Haier takes hard line on Chinese competitors

By James Wells

SYDNEY: The head of the local subsidiary of Chinese appliance manufacturer, Haier, has hinted that its parent company – the largest whitegoods company in China – intends to acquire international manufacturers to increase the brand’s market share globally.

Haier Australia executive director, Karl Quin, told current.com.au that Chinese manufacturers must think internationally if they are going to succeed in the future.

“The situation in China is that many electrical appliance manufacturers are facing strong competition. As a result, there will be more factories closing down for various reasons,” Quin said referring to the difficulties faced recently by Chinese manufacturer Guangdong Kelon Electrical Holdings.

Quin said Haier was in a strong financial position and has an ability to bid for non-Chinese appliances companies despite its failed attempt to purchase Maytag.

“Cash is king,” Quin said.

"Haier has extra cash saved from the Maytag deal and that is why Haier is in a position to acquire other players in the industry. Whatever other Chinese factories have, Haier has it all and more. As a result, Haier is not targeting any Chinese factories. Haier is targeting international well known brands,” he said.

Quin is seeking to build Haier to become a top three ranked appliance brand in the Australian market and believes brands such as Electrolux Home Products, Fisher & Paykel, Samsung and LG are the only companies which can prevent it from reaching its goal.

Quin believes Haier will not suffer the same fate as companies such as Kelon – who despite being an active OEM business partner of Electrolux Home Products in Australia, was disgraced last year when the company’s former chairman, Gu Chujin, and six other executives were arrested for embezzling company money. Another Chinese company, Hisense, has recently purchased a 26.43 per cent stake in Kelon and has also announced a multi-million dollar foray into the Australian market.

“What happened to Kelon sends an important signal to OEM merchants or retailers in Australia because the warranty responsibility is binding with retailers. If anything happened with Chinese suppliers such as Kelon, there will be a problem of continuing supply of the products and most importantly the spare parts. Without spare parts, nobody is able to provide the after sales service. Unfortunately, many Chinese brands are not internationalised yet.”

Earlier this week, Haier officially announced it has established a retail partnership with the Narta group which follows existing agreements with Harvey Norman and Retravision.

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