Cao Dewang
| Cao Dewang | |
|---|---|
| 曹德旺 | |
 | |
| Born | May 1946 Fuqing, Fujian, China |
| Other names | Cho Tak Wong |
| Nationality | Chinese |
| Citizenship | People's Republic of China |
| Religion | Buddhism |
| Education | Left school at 14; largely self-taught |
| Occupation | Industrialist, philanthropist |
| Years active | 1983–present |
| Employer | Fuyao Group |
| Company | Fuyao Glass |
| Organization | Fuyao Group; Heren Foundation; China Automobile Glass Association |
| Title | Founder and chairman of Fuyao Glass |
| Known for | Building the largest automotive glass manufacturer in China; the subject of the documentary American Factory |
| Awards | Ernst & Young World Entrepreneur of the Year (2009) |
| Spouse | Chen Fengying |
| Children | 3, including Cao Hui |
| Relatives | Cao Degan (brother), former vice governor of Fujian |
Cao Dewang (曹德旺; also known as Cho Tak Wong; born May 1946) is a Chinese industrialist who founded Fuyao Glass and built it into one of the largest manufacturers of automotive glass in the world. He is chairman of the Fuyao Group, a member of the Chinese People's Political Consultative Conference for Fujian, and chairman of the China Automobile Glass Association.
Cao left school at fourteen to support his family, herding oxen and later trading tobacco leaves at a time when private commerce was prohibited. He was working as a sales manager at a small factory making glass for water meters when, in 1983, he saved enough to lease and then buy it. Observing Japanese carmakers beginning to manufacture in China, he redirected the plant to automotive glass in 1985 and founded the Fuyao Group in 1987. The company listed on the Shanghai Stock Exchange in 1993.
Fuyao supplies glass to most of the world's major carmakers and holds a large share of the Chinese market. Cao was named Ernst & Young World Entrepreneur of the Year in 2009, the first person from mainland China to receive the award.
He became known to a wide international audience through American Factory, the 2019 documentary directed by Steven Bognar and Julia Reichert, which followed Fuyao's takeover of a closed General Motors plant at Moraine, Ohio, and the collision between Chinese and American expectations of work that followed. The film was produced by Higher Ground Productions, the company founded by Barack and Michelle Obama, and won the Academy Award for Best Documentary Feature.
Cao is among the largest individual donors in China. He established the Heren Foundation, to which he transferred 300 million shares of his company, and gave about US$580 million to charitable causes in 2012. He is a practising Buddhist and cites Andrew Carnegie as the principal influence on his approach to giving. His autobiography, A Heart Like Bodhi, was published in 2014.
Background
Automotive glass
Automotive glass is a business with characteristics that shaped Fuyao's strategy.
The product is heavy, fragile and bulky relative to its value, which means transport costs are high and manufacturers are strongly rewarded for producing close to the assembly plants they supply. It is also safety-critical and made to specifications set by the carmaker, so a supplier must qualify with each customer over a long period and, once qualified, is difficult to displace.
The combination produces an industry of a small number of large players supplying globally through local plants: Fuyao, Japan's AGC and Nippon Sheet Glass, and France's Saint-Gobain. Entering it requires capital, technical capability and the patience to work through multi-year qualification with each customer.
China's motor industry
When Cao converted his factory in 1985, China produced very few cars. Japanese and later European and American manufacturers were beginning to establish joint ventures, and each needed local suppliers.
Chinese automotive glass at the time was largely imported at high cost. Cao's judgment was that a domestic producer meeting international specifications would have a protected position, because the transport economics favoured local supply and because the carmakers wanted local content.
The subsequent growth of Chinese vehicle production, from negligible to the largest in the world, carried Fuyao with it.
Early life
Cao was born in May 1946 in Fuqing, in Fujian province, into a family that had been prosperous and lost its wealth while fleeing during the Chinese Civil War. His father had been a merchant in Shanghai; the family's assets were lost when the ship carrying their possessions sank.
His childhood was accordingly poor. He left school at fourteen to help support the family, working first as an ox herder and later selling fruit, cycling long distances to trade.
His first business was buying and selling tobacco leaves, an activity that was illegal at the time because private enterprise was banned. He was reportedly detained and had his goods confiscated.
He taught himself to read Chinese to a level well beyond his formal schooling, and his later writing and public speaking are frequently noted as evidence of it.
Career
Acquiring the factory
Cao worked in the early 1980s as a sales manager at a small factory in Fuqing producing glass for water meters. The plant was a loss-making township enterprise.
In 1983 he leased the factory and subsequently bought it outright, having saved and borrowed the capital.
The move to automotive glass
The decisive observation came in 1985. Cao noticed Japanese carmakers establishing manufacturing in China, and separately encountered the price of a replacement windscreen for an imported car, which was several thousand yuan because the glass was imported.
He redirected the factory to automotive glass, acquiring equipment and technical assistance and working through the qualification process with domestic and then foreign customers.
He established the Fuyao Group in 1987, and the company listed on the Shanghai Stock Exchange in 1993, among the earlier private Chinese manufacturers to do so.
Growth
Fuyao expanded to serve the Chinese market as vehicle production grew, and then internationally, building or acquiring plants in the United States, Russia, Germany and elsewhere, on the principle that automotive glass must be produced near the customer.
The company supplies most major global carmakers and holds a substantial majority share in China. Cao's son Cao Hui became chief executive in March 2005, with Cao retaining the chairmanship.
Trade disputes
Fuyao was the subject of anti-dumping proceedings in the United States and Canada in the early 2000s. Cao contested them rather than settling, and the United States Department of Commerce ultimately found in Fuyao's favour, an outcome he has cited as formative in his willingness to litigate rather than accede.
American Factory
In 2014 Fuyao acquired a former General Motors assembly plant at Moraine, near Dayton, Ohio, which had closed in 2008 with the loss of some 2,000 jobs, and converted it to automotive glass production with an investment reported at several hundred million dollars. The plant employed around 2,000 people, and Fuyao brought several hundred Chinese workers and managers to establish operations.
The venture was documented by Steven Bognar and Julia Reichert in American Factory, released in 2019. The film records the gap between the two workforces' expectations: Chinese managers accustomed to long hours, minimal holiday and unquestioned instruction, and American workers accustomed to safety procedures, overtime limits and the possibility of collective bargaining, many of them earning substantially less than they had at General Motors.
American workers campaigned to unionise the plant with the United Auto Workers, citing safety conditions and pay. Fuyao opposed the effort, engaging consultants, and the union vote failed in November 2017 by a wide margin.
The film was acquired by Higher Ground Productions, the company established by Barack and Michelle Obama, distributed by Netflix, and won the Academy Award for Best Documentary Feature in 2020.
Cao participated in the film and is presented in it without evident editorial hostility, reflecting on the costs of industrialisation in a passage in which he questions whether the changes he has helped bring about have improved life. The documentary made him among the most internationally recognisable Chinese industrialists.
He has separately criticised the cost of manufacturing in China relative to the United States, arguing in widely reported remarks that Chinese taxes, land, electricity and logistics costs had risen to the point that American production was competitive despite higher wages, a claim that prompted substantial debate in China.
Philanthropy
Cao is among the most significant individual philanthropists in China.
He established the Heren Foundation, to which he donated 300 million shares in Fuyao, one of the largest single charitable transfers by a Chinese individual. In 2012 he gave about US$580 million to charitable causes.
His giving has covered disaster relief, poverty alleviation, education and religious institutions. In later years he committed a very large sum to establish the Fuyao University of Science and Technology at Fuzhou, an institution intended to train applied engineers for Chinese manufacturing, funded principally by the Heren Foundation.
He cites Andrew Carnegie as the principal influence on his thinking about wealth, and has stated the Carnegie position that a fortune should be distributed in the owner's lifetime.
Personal life and beliefs
Cao is a practising Buddhist, and his religion is central to his public account of himself. His autobiography, A Heart Like Bodhi (心若菩提), published in 2014, takes its title from Buddhist imagery and treats his commercial life in explicitly religious terms.
He is married to Chen Fengying and has three children: Cao Hui, Cao Yanping and Cao Daiteng. His brother Cao Degan served as vice governor of Fujian province from 1998 to 2003.
He chairs the Fujian Golf Players' Association and is a member of the Chinese People's Political Consultative Conference for Fujian.
Assessment
Cao's industrial record is straightforward. He bought a failing township factory making water meter glass and built from it a company supplying most of the world's carmakers, in an industry with high barriers to entry and long qualification cycles, and he did it without state ownership and largely without foreign partnership.
His international reputation rests on a documentary he did not commission and does not entirely flatter him, which is unusual. American Factory is generally read as being about the difficulty of transplanting industrial culture rather than about Cao personally, and his willingness to appear in it, and to reflect on camera about the costs of what he does, is frequently noted.
His philanthropy is the least contested part of the record. The scale of the Heren Foundation transfer and the funding of a technical university are substantial by any measure and unusual in a Chinese context where large-scale private giving developed late.
The criticisms attaching to him concern labour. The Ohio plant's safety record and its opposition to unionisation were documented at length, and the working practices the film records were not disputed by the company so much as defended as necessary to make the plant viable.
See also
References