Weekly News Column Opinion and Laughs on The Record

Made in Where

Jeff Borgardt's Soundoff from Summit Column 7/21/05

 U.S. consumers are accustomed to ‘made in China’ labels but
what happens when China starts buying up U.S. companies can
be surprising.
    People in the manufacturing sector think a lot about China.
    The latest story surrounds Maytag.
    Several companies are vying to take over the long-time Iowa and
Western Illinois appliance company.
    An American company was expected to buy the company and then
cash in by offsourcing operations to China.
    The profiteers were reportedly scheming to dismantle the
company and then sell it off for big bucks.
    Then something interesting happened.
    A Chinese company jumped into the arena and announced they
wanted to buy Maytag.
    And the Chinese company wants to come to the U.S. and retain
the American workforce.
    So, union Maytag workers in Iowa are now rooting for their
traditional cheap-labor rival — the Chinese.
    Shanghai-based appliance maker Haier announced their
preliminary bid of $16 per share for Maytag last month.
    This outdid big buyout firm Ripplewood Holdings; a consortium
that includes Goldman Sachs, GS Capital Partners and the J.
Rothschild Group.
    Haier controls 25 percent of the Chinese refrigerator market and
17 percent of the Chinese air conditioning market.
    Its hard to wrap your mind around this riddle.
    A U.S. company wants to buy Maytag and presumably offsource
workers to China while a Chinese company wants to buy Maytag
and retain the U.S. workforce.
    Ted Fishman author of “China Inc. : How the Rise of the Next
Superpower Challenges America and the World” says the surging
China is a mixed blessing for the U.S.
    According to Fishman, “No country has ever before made a better
run at climbing every step of economic development all at once.”
    I’m not sure I believe the Chinese economy is growing as fast as
communist statistics claim, but China is clearly growing.
    Other Chinese companies are hovering over a U.S. gas company
and a Canadian coal interest.
    China has a plan, first Maytag then the World.