Ford

"At the same time, the executives of Kroll Associates in France, an American economic intelligence company engaged by LVMH for several weeks to find any exploitable weaknesses in both Gucci and De Sole and Ford, fax the news highlights to their European management in the UK, without hiding their surprise: "We are speechless," they write. The intelligence agency wasn't informed..."

"A foundation was created by Gucci for the occasion, for the benefit of its employees. This foundation bought the shares on their behalf, using money borrowed from... Gucci. However, although these new shares are theoretically reserved for employees, they will never actually see them. Because they are non-transferable and will never be converted into individual shares. It's a temporary protection. At the end of the operation, Gucci plans to destroy these shares that it has created and financed itself, and only pay a flat premium to employees, which can reach a maximum of $ 13 million in total. De Sole and Ford are ecstatic: "We have the support of employees, suppliers, and independent shareholders," De Sole proclaims. Ford is not far behind: "I give my unconditional support to the measures taken by the board to safeguard our independence.""

"While François Pinault's offices on Boulevard de La Tour-Maubourg (in the former LVMH headquarters) have become a hive of activity, while Kroll is supposed to be monitoring Ford and De Sole like a shadow and reporting everything that is happening at Gucci, Bernard Arnault, for once, knows nothing, is not informed about anything, and has no suspicions. On March 18, he participates in a meeting with financial analysts, during which he reaffirms that he has no intention of launching a takeover bid for the entire capital of Gucci and is completely optimistic about the outcome of his operation."

"Everybody says they obviously want to find the best television they can within their price bracket. They’d answer all these questions as if they were hyper-logical, they’d say that obviously if this thing costs less than the iPad, and it’s better, then they’ll buy it. Then reality comes into it, and actually, the reason they buy the iPad is that they know that every time they get out the Samsung, all their friends will say: “why did you get that, why didn’t you buy the iPad?” and that this will bring with it a little burst of anxiety and a little burst of effort. Never, never underestimate the importance of that. If you buy a Ford or you buy a BMW or a Volkswagen and it breaks down a lot, it’s Ford’s fault, and you and all your friends will go: “golly you’re really unlucky you bought that new Ford and the clutch plate’s gone, bloody hell, I do feel sorry for you”, and you will get a degree of sympathy from your friends, okay? If you go and buy an Alfa Romeo and the clutch plate goes, deep down all your friends are thinking: “what does he expect, he goes and buys an Alfa Romeo, what the hell does he expect?” If you’re going to buy this flash, weird Italian car, it’s going to break down."

"The fourth was a company whose name I had heard, but the unit that wanted to hire me was opening up an industry I knew nothing about. This company was “Sylvania,” famous for light bulbs, televisions, radios, and vacuum tubes; the industry they wanted to develop was transistors made with semiconductors as the material. In mechanical engineering courses I had heard of “semiconductors,” but other than the name I knew nothing. As for “transistors,” I had not even heard the name. Then how did I go to Sylvania to apply for a job? It was entirely because of an offhand remark by my third uncle. In the period when I had failed the doctoral exam and was at a loss and unsure what to do, one day I went to my third uncle’s home, and he suddenly said: “A few days ago a Chinese friend came to see me and said he recently joined Sylvania working on transistors, and he said there are several Chinese people there. You might as well go and give it a try.” So I called Sylvania, and a few days later I went for an interview. The executive who interviewed me was the director of the semiconductor laboratory, a slightly chubby middle-aged American, very imposing, and he also seemed to know semiconductors well (later I learned that at that time people who understood semiconductors were as rare as phoenix feathers and unicorn horns, and this director was not among them). He told me that his task was to turn the “laboratory” into a large factory, and in the process the manufacturing process would certainly need to be automated. And I was a mechanical engineering master’s graduate and had studied “automatic control,” which might be of some help to automation. With that one conversation, it neither aroused much interest in me nor stirred much hope. However, unexpectedly, the offer letter came—and the monthly salary was even one dollar higher than Ford’s: four hundred eighty dollars."

"Having “outsmarted myself” like that—if it were me now, I might just laugh it off, accept it, and without another word still go to Ford. But the young, hot-blooded me became furious from embarrassment. And in that fury, I began to “think in reverse.” I was confident about the work at Ford, but was I unwilling to take a risk and go to Sylvania to do something I wasn’t confident about? I thought I got along very well with the supervisor at Ford, but judging only from the personnel manager’s coldness, how unreliable was that fleeting impression! I thought Ford was large and my career would be secure, but semiconductor development might be fast and perhaps would give me more opportunities to grow. Turning it over again and again for a few days while the humiliation was still fresh, I actually arrived at a conclusion that would have been impossible a few days earlier: go to Sylvania!"

"In 2009, when a senior executive from BYD attended the Paris Motor Show and saw Ford employees still staying in the luxurious George V Hotel, he was very "shocked." To save costs, BYD executives even rented a house in the suburbs when attending the Detroit Auto Show. And as early as 2008, all of BYD's businesses were already profitable."

"In the early twenties, it was also necessary to break free from British brokers who control international rubber prices and let them rise vertiginously. Michelin became planters[23](private://read/01jkqdqdgs7t399cyecbezrhj0/#ftn_fn23). Like Ford at the same time in Brazil or Firestone in Liberia. Especially since the bosses in Clermont fear that American tire companies will seek at all costs to secure a global monopoly on natural rubber to ensure the safety of their supplies."

"By 1948, the bottlenecks are clearing, and automobile manufacturing resumes its momentum. Citroën that year produces thirty-four thousand one hundred sixty-five cars, surpassing Renault (twenty-nine thousand nine hundred twenty cars), Peugeot (nineteen thousand three hundred ten), Simca (nine thousand nine hundred seventy), and the distant outsiders such as Talbot, Salmson, Panhard, Delahaye, or Ford."

"The yellow cows’ responses astonished him. “You could never run me out of cash,” one told him. Ford wasn’t convinced, but the reseller took him on a short walk, down a few blocks and around a corner, then past some informal security types. They entered a room, roughly 2,000 square feet in size, lacking furniture or anything else, save for one thing: renminbi. Piles of cash in neat stacks were at the ready to hand out to migrant workers so they could buy iPhones in the tens of thousands. No experience in the Mormon missionary’s background had prepared him for this. Looking at the sea of renminbi before him, he estimated he was staring at a billion dollars. “I don’t know what the number is for a room that size, but it was more money than I’ve ever seen in one space,” Ford says. His estimate is, of course, imprecise. It could be wildly off. But as Apple’s popularity grew, it wouldn’t be uncommon for Ford and his team to spend hours counting a few million dollars’ worth of renminbi from a single day of sales, in preparation for an armored truck to haul it off. (Soon, these trucks were showing up several times per day, as the back room of the Apple Store wouldn’t suffice for the amount of cash coming in.)"

"His handling of the situation earned him some credibility in Cupertino. It was now easier to accept that a soft approach to the reseller issue wasn’t the problem. But as Apple’s business boomed in China, the yellow cows were just one challenge. More broadly, Ford worried that Apple was losing leverage with the Chinese government and failing to exert its own power. As early as 2010 he’d told Bob Mansfield, Apple’s head of hardware: “All you gotta do is open up a factory in Vietnam and you’re gonna get some nervous Chinese government officials.”"

"Years of living in Taiwan trying to convert people to the Mormon faith, coupled with his time in China, had taught Ford unwritten rules. He possessed street smarts that let him work the system in Apple’s favor. But he struggled to convey these concepts back to Cupertino and grew dismayed by some of their decisions. In 2012 higher executives chose to deal with the iPad trademark problem by paying Proview $60 million. It was a decision they could easily rationalize—global iPad sales that year would soar 61 percent to $31 billion. But to Ford, this rationalization missed what the fine signified."

"When Ford’s brother came to visit him in China, John would teach this same lesson in a more fun, slightly dangerous way. “My brother loved driving with me and my car in China, ‘cause I could pull up next to a cop at a red light, then run the red light in front of him,” he says. “My brother would laugh and say, ‘How do you get away with that?’ It was because the cop assumed that if I was doing it, I must be *able* to do it. If he pulled me over, he’d be risking getting fired by this powerful person who clearly knew he was powerful enough to pull around the red light right in front of him.”"

"Ford found the argument dubious. And when, during the dispute, a Chinese government authority attempted to confiscate iPads from the Apple Store, Ford walked to the inventory room where his staff was bundling them up for the official and told him to “fuck off”—in English—declining to hand over a single iPad. He had his team translate his frustration on his behalf, a face-enhancing move that gave him leverage. “You want to create an impression that you’re an executive who is at a level where it’s not required to speak their language,” he says."

"How the police functioned was something Ford had taught his school-age children living in China at the time. “My kids learned at a young age: When a cop comes up and asks you to do something, check if he has a gun. If he doesn’t, ignore him. If a cop comes up and he does have a gun, do whatever he says because that’s an army policeman. But the non-army policemen have no power whatsoever.”"

"But Chinese law didn’t allow that. If a store was open to the public, it was open to everyone. Efforts to exclude people proved disastrous. Trying to impose order, the Navy SEALs turned physically aggressive, a tactical no-no, culturally. “We’re in *their* country,” says MacKay. “And they’re very sensitive to Westerners telling them what to do and taking advantage of them.” The resellers responded by having their minions flood the store, clogging the sales channels to such a degree that sales would freeze. “They’d all come to the front, where the cash register is, screaming and yelling and holding out money: ‘I want my phones! You’re selling phones! I want my phones!’ ” Ford recounts. The resellers were sending a message: *Work with us, or we’re going to shut you down so nothing happens.*"

"Speaking to Cupertino, Ford struggled to convey just how powerful the demand was. One time, when he told an Apple executive visiting Beijing that he needed such and such number of iPhones, the executive looked incredulous. “You’re asking for a quarter of the entire planet’s supply of iPhones!” Ford looked back at the executive. “Yes! Welcome to China!”"

"This was the conversation when Ford realized just how much work awaited him. “We don’t have anything,” Cano told him. “You’ve got to figure everything out. You’ve got to figure out the whole operating process. We don’t really have anyone on the ground. We have a small marketing group there that works for Apple, but they’re a different entity than you. You’ll have to go set the entity up. You’ll have to figure all these things out.”"

"Executives had presumed that doubling down on China helped their cause—“look at how many jobs we’re creating!”—but Ford’s understanding of Chinese culture was more nuanced. “They call it big potato, small potato,” he says. “It’s an analogy for social status.” Sure, Apple was creating a lot of jobs, but it was also making a lot of money, so these things balanced out—China didn’t “owe” Apple anything. The job creation didn’t give Apple leverage; it just deepened its vulnerabilities and reinforced that it was the small potato. “I didn’t think Apple understood China very well,” he says. “I don’t think the American government does, either. They don’t get the culture of how the Chinese operate or how the [Chinese] government works. We approach everything from this Western mindset of fairness. The Chinese approach it from positional power—who’s got more strength?”"

"Ruben, greatly impressed, later described that for the first time he saw a practical example of how poverty could be eradicated. At Ford’s factories, rationality in production was not just about the production itself, but it was a comprehensive concept that also included healthcare, education, housing for the workers. The purpose of it all was to produce as many vehicles as possible for a rapidly expanding market. After the successful visit, they headed back to New York, via Buffalo and Albany."

"Towards the end of their car journey, they visited the Ford factory in Detroit and were well taken care of by, among others, the future CEO, the Dane Sörensen. They were shown around the various departments and were some of the first Swedes to see the famous assembly line, which had an unbelievable output of 35,000 cars a day."

"TESLA: 7 FOR 7 Tesla is one of the few cleantech companies started last decade to be thriving today. They rode the social buzz of cleantech better than anyone, but they got the seven questions right, so their success is instructive: TECHNOLOGY. Tesla’s technology is so good that other car companies rely on it: Daimler uses Tesla’s battery packs; Mercedes-Benz uses a Tesla powertrain; Toyota uses a Tesla motor. General Motors has even created a task force to track Tesla’s next moves. But Tesla’s greatest technological achievement isn’t any single part or component, but rather its ability to integrate many components into one superior product. The Tesla Model S sedan, elegantly designed from end to end, is more than the sum of its parts: Consumer Reports rated it higher than any other car ever reviewed, and both Motor Trend and Automobile magazines named it their 2013 Car of the Year. TIMING. In 2009, it was easy to think that the government would continue to support cleantech: “green jobs” were a political priority, federal funds were already earmarked, and Congress even seemed likely to pass cap-and-trade legislation. But where others saw generous subsidies that could flow indefinitely, Tesla CEO Elon Musk rightly saw a one-time-only opportunity. In January 2010—about a year and a half before Solyndra imploded under the Obama administration and politicized the subsidy question—Tesla secured a $465 million loan from the U.S. Department of Energy. A half-billion-dollar subsidy was unthinkable in the mid-2000s. It’s unthinkable today. There was only one moment where that was possible, and Tesla played it perfectly. MONOPOLY. Tesla started with a tiny submarket that it could dominate: the market for high-end electric sports cars. Since the first Roadster rolled off the production line in 2008, Tesla’s sold only about 3,000 of them, but at $109,000 apiece that’s not trivial. Starting small allowed Tesla to undertake the necessary R&D to build the slightly less expensive Model S, and now Tesla owns the luxury electric sedan market, too. They sold more than 20,000 sedans in 2013 and now Tesla is in prime position to expand to broader markets in the future. TEAM. Tesla’s CEO is the consummate engineer and salesman, so it’s not surprising that he’s assembled a team that’s very good at both. Elon describes his staff this way: “If you’re at Tesla, you’re choosing to be at the equivalent of Special Forces. There’s the regular army, and that’s fine, but if you are working at Tesla, you’re choosing to step up your game.” DISTRIBUTION. Most companies underestimate distribution, but Tesla took it so seriously that it decided to own the entire distribution chain. Other car companies are beholden to independent dealerships: Ford and Hyundai make cars, but they rely on other people to sell them. Tesla sells and services its vehicles in its own stores. The up-front costs of Tesla’s approach are much higher than traditional dealership distribution, but it affords…"

"Starting in 2002, Li Shufu had been eyeing Ford’s Volvo. After several twists and turns, he finally achieved his wish eight years later. Li Shufu’s acquisition introduced him and Geely to the world. The changes brought to Geely by this acquisition were evident. Volvo’s three factories, more than 10,000 patents, and complete technology research and development system could feed back into Geely’s tech R&D, forming a balanced product line and complete manufacturing system. The change brought to Li Shufu can be described as “impact.” Volvo’s supply chain, employee training system, safety test center, large-scale testing grounds, and global sales and service network taught Li Shufu to use global business thinking, experiencing the art and wisdom of management in the conflicts and integrations of different cultures."

"“We have not failed Ford’s trust!” Li Shufu always appreciated Ford’s broad-mindedness and sense of responsibility as a giant in the global automotive industry. Li Shufu knew that money alone could not buy Volvo, and he valued Ford’s trust in him. International media have likened Li Shufu to China’s Henry Ford. As founders of their respective automotive brands, Henry Ford was born in 1863, and Li Shufu in 1963. Interestingly, Geely was founded in 1986, and 100 years earlier, in 1886, the automobile was invented by the Germans."

"Starting in 2002, Li Shufu had been eyeing Ford’s Volvo. After several twists and turns, he finally achieved his wish eight years later. Li Shufu’s acquisition introduced him and Geely to the world. The changes brought to Geely by this acquisition were evident. Volvo’s three factories, more than 10,000 patents, and complete technology research and development system could feed back into Geely’s tech R&D, forming a balanced product line and complete manufacturing system. The change brought to Li Shufu can be described as “impact.” Volvo’s supply chain, employee training system, safety test center, large-scale testing grounds, and global sales and service network taught Li Shufu to use global business thinking, experiencing the art and wisdom of management in the conflicts and integrations of different cultures."

"The facts, as Tex saw them after leaving Howard Hughes, were these. There was room in the market which Hughes had tapped for at least one more blue chip company similarly oriented in advanced technology, especially in electronics. Most of the smaller electronics companies that had begun rushing into the field would ultimately be eliminated or ab- sorbed; thus he must think from the beginning in terms of an enterprise capable of extremely rapid growth toward blue ribbon status. Such an enterprise could be created by the purchase of one solid, profitable company for a building block toward internal growth. Other companies could be acquired if necessary in order to buy time, which would be of the essence, but only if they were integral to Tex's master plan. A final fact of which he was certain, after his experi- ence at Ford and Hughes, was that the cream of executives, scientists, and engineers must be hired as rapidly as possible, and could be, not through high salaries but through the inducement of generous participation in responsibility, and in the fruits of potential victory via stock options. In sum, the market was there, in electronics and related technologies, with a tremendous growth potential, for a man who knew what he was doing and how to move fast."

""These kids have gotten the cockeyed idea into their heads that there's something wrong with profits, when profits and other incentives are the engine. And they seem to think that there's something sinister about bigness—just bigness in it- self. Have they stopped to think that if you didn't have a General Motors or Ford or Chrysler we'd still be driving horse carriages over dirt roads? You can't do the big jobs without big companies. The bigger the company, the bigger the jobs it can do and must do, it's as simple as that. And another fallacy. Youngsters seem to think that opportunity is dead, that you have to become a company man in a giant corpora- tion. Nuts. If a fellow wants to be his own boss, opportunities are busting out all over the place like they never have before.""