not right to say that!"

Xie Wei retorted without hesitation, his face full of dissatisfaction, "You were the ones who made me propose this! Besides producing simple vehicles like minivans, which don't require much technology and have little market competition, what can Factory 122 produce with its current technological foundation and financial strength? Producing the heavy-duty trucks that are most needed domestically? How can we compete with special vehicle factories? Producing sedans? FAW and other factories have stronger capabilities and foundations, right?"

"..."

His words left the other party with no room for rebuttal.

Thus, the first round of negotiations between the two sides ended without any progress.

"Principal Zhang, Secretary Liu, please wait a moment."

Zhang Mingqiu and his group had just left the meeting room when Huo Guoqiang called them back.

Knowing what he was going to say, Principal Zhang said apologetically, "Director Huo, the cooperation is handled by the School-Enterprise Cooperation Office. Currently, Comrade Wang Zheng has been transferred to another position, and the head of the School-Enterprise Cooperation Office has not yet been appointed. Comrade Xie Wei will be fully responsible for the cooperation."

"..."

Before he could even speak, he was silenced. Director Huo was incredibly upset.

"Principal Zhang, Secretary Liu, are these conditions really not negotiable?"

"If you can get a loan from the bank at this interest rate, or get funding from the Ministry of Machine Building, we won't waste any time. Xie Wei isn't making things difficult for you by proposing these conditions... You need to know how many people are eyeing the school's funding... Also, several projects of the Ministry of Machine Building are funded by the school..."

Knowing that the other party thought Xie Wei's conditions were too demanding, Liu Debao gave them a reminder.

After saying that, without waiting for a reply, he caught up with Xie Wei's pace.

Huo Guoqiang only came to his senses after watching the group walk to the 212 Jeep parked in front of the office building, get in the car, and the car disappeared from sight.

"Director?"

Chen Rongjie called out to Huo Guoqiang.

"Call a meeting for all managers at or above the middle management level in the factory!"

Liu Debao's words did indeed remind Huo Guoqiang that the hundreds of millions of yuan in funding held by Harbin Institute of Technology were not only being eyed by them, but also by other institutions.

If they get funding from Harbin Institute of Technology too easily, other institutions may follow suit, or even try to get their hands on the school's funding through higher-level management departments.

"Old Liu, have you told them about our difficulties?"

Zhang Mingqiu asked Liu Debao.

Liu Debao nodded, then asked worriedly, "Will they accept it?"

Ultimately, even though he thought Xie Wei's argument that investing in the school was risky and therefore required higher returns made sense, he still felt that Xie Wei's conditions were too harsh.

“They will accept it. Unless they can secure follow-up funding… because the technology is simple, the school's design work didn't cost much… but production is a different story… Harbin is a heavy industrial city, and there are too many organizations waiting for funding…”

Xie Wei said calmly.

It's impossible to lose money in the automotive industry if you've been in business for 80 years.

Even if it's just scrap metal from cars, as long as the wheels can turn, there's a market for it.

Can you lose money in a market without competition?
"I'm afraid other organizations will also make similar demands and ask to cooperate with us."

Principal Zhang sighed.

The sudden increase in school funding has become a major headache for the principal. "The initiative is in our hands," he says.

Xie Wei knew that after the first payment for the rocket launcher sales went into the school's account, Principal Zhang was under a lot of pressure. Not only would higher-level leaders intervene, but many other organizations that lacked funds or projects would also come knocking on their door.

They claim it's cooperation, but in reality, they're robbing the wealthy.

"By the way, when will the person in charge of the school-enterprise cooperation office be in place?"

Xie Wei turned to ask the two men.

Since Wang Zheng was taken to Hong Kong by Xie Wei, the school-enterprise cooperation office has been completely unmanaged. Fortunately, each project has a designated person to coordinate with, so no problems have arisen yet.

Even if Luo Cheng hadn't gone to Chengdu, he wouldn't have been able to directly manage the entire school-enterprise office, given his qualifications, experience, or abilities.

"The candidate has been chosen. Principal Li found a section chief from the Ministry of Commerce who is familiar with international trade. He will come later after the cooperation with Factory 122 has yielded results."

Zhang Mingqiu hurriedly said.

The current school-enterprise cooperation office is practically a disorganized mess.

It's really hard to determine the right person.

A strong-willed director of the school-enterprise cooperation office is bound to cause conflicts with Xie Wei.

How can someone who is always obedient accumulate rich management experience and understand the market?
There aren't many people in the whole country who truly understand market economics.

Now, it seems that the person in charge of the school-enterprise cooperation office also needs to know about investment?
Xie Wei, the clerk, has always been someone who kills but doesn't care about the aftermath.

Upon hearing this, Xie Wei frowned immediately. Sitting in the passenger seat, he turned to look at the two of them. "Are you two completely indifferent to the affairs of the university-enterprise cooperation office? After all, the university's various research projects and programs still rely on the university-enterprise cooperation office for subsidies!"

"Xie Wei, young people should know how to respect the elderly and care for the young. We're all getting old and will be retiring soon. Can you bear to let an old man like me, who's almost buried in the ground, worry about these things all day long?"

Zhang Mingqiu had a smile on his face.

"That would kill brain cells. Young people might become more sharp-minded if they lose a few brain cells, but for an old man like me, losing too many brain cells would lead to Alzheimer's!"

Liu Debao was also all smiles.

Xie Wei once again discovered that the two men's rascality was becoming more and more like Old Man Li's.

The old man didn't serve as the school principal for long, but his influence has lasted.

"By the way, Abdullah is here again. He'll be at school the day after tomorrow."

Liu Debao promptly changed the subject.

"And what's the result? If we keep arguing, it's a complete waste of time."

International trade negotiations are always protracted, and arms trade negotiations take even longer, sometimes involving multiple rounds of talks over a single condition, lasting for several years.

Xie Wei was not unaware of this.

But he didn't want to.

In his view, the demands made were not high and there were no conditions attached, in order to save negotiation time and avoid wrangling, which was good for both parties.

result……

"Unlike last time, this time the other party hasn't revealed any information. They only expressed their hope to communicate with you first after arriving before proceeding with negotiations..."

When Xie Wei heard Abdullah's request, he was momentarily confused about what the other party was up to.

After the group from Harbin Institute of Technology left, Director Huo convened a meeting with the factory's middle and senior management. The discussion lasted from morning until evening, but no decision was made on whether to accept Harbin Institute of Technology's harsh conditions.

It's not that Director Huo is unwilling to take responsibility.

A three-year loan of 500 million will require a total interest payment of 360 million!

Moreover, the other party will invest an additional 500 million yuan to take a 40% stake. In this way, Harbin Institute of Technology's total shareholding in the entire automotive business will reach 48%, which is almost half.

There are no precedents to follow.

If it succeeds, there's no problem, but what if it fails?
122厂因为直-5在今年停产，直-6早在70年就转入常州飞机制造厂跟昌河飞机制造厂制造，直-7则是设计过程整机严重超重在去年就已经下马。

As a result, Factory 122, which mainly produces helicopters, not only lost its helicopter research and development project, but also its production tasks.

That's why Harbin Institute of Technology attached such importance to purchasing a Y-11 transport aircraft worth over 200,000 yuan. The factory director, party secretary, and chief engineer personally welcomed the aircraft, and the university was also eager to start a new automotive project.

If the Hongguang 1.0 minivan doesn't perform well in the market, Harbin Institute of Technology's 500 million yuan investment won't need to be repaid, but the loan will!
That would make things even worse for Factory 122, which was already struggling.

Who dares to take this responsibility?
There are tens of thousands of cadres, employees, and their families in the entire factory!

"Factory director, since there are no relevant policies or precedents, and the higher-ups are asking us to take initiative and find a way to solve the funding gap problem, the factory can't make the decision. Why don't we ask the leaders in the ministry for their opinion?"

Some people offered their suggestions.

Upon hearing this proposal, the previously quiet meeting room instantly became lively.

"Yes, report directly to the higher-ups! Let them help the factory stay on track and avoid making mistakes!"

Everyone agreed to report the matter to their superiors.

So, Director Huo immediately had someone book a train ticket for the morning and went back that night to pack his things.

The next day, Xie Wei thought that negotiations with Factory 122 would begin again. Before he could even set off, he received a call from Zhang Mingqiu, who told him that Huo Guoqiang had gone to the Ministry of Machinery Industry and that the negotiations would have to wait until he returned.

He didn't think much of it.

Compared to cooperating with Factory 122, he was more looking forward to Abdullah's arrival, and was especially curious about what new conditions Abdullah would bring.

I don't know what that guy meant by asking to communicate with me before negotiating.

The next day, Xie Wei took the school's jeep to the Northern Building alone, told the driver to go back first, and after he finished talking, he took the bus back and entered the Northern Building.

Although he hasn't visited often, Xie Wei is quite familiar to the staff at the Northern Building.

So young, yet capable of leading negotiations with clients from several countries. If you're not familiar with the field, why not try keeping him out?

"You want technology? General, are you kidding me?"

Upon meeting Xie Wei, Abdullah skipped the pleasantries and went straight to the point, stating that he could agree to Xie Wei's offer, but only if Harbin Institute of Technology transferred its long-range rocket production technology to Iraq.

The reason is that rockets are consumed in large quantities, and they purchased a sufficient number—more than 6000 in total!

"No! If you're willing, we can sign the contract directly, just like our previous collaborations—cash, payment first!"

Abdullah believed he had the other party's weakness in mind.

The president only added $1 million in funding, which is far from enough to acquire the production technology for long-range rockets and the production formula and process for solid fuel.

Therefore, General Abdullah's plan was to obtain the technology for free through a contract, and then purchase solid fuel formulas and production processes for $1 million.

(End of this chapter)