Li Mingde’s words are devastating, but he is qualified to say these, and no one can retort. Bing City Machinery Manufacturing Group had been creating wealth for the Country, while the rest are making money for the overseas brand. There’s no way to compare.
Everyone looks at each other and dares not to say a word.
The bigger automobile manufacturers, like FAW, are waiting for each other to say something, and the smaller ones are sitting on the fence. They had never conducted any crash test before in the first place. As for the spare parts manufacturers, they wonder if they must send their parts to Bing City Machinery Manufacturing Group for testing in the future?
Also, what are the wind tunnel and measurement laboratories for?
Wang Donghui saw no one is saying anything, and he said. “I think this is a good idea. Our target is to move out of Asia to the rest of the world. If we cannot even reach international standards, how can we achieve this goal? The Bing City Machinery Manufacturing Group has the most experiences, and we should all learn from them.”
“Chairman Wang, I want to know if this laboratory will be owned by their company. If so, how are the tests going to be fair?” SAIC’s General Manager Zhou asked.
Li Mingde replied emotionlessly. “I said that this new laboratory will let everyone participate. All of you will have workers in it, and the tests will be conducted in front of everyone to make sure the results are not bias. This laboratory will also be non-profit. If anyone of you is going to export your vehicles, you all must undergo these tests. All major overseas manufacturers have the laboratories I mentioned.”
“Non-profit? That means you all will not recover your investments? Are you saying your company is going to do charity?” Manager Zhao sarcastically asked.
“We are not a charity organization. Non-profit means we will not collect more than 10% of the costs from you all. In the future, when we have accumulated enough funds, we will use them to build newer laboratories. Even if we collect back our cost, it will still be losses. Don’t forget that even banks pay interests.” Li Mingde replied.
“Does your company need to pay your company to conduct tests on your own vehicles?”
“We will not pay for the time being, but once we recover the cost, we will pay like the rest of you.” Li Mingde replied.
Li Mingde is playing with words. This means the cost of these test centers is paid by the rest of the manufacturers, and he is only coming up with the funds upfront. Just the interest alone will let Bing City Machinery Manufacturing Group use the laboratories for free for a long time.
“Manager Li, you all are taking advantage of us.”
“Then you all can invest. A crash test laboratory costs around 200 million USD, and the cost of other laboratories varies. The total investment is only around 1.5 billion USD, and it does not include the land parcel cost. Which one of you is going to invest?” Li Mingde looks at the rest of the representatives, and no one dares to look at him.
1.5 billion USD. None of the companies can afford it except for Bing City Machinery Manufacturing Group.
In reality, Bing City Machinery Manufacturing Group also could not pay 1.5 billion USD all at once. But the test centers’ construction will be in phases, and this amount can also be split into two to three parts over two to three years.
Suppose Bing City Machinery Manufacturing Group had not invested much of their funds into R&D. In that case, they will have enough to fork out 1.5 billion USD at once. But they know the importance of having better technologies to be competitive.
Bing City Machinery Manufacturing Group had plans to build a large test center as all of their small laboratories are outdated. But they felt it is a waste to just test their own vehicles. It was only until Feng Yu suggested this idea and they realized they can rope in the other automobile manufacturers.
The other manufacturers had no choice but to participate in this. In the future, Songjiang Motors will market their vehicles to pass the international safety tests with good rests. How are other manufacturers going to sell their cars if their vehicles had not undergone the tests?
Joint venture cars had undergone these tests before, but people must believe it in the first place.
Also, which manufacturer doesn’t want to export their cars overseas? It will be a great achievement! But if the vehicles have not passed the safety tests, other countries will not recognize them, like what Li Mingde said. It will also be more costly to send their vehicles overseas for tests. Just the transportation cost alone will be too high.
Bing City Machinery Manufacturing Group can afford to conduct tests overseas is because they have joint venture factories overseas, and it’s convenient. But the other Chinese manufacturers cannot afford that.
Wang Donghui interrupted. “I think this is a good suggestion, and I will report this to the higher-ups. We will set up our own NCAP system. Since Bing City Machinery Manufacturing Group has more experience in this, I will ask Manager Li to write a proposal, and the rest of you must coordinate with him.”
The other representatives are furious and speechless. The truth is their companies do not have money. If not, they will never allow Li Mingde to succeed! He had announced Bing City Machinery Manufacturing Group will be investing in the construction of this test center. The higher-ups will not be issuing funds to the other manufacturers to build their own test centers.
Building the same laboratories will be a waste of resources. Chairman Wang is also present at the conference, and the other manufacturers cannot fool the higher-ups.
Li Mingde suddenly says. “Chairman Wang, we will be building Asia’s biggest automobile test center, but we are facing some difficulties. I hope you can help us solve it.”
“What difficulties are you facing? Just tell me, and the government will surely support you.” Wang Donghui thought to himself. You are going to pay for everything, and what other difficulties can you face? At most, it will be some paperwork and approval issues.
“We need a plot of land around 30 hectares. I hope you can help us solve this. This test center will be non-profit, and I hope we can get some subsidies for the land. If not, we will not have enough money to build it.”
Wang Donghui is stunned. Damn! This is what Li Mingde wanted from him. He thought Bing City Machinery Manufacturing Group had already started the construction or the construction is already completes and only needs some expansion. But he is asking for a new piece of land now!
30 hectares is not a small plot of land.
“Old Li, why do you need such a big plot of land? 10 hectares should be enough for a test center. Even with the rest of the laboratories you mentioned, 15 hectares should be enough.”
“10 hectare is not enough for the crash test. We need sufficient distance for the vehicles to accelerate. Also, the wind tunnel, material laboratories, etc. requires huge area and to prevent interferences. That’s why I hope you can settle this for us. We are going to build a Test Laboratory Park! Asia’s biggest automobile Test Laboratory Park!”
Li Mingde purposely emphasized the words ‘Asia’s biggest’ to attract Wang Donghui. To government leaders, this will be their political achievements.
Wang Donghui clenched his teeth. “I will report this to the higher-ups and get back to you!”