Zhou Huicheng was well aware of the situation, but he still had to make excuses.
He stated that the reason why Zhonghua and Hongqi have so many advertisements is because these two car brands have high profit margins, allowing them to afford advertising. Similarly, the high commissions for 4S store salespeople are also due to the high profit margins of Zhonghua and Hongqi cars.
The reason why Zhonghua and Hongqi cars have high profits is because they are 100% domestically produced, and all parts are made in China.
Mercedes-Benz is different. Although it is assembled and produced in China, many key parts are imported from Mercedes-Benz headquarters at high prices. This allows Mercedes-Benz headquarters to make a fortune from auto parts.
Mercedes-Benz's behavior was too unseemly, which greatly displeased Tiangong Technology Company.
At the beginning of the cooperation, Tiangong Technology tolerated it because it wanted to steal Mercedes-Benz's technology.
Now that Tiangong Technology has mastered the technology and is fully capable, it naturally no longer wants to be "exploited" by Mercedes-Benz headquarters.
Wouldn't it be better to promote your own domestic car brand?
Tiangong Technology Company had long been prepared to turn against them.
Right now, Mercedes-Benz is the most anxious one, fearing that Tiangong Technology will shelve the Mercedes-Benz brand.
Of course, Mercedes-Benz also has the right to revoke the authorization. However, when Tiangong Technology and Mercedes-Benz established the joint venture, they also specified the exit mechanism in detail. If Mercedes-Benz wants to take back the authorization and the shares of the joint venture, it must pay a premium of 30% on the valuation of the joint venture.
Mercedes-Benz was naturally unwilling to pay such a high price, so it tried to cause trouble for Tiangong Technology Company by using the excuse of violating the contract to try to lower the price as much as possible.
Tiangong Technology wasn't going to be bullied. They negotiated and sued Mercedes, trying to drag things out as much as possible. Since Tiangong Technology wasn't in a hurry, they resorted to suppression and shelving. What can you do about it? Aren't there countless examples of foreign companies shelving Chinese national brands? How many national brands have disappeared because of this?
...
A lawsuit between two large companies can take several years to resolve.
Mercedes-Benz knows very well that they can't afford to delay any longer, and in the end they will most likely pay a high price to buy back the shares of the joint venture.
However, there are many Chinese companies willing to pay high prices to cooperate with Mercedes-Benz, which makes Mercedes-Benz very happy.
Therefore, after several unsuccessful attempts to communicate with Tiangong Technology, Mercedes-Benz ultimately chose to honestly buy back the shares.
On the morning of November 1, 2007, Mercedes-Benz reached an agreement with Tiangong Technology Co., Ltd. to acquire all of Tiangong Technology's shares and related licensing rights in the joint venture for RMB 52.1 billion.
Around noon, the news spread like wildfire throughout the country, causing a great sensation.
Numerous netizens are discussing this.
However, most people applauded it.
"The saga between Tiangong Technology and Mercedes-Benz has been making headlines, but today they've finally parted ways. I must say, Tiangong Technology really has guts; they actually gave up on the Mercedes-Benz brand—amazing! Speaking of which, Tiangong Technology's decision to insist on making domestic cars and abandon foreign brands is truly admirable! Look at the cars on the market; foreign brands are everywhere, it's truly heartbreaking. Now that our domestic cars are starting to rise, if we don't support them and instead support European, American, Japanese, and Korean cars, wouldn't that be disheartening?!"
"The person upstairs is right. I won't buy foreign cars anymore. Tiangong Technology's car brand is just fine!"
"South Koreans prefer to buy domestically produced cars rather than imported ones. Why can't we? Brothers, don't let South Koreans look down on us! We are patriotic too! Buying foreign cars is like sending funds to Europe, America, Japan, and South Korea to manufacture weapons and ammunition!"
"..."
Many people online express patriotism, but when it comes to buying a car, they may not.
Chinese automakers need to prove themselves.
Some car companies, on the other hand, are so shameless that they only cheat their own employees, no wonder consumers hate them so much.
However, in this life, Tiangong Technology Company is extremely conscientious and has won the hearts of the public.
The low-end brand "Hongguang" is priced under 100,000 yuan and offers good value for money.
In addition, Tiangong Technology Company offers a wide range of car brands for consumers to choose from.
Zhonghua and Hongqi are positioned to compete with Mercedes-Benz and BMW.
Many motorcycle brands have also transformed into car brands, including "War Horse", "Red Rabbit", "Wuzhui", and so on.
Furthermore, Tiangong Technology has also acquired several luxury car brands from abroad, including Rolls-Royce, Bentley, and Lamborghini.
Of course, there are also new energy electric vehicles—Tesla cars.
It can be said that Chinese consumers can buy cars of all grades and types at Tiangong Technology 4S stores.
It's worth mentioning that the split between Tiangong Technology and Mercedes-Benz was a significant event, setting the stage for a major battle between domestic and foreign automakers...
(End of this chapter)
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