Trump is also announcing that "Chinese car companies are welcome to build factories in United States", but the United States Department of Homeland Security conducted an investigation into "allegations of financial crimes and labor exploitation" at Fuyao Glass's United States plant and 27 work sites on July 26, Eastern time.
Murphy, the acting special agent in charge of homeland crime investigations in Ohio and Michigan, said investigators came to Dayton to enforce 28 federal search warrants in multiple cities, the report said. "Our investigation is focused on financial crimes, money laundering, labor exploitation, and potential human smuggling violations," Murphy said, "and law enforcement is currently working to locate victims, provide them with services, and gather evidence relevant to the investigation."
The reason why Fuyao has attracted attention is that Cao is a Chinese manufacturing enterprise that went to United States and transferred relatively early. In 2014, China's Fuyao Group acquired a stake in GM's defunct plant in Molin, which it described as the world's largest automotive glass production base. Later, the documentary "United States FACTORY" based on this and produced by Netflix won the 92nd Academy Award for Best Documentary.
He has some well-known remarks, such as raising wages for employees to consider whether other companies can afford it, and if other companies can't afford it, it is harmful to the society to do it yourself.
Xiang Ligang, a well-known communications expert, said: "When Cao Dewang went to United States to build a factory, he also did large-scale publicity, Cao Dewang attacked China's taxation and business environment, which was very influential at that time, and it was not possible to create a Chinese business environment in the society, and Chinese companies had to run United States." That's why it's important for everyone to pay attention. ”
Ironically, this United States factory was once a typical benchmark for the return of the manufacturing industry in the United States, and the documentary "United States Factory" also won an Oscar. Today's charges are extremely serious, 1 financial crime 2. Money Laundering 3. Labour exploitation 4. Potential human smuggling.
Fuyao Glass was investigated, which is a heavy blow to the return of the United States manufacturing industry
From some point of view, this investigation is related to the conflict between Fuyao Glass and the labor union.
As early as the filming of "United States Factory", some scenes of conflicts between the union and Fuyao Glass were also recorded, and when asked if he wanted to interrupt the shooting, Cao Dewang made it clear: "How I am, how to shoot, the union proposed to establish a union, which is the right of the union, and I, as the boss, also have the right to oppose the establishment of the union." ”
In 2017, Fuyao Glass's Ohio plant voted down the motion to form a union, which caused strong dissatisfaction from the United States Automotive Industry Workers (UAW), but Fuyao Glass workers voted back against the accusations and successfully frustrated its plan to move in.
Over the years, Fuyao Glass has developed smoothly in the United States. Fuyao Glass is the world's largest supplier of automotive glass, accounting for about 9% of Fuyao Glass's revenue, and Fuyao uses the coordinated development model of the whole industry chain, from a grain of sand to float glass, to the deep processing of automotive glass, to exterior parts and glass assemblies, to the "last mile" to meet the comprehensive needs of global customers. It provides global OEM supporting services for Bentley, Mercedes-Benz, BMW, Audi, General Motors, Toyota, Volkswagen, Ford, Chrysler, Nissan, Honda, Hyundai, Fiat, Volvo, Land Rover and other world-renowned brands, as well as Chinese automobile manufacturers, with a global market share of about 34% and a Chinese market share of more than 65%.
According to the 2023 Fuyao Glass financial report, the total assets of Fuyao Glass United States Co., Ltd. on December 31, 2023 were converted into RMB 7.431 billion, the operating income in 2023 was RMB 5.570 billion, and the net profit was RMB 494 million. It has also made outstanding contributions to the local manufacturing industry and has been warmly welcomed by the state.
And now the United States Department of Homeland Security is investigating Fuyao Glass United States with "four deadly crimes", which is obviously not so simple, because Fuyao's overseas business, including the business in the United States market, is basically operated independently, that is, from production to after-sales, all localized. Especially in the context of Sino-US trade frictions and the United States election, Fuyao Glass was questioned by the outside world, and it is likely to be treated unfairly, and it may not be directly related to whether to establish a trade union.
Trump wants Chinese companies to build factories in the United States, giving him a heavy blow to the business environment
With Chinese companies United States increasing investment, especially in today's globalized electric vehicle industry, United States unfair treatment of Chinese assets in the United States may be a blow to its manufacturing reshoring strategy.
Now Trump has distinguished himself from Biden, reiterating that he is "open" to Chinese automakers making cars in the United States, and saying that he wants to boost United States manufacturing and increase United States jobs in this way.
His exact words were that unless Chinese auto companies built factories in the United States and let Americans work in those factories, he would impose tariffs of up to 200 percent on each car to prevent them from entering the United States.
For Fuyao Glass, if Trump comes to power, he can live a better life. Because Fuyao Glass has made a great contribution to the United States manufacturing industry, in 2023, Fuyao Glass will also make a large investment in United States: 650 million US dollars.
BYD has an electric bus and battery production plant in Lancaster, California, United States, and CATL has cooperated with Ford to build a power battery factory in United States;United States Volvo Cars, a subsidiary of Geely Holding, has a production plant in South Carolina.
Chinese companies, especially mobile phone manufacturers, have suffered in India in the past two years, including surprise tax inspections, freezing and confiscation of assets, forced placement of Indian executives in important positions, and forced acquisitions, which have made a series of Chinese-funded enterprises complain. Many Chinese companies are beginning to realize that the importance of the business environment is the first place to invest in a country, because if the legitimate assets and normal business interests of the enterprise cannot be guaranteed, then the subsequent growth and profitability are zero, and there is no way to talk about it.
Now that the United States has raided Fuyao Glass, industry insiders have seen operations similar to those familiar to India.
In his last term, Trump has called for United States reshoring of manufacturing, but the reshoring of manufacturing requires a good business environment.
United States its own labor costs and raw materials and other aspects of the cost are relatively high, to the United States to build a factory manufacturing enterprises, itself is under the pressure of losses, the United States only benefits and no harm, if from the perspective of Trump's policy direction, has been named to welcome Chinese auto companies to United States to build factories, United States the correct approach should be to gradually open up some areas that were not allowed to enter before, and even introduce more preferential policies, rather than the other way around.
Fuyao Glass originally thought that the business environment of United States was good, thinking that United States had a chance, who knows, with its own development and growth, began to face uncertainty, Fuyao Glass as a landing United States local factory, compliance and legal operation of enterprises, it is a mirror, reflecting the prospects of future investment United States, Cao Dewang once went to the United States to build a factory, accusing the high cost of domestic electricity, poor business environment, now this encounter, but embarrassing, the search incident is a temporary interference for Fuyao United States, the impact on the company's overall operation is limited. Fuyao Glass's announcement is intended to send a positive message to the market that its day-to-day operations have not been significantly affected.
Still, for investors and stakeholders, it is still necessary to pay attention to the development of subsequent events, Trump wants Chinese companies to United States and build factories, but he has given himself a heavy blow to the business environment in advance, United States if he learns India, I am afraid that it will scare off many investors, and it will be a disaster for the United States manufacturing reshoring policy, we will wait and see."
Author: Wang Xinxi, Senior Reviewer of TMT This article is not reproduced without permission