International Department of the CPC Central Committee       BEIJING REVIEW
Silver Lining In the Rust Belt
By Yu Shujun 

The Fuyao Glass America factory in Moraine, Ohio (ZHAO WEI)

Chuck Marr, 63, once the owner of a bar and grill in Dayton, Ohio, catering to General Motors (GM) employees, stopped making good money after GM closed its plant in 2009. But when Chinese company Fuyao Glass Industry Group, led by its Chairman Cao Dewang, bought the abandoned facility in 2014 and opened it for production, Marr applied for a job and began work in 2016 at an entry-level position. 

"It (the starting wage) was much less than what we were used to making. But still, we're thankful for the jobs," Marr said. 

What he likes about Fuyao Glass America is that wages are all performance-based, unlike at GM where it was based on seniority. "So the harder you work, the quicker you can advance and the more you can earn accordingly," said Marr, who has been promoted several times and is now a supervisor leading a group of 35 workers. 

Thus, young workers are also attracted to the factory. "I've seen 21-year-old supervisors," Marr added. "Young people are moving up through the ranks and that's very unusual, especially in the automotive industry." 

This part of the story in the recently released documentary American Factory, produced by Barack and Michelle Obama and streaming on Netflix, may be a reason why Fuyao, although experiencing cultural clashes, remains attractive to local people. 

As for the work environment and safety issues, another cause of clashes between U.S. workers and Chinese managers raised in the film, Marr said, "The work environment has been greatly improving and they (the management) are identifying [safety] issues, and in a relatively short period of time, they've corrected many of them. We're moving in the right direction." 

Fuyao's U.S. factory currently employs 2,400 people and with work opportunities created by its supply chains included, the total number of jobs associated with Fuyao in the U.S. amounts to 6,000, according to Jeff Liu, President and CEO of Fuyao Glass America. 

In Moraine, a suburb of the Dayton metropolitan area with a population of only 6,400, Fuyao has not only won the trust of the local community but also become a role model of Chinese investment in the area. 

Substantial benefits 

Mitch Heaton, Vice President of the Dayton Development Coalition, said Fuyao's contribution has been tremendous in terms of the number of employees it has hired. 

"Generally, for every dollar spent [by Fuyao], seven [dollars] go to the community," Heaton said. 

Niraj Antani, who represents the 42nd District in the Ohio House of Representatives, agreed that Fuyao's contribution is critical, explaining that not only is it employing local people, it is employing them at a good wage. Fuyao has made one wage increase in the past three years, he said. 

"From a community perspective, you're talking about 2,400 families that are being supported. From a governmental perspective, that's also 2,400 new taxpayers," Antani said. 

Fuyao invested more than $600 million in its U.S. factory and started full-scale production in October 2016, with an annual capacity of 4.5 million sets of automotive glass and 4 million pieces of windshield glass, making it the world's single largest manufacturer of auto glass. 

Fuyao Glass America turned loss into gain in the late half of 2017, recording a profit of $754,500 for the year, according to Fuyao's financial report. In 2018, its net profit skyrocketed to 246 million yuan ($35 million). Its growth momentum has continued this year, with its first half net profit increasing more than 16 percent year on year to 147.6 million yuan ($21 million), despite its parent company's profit decline during the same period due to a slowdown in the auto industry. 

Fuyao is thinking of reinvesting the profit locally. Liu believes its 17-percent market share in the U.S. can still grow by 10 percentage points. 

Fostering culture 

The documentary paints a bleak picture for manufacturing workers around the world with a final shot of a Fuyao manager telling Cao he's going to replace four workers with the installation of a mechanical arm. It also states that up to 375 million workers globally will be affected by automation by 2030. 

However, Fuyao is actually facing the challenge of losing its employees to turnover. Liu believes it's important for the company to build a great culture to keep its workers. "Turnover is going to kill the company," he said. "To keep employees longer means we will be more competitive." 

Team building activities, travel to China rewards and hot meals that are mostly subsidized by the company are among the efforts, according to Liu. 

In December 2017, the company established the Fuyao Glass America Hardship Fund, the first relief fund to provide financial assistance grants directly to its employees during times of hardship or disaster. 

"I believe we're doing better than our competitors in terms of workload, benefits and bonuses," Liu said. "This could lead to our sustainable growth in the long run." 

Marr plans to continue working at Fuyao well over 70 years old as long as he's in good health. "It's a better place to work," he said. 

Jamie Hoskins, who formerly worked at a steel plant, joined Fuyao earlier this year because it offered better pay and he had heard great things about the management, training, the work environment and workers. "I feel like a part of the family already," Hoskins said. 

Fuyao is also a good citizen in the community, Liu said. On July 20, about 100 of Fuyao's top executives and employees built the entire frame of one of the houses that the company is going to construct this year, which will be for a family of about five. The Heran Foundation, launched by Cao in 2017, committed $50,000 to the project. 


A worker drives a forklift at the Fuyao Glass America factory in Moraine, Ohio (ZHAO WEI)

More Fuyaos wanted 

Thanks to Fuyao, the Dayton area, the county of Montgomery and the state of Ohio are wooing more Chinese investments, in sharp contrast to the federal government's restrictive investment policies toward China amid an escalating trade war. 

Antani said they want to see more cooperation between Ohio and China. "The example of foreign direct investment, like Fuyao, is very important. It will show both of our national leaders what these relations can do for our countries." 

According to Antani, Ohio hopes to introduce investments in automobile, and general and agricultural manufacturing, which used to be the state's strong suits. "With our workforce, tax climate, energy climate, etc., Ohio does very well for all businesses. We're going to encourage Chinese businesses to invest here," Antani said. 

Phillip Parker, President and CEO of the Dayton Area Chamber of Commerce, said his organization really appreciates the investment that Fuyao and its chairman have made in the community, and looks forward to the possibility of future Chinese investments. "There can be a synergy that we've seen with other industries with other countries," Parker said, citing an example of the large number of Japanese member companies in the organization. 

Erik Collins, Community and Economic Development Director for Montgomery, said, "We're excited about fostering and bringing more Chinese businesses to our community, and then of course, working with our local companies to do more work in China." 

Collins explained that the Dayton region has focused on making itself a business-friendly community and that his department will do its utmost as it works with local businesses to connect them with Chinese opportunities. 

According to Collins, the county is doing a global report, profiling its connections in different countries, and China is among them. "I'm happy to say we are seeing more and more connections that we're working on in China," Collins said. 

Heaton said he went to Fuyao's headquarters in Fuqing, southeast China's Fujian Province, in July and spent time with 11 companies throughout Fujian. His organization will also host a delegation from central China's Hubei Province in September. 

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