Jackson began writing on his card.
Qiang turned to the Chairman of General Electric. “Mr. Billings,” he asked.
“Yes?”
“We need 200 locomotives over three years. Heavy freight, high-speed, long-haul. Your best diesel-electrics.”
“Standard price?” asked Billings calmly. He had begun to absorb and appreciate the magnitude of what was occurring.
“Yes,” replied Qiang.
“Are you allowing for spares and maintenance in your figure? Normal spares for maintenance, wreckage, etc., are five or ten percent. Would you like me to price 225, and will this be with my current or supplemented capacity? And the delivery? When do you need your first shipment?” He was fully in the game now.
“225 will be fine, thank you. If you think additional manufacturing capacity will be required to service this order and your current customers, please include that, but do not be greedy. There will be more,” Qiang replied. “And we would like the first ten as quickly as you can provide them. Two months, with the remaining 215 delivered at a rate of five per month?”
“We can do that,” Billings agreed. “Deposit?”
“No more than 15%, please.”
“And China’s interest in America “getting going” again…?”
“In a moment, please, Mr. Billings.”
Billings thought, wrote and handed the card to Qiang.
The Minister collected Billings’ card and the additional cards from the automakers and briefly looked at them. The auto numbers basically were the same as the published ones. Qiang now assumed that he was being dealt with honestly.
“Thank you,” Qiang said as he put down the cards.
Again reaching in to his briefcase, Qiang pulled out a different checkbook, one embossed with the logo of the largest American commercial bank, removed a check and began to write. Finished, he handed it to Mr. Board. “Here is the $50,000,000 deposit you require,” he said, handing the check to a surprised Board.
He wrote another check and handed it to Billings. Billings looked at it and placed it into his pocket. “Thank you. Who is my primary contact for the necessary paperwork, questions and project information?”
Qiang removed a sheet of paper from his case and handed it to Billings. “Here is the pertinent information, as well as my American office, apartment and cellular telephone numbers, should there be any problems or questions.” He handed another to Board. “If you would like, we will precede the orders with a contract. But our preference, of course, since we have already provided many millions of dollars, is to proceed on our handshake and follow with a contract. Will this be acceptable?”
“Yes, thank you,” nodded Mr. Billings, taking the sheet, glancing at it and folding it into thirds before placing it in the inside breast pocket of his suit coat, along with the check. “Will there be anything more?” he asked, beginning to rise. He wanted to get going on this right away, to call his executive team together and share this news, as well as ensure he could meet the promises he had just made, perhaps too quickly.
“Yes, Mr. Billings, if you could wait, please, as we finish these other transactions.”
“Of course.” He sat again.
Qiang removed and handed a similar sheet to Mr. Park. “Here is similar contact information for you, Sir.” Park took the paper with a nod.
Qiang again turned to the automakers. “I would now like to ask you gentlemen,” he said, “to use the second card to tell me how many units you could be making annually, in addition to your current output, if you ran at three-shift capacity. In other words, your current, total capacity. Again, this can be extrapolated from current information, but we would like to ensure reliable data. Please do not add planned capacity, just what you have now. Thank you.”
The men, having entered the game this far, and having watched the previous transactions each quickly filled-out his card. Qiang gathered the cards from the men, looked at each for a moment and nodded.
“It seems, gentlemen, that amongst all of you is an unused capacity of approximately 317,000 units of annual American production.”
Again, the executives at the table remained impassive.
“On the next card, please write the revenue you would anticipate that your unused capacity would deliver to you if manufactured in your current plants, in your current ratio of cars-to-trucks and of the various model types, with your current employee base and sold at your current list price, minus 15%.” As he spoke he walked around the table and returned the cards to the men. “In short, approximately – we can finalize detailed pricing later - what you would charge me to buy all of the vehicles you can make over-and-above your current production, but within your current capacity, on an ongoing basis.
Because the information still seemed non-confidential, and each auto executive knew his prices were on the street anyway, each did a rough average calculation in his head and wrote down the number. Again, the Minister picked-up the cards, looked at them, handed them back, and continued.
“Please, now, Gentlemen, one last request, and this probably can be answered only in the broadest of estimates. We would like to purchase approximately one million new cars and light trucks annually for a minimum period of 10 years. What would it cost for each of your companies to build an expansion plant in the state of either Indiana, Georgia, Tennessee, Alabama, Mississippi or Texas, adding an annual capacity of, say, 150,000 autos and trucks?”
Mr. Jackson immediately saw the connection between this question and the lack of an invitation to his peers at General Motors or Chrysler. He looked at Minister Qiang for a long moment, then turned his gaze to Premier Fang, who returned it expressionlessly.
Qiang looked at Jackson steadily, waiting.
In for a penny, decided Jackson, and wrote a number on the card, as did the others.
Minister Qiang again picked them up and reviewed them.
Qiang again opened his checkbook and wrote two checks, handing them to Jackson. “The first is for your new plant. I would ask that it be online within twelve months. Can you do this?”
“Yes,” said Mr. Jackson, accepting the check.
“The second is for the first year of your third-shift capacity. But we do have one caveat,” said Qiang, “which I will tell you in a moment.”
He turned back to his briefcase and opened another checkbook, and wrote checks for the new plants and one year’s unused American capacity to the other automobile manufacturing executives, and then handed these out. The amounts of each check were the amount they each had written in response to the query.
Billions of dollars changed hands.
“We are buying,” Qiang said, “paid one year in advance, and are contracting for ten years, the number of cars you can build in America with your current capacity, and the additional capacity just discussed. A formal agreement will be in your hands by the beginning of next week. It is likely this agreement will be extended regularly.
“Regarding your manufacturing, we will not accept cars from any locations other than your current American manufacturing locations and the new ones we are asking you now to build.”
He turned to Mr. Jackson. “Mr. Jackson, your new plant will be built in one of the states I just mentioned – not in Michigan. Please be certain you understand this.”
Qiang then returned to addressing all of the men. “These vehicles should be delivered FOB under your standard three-shift schedule to the port of New Orleans, where they will be shipped by