n 2014, a former General Motors factory in Dayton, Ohio was taken over by Chinese glass producer Fuyao Glass America, a supplier to auto giants GM, Ford, BMW, Honda and Bentley. The factory, which employs 2,000 American workers, is the world’s largest auto glass plant. Cultural clashes between Chinese management and American workers at the factory attracted attention from both Chinese and international media. These issues and more are explored in the documentary American Factory. Released in August 2019 on Netflix by Higher Ground Productions – Barack and Michelle Obama’s production company – the film has since garnered global attention.
In his interview with NewsChina, Jeff Daochuan Liu, president and CEO of Fuyao Glass America, talks about what Fuyao has learned from its experiences of merging the two work cultures and the challenges that lay ahead.
NewsChina: As a Chinese company running a factory in the US, what has Fuyao learned from the experience?
Jeff Liu: I believe you have to earn trust. When you come to a new place, you have to respect the local culture, local policy and local law. It’s not the same as operating in China – the government, the system – they are a little different. But when we talk about the automotive industry, there are no boundaries. It’s like globalization: When we have a new model you can take it more than one country. You can go to China, to India, to Europe. When you come to the US, you have to make sure your culture merges with the local culture. You don’t have to change anybody. You have to change yourself basically. This is what we learned: earn trust and respect each other.
NC: What cultures do you mean exactly? JL: In China we work hard. Parents work hard in order to provide the best education for their kids, so their kids can have a better chance at earning a better life. Americans are pretty much independent. They have their own minds. They encourage you to work for yourself. Chinese people can work hard and wait until the end of the year for a big bonus. But Americans probably look to next week or next month. The ways they work are different. Chinese people compromise a lot of their family time. But in the US people want rewards and vacation. Chinese people can really give up vacations and go to work.
But manufacturing today is totally different than it was many years ago. We call it a game of survival. You’ve got to work hard to keep improving and surviving, otherwise there is no way, because labor costs are going up, but prices of auto parts and vehicles are going down every year. So this is what we have to do: We call it lean manufacturing, which means you have to continue improving to be a good supplier and survive in the automotive industry. We tried to meet somewhere in the middle of our two cultures to find our success. Auto glass production is a non-stop process. Any interruption would lead to rejects or sub-standard products. It means a complete process needs overtime sometimes. American workers did not understand why they had to work extra at the beginning. Fuyao explained the process to them and told them higher wages can only be made possible by more orders from our customers who are satisfied with the quality of our glass.
NC: You mentioned the differences in work cultures between China and the US. Things you may see as very normal American workers see as harsh. Are you concerned about the criticism Fuyao faces for these differences?
JL: We are a global company. When you talk about global, you’ve got to learn from one another. We have different people from different backgrounds. It’s very important for us to work together. I don’t think Chinese work culture of compromising family time is going to work in the US. But if you fully adopt American work culture, I don’t think the company could survive in this industry because our customers have strict demands and the cost pressure is so high. That’s why we have to find something in the middle, not 100-percent Chinese nor 100-percent American. That is how Americans understand Fuyao’s past success. We have really good, hard-working people working together. But we also have to learn something from the US. When American workers learn new skills, they have a competition. They always want to do better, and they are very independent. We have a one-on-one training program. Chinese workers have accumulated a lot of experience in the glass industry that American workers can learn from. There are no shortcuts. I think the merger of the two cultures works pretty well for us.
NC: Fuyao’s relationship with the labor union shown in the film also stirred some controversy. What’s your take?
LJ: I’ll give you an example. When we develop a new vehicle, we call it a VDP, or vehicle development program. Back in the old days, you needed 48 months to develop a brand new vehicle on the market. Now there is Fast VDP, which went from 48 months to 32, down to 24, 12 or even 6 months. You can have design teams both in China and the US working 12 hours in China and 12 hours in the US. Fuyao has to respond to our customers quickly enough. That’s why there is no room for a third party in your decision. That’s why we have to work directly with our customers.
The same goes for running the company. There is no room for a third party. Indirect communication can cause a lot of misunderstandings. That’s why communication is the most costly factor in manufacturing. That’s why we need direct communication, so that we can earn trust and time. When we have more business from customers, you have a job. Nobody else can guarantee your job, only customers do. So you have to meet their demands. So that’s why we say we definitely must have direct communication. There is no room for a third party. There is no time for delays.
NC: You said in the documentary that you wanted Fuyao America to be a real American company. What does that mean and why is that so important?
JL: The automobile is really a global product with no boundaries. We are Chinese coming here to invest. That’s why everybody thinks this is a Chinese company. I’d say Fuyao has been a global company for many years. We follow our customers. Fuyao Glass America is here for orders from General Motors. We have been a strategic partner with GM for a long time.
NC: What future changes will AI bring to the manufacturing industry?
JL: Some of the workstations or processes use robots that really improve productivity. We are human beings. Sometimes you feel tired or in very bad condition. You can use robots to replace human workers. In the documentary we mentioned how we load glass automatically. That really can reduce labor. The purpose of automation is not to reduce the number of workers, but to maximize the productivity of every worker through synergy of people and automation.
NC: But if robots can replace, say, 30 workers, would Fuyao provide more highly skilled jobs for them?
JL: Our factory is still expanding. More robots can help us win more orders. For example, when we want to increase our per capita output from US$500 million to US$600 million, we could either upgrade and hire 50 more workers or not upgrade and need 200 or 300 workers. The money saved would be used to provide better treatment and work conditions for our workers. The workers and company both benefit.
Fewer young people are now willing to do simple, repetitive labor. Manufacturing is completely different from what it used to be. Automation makes highly skilled workers feel that their work is meaningful.