The origin of the incident
On February 23, Weichai Power announced that its wholly-owned subsidiary, Weichai Hong Kong, had won a bid of 2.99 million euros to acquire the relevant assets of Bauduen, a French parts and components company, through auctions. Currently, the project is fulfilling relevant administrative duties. approval procedure.
Founded in the early 20th century, Baudouin AG is a global shipping provider with a registered capital of 3.55 million Euros and is registered in Cassie, Provence, France.
The company is mainly engaged in the design, development and sales of engines and drive assemblies. It mainly produces high-end, high-power diesel engines of 16L and above. As the company was mainly export-oriented, it suffered heavy losses in the financial crisis and entered bankruptcy procedures at the end of 2008.
It is understood that at first six companies participated in the competition. After the screening, the court only approved Weichai Power's restructuring plan. In the end, Weichai Power bought Bauduen at a low price of 2.99 million euros and invested 5 million euros to resume production.
It is reported that at present, Weichai Power's engine products are mainly concentrated in the following 12L, and Baudoin is based on high-power engines of 16L and above. With low-cost overseas acquisitions, Weichai Power not only fills in gaps in technology research and development, but also can use European factories to effectively avoid the risk of exchange rate fluctuations when exporting, and occupy the local market with more cost advantages.
Although the financial crisis is generally considered by the industry to be a good opportunity for overseas mergers and acquisitions, related parties pointed out that opportunities for low-cost mergers and acquisitions of overseas companies also pose potential risks.
In the process of acquiring Baudouin, France, the French local government had proposed to guarantee the employment of employees and ensure that the manufacturing of diesel engine factories remained in France within 15 years.
Li Xianjun, Director, Automotive Development Research Center, Department of Automotive Engineering, Tsinghua University
The three major capabilities of management, culture and research and development are indispensable
Li Xianjun, director of the Automobile Development Research Center at the Department of Automotive Engineering at Tsinghua University, believes that Weichai Power's acquisition of Baudouin, a French parts and components company, reflects the ability of Chinese parts and components companies to realize their internationalization strategies in the financial crisis environment.
Throughout the decade from the end of the 1990s to the beginning of this century, international auto parts and components companies have seen many waves of industrial restructuring and corporate mergers and acquisitions. They learned from successful experiences and learned lessons from failures. For Weichai Power, It is the most critical and important thing at present.
In my opinion, Weichai Power may face strong pressure from the French government and labor unions. This includes the factory's retention in the mainland, its indiscriminate layoffs, and the inability of employee benefits to be reduced. These are not the most critical issues. Weichai can step out of cross-border mergers and acquisitions, and I believe it has been strategically prepared to respond, but it is necessary to maintain a cautious attitude.
The key to the success of multinational auto giants such as GM, Toyota, and Ford is to have a mature management model, a cultural model, and a research and development platform, collectively referred to as the three major capabilities. If a company wants to achieve an international strategy and establish a global business system, it will not be able to bypass the training of these three major capabilities, and it must be indispensable.
If only the capital output and the appointment of a leading group, the multinational companies after the merger will certainly not be well integrated with the parent company. In the end, situations like Chrysler's and Daimler's separation will happen again. Even after the domestic parent company's profits have been “transfused†to supplement the companies that have been merged, it is not worth promoting this kind of “dumpling, bloating, and fat†approach to achieve international strategy.
Xu Changming, Director of Information Resources Development Department, National Information Center
Not only acquiring factories but also controlling technologies
Weichai Power chose to acquire French auto parts companies at this time. It should be said that the choice of timing is just right. At the moment of the global financial crisis, some overseas parts and components companies are mainly affected by export support and have been affected and have a greater impact. At this time, China's auto companies have a unique strategic vision in selecting those foreign companies that have a good technical foundation, complete supporting channels, and favorable long-term development as the targets of mergers and acquisitions.
Weichai Power acquired a French spare parts company with a registered capital of 3.55 million euros for 2.99 million euros, and took the initiative in the cost of mergers and acquisitions. However, the French government's proposal to guarantee the employment of employees and ensure that the diesel engine plant stays in France for 15 years is debatable. At the same time, Weichai needs to adapt quickly to the problems of cultural and industrial integration, as well as to France’s auto industry policy and laws. Regulations should be familiarized as soon as possible to avoid unnecessary losses.
If only for the acquisition of French parts companies, the purpose of the acquisition appears to be weak, and it should strive to expand the scope of technology applications, allowing the French companies to bring advantages of domestic technology back to the application, this is the key to mergers and acquisitions.
China is not lacking resources and energy-based enterprises. What we need is leading technology and application of technology industrialization. Therefore, Weichai Power must insist on the control of technology when discussing details of specific M&A with French companies.
China National Internal Combustion Engine Industry Association Deputy Secretary-General Ge Hong
Weichai is the first overseas internal combustion engine company
Weichai Power's successful acquisition of Bauduen, a French parts and components company, will have a positive effect on the development of China's internal combustion engine industry and Weichai itself.
Recently, the state has promulgated the "Auto Industry Adjustment and Rejuvenation Plan" to encourage enterprises to speed up product structure adjustment, improve independent innovation capabilities and accelerate industrial upgrading. Although rumors of mergers and reorganizations in the automotive and parts industries have been heard, there are few examples below. Weichai Power at this time "to eat crabs at sea", showing the courage to innovate and actively expand the confidence and strength.
From the perspective of the development of the internal combustion engine industry, Weichai Power, as the chairman unit of the Internal Combustion Engine Industry Association, took the lead in “going to sea†and took the first step in overseas mergers and acquisitions, which has a positive demonstration effect on the development of the industry. Weichai Power has turned the crisis into a machine through “going outâ€, which has given China’s internal combustion engine industry confidence in winning.
From the perspective of Weichai Power's own development, we will acquire Baudouin's products, technologies and brands through the acquisition, and we can further expand our product lines, explore the international market, learn from the globalization and development of product development and technical management experience, and expand our products. The scope of market support has formed new competitive advantages and promoted the rapid development of various businesses. At the same time, it is conducive to accumulating experience in the operation of international capital and is conducive to the cultivation of international talents, which will lay a solid foundation for Weichai Power's development strategy of “internationalized new chopping woodâ€.
Beijing industry university
Deputy Director of the Institute of Economic Management, Min Pingnan
Overseas mergers and acquisitions need to be cautious
Weichai Power’s acquisition of French parts and components companies to a certain extent reflects the development strength of China’s auto parts companies, especially key parts and components companies. After reviewing the cases of major enterprises in many domestic industries and acquiring foreign companies, it is not difficult to find that overseas mergers and acquisitions need to be careful.
The Capital Iron and Steel Group once tried to acquire an iron ore company in Peru and later failed to achieve the desired result because of many differences in management, policy, and culture. In addition, the TCL Group once hoped to expand its international marketing channels by acquiring a French company, and eventually ended up unhappily. Recently, Lenovo’s global personal computer business suffered a business loss. At the beginning, many people praised Lenovo’s merger and acquisition of IBM’s personal PC business. Now, it’s still time for Lenovo to “merge and digest†overseas businesses after acquiring them.
Through the above cases, it is not an act of cracking down on overseas mergers and acquisitions by domestic companies, but it is hoped that we can see Weichai’s acquisition of a French parts and components company with a rational and objective attitude. In my opinion, there is still a lot of homework to do after the acquisition. After Weichai has implemented overseas mergers and acquisitions, it is necessary to make efforts to adapt to local policies, regulations, and cultural habits, and gradually realize localization of operations.
From the point of view of the development trend of global manufacturing, from the 1970s onwards, simply relying on expanding the scale of enterprises, expanding toward a single organizational group, and extending the product line model are gradually being questioned. At the same time, a model known as "clustered development" is becoming more and more respected. Taking GM as an example, it once proposed a business philosophy of platform management, modular R&D, and global procurement. Compared with scale expansion, this is an “intensional†expansion. On the one hand, it avoids the risk brought by mergers and acquisitions; on the other hand, through the “contract†relationship, the company maximizes operational efficiency and minimizes operating costs.
Gearless Machine,Traction Machine,Elevator Machine
Gearless Traction Machine Co., Ltd. , http://www.zjelevators.com