Chapter 267 Negotiations at the Assembly Plant

"Overall, after these few days of on-site inspections, we deeply feel your sincerity. In terms of land and factory construction costs, I have to admit that, up to now, I haven't found any place that has more advantages than yours!"

The next day, in the meeting room of the Agel City Hall, both parties took their seats.

Shojiro Toyota began with a round of praise. However, this praise did not relax Kriell, including Carter. Because according to convention, after praise, there must be a belittlement, there must be that damned "but"!

"But..."

As expected!

"For an automobile factory, the location in Georgia is suitable for us to establish an assembly plant. All the parts can be assembled into complete vehicles here, and then shipped to every consumer through railways, highways, and cargo ships."

"But for an assembly plant, there is a lack of related industries near Georgia. For example, plastic companies that can provide plastic products nearby, textile companies that can provide textile interiors, processing companies that can provide steel melting, cutting, and manufacturing into standard parts, and so on. Without these supporting industries, if we want to build this assembly plant, we will have to spend more money to establish warehouses, establish logistics supply systems, and even need to stockpile a large number of inventories."

"This is something we Toyota cannot accept. We have always firmly believed that waste is the root of all evils in manufacturing! Unnecessary warehouses, unnecessary inventory stagnation, originally savable transit time, and the additional handling procedures of moving from warehouses to workshops, these are in direct conflict with our production philosophy."

"Sorry, Mr. Toyota, I have to interrupt you. What I want to point out is that the textile industry in our Georgia is not weak. Recently in Macon, less than 200 kilometers away from here, there are many textile companies there. I believe supplying Toyota's automobile factory is not too difficult."

Listening to Shojiro Toyota listing the shortcomings of Georgia, Kriell felt uneasy. Who knows if he said this to negotiate the price or to say "let's consider it later."

In any case, Kriell was not very willing to see it. After all, a reduction in investment would inevitably weaken the driving force on the local economy, which was not good news for Agel, which urgently needed external forces to drive it.

"Well, in that case, let me add something!"

After Kriell's words, Carter also seized the opportunity to speak:

"Regarding the plastic industry, it is indeed not our strong suit in Georgia. But it is not impossible to supply, or, as Mr. Toyota said, it will cause a lot of trouble. Actually, it's not troublesome! In the Greater Atlanta area, there are many aircraft manufacturing companies, such as Lockheed's Marietta factory and Savannah's Gulfstream Aerospace, and so on. Similarly, Savannah is also an important shipbuilding base on the East Coast. Mr. Toyota, you have also been there and should be familiar with it."

"These airplanes and ships also require plastic products during manufacturing, even if we cannot produce them independently for a while. Supplying them is really not a problem. Secondly, we have UPS headquarters here, and there is also a powerful logistics transportation company next door, FedEx. Transport and warehousing services, in the initial stage, can be entrusted to them."

"As for costs, it will certainly waste some, but look at the vast land outside the window. There is almost unlimited development space here! In the future, how to save costs, you have plenty of room to maneuver here! There will be no restrictions!"

"You are right, especially Mr. Blake's mention of the broad future, that's the most attractive part to me! Just like the vast market in the United States. I understand this point very well, including what you said, but you may not understand us."

Shojiro Toyota sighed, whether it was pretending or real, no one knew. After he sighed, he said slowly:

"Since the export of the first generation of models to the United States, almost ruining our reputation. We have paid a painful price for this before slowly recovering some. While there is credit to our technological updates, but to a large extent, it's because our prices are lower! Among comparable models, regardless of which one, Toyota's prices are $400-1000 cheaper than American cars, European cars, and even our competing Honda cars!"

"I heard Mr. Blake mention yesterday when chatting with Mr. Zhang, that every era has its own product. Cheap! Plus, fuel-efficient, that's what this era needs most! In terms of improving fuel efficiency, saving fuel expenses for consumers, and maintenance costs, we have already done our best. So, naturally, our focus needs to be on costs!"

"Only by constantly improving and even rigorously pursuing extreme cost control can we ensure the competitiveness of Toyota cars in the US market. So, those cost increases that may be tolerable to you, for us, they are deadly! Once we lose the price competitiveness, how can I ensure that the output of this factory can get enough returns?"

"How about this, you move the parts factory here as well?"

Compared to Kriell, who was cautious, Carter's answer was much bolder.

Since you think it's too expensive to procure other parts here, why not just move the supporting industries here as well! Self-production and self-sales, wouldn't that be much cheaper!

"Hahaha, that's impossible! Mr. Blake, Toyota has never opened a factory in the United States. Faced with an unknown environment, we cannot invest a large amount of resources at once to gamble on that uncertain future. This idea simply won't pass the president's review."

"How about this, then? I'll provide warehouse services. That is, I'll build the warehouse, I'll manage it. And as for the cost, I guarantee to give you the lowest price, and even for the first three years, I'll only charge the cost price. This way, I'll help you bear some of the costs, what do you think?"

Rubbing his chin, Carter thought for a moment. For warehouses, setting up a temporary one wouldn't cost much at all. After the residential area is completed, those mobile homes would be wasted if not repurposed.

It's better to bring them over, convert them into warehouses, and the actual cost might only be the expenses of hiring a few warehouse managers.

"Besides, in terms of logistics, I can also simultaneously increase some investment in logistics companies. Still the same, guarantee to provide you with a low freight rate, and for the first year, I'll only charge the cost price!"

"Oh? If that's the case, where do you plan to build your warehouse?"

"Of course, it will be inside the factory park, so that it can also help shorten the transportation distance for you, right?"

"What about the land rent?"

Carter: ???

"I'm already giving you the cost price, and you still want to charge me land rent?!"

"Let's be fair. Let's be fair. Or, if you build the warehouse on your own land, you bear the cost of road leveling, then that piece of land is yours, and we won't charge rent for it."