My Lord, you need to stand up!

Chapter 781 The Natural Constraints of a Manufacturing Tycoon

Wei Dong has come to represent capital.

However, he didn't show any signs of this on his person. When attending a financial capital meeting on Wall Street, he dressed a little more formally, wearing a shirt, jeans, and sneakers, with a casual suit on top.

Actually, he was no different from the young boss who stayed at a hotel with his secretary for the first time back then.

Steve will explain to the financial tycoons the situation where Apple computers and Kungfu software are flanking from both sides.

Wei Dong then spoke up: "I am very grateful to Steve for giving me this opportunity. I have always been providing support and assistance to Steve, helping a genius like him create miracles."

This harmless positioning made Steve lean back on the sofa and look at his young partner.

Because the guy he knew wasn't so docile and innocent.

Let Wei Dong reveal his secrets: "Let me briefly introduce my business development trajectory. It's very simple. I seized the opportunity presented by the hundreds of millions of cheap laborers in China, a country with a huge population. I started by selling snacks on the street, but at the age of nineteen, I chose to produce them at low cost in places like the countryside outside New York, about 200 kilometers away, and then bring them to big cities like Manhattan to sell. That's how we achieved the huge profit margin..."

This explanation makes it very easy to understand.

Financial tycoons' mastery of human nature and the cutthroat competition among business elites does not mean they understand the workings of IT and the internet, nor does it mean they have any knowledge of distant Eastern countries.

Now he's nodding frequently as he listens.

Kemp sat behind Jean Weidong, mimicking the posture of the hotel's business assistant leaning forward, attentively listening to the boss's wife's vivid translation.

"So looking back at all the businesses I've entered step by step, they've all been about making profits by taking advantage of cost and price differences between different regions. That's why I got involved in the construction of Chrysler's Asian contract factory. This all started with how I inexplicably became the deputy general manager of the first Citibank plant in mainland China..."

This is like a storyteller; everyone is listening intently.

There's no need to even show Qin Yuye's photo with the bigwigs. Wei Dong observed that everyone here reacted much more calmly to the Citibank vice president than to the Chrysler president.

“I don’t care much about this car factory, just like I’m not very interested in the mainland China market. I’m too poor to buy anything. A qualified businessman should focus on profits. Ouyi has been prompting me to think about this issue for the past two years. There is a huge amount of cheap labor over there, and a huge consumer market and products over here. How can we find a profit point? Establishing an OEM factory to become the best production base for Citibank might be an option.”

These are all facts, and there's no self-deprecation involved. Even if forty years from now, the consumption of over a billion people in mainland China will not match the extravagant spending of two or three hundred million Citizens.

Many mainland export factories are still only focused on the North American market even 40 years later.

So Wei Dong spoke with utmost sincerity: "Why can Japanese cars be sold all over the world? It's because they are cheap and of good quality. A Chinese auto worker earns less than thirty dollars a month, while a Detroit worker earns more than three thousand dollars. How can the cost of producing cars be the same?"

A hundred times!
While it's true that discussing income without considering price levels and cost of living is somewhat dishonest, a monthly salary of around two hundred yuan is definitely a high salary in mainland China right now.

But it sounds amazing.

Steve chimed in with examples, saying that Apple is a publicly traded company, so all its annual production and operating reports are public. The California factory is now the main facility, and two years ago they invested $200 million to build a European factory in Ireland, but so far it's just an assembly plant.

The Shanghai factory, with an investment of US$70 million, is now able to handle about two-fifths of the production, and its costs are much lower than those of the California factory. Therefore, the second phase of the Shanghai factory is being expanded, and a new factory in Pengzhou is planned to be built, forming a three-factory scale.

Wei Dong even pointed to Kemp: "This is my sports ambassador. He will lead the young Citigroup youth basketball team to compete all over Asia. What is the purpose? It is to showcase Citigroup's strong all-round strength and promote Apple computers and Chrysler cars. I am confident that I can help Apple computers and Chrysler cars produce more, better and cheaper products and seize all the global markets that can be seized. That is my role."

That's right, which has led Wei Dong to now define himself as the king of OEM manufacturing.

Regarding software: "So, for the Kungfu software that Steve recommended, I will also follow the same approach. The most high-end and capable talents will naturally be concentrated in Citibank, while all low-level, labor-intensive parts will remain in China. The more work that requires a large number of low- and mid-level workers to complete, the greater the profit gap will be. In this regard, I will follow the arrangements of Steve and all the gentlemen and wholeheartedly provide services."

To be honest, if a short video of him in this position were posted in mainland China, he would definitely look like a traitorous comprador.

Domestically, the "hide your strength and bide your time" mode has not yet been fully implemented, but it has given Wei Dong a sense of confidence, as he saw signs of it when he came out this time.

So I don’t mind coming myself: “My wife and I are both from Hong Kong. I have docks and industrial zones around Hong Kong, and I’m investing heavily in various supporting facilities to build larger and more quality-compliant contract manufacturers. Wanma Hotel Group, Chrysler, and Apple will all be partners that I will serve wholeheartedly. Kungfu Software also hopes to provide services according to your requirements.”

Qin Yuye was surprised, but not so surprised; more importantly, she excitedly conveyed her husband's attitude.

Hong Kong people think this attitude is perfectly natural.

Therefore, her translation uses more humble language.

The financial tycoons were very satisfied, because Wei Dong's words clearly meant that he was handing over the Kungfu software and could do whatever he wanted with it.

The information he revealed even prompted everyone to immediately begin inquiring about the details of Chrysler's and Vanmad Hotel's investments in Asia.

Wei Dong was completely open with his information. Of course, he didn't mention how booming the market was, but rather he frequently boasted about his factory and sales team, which numbered in the tens of thousands: "It was very poor, with nothing. I drove around for six months doing sales and transportation work, encountering robbers and thieves many times, and I had nowhere to stay. So, it's necessary to establish a safe and comfortable chain of business hotels to ensure the entire system operates smoothly. And I don't rule out going to those poor but primitive areas to see the scenery. Undeveloped, primitive areas can still attract high-end tourists, like the African savanna or..."

His wife filled in the gaps for him: Tahiti, the Amazon rainforest, and the Indian snow mountains. This immediately created a stereotype in the minds of the financial tycoons, which even influenced them for many years.

But at this point, the most important factor was that it affected their assessment of the future prospects of Wanmad Hotel Group and Chrysler Automobiles.

Both of them are publicly listed companies.

They are even considered customers in which they hold shares.

It includes investments in industries by financial institutions, as well as investments by various large investors and financial capital funds that they hold on behalf of.

This allows us to learn about the details of these two companies' movements in advance from the sidelines.

Chrysler is currently Citigroup's largest automaker!
Regardless, it's a behemoth with a market value of two or three hundred billion US dollars. It's truly a miracle that Apple could catch up to a similar position to such a century-old giant in just one or two months.

We now have inside information about Chrysler's latest developments, including firsthand assessment details.

Simply placing a large bet on Chrysler in advance would be a very profitable move.

It's quite a coincidence, actually. Two years ago, when Wei Dong was made vice president of Cherokee, Chrysler hadn't yet acquired Jeep.

Now, somehow, I've gotten involved.

He had little experience in stock and financial investment, and he made no attempt to hide it, so even though his wife grew up in Hong Kong where everyone was into stocks, she was only twenty years old and didn't realize it.

They revealed most of the details of the entire project.

It wasn't until they came out that Steve reminded them: "Aren't you guys talking too much about this? It could very well cause major upheavals in Chrysler's capital markets."

Wei Dong was genuinely surprised: "Ah, won't this affect the relocation of these two factories?"

Steve shook his head: "It's hard to say. Major changes in the automotive industry may touch a nerve with some members of Congress, but Chrysler was on the verge of bankruptcy a few years ago, and now... in the eyes of financial capital, it has signs of a last gasp. Although its sales performance has been decent in the last two years, it cannot change the fact that it has lost to Japanese automakers in the overall market. So this idea of ​​shifting to overseas contract manufacturing cannot be denied. Hopefully, it will not affect Apple's contract manufacturing."

Wei Dong was even more startled: "How could this be? How did car manufacturing get involved in computer production?"

Steve smiled wryly: "There will always be people advocating for keeping production in the country. This kind of voice is most appealing to lower-class voters, and there are also various restrictions such as import and export quotas, so it depends on the policy direction of the members of Congress and the two parties."

Wei Dongcai laughed: "So Citibank is also affected by policies!"

Steve patted him on the shoulder with a hint of annoyance: "Overall, it's pretty good. Your positioning as the world's manufacturing hub will make a lot of work easier. Well, this capital can also push for the acceptance of the GATT."

That's how translation works; some words are easily noticed or not, depending on Qin Yuye's vocabulary of certain technical terms.

As someone who graduated from a girls' school in Hong Kong, she's certainly very familiar with everyday language, but her professional terminology comes entirely from her older brother's upbringing.

At the very least, she would carefully inquire about and confirm the GATT that Steve casually mentioned.

Citibank is quite annoying in this respect; they love to use all sorts of abbreviations to show off.

"The General Agreement on Tariffs and Trade (GATT) is the agreement organization for most countries' sales and trade. China is not in it, so many import and export quotas are restricted. Our jeans exports have to go through Japan, and we still haven't been able to sell our cosmetics here. Also, whether the goods from Apple's contract manufacturers are considered imports or exports or contract manufacturing makes a big difference in tax rates. All of these are affected by this agreement."

It would have been better if the word "tax" hadn't been mentioned, as it instantly made Wei Dong's scalp tingle.

This looks like that WTO agreement, doesn't it?

The real watershed moment in China's rise after the reform and opening up...

If I were to cause trouble in this matter and affect the overall situation, I would deserve to die a thousand deaths.

This is a crucial matter that truly concerns whether hundreds of millions of working people in mainland China can live a good life.

Now Wei Dong knows what he has touched.

Tariffs are the biggest constraint on OEM manufacturing.

(End of this chapter)