The Businesswoman Behind The Wheel At A "Model" Chinese Employer In America

This year’s new film “American Factory“ highlights strains in management-labor relations at a plant in Ohio owned by China’s Fuyao Glass Industry. This week, union workers at GM also went on strike.

Labor-management relations have been a different story at another factory in the U.S. owned by another company, BYD. The Chinese manufacturer started with six staff in 2013; today it has created 800 jobs and received bipartisan support for its business from area politicians including U.S. House of Representatives member Kevin McCarthy, who represents the Lancaster, California district where BYD’s American headquarters is located.

“At first, BYD questioned why it was in the company’s interest to engage with unions and community groups in the region,” Jobs to Move America Executive Director Madeline Janis wrote in the L.A. Times in August. “But the story of BYD ended differently than Fuyao’s does in ‘American Factory.’ Workers in Lancaster came together with community members, including union leaders, clergy and environmental advocates, and convinced BYD to do the right thing — for itself and its workforce. Today, BYD is a model employer.” Jobs to Move America is a non-profit organization whose goals include inclusive employment and is affiliated with the AFL-CIO and other large U.S. labor groups.

That clarification is helpful to BYD. At a time of trade tensions between the two countries, some 60% of Americans don’t have a favorable impression of China, according to a July survey by Pew Research.

Rather than a murky state-owned business, BYD (“Build Your Dreams”) was born in one of China’s most scrappy, best-known cities for entrepreneurism, Shenzhen, located across the border from Hong Kong. Battery researcher-turned-businessman Wang Chuanfu started BYD there in the mid-1990s with financial support from a cousin from his hometown in Anhui Province, Lv Xiangyang.  BYD’s success in batteries won a minority investment from American business icon Warren Buffett by 2008, who Berkshire Hathaway bought a 10% stake at HK$8 a share.

BYD has since come a long way from its early days.  It has gone public in Shenzhen and Hong Kong, and expanded into four industries: auto-related, including  traditional and electric passenger vehicles, electric buses, coaches, trucks, forklifts; monorail; new energy, including solar panels and energy storage systems; and electronics manufacturing service for mobile phone brands. Component customers include Apple and Oppo; rivals in electric vehicles include Tesla, which is building a large plant in Shanghai, and Volkswagen, among others. BYD achieved a new milestone in July when it announced an agreement with Toyota Motor to jointly develop battery electric vehicles. The two plan sedans and SUVs as well as the onboard batteries for the vehicles and others with the aim to launch them in China under the Toyota brand in the first half of the 2020s.

Currently one of the world’s largest electric vehicles companies, BYD said in August revenue in the first half of 2019 rose by 14% to the equivalent of $8 billion; net profit shot up by 204% to $207 million. Though its shares have declined more than 10% in the past year on worries about future profit growth amid a reduction in Chinese government subsidies for electric vehicles, the company’s stock market capitalization is still about $19 billion. All of that success has turned Wang and Lv into billionaires.

The leader behind BYD’s U.S. advances is Stella Li, a 50-year-old graduate of China’s prestigious Fudan University and statistics major who started out at BYD as a market manager helping to sell batteries to international customers in the mid-1990s. Earlier, she worked at Global Sources, a business information company.

Speaking at a Forbes China event in New York in August, Li recalled the early days of opening offices in Hong Kong, Europe and Chicago, and visiting trade shows to sell mobile phone batteries.  She nailed down key accounts such as Samsung, Motorola and Nokia, putting the nascent Chinese company on the international business map.  For her success, Li  in 2007 was appointed the CEO of an BYD spinoff company: BYD Electronics. By the time she left in 2015, she was one of the most successful women in business in China. BYD Electronics went public in Hong Kong in Dec. 2007 at an IPO price of HK$10.75; its share price at the time she switched job in 2015 was HK$13.52.

Li’s next assignment: Manage BYD’s expanding U.S. operations. BYD selected California to launch its manufacturing beachhead in 2013. The Lancaster factory has since produced more than 300 electric buses and considers itself to be the undisputed leader as North America’s largest electric bus manufacturer.  Labor peace has helped the company pursue its business goals.

“We have a very good relationship with the union,” Li said in New York. “I think our management and people bought more than one hundred houses over there,” helping the local economy, she said. “We offered jobs to the single mom; we offer the jobs to veterans. We also offer jobs for the men and women who once was criminal. We give them opportunity because we believe in people.”

For her part, Li is today focused on expanding BYD U.S. business into relatively new areas: electric trucks and monorail systems.  The company recently bought 100-plus acres of land near Lancaster to produce monorail systems there, she said.  BYD’s U.S. current customers include Facebook, Stanford University, and the cities of Los Angeles, New York and Atlanta.

Clouds in the China-U.S. relationship are hovering. “I think there are some challenges here,” Li said, “But there still also a lot of opportunities. The challenges include concerns among some that railway equipment and even buses build by Chinese-based companies can be used for spying. There’s no proof, however, the New York Times reported this month. Li didn’t comment on the subject.

Li, having been doing business in the U.S for nearly two decades, takes a long-term view of BYD’s ties in America. “The U.S. investment is very strategically important,” she said. “We are continuously looking forward for the next 10 years.”

To last that long requires more than technology, Li continued.  “We are a publicly traded, private (sector) company, and carry very high standards for transparency and integrity,” she said. “That’s the way you build the culture to a global culture and a global company. Then, it doesn’t matter what will happen. This kind of company can survive. You have to be strong in any environment.”

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