A Car Factor in Bulgaria

 

Vocabulary

fortress	medieval	on first glance
outskirt	decisive	stuck in time
advise	plant (3)	joint venture
hire	negotiate	demand (2)
vehicle	participate	water-tight (2)
to foot	segment	bargain (2)
CEO	strategy	driving force
amiable	assemble	take a while
feature	count (3)	try our luck
wage	supply (2)	cost-effective
expand	based on	spearhead (2)
tough	suspicion	element (2)
phase	foothold	in terms of
offering	high-end	offering (2)
roll off	price tag	assembly line
realize	standard	turnover (2)
venture	pick up (5)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 

Video

 
 
 
 

Transcript

The town of Lovech in northern Bulgaria has a medieval fortress, less than fifty thousand residents, and an old bridge.

On first glance, it appears stuck in time.

But there’s change underway on the outskirts of town: a brand new auto factory has appeared — a Bulgarian-Chinese joint venture.

Harald Leschke helped build the plant. He was a designer at Daimler for thirty years. And he’s been advising the Bulgarians on the project.

The factory should assemble fifty-thousand Chinese vehicles for the European market each year.

Harald Leschke, Former Litex Motors Employee: “I was hired as the general manager. I employed the first people, participated in the contract negotiations with the Chinese, which wasn’t so easy. It also took quite a long time.

I think everything is water-tight now, and the vehicles will be produced here.”

The opening ceremony featured traditional, Bulgarian folklore.

Thirty million Euros are being invested here.

Harald Leschke says it’s a bargain for a plant this size.

Grisha Gonchev is the Bulgarian partner involved in the project. His firm, Litex Motors, is footing most of the investment costs.

The businessman made his first million importing vodka and operating gas stations.

He never gives interviews.

Another driving force behind the new plant is Wang Feng Ying. She’s the CEO of Chinese auto maker Great Wall. Her strategy is to use Bulgaria to supply the European market, including Germany.

Wang Feng Ying, Great Wall CEO: “We knew that Germany is a difficult auto market. But there will be market segments that will be interested in our products — especially where low prices and good quality count.

Of course it might take a while until we get a foothold on the market: maybe one or two generations.

But we’re going to try our luck.”

She wants to try her luck by starting with small vehicles: this model will cost €8,000.

The factory’s workforce is young; their average age is 25.

All the parts are supplied from China and put together by hand. The factory will be cost-efficient as long as Bulgarian wage costs remain low.

The assembly hall is almost empty . . . only a few hundred vehicles are currently in production.

Wang Feng Ying leads one of China’s biggest auto makers. It’s annual turnover is three billion Euros.

Great Wall vehicles are spreading throughout the world — and Wang Feng Ying is spearheading the expansion.

Harald Leschke got to know the CEO during contract negotiations.

Harald Leschke, Former Daimer Designer: “Ms. Wang is a very direct lady. She’s decisive. She’s certainly very tough by our standards.

But she’s also very friendly, very amiable, and we have very good experiences in the first phase of the negotiations.”

SUVs and pickup trucks are the company’s high-end offerings on display in the showroom.

They should soon roll off the assembly lines here.

Harald Leschke thinks the vehicles with their very competitive €15,000 price tag will be able to find buyers in Europe, like the Steed.

Harald Leschke closely examines the different models . . . and he finds familiar design elements.

Harald Leschke, Sofia University Design Professor: “In terms of the vehicles, the Steed is certainly, loosely based on an old study of a VW model. But I think most people won’t realize that.

The jeep, the Hova, is based on the Isuzu, which was build years ago in America before the entire factory moved to China.”

But suspicions like that aren’t slowing down the Chinese automaker, which plans to invest half-a-billion Euros in the development of new models.

Questions

1. The town and region of Lovech presents a big contrast. True or false? Why is there a stark contrast there?

2. Is this a Bulgarian-Chinese-German business venture?

3. Who is Harald Leschke? He was only involved in the engineering aspects of Daimler. Is this right or wrong?

4. Were the negotiations straight forward?

5. Grisha Gonchev never gives interviews. What does this mean or imply? Who is he?

6. Describe Wang Feng Ying. What is her business strategy? Is it a short, medium or long-term strategy?

7. Why did Great Wall set up shop in Bulgaria? Does Ms. Wang believe her cars can gain a foothold in the European market?

8. The Great Wall cars are all original models and designs. Yes or no? Will it be like that in the future?

 

A. Is there an automobile or auto parts factory in your city or country?

B. Would (young) people like to work in a car plant?

C. Are there many foreign or international investment or business partnerships in your city or country? Give examples.

D. Is the manufacturing sector increasing, decreasing or staying the same?

E. What will happen in the future?