“I drive happily!” This could, in the near future, be the slogan of a car commercial, since the announcement by Ford of an agreement to sell Volvo to Geely (吉利). Volvo means “I drive”, “I move”  in Latin and Geely’s Chinese name means “happy”, “auspicious”.

As noted in Ford’s official announcement, “the sale is expected to close in the third quarter of 2010, and is subject to customary closing conditions, including receipt of applicable regulatory approvals.” But the fact, that both Li Yizhong (李毅中), China’s minister of industry and information technology and Maud Olofsson, Sweden’s deputy prime minister and minister for enterprise and energy were present at the signing ceremony in Gothenburg is a sign that the deal is being supported both in Beijing and Stockholm.

Earlier this year, Sichuan Tengzhong Heavy Industrial (四川腾中重工机械有限公司) said it didn’t receive the approval of the ministry of commerce (中华人民共和国商务部) to buy the Hummer brand from General Motors. The acquisition of a brand associated with secure and well designed cars (Volvo) by a company already making cars (Geely) should go more smoothly.

In 2009, Beijing Automotive Industry Holdings (北京汽车工业控股有限责任公司) agreed to buy some intellectual properties belonging to another Swedish brand, Saab, from General Motors. For Geely, Volvo is not the first overseas acquisition. At the beginning of last year, it bought Drivetrain Systems International, an Australian car parts maker.

The deal says, that Geely, which is China’s biggest private car manufacturer “will own 100 percent of Volvo Cars and its related assets”. Geely intends to maintain Volvo’s factories in Europe.

“Become Asia’s biggest production center for laptops.” This is the ambition of the authorities of the city of Chongqing (重庆) in Southwestern China. Some 2000 kilometers away from the sea, Chongqing is located at the confluence of Jialing River (嘉陵江) and Yangtze River (长江). Its situation next to these fluvial roads has made out of Chongqing an industrial city and an attraction pole for workers from neighbouring provinces.

Important industrial activities in Chongqing are car and motorbike factories, chemical industry and heavy industry (steel, aluminum). Furthermore, the region is rich in natural resources like natural gas and the service sector is rapidly expanding. But now a new activity is planned to multiply the city’s industrial capacity.

This is not wishful thinking. In 2009 the city of Chongqing signed a deal with HP. The US company is to build a production base in Chongqing and move its accounting centre for Asia to the city. Hp’s commitment to Chongqing has pulled big Taiwanese OEMs like Foxconn (富士康) and Inventec (英业达) to build production plants in the city. If everything goes as planned, the computer industry should replace the car and motorbike industry as the city’s biggest industrial activity in 2012. Other computer brands and OEMs are said to be moving to Chongqing as well.

There are both political and economical reasons that explain why Chongqing is now attracting these kinds of high tech investments:

• It was always (since 1978) the authorities’ intention to first develop the coastal regions; but then let the investments go westwards. Under the Western Big Development (西部大开发 ),established in 2000, and other policies, Western regions can offer lower taxes than coastal regions.
• Since 1997, the city of Chongqing and the surrounding countryside have been separated from Sichuan province and given the status of a provincial level municipality. Before 1997, Chongqing was a busy, but rather poor industrial town. Since 1997, the city’s government has the power and means of a province to plan the development of the city.
• This has let to major improvements in logistics and infrastructure. Chongqing is now connected to the rest of China and the world by a growing network of high speed roads, railways and a state of the art international airport. All these have taken over from the fluvial roads and seriously reduced the time between Chongqing and other big industrial hubs.
• The nearby Three Gorges Dam (三峡工程) ensures the regions future electricity supply.
• Chongqing is going through a massive urbanization phenomenon, where people from all kinds of places are attracted to the booming city. While this is not an easy thing to manage for the authorities, it also gives them the opportunity to plan the future of a city that has an urban population of more than 5’000’000. Most of the new computer industry will be located in Xiyongpark (西永微电子产业园区), in the new Western parts of the city. The park was specially built to attract the computer industry and meet all its needs.

During the Second Sino-Japanese War (1937-1945), the Chinese government and many institutions were transferred to Chongqing, and for a while Communists and Nationalists stopped fighting each other and fought together against their common enemy. The buildings of the US legation are among the buildings from that time. that are still standing.

Chinese sources: 重庆筹划建立“亚洲最大笔记本电脑基地”; 惠普富士康两大产业基地落户重庆 再造1/3个重庆工业

Acer’s (宏碁) prospects for the near future look rather rosy. In 2009, the Taiwanese company came third in units shipped worldwide for the whole year. It is successfully surfing on the cheap laptops wave, which boosted shipments in the last quarter of 2009. To emphasize its position as a global brand, Acer signed into the Olympic partnership program (TOP)  for Vancouver 2010 and London 2012. It is taking over from Lenovo (联想), which was the computer manufacturing TOP partner for Torino 2006 and Beijing 2008.

But there is one market, where Acer could do better: China. So far Acer has failed to be among the top three in China (something it has achieved in the US and worldwide).  Simply put, Acer isn’t well known as a brand in China. According to zol.com.cn’s brand awareness index, these were the most popular computer brands in China in 2009:

• laptops:                1. Lenovo 2. HP 3. Asus (华硕)
• Desktops:             1. Lenovo 2. HP 3. Dell
• Netbooks:            1. Lenovo 2. Asus 3. Hasee (神舟)
• All-in-One PCs:  1. Lenovo 2. Apple 3. Hasee

To improve its image in China, Acer planned a big publicity campaign. The company’s announcement, that it signed a partnership with the Chinese Olympic delegation for the 2010 winter games is a key part in this strategy. In Parallel to its global partnership with the Vancouver games, Acer will present itself in China as a partner of the Chinese athletes. No doubt this will get noticed.

Besides a financial agreement, Acer will supply the almost 200 members of the Chinese delegation with mobile phones and computer equipment and assistance. During the Chinese New Year festivities (mid February), Acer will start promoting this partnership through ads in printed media, online media and TV.

Lenovo being a pioneer of the Chinese computer industry and having a very good knowledge of the Chinese market, clearly is the strongest brand in China. But teaming up with the Olympic delegation is bound to attract some eyeballs.

Chinese sources: 宏碁Q4全球销量超戴尔 联想仍在三甲之外; 宏碁与冬奥会中国代表团签约 发力大陆品牌推广

At this year’s Consumer Electronics Show, Haier (海尔) presented the world’s first TV set without any wire. To achieve this, Haier applied different already existing wireless technologies for the transmission of electricity, video signal, etc. The result is still a concept and will not be commercially available before two years. But Haier probably got what it wanted: the company managed to get some international coverage.

So far, Haier has been quite successful; but its biggest achievements have been  in a completely different market. Producing all kinds of electronic appliances, Haier has established itself as the number one brand in the Chinese countryside. There, Haier is a symbol for quality, affordable prices, good customer service, etc.

Haier has reached this desirable position by systematically studying and targeting the needs of the consumers in China’s countryside. Instead of wireless TV sets, Haier has built its name there by providing, for example, refrigerators that are protected from the bites of small animals.

In 2009, Haier benefited from one of the governments stimulus policies whose aim is to “bring electronic household appliances to the countryside” (家电下乡), and which consists of subsidies for the most needy.

Already now, Haier is a global company present in many countries. By showing to the world its wireless TV concept,  Haier has signaled that it aims to be successful in the high-end market segments around the world as well. Whether it will succeed is another story; but its strong position in its domestic market is unlikely to weaken soon, which should boost the company’s confidence.

Chinese sources: 海尔推出全球首台“无尾电视”; “家电下乡”冰箱拔头 海尔等大品牌受益大

Ever since it stepped out of the European Galileo project, China has been developing its own satellite navigation system. The whole program goes under the name Beidou (北斗) and should be operational around 2015. Like the US Global Positioning System (GPS), China’s Beidou was primarily designed for the military; but it will be available for civilian purposes as well.

A base for the industrial application of satellite navigation is now being built in Shanghai’s Minhang district (上海闵行区). It is the first of its kind in China and will be located within Shanghai’s National Base for Civil Aerospace Industry (国家民用航天产业基地).

The new base will comprise several research and development centers in different satellite navigation-related areas. Companies associated with the Beidou project, will also have a presence on the base: the first two key companies (龙头企业) are Everthriving Satellite Technology (中兴恒和) and GZHPower (国智恒).

Similar to the motivations behind Gallileo (Europe) or Glonass (Russia), China’s aim is to be technologically and politically independent in this strategic area. The economic prospects are also potentially big, if Beidou succeeds in being the leading provider of satellite navigation for commercial use in China. There is no doubt that the different government entities will push in this direction.

Chinese source: 中国首个国家卫星导航应用产业项目落户上海

In contemporary China, the private sector plays an increasing role in developing, applying and popularising technology.

The interactions between the private and the public sectors, the structure of China’s technology industry, its means of financing, the industry networks, etc. are all topics that technological China is covering.

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