Issue link: https://iconnect007.uberflip.com/i/1060280
42 PCB007 MAGAZINE I DECEMBER 2018 Article by Philip Carmichael IPC—ASSOCIATION CONNECTING ELECTRONICS INDUSTRIES Twenty years ago, you could gauge the po- litical climate in China by observing what cars officials were driving. If the econom- ic climate was opening up and trending to- wards reform, officials could be seen driv- ing Mercedes. During times of stress, tight- ened access, and political meetings, officials would be seen only in domestically-made cars, like the ubiquitous Red Flag or the Shanghai-made Santana; during these times, the Mercedes were quietly garaged. Today's China is a lot more complex, which means the "official's auto" metric no longer applies since nearly all automotive manufacturers worldwide now have local production in the world's largest car market. While the United States may be the world's most open market, China remains the most competitive. It is also the second largest econ- omy in the world and is still viewed by most U.S. and EU companies as the "last great op- portunity for growth." Many companies want to gain entry to the Chinese market share for their products or services. Thus, the competi- tion for sales of products or services is corre- spondingly intense, which causes foreign com- panies to offer low prices, reducing normal or worldwide margins to gain a foothold. It also creates significant volatility for those engaged in sales forecasting. Recently added to this complexity are turbu- lent trade tensions between the world's num- ber one economy (U.S.) and the number two (China), so how can you navigate your busi- ness successfully through this landscape? Strategies One of the first strategies is to be low key. Now is not the time to hold a global board meeting in China with a lot of fanfare, nor is it a good time to translate and publish local- ly your company's commitment to the "make America great again" initiative. While that might seem relatively obvious, I have seen ex- amples of this in the last three months. Quietly keeping focused on your core business is a key consideration. Foreign participation in this current market- place is under an increased level of open scru- tiny. All foreign companies are facing this at- tention—not just Americans. Recently, for ex- ample, I received a notice from the bureau that approves work permits for foreign work- Strategies to Manage Your China Business Through Turbulence