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DEBTOR NATION

Chapter 1 ♦ AIRMAIL FROM AFTERLIFE

1976

One rainy summer day, I packed my backpack and went to America. I was seventeen. I knew what I was doing: I was escaping from the debacle at home. And I was looking for something. For what exactly, I didn’t know, but I’d go look for it in America. There, the heat burned in my nostrils. Lawns were brown. Cars were big and air-conditioned. Girls went gaga over my accent. Guys thought I was cool. And I fell in love with it all.
          Three years later, I was paying my way through college in Texas when the notion of home, distant and convoluted as it had become, blew up with gratuitous violence. A Boeing had crashed into a mountain in Turkey, killing all 155 people aboard. I heard about it on the radio. But I didn’t connect the dots.
          A few days later, I found a message from the operator in my campus PO Box. Telegram, call Western Union, it said. I called from one of the pay phones. My heart was pounding in my temples, and I had trouble hearing the lady on the other end.
          “I’d read it to you,” she said. “But it’s in German. I think you better come by and get it.”
          “I’m fixing to go to work. Can’t you try to read it to me?”
          “Oh dear.”
          “Is it long?”
          “Two lines.”
          “Can you spell it?”
          “Well, I guess I could. Are you ready?”
          I pulled out a notepad and pen. “Ready,” I said, though I knew that I wasn’t ready, that I’d never be ready for whatever she was about to spell.
          “E-L-T-E-R-N new word,” she said, “A-M new word M-O-N-T-A-G new word M-I-T new word F-L-U-G-Z-E-U-G new word I-N new word D-E-R new word T-U-R-K-E-I—”
          “Stop! Please.” I couldn’t write anymore. Parents on Monday with plane in Turkey.... German sentences, even in abbreviated telegram style, had the main verb at the end, but I didn’t want to hear the main verb, didn’t want to hear it spelled out letter by torturous letter. “Thank you. That’s enough.”
          I’d escaped the debacle at home and had gone as far away as possible. But this wasn’t what I’d had in mind. I stood there in a daze, brain deadlocked, numb, clutching the receiver, drowning in abysmal emotions.
          Then I went to work. It was just a part-time job, but now I needed the money more than ever. Afterward, I drove to the Western Union office and picked up the yellow slip of paper with twelve lines of all-caps alphanumeric gibberish and two lines of readable text. It was from my sister, sent from the town where she was staying with friends. But it didn’t include their phone number. And my brother was on vacation somewhere. So there was no way to reach him either.

Next....

TESTOSTERONE PIT, the novel

Wolf Richter

Chapter 1 ♦ Circle Jerk

It was Saturday, the biggest day of the week, and everyone was working bell to bell, over forty salesmen, though Ferronickel didn’t know exactly how many he had because some hadn’t shown up and might have started selling cars some other place, and because he’d hired a bunch of new guys an hour ago.

“It’s a beautiful day,” he sang in a basso profundo voice as he marched across the showroom in his asymmetric gait. He was the general sales manager at the Ford Superstore. His Tabasco Sauce tie was loosened, his collar unbuttoned. His gut that hung over his belt strained his shirt. He had puffy eyes and was full of mean energy, ready to explode, ready to force things to happen. He blew out the door, came to a halt on the porch that surrounded the showroom on three sides, and lit a cigarette.

Al Millikin, one of his four sales managers and perhaps the best closer in town, was watching Mad Boxer work a customer on the truck lot. Potential deal.

“Why can’t he bring that guy inside and write him up?” Ferronickel said.

“He ought to tell him we got free pussy on the showroom,” Millikin said.

“Don’t give me any ideas for our next live remote.”

“Come to think of it, that would be a hell of a lot more effective than the classical rock-and-roll shit we’ve been doing.”

“For our male customers.”

“We could alternate. Free pussy one day, free Godiva chocolates the next. We’d have both ends of the spectrum covered.”

“You’re a fucking Einstein, Millikin.”

Reginald Pierce, another sales manager, a big guy with a shortish Afro, was jumpy and his eyes darted about. He fretted about Whacker Packer, Hackman Jones, JoAnn Delouche, and several other salesmen who’d formed a dope ring by the plate-glass window. If left alone, they’d make up rumors, complain about dealership coffee, and infect each other with morale problems. He singled out a young guy.

“Freddie T, are you going to participate in a circle jerk?” he growled. They called him Freddie T because of his unpronounceable Greek last name. “Or are you going to sell something?”

It startled them; they’d forgotten all about selling. And they drifted apart.

Lou Massago gesticulated on the phone in one of the closing booths. He wore a white button-down shirt, a red and blue tie, slacks, and ostrich-skin boots. A scar curved upward from the right corner of his mouth, giving him a lopsided grin even when he was serious. His eyes were set close together and peered out from under his bushy eyebrows with ferocious intensity. But he had a soft voice when he wanted to, and now he wanted to because he was talking to a customer about a 15-passenger van that had come out of the rental fleet. There were ten of them. They were scratched and dented and had too many miles on them, and they were overpriced, and no one could sell them, but he was king of sales, and if he could sell them, it would prove he could sell anything.

He hated working the phone. He needed his customers in front of him, needed to stare into the whites of their eyes. But no one had sold any of those vans yet, and to prove he was king of sales and could sell anything, he’d decided to sell them all. Besides, the Saturday rush hadn’t begun yet, and calling old customers was more productive than standing around waiting for something to happen.

Next....

Wednesday

Dec282011

The US Auto Industry Drifts Off To China

Wednesday, December 28, 2011 at 4:57PM

Though practically every car sold in the US today contains Chinese-made components, the announcement that a few Chinese-made cars would arrive in Canada raised a lot of eyebrows. It would be a Honda Fit assembled in the same plant where the European version, the Jazz, has been built for years. But Chinese-designed and branded vehicles have not made it yet. Chinese automakers, of which there is a whole slew, are scrambling to improve their technologies from nice-looking but shoddy copy-and-paste models to reliable products that would be competitive in developed markets. It’s a government priority. And they’re getting there through the back door.

China's automotive market, with new vehicle sales in the 18-million-unit range in 2011, has leapfrogged the US market with its 12 million units. Some analysts estimate that sales will reach 28 million units in 2017 (highly optimistic if the China bubble blows up before then), and no major automaker wants to miss out on the opportunity. They all have invested heavily there, though the National Development and Reform Commission is pushing foreign automakers to share more of their advanced technologies with their Chinese partners—and they all have to have Chinese partners.

The push to develop new technologies is immense. China has already outdistanced the US in published patent applications, according to a report from Thomson Reuters, though it is still lagging behind the US, Japan, and Europe in patent grants. The surge in applications is in part due to incentives that the government is offering in its amazing effort to push the country up the industrial and intellectual food chain to where products are designed from ground up in China. Targets: pharmaceuticals, technology, and ... the auto industry.

Developing technologies in China is one way. Another way is to go shopping in America. And in most cases, government-owned enterprises are behind it. For example, BeijingWest Industries. The joint venture of three government-owned companies—Shougang Corp, Bao'an Investment Development Co., and Beijing Fangshan State-Owned Asset Management Co.—bought the chassis division from Delphi Automotive during the crisis in 2009. Building on Delphi’s technologies, it now develops and manufactures brake and chassis components for a variety of US and European automakers.

Delphi embodies what’s wrong with manufacturing and financial engineering in the US. In 1999, when GM spun it off, it was a mega manufacturer of automotive systems. In 2001, the company cut 11,500 jobs. In 2004, it got into hot water over its accounting practices. In 2005, six years after its IPO, it went bankrupt and closed 24 plants. In 2006, it closed another 21 plants. Throughout, GM began to source its components elsewhere, particularly in China.

Visteon, Ford’s version of Delphi, is another example. Visteon designs and manufactures automotive interiors, lighting systems, climate control systems (second largest supplier in the world), and electronics, including driver information, audio, and powertrain systems. When Ford spun it off in 2000, 80% of its revenue came from North America. In 2009, nine years after its IPO, it went bankrupt and closed numerous plants. While the “reorganized” Visteon is still a primary component supplier to Ford, it now supplies other automakers as well. Its center of gravity is shifting to its Asia Pacific Corporate Office and Innovation Center in Shanghai. And the building of its North American Corporate Office and Innovation Center in Van Buren Township, Michigan, is up for sale.

Already, Visteon is consolidating its interior systems into Yanfeng Visteon Automotive Trim Systems, its Chinese joint venture with Huayu Automotive Systems, which is a subsidiary of China's largest automaker, Shanghai Automotive Industry Corp. (SAIC), which is owned by the Chinese government. And now analysts believe that Visteon may also merge its electronics entities into Yanfeng and sell its 50% stake to SAIC—hence, to the Chinese government.

To match quality and design standards of the best in the world and to become competitive in the US, Chinese automakers can't rely on copying existing technologies. They must learn how to design, engineer, and manufacture vehicles from the chassis up. And to accomplish that, China is weaving a matrix of companies with state-of-the-art capabilities, both in China through its joint ventures and overseas through acquisitions.

The most visible acquisition occurred when Zhejiang Geely Holding Group bought Volvo Cars from Ford in 2010, but the most significant movements are happening in the components sector where much of the unglamorous engineering and manufacturing work takes place. Clearly, China has set out to conquer the global automotive markets, but not by trying to flood the US prematurely with Chinese-branded vehicles.

The US trade deficit with China will hit $300 billion this year. It’s politically convenient to blame China’s yuan policy. But the driver is an enduring strategy by US corporations. And now a trade war has broken out.... The Trade Debacle With China.

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Reader Comments (4)

If I recall correctly, I read a few weeks ago that Daimler was attempting to sell 10% of the company to the Chinese. If THOSE folks are throwing in the Chinese towel, the rest of the non-Chinese automotive must truly be DOOMED.

December 29, 2011 |

Shibumi

Shibumi - Thanks for your thoughts. I'm keeping my eyes on it. The auto industry certainly thinks China is the future. And that's where a big part of the money is going. Someday, there will be something called "overcapacity" ... and that's when China-built cars will start sloshing around the world.

December 30, 2011 |

Wolf

When China was opening up her economy, like any other western country, lured by the big market sold off their technology to China. When China introduced highspeed trains or launched a space ship, the native's effort is not decried, but not proportionate to their technological prowess. In the trap laid by China, many western countries fell head over the other in selling off their technology. GM sold their technology/lines in anticiaption of big business to scuttle Ford's entry and so on. China cleverly played one upon another to get her work done and the point of no return is reached. The same product with some tinkering, she is going to sell it to the western counterparts at a throw-away price, killing the competition and expanding the market , all in one shot. Thanks to the avarice and greed of the western companies and foresight and negotiation skills of the chinese govt. It is heads I win and tails you lose.

January 9, 2012 |

Rajan

many people may think a large population may make large car sales, but not true in China, money is in the citys and owning a car in the city is expensive even by western standards, car's do need a parking space and at $25.000,- U.S. dollars people need to save for 2 cars at their first car purchase.
city government in China are turning in to western ticking/ fining machines, someone has to pay for big government , so the car will be the golden goose.
And now that you have your car in China, you will need to go to work , sit in traffic and have no place to park, so China may become the factory for the worlds car industry but large car sales number forever are not likely.
moreover soon the flood of low mile/km cars will hit the market,, remember Chinese live, work and play in the City, the few that venture out are limited, and the subway system becomes very attractive again after you have swallowed your pride of over spending on that import BMW and sitting in traffic.

February 7, 2012 |

lucas

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