Posts Tagged ‘China’

Holy Solyndra: Battery maker A123 Systems goes Chinese … ouch!

August 10, 2012

A123 Systems was supposed to be one the U.S. companies to propel the green energy revolution … by designing, making, and supplying batteries to hybrids and electric cars (think Volts).

A123 received more than $200 million from venture investors before raising $378 million in a 2009 initial public offering.

Also in 2009, it was awarded a $249 million green-technology grant under the Obama administration’s $2.4 billion Electric Drive Battery and Component Manufacturing Initiative.

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But, things haven’t been going so good for electric cars and A123.

A123 said second-quarter revenue fell 53 percent to $17 million … the company’s  second-quarter loss of was $82.9 million … and cash dwindled to the point that the company can only fund its operations for the next four to five months.

So, according Auto News, China’s largest automotive parts supplier is now poised to take control of A123.

China’s Wanxiang Group Corp. plans to invest up to $450 million in A123 Systems, taking an 80 percent stake in A123.

* * * * *

Ken’s Take: So much for energy independence and government venture capitalism.

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For Sale: Best-seller books … Price: $8 per kilo, hardcovers extra.

April 9, 2012

In one of my classes we study how books are priced.

Last fall, a team suggested that page count was a relevant criteria … that books with more pages should be priced higher than shorter books.

I summarily rejected the idea and joked at the team’s expense.

Well, the page has turned.

The team just returned from China and sent me me this picture.

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 Lo and behold, in China, they encountered book stores that sold books based on their weight.

A counterfeit version of the Steve Jobs biography (above) weighed in at 360 grams, and was priced by weight at 18 RMB ($2.85). Roughly 50 RMB ($8) per kilo.

The team tells me that all paperback books in that particular shop (located on Nanjing road, main street Shanghai) are sold at this rate; hardcovers are also priced  by the kilo but at a higher rate.

OK guys, you get the last laugh.

Thanks to Ash Kaluarachchi & Greg Berguig for feeding the lead

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What’s $65 among friends?

February 28, 2012

There was a piece recently in  the NY Times — titled How the U.S. Lost Out on iPhone Work.

The article stirred up some flak against Apple for producing the iPhone in China instead of the U.S.

The author argues that lower Chinese wages are, at best, only a partial explanation:

It is hard to estimate how much more it would cost to build iPhones in the United States.

However, various academics and manufacturing analysts estimate that paying American wages would add up to $65 to each iPhone’s expense.

The article concludes: “However, labor is such a small part of technology manufacturing …and since Apple’s profits are often hundreds of dollars per phone, building domestically … would still give the company a healthy reward.”

What???

Apple sells about 100 million iPhones annual … times $65 is $6.5 billion.

So, the answer is for Apple to suck it up, lower its profits, and dish the dough to high cost American workers.

Or, maybe Apple could just jack up the price of each iPhone by $65.

Certainly folks would be willing to pay that much of a premium to get an American made phone that works almost as well as the Chinese made one, right?

I’ll take the under on that bet.

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