Chinese Enterprises Have Weakened Their Cost Advantages In Building Factories And Manufacturing Industries.

Behind the construction of Jinlong group, P is the cost advantage of China as a big manufacturing country.

Jinlong group research found that many costs of building factories in the United States are even lower than that in the domestic market < /p >

< p > < strong > < < a href= > http://www.91se91.com/news/xieye/20140613/389753.html > > investment > /a > USA > account < /strong > /p >

Behind the construction of Jinlong group, P is the cost advantage of China as a big manufacturing country.

Jinlong group research found that many costs of building factories in the United States are even lower than that in the domestic market < /p >

< p > < strong > Ma Ji Chao < /strong > /p >

< p > Alabama, the hometown of Agam, the hero of the movie Agam, is a famous poor state in the United States. The residents of this state have the lowest family income and the highest unemployment rate in the United States.

The operation of a Chinese company's US branch ended the embarrassing history of several counties and cities in the state that did not build a new manufacturing plant for nearly half a century.

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< p > the Golden Dragon Precise Copper Tube Group Inc, which is headquartered in Xinxiang, Henan, is the "Golden Dragon Group".

The company announced in May 28th that a $100 million precision copper tube project has been put into operation in the state of Alabama.

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< p > since 1967, Willcocks County, Alabama, where the American branch of Jinlong group has not built a decent manufacturing plant, some local workers have not been able to find new jobs for over a year.

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< p > the construction of Jinlong group not only brought Willcocks county from the "agricultural society" into the "industrial society", but also the first investment promotion project after the current governor took office.

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"P >" but behind the overseas construction of Jinlong group, the cost advantage of China as a large traditional manufacturing country is weakening.

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Li Changjie, chairman and Secretary of the Party committee of Jinlong group, told reporters in the first financial daily (micro-blog) daily that the real reason why Jinlong group chose to invest in the United States is that the US government, which is picking up the manufacturing industry, is increasingly launching preferential policies for manufacturing industry, which eventually attracted a group of global manufacturing enterprises including Jinlong group to enter P.

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< p > < strong > behind the establishment of the United States < /strong > /p >

< p > Jinlong Group USA branch is the second branch factory built by the company overseas. Its first overseas branch plant is located in Mexico. The plant was put into operation in 2009.

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"P", a branch factory in the United States, was set up in 2010. The background of its construction was that the precise copper tubes produced in China and Mexico were suffering from anti-dumping from the United States.

In September 27, 2010, the US Department of Commerce made a final ruling to impose 11.25%~60.85% and 24.89%~31.43% anti-dumping duties on seamless copper pipes imported from China and Mexico.

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As the world's largest copper tube manufacturer, Jinlong group sells nearly 500 thousand tons of copper pipe annually, occupying 1/3 of the global copper tube sales, while in the United States, its annual sales of copper pipes are only 60 thousand tons.

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In order to get rid of this passive situation, the executives of Jinlong group, including Li Changjie, began to examine the possibility of building a factory in the United States in order to get rid of this p.

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< p > in the US market, the largest agent of Jinlong group is the Wolverine company of the United States, which was built in 1912. It was the largest precision copper tube manufacturer in the United States and the largest competitor of Jinlong group in North America.

However, due to poor management and high production costs, resulting in successive losses, eventually, the production enterprise pformed into a trading company and became the general agent of Jinlong group in North American market.

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< p > Jinlong group's US agents, as well as the support of strategic partners such as Dajin and York air conditioners, have made Jinlong group operate in the United States.

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< p > "in fact, the investment of the US government is also a look at the business, who needs the market and who needs the manufacturing industry, so the government shows enthusiasm."

Li Changjie said that the reason why Alabama values Jinlong group's investment is actually the importance of Jinlong's behind the refrigeration industry chain.

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P, the largest commercial air conditioner manufacturer in the world, is located in Houston.

Alabama hopes that in the future, Daikin will be able to build factories in Alabama in the process of expanding production, and eventually build a refrigeration industry base in the state.

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In order to attract the Jinlong group, Alabama not only contributed to the adoption of the Alabama tariff subsidy act by the Senate of the state legislature, but also raised $5 million to build a high-voltage substation, and raised $about 4000000 to build a dedicated road and a railway bridge for the Jinlong group.

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< p > according to the Alabama tariff subsidy act, foreign enterprises can get the corresponding tax relief of the state government if they invest more than 100 million dollars in the state directly and create more than 100 jobs.

At the same time, the government subsidy of up to US $20 million can be obtained.

Li Changjie told the first Financial Daily reporter that the US branch has now received $about 15000000 in financial subsidies.

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< p > < strong > the cost of building factories in China and the United States is less than /strong > /p >

< p > Li Changjie research found that as the most developed country in the world, many costs of building factories in the United States are even lower than those in China.

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For example, electricity consumption in the Americas, including Mexico and the United States, is equivalent to RMB 0.38 yuan / degree, while in China, the price of industrial electricity is above 0.67 yuan per P.

According to the monthly electricity tariff of 10 million yuan in Xinxiang branch of Jinlong group, only one item can save 51 million 940 thousand yuan a year.

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< p > "the cost of oil is also lower than that of China."

Li Changjie said that in the United States, the cost of oil, including lubricants, gasoline and diesel, is cheaper than that in China, which is basically 1/5 cheaper than that in China.

Others such as natural gas, land, corporate taxes, etc. are either cheaper or flat than China.

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< p > the only cost that is higher than the domestic cost is the wages of the workers.

Li Changjie told the first Financial Daily reporter that in Xinxiang, the monthly salary of front-line workers in Jinlong group is RMB 3000 yuan, while in the United States, the monthly salary of front-line workers is more than 3000 dollars, equivalent to 6 times that of domestic workers.

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< p > "from a comprehensive point of view, the cost is high and low, but it is still cost-effective to calculate."

Li Changjie said that the future US branch of Jinlong group will reduce labor and improve its production by improving production lines.

Even if the three phase of the entire factory is completed in the future, there will be no more than 500 workers employed.

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P. But even so, Alabama officials at the location of the factory are very excited.

After all, for the region where the manufacturing industry has been depressed for many years, the entry of some manufacturing enterprises, including Jinlong group, directly promoted the local employment rate.

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< p > < strong > reflect on overseas a href= "http://sjfzxm.com/news/index_s.asp" > investment < /a > /strong > /p >

< p > Jinlong group Mexico branch was completed and put into operation in October 2009. At that time, in order to ensure the smooth investment of the project, Li Changjie not only appointed the chairman of North American general agent Wolverine as the chairman of the Advisory Committee, but also hired a large consulting company in Mexico to form a research team, and went to Mexico to conduct field investigations before and after, and finally chose the state of the state of the state of the state of "Wei" as the base for the project.

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< p > in the whole investigation process, the investigation team even considered how to deal with trade frictions and how to achieve reasonable tax avoidance in future China and Mexico.

But even so, unexpected difficulties still arise.

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< p > the first problem is workers' management problems.

The workers in the American branch were recruited by the local government, and then sent to the factory after being funded by the government. Moreover, most of the recruits were technical school graduates and had technical foundation. In Mexico, not only all workers needed their own recruitment and training, but even the wage cycle was not issued monthly, but every Friday.

"When wages are paid on Friday, individual employees will not come any more next week."

This made the executives of Jinlong group very upset.

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< p > "what can be done? The local workers have been working like this for many years. Our factory can not change the habits of a country."

Li Changjie told the first Financial Daily reporters that due to the large freedom of workers in Mexico, they had caused many difficulties to the company's normal production plan and high standard production.

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Another problem facing the Mexico branch of the P is that local drug trafficking groups are rampant, resulting in poor local policing.

Even some armed gangs are looting looting at trucks loaded with copper tubes.

According to the price of 8000 yuan per ton, the value of a truck's copper tube is millions of dollars.

"From commissioning to now, our vehicles have been robbed 7 times, and even local insurance companies are unwilling to underwrite us."

Li Changjie told our reporter.

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< p > < a href= > http://sjfzxm.com/news/index_s.asp > < < /a > > the upsurge of Chinese enterprises' overseas investment. Li Changjie suggested that enterprises should not blindly go out because of the encouragement of the government. The first thing to consider is whether the enterprises can realize localization and making money if they go out, and whether they can integrate with the local economy. Second, evaluate their own economic energy and investment ability. After all, investing abroad is very expensive; third, we must strengthen our understanding of local social, cultural, legal and other environments.

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