Modest Beijing Auto Show Presence Belies Harman's Gains In China

Apr 25 2014, 10:54pm CDT | by

At China auto shows, it’s usually companies with the biggest displays, sleekest cars and attractive female models that get the most attention.  A relatively modest showing by U.S. acoustics and auto entertainment electronics supplier Harman at the Beijing Auto Show this week belies the success it’s been having in the China market.

The Stamford, Connecticut-based company’s China sales have increased from less than $50 million a year to $500 million in the past five years to customers that include BMW, Toyota, Hyundai and GM. It expects growth in the country to continue to outperform China’s gains in GDP in the coming years, chairman Dinesh Paliwal explained to me at the fair this week.   “China has been a great growth story for us,” Paliwal said. “It didn’t happen by accident.”

How did it happen? First, Paliwal knows something about China because he resided in the country himself relatively early in its reform period. He lived in Beijing in 1994-98, when he opened global industrial firm ABB’s China operation and built up the business before being transferred to its headquarters in Switzerland.

Under Paliwal, who became CEO of Harman in 2007, Harman has expanded in China quickly in part because it has successfully localized.  It hired a China hand, American David Jin, to run the business. Then, it poured some $100 million into local production lines and research centers in Shanghai and Chengdu. It also has a design center in Shenzhen.

 “In China, you cannot operate from the outside,” Paliwal said. Manufacturers want ready supplies from local plants. “They aren’t interested in shipping from the U.S. or Germany.” Harman differentiates itself because of the breadth of that is can offer locally, Paliwal. “A lot of our competitors are not doing the whole value chain here.”  

Of course, it also helps to be in an expanding industry in an economy that boasts the world’s largest population. That growth has make China’s the world’s largest auto market in the past several years. “There is still a lot of mismatch between supply and demand,” Paliwal said.

Yet there’s a big difference between seeing a lot of potential demand for your products in China, and creating the operation to prudently win business. Harman has apparently managed to find a way.

– Follow me on Twitter @rflannerychina

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

IPad Air Giveaway 2014 is Online
IPad Air Giveaway 2014 is Online
Our sister site I4U News is giving away a brand new iPad Air or if you can wait an iPad Air 2. This is an $499 value.
 
 
Your Parent Or Kid Moved In: Are You Covered?
A record 57 million Americans now live in multigenerational family households — double the number in 1980, according to a new Pew Research Center study. And I bet many of them have the wrong homeowner’s or renters...
 
 
Pandora Looks to Challenge Terrestrial Radio's Dominance in Cars
Pandora Media is one of the largest Internet radio providers in the U.S. with more than 75 million active users. While the company’s active user count has increased at a robust pace historically, it is likely to slow...
 
 
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
It’s January 2026. New York Yankees owner Hal Steinbrenner gets out of his driverless car and triumphantly marches before the gathered press to introduce his prized new free agent. It’s a record-breaking contract—over...
 
 
 

Latest from the Network

Maisie Williams passes driving test
Maisie Williams has passed her driving test. The 'Game of Thrones' actress, who turned 17 in April, took to her Instagram account yesterday (08.22.14) to announce that she's now got her full UK driving license. The...
Read more on Celebrity Balla
 
Shia LaBeouf calls police after female stalker found in his home
Shia LaBeouf called the police after he found a female intruder in his home last week. The 28-year-old actor panicked and rang the emergency services when a strange woman turned up at his door in Los Angeles after...
Read more on Celebrity Balla
 
Liam Hemsworth buys Malibu home for $6.8m
Liam Hemsworth has reportedly splashed out $6.8 million on a new home in Malibu. The 'Hunger Games' hunk - who split from his fiancée Miley Cyrus last year - forked out the impressive sum after falling in love with the...
Read more on Celebrity Balla
 
Briton in Sierra Leone contracts Ebola virus
London, Aug 24 (IANS) The British Department of Health confirmed Saturday that a Briton living in Sierra Leone has tested positive for Ebola. "We can confirm that a British national residing in Sierra Leone has tested...
Read more on Business Balla
 
Political stalemate continues, as opposition wants Sharif's head (Roundup)
Lahore/Islamabad, Aug 23 (IANS) Pakistan's political stalemate continued Saturday amid political discussions by the government to find a solution and protest leaders Imran Khan and Tahir-ul-Qadri refusing to give up...
Read more on Politics Balla
 
Two British Indians charged with murder
London, Aug 23 (IANS) Two British Indian men were Saturday charged with stabbing and murdering a man on a London street, a media report said. Gaurav Sharma, 33, and Jaswinder Singh, 27, have been accused of attacking...
Read more on Politics Balla
 
11 militants killed in Libyan air strikes
Tripoli, Aug 23 (IANS) At least 11 Islamist militants were killed and 20 injured in air strikes in Libya Saturday, Xinhua reported citing military sources. Mohammed Ghiryany, spokesman for the Islamist armed group,...
Read more on Politics Balla
 
31 held in Hong Kong drug bust
Beijing, Aug 23 (IANS) At least 31 people were arrested for possessing drugs in two unlicensed bars in Hong Kong, police said Saturday. Hong Kong police seized drugs worth over 640,000 HK dollars (about 82,580...
Read more on Politics Balla
 
Ten killed in attacks across Iraq
Baghdad, Aug 23 (IANS) Ten people were killed and 50 wounded in a wave of attacks across Iraq Saturday, security sources said. The deadliest attack occurred around mid-day when a suicide bomber blew an explosive-laden...
Read more on Politics Balla
 
Egyptian court postpones trial of Morsi, 130 others
Cairo, Aug 23 (IANS) A criminal court in Egypt Saturday postponed the trial of ousted president Mohamad Morsi and 130 other defendants in a jailbreak case till Sep 15. The case was postponed to listen to the...
Read more on Politics Balla