The strategic department of Xinghai Group worked all night and all night to hand over more detailed information about Hydro Aluminum Company to Mu Yang the next day.

After reading the information, Mu Yang had a deeper understanding of Hydro Aluminum Company. At the same time, the cooperation areas must be divided. For example, the Chinese market is definitely not within the scope of cooperation. It is mainly the European and American markets. What other markets are included? It must be detailed.

talk.

Similarly, Assem and his entourage analyzed Xinghai Group's aluminum alloy automotive sheet factory. If they cooperate, what they need to give and what they will get; if they do not cooperate, how much they will lose.

Everything is based on a win-win situation.

The current global competition for aluminum alloy automotive panels is severe, especially after Xinghai Group entered the international market to grab share.

Last year, the global demand for aluminum alloy automobile plates was about one million tons, of which Novelis' market share was almost 50%, or about 500,000 tons;

Next is Hydro Aluminum Company. Although it is second, its market share only accounts for about 18%, 180,000 tons (about 930 million U.S. dollars). The company’s annual output value last year was about 8.11 billion U.S. dollars. Aluminum alloy automobile plates

It’s just one of the businesses);

The third is Alcoa, which only accounts for about 15% of the market share.

Alcoa is a behemoth. Founded in 1888, it is the world's third largest aluminum producer after Rio Tinto Group and Rusal Group. Its main products include rolled products, wheels, forgings, fastener systems, precision castings and construction systems.

solutions in the field, etc. This technology also involves other light metals, including titanium, nickel and super alloys.

On May 7, 2007, Alcoa launched a hostile takeover of Alcan Group with a total value of US$27 billion, aiming to merge and become the world's largest aluminum producer.

However, the acquisition ultimately failed.

Therefore, in the aluminum alloy automotive plate business, if Xinghai Group cooperates with Hydro Aluminum Company, in addition to its biggest rival Novelis, it will also have Alcoa.

Now, Xinghai Group wants to come in and grab the cake, not only the domestic ones, but also the foreign ones.

The domestic market is not large. According to Mu Yang's previous estimates, the demand for aluminum alloy body panels in my country's automobile industry is expected to be about 70,000 tons around 2011.

At present, Xinghai Group's annual output of aluminum alloy automotive panels may reach 200,000 tons, and it plans to build a second phase of 300,000 tons.

If based on the current sales price and the current sales situation of Xinghai Group, the domestic market share is about 50%, mainly because Yiqi and Shangqi have not yet been settled.

In overseas markets, Porsche has been secured, but it is impossible to purchase all Porsches from Xinghai Group, and supply risks must also be considered.

In other words, Xinghai Group's sales volume currently only reaches about 80,000 tons per year, which is still far from 200,000 tons per year.

If Xinghai Group wants to sell out the remaining 120,000 tons of production capacity, it mainly needs to find ways from overseas markets, but there is currently not much progress in the international market. This is also where Mu Yang is worried, unless he is willing to significantly reduce prices, but in this way,

It will definitely be accused by its peers. If malicious competition destroys the local market, the local country will increase tariffs on Xinghai Group.

The demand for aluminum alloy automotive plates is increasing. Next year, the domestic demand for aluminum alloy automotive plates is likely to reach 100,000 tons, and the global demand for aluminum alloy automotive plates will reach 1.4 million tons.

In this way, Xinghai Group's annual output of 200,000 tons was quickly digested, but it was still far from Muyang's market share target. It sought a strong partnership to increase its global market share and make more money.

If Xinghai Group is willing to lower prices and domestic automobile manufacturers are willing to increase the use of aluminum alloys instead of steel, the demand for aluminum alloy automotive panels will increase dramatically in order to achieve small profits but quick turnover.

But Mu Yang feels that small profits but quick turnover are too laborious, and it may not necessarily make more money than before. Moreover, car manufacturers are unlikely to be willing to replace aluminum alloy car panels all at once. Design update is a long process.

On August 3rd, that is, at nine o'clock in the morning on the third day.

Assem and his entourage came to the old company of Xinghai Group again.

Mu Yang had been waiting for a long time, and the two sides began real negotiations in the conference room.

Assem elaborated on the advantages of his company, including what sales channels it has around the world that Xinghai Group does not have, technical advantages, etc.

After finishing speaking, he went straight to the topic: "Mr. Mu, I suggest that we cooperate to establish a new aluminum alloy automobile plate factory. You will provide the production line and technology, and we will provide funds, personnel, and be responsible for sales and after-sales. As for the division of shares,

We can discuss it later."

As for the independent technology license, he can't get much money, Mu Yang has already rejected him, so the only option is to establish a new company in partnership, and everyone will share the money.

"Cooperation is not impossible, but how much do you think our production line is worth and how much is our process technology? Let me reiterate, I will not sell process technology and production line drawings." Mu Yang is not opposed to cooperation. Process technology and

The formula will not be sold to Hydro Aluminum, but is only licensed for use.

However, with such cooperation, it is inevitable that the equipment of Hydro Aluminum's original aluminum alloy factory will be eliminated.

Then, Hydro Aluminum Company personnel must understand the process and learn how to operate the equipment. It cannot be said that it cannot be operated without Chinese personnel.

In the cooperative factories, Hydro has the right to use the technology, but it does not have the right to transfer the technology or use it in other factories. Of course, Muyang will not open up the core technology.

If Hydro imitates equipment, it is considered infringement, and these details must be clearly explained.

"What if Xinghai Group will develop better processes and production lines? If it is upgraded, will there be additional costs?" Assem must consider this. If Xinghai Group is not responsible, then in the future

, the factories they cooperated with fell behind.

Of course, this cooperation is an exclusive one. Regarding the aluminum alloy automotive panel project, Xinghai Group will no longer cooperate with others to produce aluminum alloy automotive panels. The same is true for Hydro Aluminum Company. The two parties have established an alliance.

However, there will be no restrictions except for aluminum alloy automobile plate projects.

"Mr. Asem, since we have cooperated, of course we will also be responsible for subsequent technical optimization and equipment improvement. You do not need to pay additional fees. We need a win-win situation." Mu Yang replied, if the other party is asked to pay additional fees, then the other party will

Definitely not willing, "But if due to technical optimization and equipment improvement, improvements to the plant and other facilities are required, Hydro will be responsible."

"This is as it should be."

"Then let's talk about how much this equipment is worth first?" Mu Yang nodded and continued,

"A production line costs about US$40 million and can produce 20,000 tons of aluminum alloy automotive panels per year.

Next year, we can plan to produce 600,000 tons per year, which will require 30 production lines to meet international market demand and grab orders from competitors. Moreover, due to the advanced equipment, we will use less labor and consume less energy.

, less failure rate, etc., our production cost is three hundred US dollars per ton lower than conventional, and the comprehensive cost is four to five hundred US dollars lower. These 600,000 tons save 180 million to 300 million US dollars."

Mu Yang replied that the production cost of a production line is 70 million yuan, which is about more than 10 million U.S. dollars, but it is made by oneself.

Therefore, the equipment must be priced according to the market price. Forty million U.S. dollars is about the same. The other party also conducts an appraisal, but Mu Yang does not mean that it is worth so much.

Previously, Li Shufu from Zheli Group asked Muyang how much a production line cost. Muyang said it was 120 million yuan, which was also an exaggeration.

But that doesn’t mean you can buy it for 120 million yuan.

Even if it costs 40 million US dollars, equivalent to 272 million yuan, Mu Yang will not sell it.

Equipment is one thing, process and technology are another.

"Okay, there's not much difference. We'll value it in the end." Asem's expression was indifferent, but he was very happy inside. It's not expensive. Sure enough, things from China are cheap. "What about technology investment? How do you want to value it?"

Assem has made an estimate of Xinghai Group's equipment and found that it indeed uses less manpower and material resources and has various advantages. It is no problem to save US$300 per ton in the overall cost.

Xinghai Group seizes the market with excellent material performance and preferential prices. Hydro Aluminum Company will definitely have a serious impact. Last year it was able to sell 180,000 tons, but this year it may not be able to reach it, and its market share will drop from 18% to 15%.

the following.

If there is no cooperation, let's be optimistic. Based on annual sales of 150,000 tons, Assem's annual profit will be approximately US$255 million.

If we cooperate, we will need to sell more than 500,000 tons of aluminum alloy automobile plates annually to make cooperation necessary. The shareholding ratio is too low, so it is better not to cooperate.

According to Mu Yang's tone, it is unlikely that Hydro Aluminum will take a dominant position. They can choose other partners, but Hydro Aluminum requires at least 40% of the shares.

If it holds 40% of the shares and sells 500,000 tons of aluminum alloy automotive sheets annually, plus a cost saving of US$300 per ton, Hydro Aluminum can earn 1.57 times its previous net profit, which is about 1.5 times more.

billion dollars.

If we can sell more than 600,000 tons, the profit will be 1.88 times that of non-cooperation, which means we will earn approximately US$230 million more.

Only in this way is cooperation necessary.

Of course, if the two parties do not cooperate, and under the pressure of competition from Xinghai Group, to be more pessimistic, Hydro Aluminum Company may not be able to sell 100,000 tons of aluminum alloy automotive panels a year, and it may not make money.

600,000 tons, for Hydro Aluminum Company, means increasing its market share from 18% to 50%, which is not a difficult task.

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