The Magician’s Memorial - Chapter 75



Only Krnovel

Episode 75 Advance (4)

As with all negotiations, the side that came first was at a disadvantage.

Therefore, we had to wait until sales of Taewoo Motors in China increased.

As I waited like that, another two months passed, and the planning manager came to me with the answer I wanted.

“Taewoo Motors sales exceeded 20,000 units. About 5,000 units are being sold every month, and the rate is increasing.”

“It’s definitely starting to pick up speed.”

“But growth is expected to slow. “The productivity of Romanian factories is lower than that of domestic factories, making it difficult to increase production further.”

Evidence has been secured that Taewoo Motors operates in China.

This information may have been detected on the radar of American automobile companies eager to enter the Chinese market.

To be exact, I solved the information.

All information in the United States was gathered on Wall Street, and news of Taewoo Motors’ expansion into China was released through SAVE Investment Company.

“Have you heard from America yet?”

“There are rumors going around that GM is interested. But there was no direct contact.”

“Doesn’t GM have a strained relationship with us?”

“In business, yesterday’s enemy can become today’s comrade and tomorrow’s enemy.”

GM is interested first?

Even so, I had no intention of joining hands with GM.

If he had intended to do so, he would have held shares in GM rather than shares in Ford.

“I guess I’ll have to wait longer. “After today’s report, I will listen to this.”

After dismissing the head of planning.

I called David in the US.

“David, I need you to do one more thing for me.”

[You have to do whatever the boss wants! Where should I go this time?]

“Please contact Ford. “We are meeting as a representative of SAVE Investment Company, which holds a 20% stake in Ford.”

[I guess I won’t have to take a long-distance flight this time. What can I get from meeting them?]

“You can bring up the story that Taewoo Motors is forming a joint venture to enter the Chinese market. So that Ford can also be interested.”

David seemed to be lost in thought for a moment and spoke briefly.

He took a long time to organize his thoughts by making a ‘hmm’ sound.

[Are you saying that all we have to do is make Ford propose a joint venture first?]

“Yes. “The point of this matter is to get Ford, not Taewo Group, to show interest first.”

[It is widely rumored on Wall Street that American automobile companies are anxious to enter China. Just scratch it a little and you will get a response right away.]

“I will send you data on Taewoo Motors, which successfully entered the Chinese market. “It will help.”

[I will make the management and board of directors anxious and rushing to Korea.”]

David was full of confidence.

The 20% stake gave him confidence.

No management would carelessly listen to what the majority shareholder says.

In addition, current American automobile companies were anxious to enter the ever-growing Chinese market.

* * *

David’s abilities were, as expected, outstanding.

Less than a week later, Ford executives visited Korea and inquired about establishing a joint venture.

I was the first to suggest a joint venture.

My grandfather selected me as the person to negotiate with Ford.

As a representative of Taewo Group, I met with Ford executives.

“Nice to meet you. “This is Kim Min-jae, head of Taewoo Group’s planning department.”

“This is Drank, and I’m in charge of the Asia Pacific region at Ford. I didn’t know that Taewoo Group’s successor would come out directly. “Hehehe.”

Despite his heavy body, he was a Drank director with deer-like eyes.

Considering that he knew that I was the successor to the Taewo Group, he seemed to have gathered quite a bit of information.

We had about 30 minutes of ice breaking time.

After the awkwardness disappeared to some extent, I got to the point first.

“Seeing that the famous Director Drank visited Korea in person, I think it is quite important.”

“I heard that Taewoo Motors is considering establishing a joint venture to enter the Chinese market. “We came to inquire if we could also become a partner of Taewoo Motors.”

What on earth was David talking about?

I had no idea that Ford would want to participate in a joint venture from the beginning.

It is foolish to criticize the other party for being proactive.

“This is a joint venture that has not even started yet. “We need to talk to Chinese companies that will form joint ventures and get permission from the Chinese government.”

“I heard that an agreement has already been signed with the Chinese government. “Then isn’t it over?”

Director Drank was far from a pushover.

He was a very aggressive and active person who did nothing but push.

For this type of person, the strategy of burning out the sorrow as if it seems as if it will not be given is effective.

“It’s not that we don’t want to create a joint venture with Ford. “The combination of Taewoo Motors’ compact car model and Ford’s large car model will create great synergy.”

“Then what are you worrying about!”

“Can I ask you a question? Why is Ford trying to form a joint venture with us? “Couldn’t Ford alone create a joint venture with China?”

I changed the subject slightly.

Director Drank was too active and needed to take his time.

“I understand you studied economics at Harvard. “Then you know how important risk diversification is, right?”

“You’re saying you want to share the risk with us.”

“By creating a three-party joint venture, as well as simply sharing risks, the probability of failure can be greatly reduced.”

I also agreed.

By creating a three-party joint venture, we could reduce our risk burden and make huge profits by successfully entering China in a stable manner.

But the problem was time.

It took at least one to two years for the joint venture to be created and the factory to operate.

The foreign exchange crisis will begin next year, so we had to take advantage of what we could before then.

“I agree with everything you said. But as you know, our relationship with GM is very strained. “If we create a joint venture with Ford, legal disputes may arise.”

“If that is the case, we will defend everything.”

“Then may I make one more suggestion?”

“Tell me anything.”

“Not only do we want to establish a joint venture to enter the Chinese market, but we also want to continue our partnership in the United States.”

Entering China is a matter of two years away.

America was the problem right now.

Although Taewoo Motors’ U.S. sales volume is increasing year by year, the upward curve was too gradual.

But what if you could just get help from Ford?

Simply put, even if Taewoo cars can be purchased at Ford stores, the slope of the upward curve will change.

“We can partner only on small cars.”

“Is it possible to have a mid-size car in addition to a compact car?”

“That much is possible. “We still needed to fill the lineup of compact cars and compact models that Ford had not yet developed.”

Product groups that do not overlap.

Ford is focusing on mid-sized cars or SUVs.

Taewoo Motors focuses on compact and compact cars.

Negotiations were able to proceed smoothly because they did not harm each other’s interests.

“great. Now, let’s talk with the Chinese government about establishing a three-party joint venture. “I think it will not be too late to start detailed coordination after receiving permission from the Chinese government.”

“I am waiting for good news. And if you wish, we are willing to pay more to invest funds to establish a three-party joint venture.”

I will pay a lot of money.

At first glance, it may seem like something that benefits us.

The stake in the joint venture was bound to vary depending on the funds invested, and in the end, he wanted to have a larger stake.

“We will discuss that further later.”

“I guess I was too impatient. Well, I hope to see you again soon.”

This is the end of my meeting with Director Drank.

As soon as he got up, I immediately called David, my contact in China, and gave him instructions for permission to establish a joint venture.

* * *

After 15 days.

David came to Korea.

But there was a huge bundle of gifts in both of his hands.

“Have you immigrated? “What kind of baggage did you bring with you?”

“These are gifts that Zeng Hongqin gave me as my boss. “The transportation company’s sales are doing so well, so it feels like a gift in return.”

I unwrapped the gift bundle.

It contained everything from traditional Chinese ceramics to paintings.

Even to me, who doesn’t know much about the value of art, these were expensive items.

“I don’t think you would have given me such an expensive gift just because you took good care of your son, right?”

“Don’t you mean to ask us to create a three-party joint venture with a Chinese company that is close to your faction?”

“Was Zeng Hongqin’s faction the Shanghai Bang?”

“you’re right. Not only Zeng Hongqin, but the faction that China’s current number one ranking belongs to is the Shanghai Fang. So, we are hoping to form a joint venture with Shanghai Automobile.”

If history goes on as it was in my past life.

Shanghai Automobile creates a joint venture with GM.

However, in this case, a joint venture would be created with Ford, not GM.

“Not bad for a Shanghai car.”

“It is especially beneficial to Taewoo Motors. In the case of compact cars and semi-midsize cars, production can be done at Shanghai Automobile’s existing factory.”

“That means the initial investment is low.”

“And we may be able to sell Taewoo Motors models in China starting next year. In the case of Ford, it can be sold only after a new factory is completed.”

“It’s a really good deal.”

“And there was even talk of sharing 33% of the share structure among three companies.”

No initial capital is required.

In addition to entering China, it was an opportunity to increase market share in the United States.

It was also a plan I made before selling finished cars from the Romanian factory to China.

When the foreign exchange crisis occurred, exports were more important than the domestic market.

This was the reason for the hasty expansion into China.

If it succeeded in entering China even before the foreign exchange crisis, Taewo Group would have created a huge cash cow.

“Then let’s proceed like that. “If these are the conditions, even grandpa will like it.”

“Can I go back to China and do the detailed tuning work?”

“Create a hole through which funds can naturally flow into the Shanghai room. “I think the Shanghai Fang will be the largest faction in China for the time being.”

“Shanghai Automobile will take care of it, but I will also take care of it myself.”

In order to advance into China, Shanghai Bang needed help.

Moreover, the Shanghai Fang will be the largest faction in China for at least five years.

After that, power passed to the Prince’s Party, but since Shanghai Bang and the Prince’s Party formed an alliance, they were able to naturally join hands with the next power.

There was no need to think about the next power.

Because the Crown Prince Party will remain in power for the next 20 years or more.