Fuyao Glass America: A clash of US and China work cultures

August 27, 2019 17:13
Fuyao Glass was able to introduce its management model into the Dayton factory, which swung back to profit last year. Photo: Reuters

American Factory is a documentary that tells the story of a Chinese company’s venture in Ohio.

The film about Fuyao Glass America, aired on Netflix recently, was produced by Higher Ground, a production company backed by former US president Barack Obama.

The documentary has become a hot topic worldwide, partly because of Obama and partly because of the ongoing US-China trade war.

Pirate copies have already been uploaded to a number of popular Chinese streaming platforms. Interestingly, several social media accounts of state media have recommended the documentary.

The 110-minute-long documentary is directed by Steven Bognar, who started filming the factory in Dayton, Ohio, in 2015.

Dayton is a typical automotive town in the United States, with a population of 140,000.

General Motors once had a facility in the city, which hired nearly 10,000 workers during its peak.

However, the factory shut down in 2008 amid the global financial crisis that resulted in a downturn in the US automobile industry. Dayton’s unemployment rate surged above 12 percent.

In 2015, foreseeing a tariff risk, Fuyao Glass founder Cao Dewang decided to set up a factory in the US in order to directly supply to US carmakers.

Cao eventually decided to take over the abandoned GM factory and hired over 2,000 workers.

At the time, Dayton residents regarded Cao as their savior.

Initially, Chinese managers got along well with local workers. But the honeymoon period ended very soon.

The factory lost money persistently and Fuyao was keen on using its management model to turn the US factory around.

In the eyes of the Chinese managers, the local workers were too lazy and cared too much about their personal rights.

The local workers, on the other hand, thought they were being given impossible production targets and inadequate time for rest.

The conflict worsened and local workers wanted to set up a labor union to defend their interests.

“We don’t want to see the union developing here,” Cao said in a meeting with management at the factory. “If a union comes in, I’m shutting down.”

Cao regarded union as a key factor behind the failures of many US car factories.

Under local laws, the setting up of a union depends on the voting of all employees. Fuyao brought in professional consultant LRI.

Using the classic carrot-and-stick approach, Fuyao promised better benefits and threatened to reassign certain activists. 

In the end, the union proposal was voted down. Fuyao was able to introduce its management model into the Dayton factory, which swung back to profit last year.

To a certain extent, it’s a happy ending. But some workers are less than thankful. They said they are staying just for the money.

Chinese and local workers also appear to be less friendly toward each other.

This article appeared in the Hong Kong Economic Journal on Aug 27

Translation by Julie Zhu

[Chinese version 中文版]

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Hong Kong Economic Journal columnist