(Chairman and CEO)
Commercial heating and cooling systems
|Subsidiaries||GE Consumer & Industrial|
Fisher & Paykel
Haier Electronics Group
Haier Group Corporation is a Chinese collective multinational consumer electronics and home appliances company headquartered in Qingdao, Shandong province, China. It designs, develops, manufactures and sells products including air conditioners, mobile phones, computers, microwave ovens, washing machines, refrigerators, and televisions.
According to data released by Euromonitor in 2014, the Haier brand had the world's largest market share in white goods, with 10.2 per cent retail volume market share. This was the sixth consecutive year in which Haier had been the market share leader for major appliances.
Haier Group also consisted of two listed subsidiaries: Qingdao Haier Co., Ltd. (SSE: 600690) and Haier Electronics Group Co., Ltd. (SEHK: 1169). It was announced that Qingdao Haier would also issue "D-share" to trade in China Europe International Exchange of Frankfurt.
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The origins of Haier date back long before the actual founding of the company. In the 1920s, a refrigerator factory was built in Qingdao to supply the Chinese market. After the 1949 establishment of the People's Republic of China, the factory was then taken over and turned into a state-owned enterprise.
By the 1980s, the factory had debt of over CNY ¥1.4 million and suffered from dilapidated infrastructure, poor management, and lack of quality controls, resulting from the planned economic system and relevant policies. Production had slowed, rarely surpassing 80 refrigerators a month, and the factory was close to bankruptcy. The Qingdao government hired a young assistant city-manager, Zhang Ruimin, responsible for a number of city-owned appliance companies. Zhang was appointed the managing director of the factory in 1984.
Haier had been founded as Qingdao Refrigerator Co. in 1984. With China opening up to world markets, foreign corporations began searching for partnerships in China. One of these, Germany's refrigerator company Liebherr, entered into a joint-venture contract with Qingdao Refrigerator Co., offering technology and equipment to its Chinese counterpart. Refrigerators were to be manufactured under the name of Qindao-Liebherr (simplified Chinese: 琴岛—利勃海尔; traditional Chinese: 琴島-利勃海爾; pinyin: Qíndǎo—lìbó hǎi'ěr). The current brand "Haier" came from the last two syllables of the Chinese transliteration of Liebherr (pinyin: lìbó hǎi'ěr).
The installation of Liebherr's equipment and technology was accompanied with new quality control and management processes. By 1986, Qingdao Refrigerator had returned to profitability and grew in sales at an average of 83 percent annually. Between 1984 and 2000 sales grew from CNY ¥3.5 million to ¥40.5 billion.
In 1988, the municipal government asked Haier to take over some of the city's other ailing appliance manufacturers. The company assumed control of Qingdao Electroplating Company (manufacturing microwaves). In 1991, the company changed its name to "Qingdao Haier Group" and acquired Qingdao Air Conditioner Plant and Qingdao Freezer. The company's name was simplified to its current name "Haier" in 1992. In in 1995, the company took over Qingdao Red Star Electronics Co., a washing machine manufacturer, along with five of its subsidiaries. Haier acquired seven companies between 1995 and 1997, and began exporting to foreign markets.
In 1996 and 1997, Haier opened production facilities in Indonesia and the Philippines respectively and failed in an attempt enter Thailand's domestic market due to the presence of local companies.
Haier entered the US market in 1999. In the US it focused upon two niche markets in compact refrigerators and electric wine cellars. Haier began to manufacture full-sized refrigerators for North American market. This would bring it into direct competition with established American companies GE, Whirlpool, Frigidaire, and Maytag. As part of its strategy, Haier built a production facility in the United States at Camden, South Carolina, opened in 2000. By 2002, US revenues reached USD $200 million, still small compared to its overall revenue of $7 billion. Also in 2002, Haier moved into a building in midtown Manhattan. Formerly the headquarters for the Greenwich Savings Bank, the 52,000-square-foot (4,800 m2) building was built in 1924 in the neo-classical style.
Production facilities were constructed in Pakistan in 2002 (see Haier Pakistan) and Jordan in 2003. In Africa, Haier has plants in five countries: Tunisia, Nigeria, Egypt, Algeria and South Africa. The company also purchased a Meneghetti's factory in Italy and began placing its products in European retail chains, either under its own brand or under OEM agreements with foreign partners. Currently Haier has entered into a joint venture agreement with the government of Venezuela.
Haier Appliances (India) P. Ltd initiated its commercial operations in January 2004. Its headquarters is in New Delhi, and in 2015 it had 33 operations, including those in Mumbai, Bangalore, Chennai and Kolkata. It was listed among the top 20 most trusted brands in India by The Brand Trust Report, a study conducted by Trust Research Advisory.
In June 2005, Haier made a bid to acquire Maytag Corporation, backed by private equity funds Blackstone Group and Bain Capital. The bid was for US$1.28 billion, or $16 per share, topping a previous offer of $14.26 per share made by Ripplewood Holdings. In the end, however, Maytag was bought by Michigan based Whirlpool Corporation which offered $1.7 billion in cash and stock, or $21 per share, plus assumed debt.
In 2009, Haier surpassed Whirlpool to become the fourth largest refrigerator producer in terms of sales with a global market share of 6.3%.
In 2015, Haier began investigating how the internet of things could be integrated into their devices. The company, in collaboration with Stanford Artificial Intelligence Laboratory, found three barriers to the adoption of smart home technology: lack of unified protocols/single point of access, passive services and the lack of complete solutions. At the time Haier's core competencies lay within the large appliance sector and not the small electronics sector. Subsequently, they partnered with the then leading IoT platform IngDan owned by the Cogobuy Group to overcame their shortcomings. By utilising Cogobuy's ecosystem and supply chain, they were able to integrate IngDan's portfolio of components, modules, and edge voice analysis into smart appliance products. Haier introduced their smart appliances across seven product lines in the major appliance industry: air, water, clothes care, security, voice control, health and information.
Zhang Ruimin, soon after becoming managing director in 1985, ordered his employees to destroy 76 refrigerators with sledgehammers following a customer complaint in an effort to radically change the company's culture to one that embodies quality control practices. At the time, Chinese brands for domestically produced consumer goods were generally regarded by overseas consumer markets as being of poor quality, even when compared subjectively with foreign brands manufactured in China. The cultural transformation towards quality driven manufacturing resulted in Haier becoming the first company in China to get ISO 9001 certification.
Although under partial public ownership, Haier is still technically a "collective" company, meaning that it is supposed to be owned by its employees. However, its actual ownership situation is opaque; the employees receive no dividends and do not know how much they own in reality. Interference from officials is also a risk for state-owned enterprises like Haier. Various levels of government often try to push their ailing companies upon successful ones, often resulting in failure; Haier was once talked into acquiring a pharmaceutical company, even though it had no prior experience or infrastructure in biotechnology.
As a government entity, Haier was also officially barred from entering the stock exchange early on.[original research?] However, the company needed funds for its expansion and therefore sought loopholes to access private equity.[original research?] In 1993, it listed a subsidiary Qingdao Haier Refrigerator Co. on the Shanghai Stock Exchange, raising CNY ¥370 million. In 2005, Haier entered the Hong Kong Stock Exchange through a "backdoor listing" by acquiring a controlling stake in a publicly listed joint venture Haier-CCT Holdings Ltd. (SEHK: 1169). Haier is also an index stock of the Dow Jones China 88 Index.
Criticism and controversies
- Haier Black Pearl
- TCL Corporation
- GE Appliances
- Siemens AG
- AB Electrolux
- Maytag Corporation
- Samsung Electronics
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