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EXCLUSIVE INTERVIEW: JEFF DAOCHUAN LIU, PRESIDENT OF FUYAO GLASS AMERICA

Appointed President of Fuyao Glass America in November 2016, Jeff Daochuan Liu exclusively described to Glass Worldwide the impressive progress at the company’s state-of-the-art automotive glass fabrication facility in Moraine, Ohio.

GW: HOW HAS FUYAO GLASS AMERICA (FGA) PERFORMED FINANCIALLY
SINCE OPENING THE WORLD’S LARGEST AUTOMOTIVE GLASS FACILITY IN OCTOBER 2016 IN MORAINE?

Every year, we have seen an increase of approximately 30% in sales revenue. Having made a loss of $40 million in 2016, along with our float glass operations in Mount Zion we made a combined small profit in 2017, followed by a profit of approximately $40 million in 2018. Forecasts indicate further profitability in 2019 and for future years. All results so far indicate that Fuyao’s investment in America was the right decision… but we must continue to grow.

GW: WITH A CAREER IN AMERICA SPANNING 30 YEARS, HOW HAS YOUR PREVIOUS EXPERIENCE ASSISTED SUCH PROGRESSION IN MORAINE?

Having worked for the automotive industry for more than 20 years, I not only had a detailed understanding of how the automotive business operates but also knowledge of Fuyao, after sourcing glass from them previously. Coupled with multi-cultural experience working for a consultancy firm with responsibility for international mergers and acquisitions, I was able to understand the FGA business quickly. Fuyao Chairman Cho Tak Wong approached me and having grown up in China but worked in America for 30 years, the opportunity was a good fit.

GW: HOW WILL FUYAO CONTINUE TO INVEST IN THE MORAINE OPERATION?

Fuyao has invested more than $750 million into its American operations and to build on our position as a world leader, a further $30-$40 million is being invested annually across the board at Moraine. To my knowledge, there has been very limited investment over the last 18 years in this market before Fuyao’s arrival here but we have the financial power and willingness to invest accordingly.

We are already planning to build an additional warehouse and have just signed the new leasing agreement with IRG for new storage space to support the growing business.

GW: DOES FGA HAVE OTHER EXPANSION PLANS?

Previously a sales department, we are expanding at our facility in South Carolina with a new warehouse and by adding two value added lines to serve local customers such as BMW and Volvo. Our experts are currently training approximately 60 workers and the facility will be operational by Spring 2019.
This is not a company that stands still… if the right opportunity for growth is identified, finance for investment is available.

GW: IN GENERAL, WHAT ARE PREVAILING MARKET CONDITIONS FOR THE AUTOMOTIVE SECTOR IN AMERICA?

Similar to forecasts in China, factors in America such as uncertain economic conditions will likely lead to a reduction of around 10% in the sector in 2019; following periods of intense growth, financial uncertainty may well lead to consumers delaying purchases etc. Major players such as Ford and General Motors are cutting workforces in the USA accordingly and that will have an impact further down the chain.

But FGA is popular with customers and is in a very good position to increase its market share as we continue to improve the business at management level, as well as in terms of productivity and manufacturing.

GW: HOW HAS THE MORAINE PLANT CONTRIBUTED TO THE LOCAL COMMUNITY?

Opening the plant here brought the city of Moraine back to life, creating more than 2300 jobs. As a tier one supplier, one job at Fuyao effectively creates another three jobs further down the line… so right now, more than 6000 families are dependent on Fuyao right here in Ohio. The community has welcomed the company and we are very active in all local charitable initiatives.
As and when our customers’ needs demand more lamination or encapsulation activities, for example, there is potential to further increase the workforce to 3000.

GW: WHAT WERE THE CHALLENGES OF RECRUITING SUCH A
SIGNIFICANT WORKFORCE IN 2016 AND WHAT TRAINING INITIATIVES WERE NECESSARY FOR FGA TO ADOPT?

Employing so many people from different backgrounds was indeed a challenge. There is now a real emphasis on creating the best culture and environment, with safety being the most important priority. A current initiative is to build a new central break room to accommodate 1000 people and increase productivity of meetings and promote team building. Education and communication have improved significantly and we are progressing in the right direction.

There is still an important contribution from our Chinese experts on the technical side but extensive training will continue the trend of increasing expertise throughout our local workforce. Indeed, the majority of the management team is already American. We have a localisation plan in place... our growth demands new levels of expertise from our employees.

We have a master training programme and prioritise training throughout the operation in Moraine, identifying new gols for employees to meet current demands, as well as progressing to the next level. So our goal is to attract the right people, implement the right training and have the right people in the right positions. It’s imperative to have people with the right skill sets to meet our customers’ needs.

GW: WITH FGA BEING A WHOLLY-OWNED SUBSIDIARY OF FUYAO GLASS INDUSTRY GROUP, A WORLD LEADING MANUFACTURING COMPANY IN AUTOMOTIVE GLASS, HOW IMPORTANT HAS THE COMPANY’S EXPERTISE IN CHINA BEEN TO PROGRESSION IN AMERICA?

Leading technical people are coming from our Chinese operation to train our local workers to high levels of competence. And at the same time, US employees are visiting China to learn from experts and the core values that led Fuyao to becoming a world leader. We are benchmarking all the time and in 2019, even more American employees will benefit from visiting the Chinese operations and for longer periods. It’s a real opportunity for them to progress.

GW: ARE THERE ANY PARTICULAR INITIATIVES TO ATTRACT YOUNG PEOPLE INTO THE MORAINE PLANT?

Following a $7 million donation to support the University of Dayton, we have worked with the university to set up an R&D innovation centre to encourage young talent into engineering. Research projects have included looking at robots to generate more efficiency and produce more high quality glass. We invest a lot in R&D and in the foreseeable future, we expect to have our own Fuyao R&D centre here in America. With the type of products we are going to roll out, such investment is necessary because simply being a manufacturing company is not enough.

Again, students from Dayton have had the opportunity to visit our Chinese operations and in reverse, Chinese students have travelled here to learn American culture. As well as the Chinese and American businesses, Fuyao is present in Germany and Russia and the company is progressing as a global enterprise. Our initiatives are ensuring that future generations of young and talented people with global outlooks will be working at Fuyao and will be well equipped to deal with all customer demands.

We are proud that FGA is a flagship in the Fuyao group and is considered the number one business unit in terms of investment and technology.

GW: HOW HAS PURCHASING TECHNOLOGY FROM LEADING SUPPLIERS SUCH
AS BYSTRONIC GLASS AND GLASSTECH ASSISTED WITH FGA’S PRODUCTION IN MORAINE?

We have implemented world class equipment from the best suppliers and including over 300 robots, we have the most advanced technology on the floor. Our philosophy is to use only the best technology here and we have trained our team to have their own knowhow to combine with this equipment and create a unique Fuyao technology… only Fuyao people can make that happen. On some lines, we have technology from different suppliers and we work together as a team for the best results.

GW: HAVING FORMERLY IMPORTED SIGNIFICANT QUANTITIES OF GLASS DUE TO INSUFFICIENT DOMESTIC CAPACITY, HOW HAS THE AMERICAN
AUTOMOTIVE INDUSTRY BENEFITTED FROM FGA’S CAPACITY LOCALLY TO PRODUCE FOUR MILLION AUTOMOTIVE CAR SETS AND FOUR MILLION AUTOMOTIVE REPLACEMENT GLASS WINDSCREENS EACH YEAR?

Our customers’ supply chain is now safe, with all the logistical advantages of buying glass from FGA rather than importing. And as we grow, there is the potential to reduce importation even further. Glass needs to be delivered on time and delivered to a high quality; in the automotive glass industry, this is the life you are going to lead!

Twenty years ago, development time for a new vehicle was around four years. Today, a vehicle can be developed in as little as six months. To achieve that, timing is everything for our automotive customers – for example, a windscreen needs to be developed with the OEM at the same time and our American footprint now enables our experts to do all the trials and support the complete programme timing. Market demand told us we needed to be here.

FUYAO GLASS