2003: Starting with Foreign Trade

Chapter 552 Negotiation Techniques

"This looks a bit like a CRV?"

After discussing the purchase of shares in Changfeng Group, Huang Ming, Cheng Linfeng, and Xie Junhong left first, while Zhang Yong stayed behind.

Zhang Yong hadn't even been to the headquarters of Weilai Auto before starting his business trip, nor had he received any welcoming ceremony. He didn't complain; he knew his responsibilities.

However, Zhang Yong's joining the company still caused quite a stir in the industry.

Ordinary people may not know Zhang Yong, but those in the automotive industry know him very well. This young sales manager from Beiqi Foton is a rising star in the industry, and no one expected him to resign and join a new car company with no car manufacturing experience.

Furthermore, transitioning from commercial vehicles to passenger vehicles is undoubtedly a huge gamble in his career.

"It's designed in the style of the CRV, but it's not a direct copy. It's designed in the style of the CRV."

Tan Jincheng showed Zhang Yong the initial design draft of the new car, codenamed S1. Of course, it was going to be an SUV. This thing would be popular until at least 2015. It was very popular. Even small trucks like the Zhongtai 2008 could stay at the top of the sales charts for a long time.

These days, apart from Hongqi, almost all domestically produced passenger cars have the influence of foreign brands. There are almost none that are completely independently designed, and there's nothing shameful about that.

"Japanese cars are indeed quite popular right now, and SUVs are a particularly trendy style, so it's definitely worth exploring. But do we have the platform to produce them? Is Mr. Tan planning to use Changfeng Group's platform?"

Having learned about the group's acquisition calculations, Zhang Yong was able to grasp the key points.

Changfeng Group's Xiangcheng plant was created for the passenger car market, and the models it produces are all aimed at passenger car users. In reality, it's just a stripped-down version of the Black King Kong, which looks similar to the Pajero.

"That's possible. The Mitsubishi engines they use are quite advanced. If we can use Changfeng's existing platform to produce them and improve the quality, it would be a good option."

"But isn't this acquisition too difficult?"

Zhang Yong is not very optimistic about the acquisition of Changfeng Group. Changfeng Group is similar in nature to Foton Motor, but in terms of size, it is at least half the size of Foton. In any province, state-owned enterprises that can create many jobs are very important.

Even if their financial report last year was terrible, they can't just let them go bankrupt like that; the local state-owned assets management department will definitely find a way.

"It's quite difficult, but how will we know if we don't try? If it doesn't work, we can acquire Yangzi Automobile. Yangzi Automobile also has the capability to produce SUVs. With some investment and some modifications to the production line, it shouldn't be a big problem."

"Besides, we still have the Zhongtai Beicang branch. If all else fails, we can just take it over."

Unless absolutely necessary, Tan Jincheng would not want to do this. Maintaining the status quo is the best option. Beicang District would take a portion of the shares, and Tan Jincheng's side would take a portion. When Zhongtai wants to go public, they can either cash out or have the shares repurchased, which would be profitable.

"If it really doesn't work, just take it by force."

Zhang Yong was also taken aback. To be honest, as a tech guy, he wasn't quite used to this way of speaking. Just now, Tan Jincheng and Huang Ming were discussing how to buy shares on the secondary market, which he thought was dreamlike enough.

During the day at the dinner table, he expressed his admiration for Li Jianxin and his goodwill towards Hunan Province. He even went so far as to suggest that the success of Flash Technology was largely due to Hunan Province.

The reason is that Hunan TV's Super Girl competition helped him choose the right spokesperson?
The atmosphere was peaceful, but unexpectedly, after returning to the hotel, they immediately began plotting how to stab each other in the back.

Today, he casually mentioned that he wanted to take over Zhongtai's factory in Beicang.

"What are you looking at? That's how business competition works. Try not to make enemies, but if we have to, what are we afraid of? We need to please consumers, not our competitors."

Zhang Yong nodded, slightly embarrassed.

A graduate of a prestigious university and from a state-owned enterprise, he had little business experience. Backed by Foton and BAIC, he had never experienced the brutal competition of the market, unlike Tan Jincheng, who built his success step by step.

In the electric vehicle industry, Tan Jincheng used a strategy similar to Xiaomi's, which has caused countless small manufacturers to go bankrupt.

In other words, society has progressed and become safer. If Tan Jincheng had done this 20 years ago, his whole family would have had to be extremely careful when traveling, including Gu Hongshun and his wife.

Making enemies is fine, as long as it's not a major or fatal enemy. There's competition among peers anyway, so what's the big deal about offending a few?
"Don't worry, I'll handle these kinds of things that might offend people from now on. Mr. Zhang, you just need to focus on improving product quality and production time. You have a lot of responsibilities."

"Thank you very much, Mr. Tan."

“The operating methods of private enterprises and state-owned enterprises are still somewhat different. I know that Mr. Zhang still needs to adapt to these. Mr. Lin and Mr. Wu of FlashDrive are both from old state-owned enterprises. Mr. Zhang can also contact them when he has time and see how they transformed back then.”

Although Zhang Yong's current situation is very different from that of Lin Yumin and Wu Zhenping back then, and Zhang Yong is in a much better position, he is still far from being financially free.

Striving is also a theme for Zhang Yong's age group, essentially the same as the situation when Lin Yumin and Wu Zhenping joined the company.

To put it bluntly, they came to Weilai Auto just to make more money. Both sides do have many things in common. Lin Yumin and Wu Zhenping have worked hard for several years, and in this shareholding reform of Shanchi, Tan Jincheng will definitely allocate some shares to them. Even if it doesn't go public, they can live comfortably for the rest of their lives just by receiving dividends.

Whether it's the transformation of state-owned enterprises into private enterprises or their own needs, there are many things to learn from them. In addition, Lin Yumin and Wu Zhenping have a better understanding of Tan Jincheng, which is something Zhang Yong should also learn from.

To become a senior executive at any company, you need to understand the boss.

"Understood. There's another matter. Some of my former subordinates will be coming with me soon. I'd appreciate it if you could help with their arrangements, Mr. Tan."

"That goes without saying. Also, the company has neglected General Manager Zhang by not holding a proper inauguration ceremony, but we will make it up to him after we return from Hunan Province."

"Haha, it's alright, getting the work done is the most important thing."

"It's necessary, Mr. Zhang, you should be prepared. Flash's marketing department may occasionally use your personal image for publicity."

"How exactly will you promote it?"

"Haha, they might try to sabotage you. I'm no exception; they often impersonate me and make fun of me. I'll collect some marketing case studies for you when we get back. That's all for tonight. Get some rest."

Based on some videos from later generations, this guy often makes mistakes in front of the media, so Tan Jincheng has to give him a little psychological manipulation beforehand and slowly instill marketing ideas into his mind.

The automotive industry is highly competitive, and many best-selling models have seen their sales plummet due to a single misstatement or untimely public relations failure.

Sometimes, keeping an eye on your teammates is more important than keeping an eye on your opponents.
-
The next day.

The members of the inspection team all got up early, including Tan Jincheng. He had said yesterday that they would hold a closed-door meeting today to discuss how to negotiate with Changfeng Group.

Once Tan Jincheng arrived, the work pace quickened considerably.

A well-known hotel not far from the Changfeng R&D Center had a floor booked by Tan Jincheng. It was quite a grand affair, but more so for safety and convenience.

Privacy should be considered, but meeting arrangements should be made convenient.

"Mr. Huang, please share the conclusions we've drawn from our recent investigations."

Cheng Linfeng went back ahead of time to prepare for the acquisition in the secondary market. He was prepared for both possibilities. Even if the acquisition failed, Changfeng's stock would still be valuable in a few years. Such a large automotive industry could not possibly be allowed to go bankrupt and be liquidated.

"Yangzi Pickup is an outlying product of Changfeng Group. The Tianjin Industrial Base is currently the cash cow of Changfeng Group. Xiangcheng has also been seen as a market for civilian vehicles. However, according to General Manager Zhang, the quality of the production line is not up to standard."

"As for Yongzhou, we haven't been there yet, so we won't comment on it for now. But based on the available information, although Yongzhou has the smallest production capacity, it should be the place that Changfeng Group is least willing to give up, after all, that's where its roots are."

Huang Ming viewed the issue from the perspective of the ease or difficulty of acquisition, regardless of the technology.

"So, the most likely place for us to acquire is the Chuzhou industrial base, while Xiangcheng has the best chance of being acquired, right?"

"That's true. If a company isn't doing well, it will definitely shrink its operations, sell off unprofitable or non-core businesses, and preserve the profitable and core businesses it has built its fortune on."

At this moment, Xie Junhong interjected, "We certainly can't start today's negotiations by saying we want to acquire the other party's company right away. That would be somewhat disrespectful to them, so we need to change our strategy."

“That makes sense, so let’s start by discussing the acquisition of the Chuzhou factory. That would be the most useful thing for us.” Tan Jincheng also agreed with Xie Junhong’s statement.

Before coming, you came with the intention of cooperating, but once you sit down at the negotiating table and say you want to buy their company, without any preparation, it's bound to elicit an overreaction from them.

However, for Changfeng, which is currently facing financial difficulties, acquiring a subsidiary that is not a core business is still negotiable.

"Alright, then let's negotiate with them with the initial idea of ​​buying Yangzi Automobile and reaching a strategic cooperation with Changfeng Group."

“Currently, Yangzi Pickup’s shareholding is 55% held by Changfeng, 30% by Xinhua Lian, and 15% by Yangzi Company. Changfeng and Xinhua Lian are related parties. If we want to achieve absolute control, we must hold 51% of the shares.”

Huang Ming added.

Although Chuzhou welcomed Flash's investment, their attitude was not entirely on Flash's side. During the acquisition process, their 15% stake actually gave them control over the company.

Once Changfeng Group decides to retain a portion of its shares, the attitude of Yangzi Company will be crucial.

(End of this chapter)