Chapter 38 Sanqi, Liushi Fengyun

Known as the "Electrical Capital", Liushi Town has become a new landmark after the reform and opening up because of its developed private economy.Liushi Town is located on the southeast coast of Zhejiang Province, with a total area of ​​49.88 square kilometers, a registered population of 101,000 and a migrant population of 112,000.Because of the developed private economy in Liushi, this small town in Wenzhou has won many honors. It is a national urban-rural integrated development pilot zone, a national pilot town for comprehensive reform of small towns, and a national demonstration town for small town construction.It is also known as the birthplace of the famous Wenzhou model.Because it developed the private economy earlier, Liushi has also witnessed the ups and downs of China's private economy and private entrepreneurs after the reform and opening up.

In 1982, Liu Dayuan was 35 years old.In Liushi Town, Yueqing County, Wenzhou City, Liu Dayuan is well-known. He was the first person in Liushi to buy a motorcycle and install a telephone at home.He made his fortune by reselling screws between Wenzhou and Shanghai, so he is known as the screw king.Liushi businessmen who are also called kings with Liu Dayuan include "Electrical King" Hu Jinlin, "Mine Lamp King" Cheng Buqing, "Catalogue King" Ye Jianhua, "Catalog King" Wu Shilian, "Coil King" Zheng Xiangqing, "Bakelite King" Chen Yinsong, "Old King" Goods King" Wang Maiqian.Together they are known as the "Eight Kings" of Wenzhou.Later narrators said that the "Eight Kings" were the best among the earliest private businessmen in Wenzhou after 1978, and Liushi was the birthplace of Wenzhou's private economy.The local people's admiration for these great kings is mixed with jealousy.After a long period of poverty, some people began to get rich first, as Deng Xiaoping said.And these people will be materially more prosperous than ever before.

But it was a dangerous abundance at the time. One morning in August, when Liu Dayuan went out in the morning, he found two people following him.On the walls on both sides of the street, large slogans such as "Severely Crack Down on Serious Criminal Activities in the Economic Field" and "Leniency for Confessions and Strictness for Resistance" were posted.The change in the atmosphere made Liu Dayuan panic.While the two people behind were not paying attention, he got into the alley, ran home, took out the 70,000 yuan in cash he had saved at home, and ran to the river in only a vest and shorts, and fled in a hurry on a small motorized wooden boat. .With his many years of experience in doing business and running the wharf, Liu Dayuan became the only one among the eight great kings who was not imprisoned. The other seven great kings were all arrested as major economic elements.

From the beginning of 1982, the "big kings" began to feel the change in the atmosphere.On January 11 and April 13 of this year, the State Council issued two strict documents, "For criminals who seriously damage the economy, no matter who they are, no matter which unit they belong to, no matter how high or low their position is, they must be stern and impartial. Law enforcement is like a mountain, and no exceptions are allowed, and no one is allowed to cover up, intercede, or cover up. If there is any violation, they will be held accountable.” As a result, Yueqing County’s “Crackdown on Speculation Working Group” was stationed in Liuzhou, the most developed private business in January. City, began to talk to these kings one by one.

Also in his early 30s, Hu Jinlin, an electrical tycoon, was the first to be called to talk. On the second day of the talk, Hu Jinlin went to the working group with 60,000 yuan in cash as his own tax payment, hoping to pass the customs.But he didn't appreciate it. A month later, the cadres in the town told him that the relevant departments had already started sorting out the materials, and he was not allowed to go out from now on, and he had to be on call and wait for processing.In July, the atmosphere became more and more tense. Someone told Hu Jinlin that several "big kings" who were called to talk were detained and never returned home.At dusk, a town cadre passed by Hu Jinlin's house on a bicycle, stopped and laughed and said to the electrical king, "No, it's going to rain heavily!" Food stamps, 2,000 yuan in cash and various documents fled in a hurry.Sure enough, at 12 o'clock that night, the police car drove to his door to arrest him.

Hu Jinlin had been on the run for more than two years. On January 15, 1985, Hu Jinlin, who had quietly returned home for the Spring Festival, was arrested. On the same day, the Yueqing County Broadcasting Station broadcast news to the whole county saying: Hu Jinlin, the national economic criminal and the head of the eight kings, was arrested and brought to justice... … Fortunately, Hu Jinlin only spent 66 days in prison. The No. 1 document issued by the central government in January 1984 said: supply and marketing personnel are an important force in the circulation field, and play an important role in the development of rural commodity production.Document No. 1 even stated that these businessmen are "irreplaceable by state-owned and cooperative businesses."Yuan Fanglie, secretary of the Wenzhou Municipal Party Committee, said: "If the case of the Eight Kings is not overturned, there is no hope of revitalizing Wenzhou's economy."The secretary organized a joint investigation team to review all the case files, and finally concluded that, "except for some minor tax evasion, what the Eight Great Kings did was basically in line with the spirit of the Central Committee." Soon, all the Eight Great Kings were released. , and all the confiscated property was returned in full.

Although in the future when writing the history of Wenzhou businessmen and even Chinese private enterprises, the writers will mention the history of the Eight Great Kings of Wenzhou, but the Eight Great Kings are mostly unknown in the future, except Zheng Yuanzhong, the mechanical and electrical king, who changed his career to make clothing. His Zhuangji clothing invited Hong Kong stars Lv Liangwei became the spokesperson and became one of the outstanding garment enterprises in Wenzhou.Liu Dayuan opened a "Dayuan Precision Welding Material Company". He is no longer the richest businessman in Liushi, but his wealth is enough to allow him to buy real estate in the best parts of Liushi and Wenzhou and grow orchids.Hu Jinlin has taken a fancy to the low-voltage electrical appliance industry, but he is no longer the king of this industry, and Liushi is already producing more than 50% of the country's low-voltage electrical appliances.

Liushi became China's capital of low-voltage electrical appliances is not achieved overnight.According to "Wenzhou Suspense" written by Hu Hongwei and Wu Xiaobo, in the late 1970s, there were more than 2,300 low-voltage electrical appliance companies in Liushi. In 1989, Liushi's low-voltage electrical appliances were notorious for their poor quality. The report of the State Bureau of Technical Supervision "Summary Report on Cracking Down on Counterfeit and Shoddy Low-Voltage Electrical Appliances" wrote: "It was found during inspections that most of the fake and shoddy low-voltage electrical appliances came from in Wenzhou, Zhejiang, especially in Liushi Town, Yueqing County, Wenzhou." By 2000, Liushi's low-voltage electrical appliances had gotten rid of their notoriety and passed various verifications with a total annual output value of more than 10 billion yuan. Export earnings of 300 million US dollars.

The outstanding ones are Chint Group founded by Nan Cunhui and Delixi Group founded by Hu Chengzhong.When "Wenzhou Suspense" was written in 2001, Chint had 7,300 employees, total assets of 800 million yuan, and its comprehensive strength ranked seventh among the top 500 private enterprises in the country; Delixi Group had 6,000 employees and enterprise assets of 1.1 billion yuan Its comprehensive strength ranks 9th among the top 500 private enterprises in China.Nan Cunhui and Hu Chengzhong even built the office buildings of Chint and Delixi together.They are known as the two heroes of Liushi, and they secretly compete with each other.Various rumors that the two were not convinced by each other were circulating in Liushi. When Nan Cunhui's father died in 2008, Hu Chengzhong went to guard the coffin for two nights. Some people took this as one of the evidences that the two entrepreneurs competed in business but had a good personal relationship.But some people say that the two people are only superficially polite. When they sit at the same table for dinner, the two people who are both very good and strong will ridicule each other and will not give in to each other.

Nan Cunhui and Hu Chengzhong are elementary school classmates and business partners.In the early years, two young people who dropped out of junior high school opened a tailor shop and the other mended shoes. The two shops were on the left and the right. In 1984, the two of them partnered to open a switch factory called Qiujing Switch Factory. In 1991, Qiujing Switch Factory was divided into the first factory and the second factory, with Nan Cunhui and Hu Chengzhong serving as factory directors.As a result, the two parted ways in the second year. In 1994, Nan Cunhui established Chint Group, and Hu Chengzhong established Delixi Group. In 1999, Chint and Delixi both became "China Famous Trademarks", which are the only two national well-known trademarks in China's low-voltage electrical appliance industry.

As the boss of Liushi's low-voltage electrical appliance industry, Nan Cunhui found that what he had to face was not the policy changes that the eight kings were frightened by in the old days, but competition from the same industry, and not only the more than 5,000 low-voltage electrical appliances in Liushi Competition among manufacturers, as well as pressure from large international companies. In 1994, shortly after Chint Group was established, Schneider, a Fortune 500 company in China for two years (most people know this company because the young Deng Xiaoping used to work for Schneider when he was studying in France), came to Liushi and wanted to acquire the South Cunhui is a company with less than 100 million sales revenue.Nan Cunhui rejected Schneider's request: "Of course we are happy if it is cooperation. It was very naive at that time. You are so small and your family is so big. How can you (cooperate)?" In 1998, Schneider found Chint again and asked for a 51% stake, but Nan Cunhui refused again. In 2004, Schneider paid three visits to thatched cottage.At this time Chint is no longer Wuxia Amon, with sales close to 12 billion yuan, and Schneider is no longer a recruit in the Chinese market. It has established more than a dozen joint venture factories in China.Schneider's condition this time is that the two parties each hold 50% of the shares. However, Schneider will acquire Chint in three years.The Chint brand is retained, but it can only be positioned in the low-end market and cannot be exported. The senior management of the joint venture company is all appointed by Schneider.Nan Cunhui's request is not only to retain the brand, but also to cooperate in production technology, arrange peer-to-peer management personnel, independent sales, and independent brand. As a result, Schneider, who was rejected by Nan Cunhui, turned to Hu Chengzhong, Nan Cunhui's old classmate and rival. On December 17, 2006, Schneider and Delixi signed a joint venture framework agreement. According to the agreement, the two parties invested in the establishment of "Delixi Electric Co., Ltd." according to the ratio of 1:1. Delixi" brand.When the media reported on the joint venture between Schneider and Delixi, they used words such as "bringing troops into the customs" and "force the palace".Nan Cunhui also began to take the initiative to meet with the media, and said fiercely: "The government must see clearly, what are the multinational companies doing in this rural area? Their purpose is to monopolize, and take all high, medium and low-end in the field of low-voltage electrical appliances. !" "See clearly the essence of Schneider!" "Multinational companies are used to using standards, patents, acquisitions, temptations, threats, slander and other means to achieve their goals." On October 17, 2007, Schneider and Delixi announced in a high-profile manner that their joint venture plan had been approved by the Ministry of Commerce.Since then, the Big Mac has come to the town, and the two-hero struggle for hegemony in Liushi has been completely changed by the joint venture between Schneider and Delixi. But Nan Cunhui also has good news.Schneider has been entangled in the property rights issue for more than ten years, and after more than 20 lawsuits, Chint hit back and sued Schneider for infringing Chint's property rights, and won the victory shortly before the Schneider-Delixi joint venture plan was approved by the Ministry of Commerce , Wenzhou Intermediate People's Court ruled in the first instance that Schneider patent infringement was established and Chint should be compensated 330 million yuan. "It sued us more than 20 times in a row, and we can't stand it once we sued it?" Nan Cunhui said to the reporters who came to interview. The victory of the lawsuit also brought his magnanimity. He said, "Hu Chengzhong is not Wu Sangui", "Opening up and attracting investment is a national policy. It is good to introduce foreign companies to learn technology and management from them. Some people choose capital operation and regard enterprises as products. , Anyone can buy it if it is well managed, and sell it if the price is high. This is a matter of value and is beyond reproach." But he also said that Schneider's entry "will bring huge pressure to the electrical industry in Liushi."Chint, which has become the leader of low-voltage electrical appliances industry in Liushi and the leader of low-voltage electrical appliances industry in Asia, is undoubtedly the first to bear the brunt of the pressure.This time, Xiaoxiaoliu City has become the competition stage for the global low-voltage electrical industry.