News on China's scientific and technological development.

vesicles said:

A multinational company growing that fast is almost unheard of. I don't know if any of our fellow posters who understand enough economics could do an analysis to see if a huge company that size can even theoretically expand that fast. To me, it sounds impossible even on paper...

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Well, it's said to be net profit, which can somewhat easier to achieve than gross sales figures. Even just switching one of four/five contractors could greatly reduce the cost and increase profit margins. Don't forget, the profit on a laptop is actually pretty low, considering the net profit is only about 1%-5% of the overall sales figures. Even just firing 100 engineers could save at least 5-10 million a year, which is already like 5% of the net profit. Lenovo has around 26,000 of those employees (no fabs, so majority would be highly paid talents).

I'm not saying the profit is achieved through firing people, just saying that a company this big could easily wiggle out some profit by simply streamlining few factors in their operation.

---------- Post added at 12:31 PM ---------- Previous post was at 12:22 PM ----------

vesicles said:

it might be a typo in the article then. A 54% increase in net profit for a company that size? That's like more than doubling the size of the company in 2 years. I just did a calculation and found that if Lenovo grows like this, it will be 2.4 times its current size in 2 year...

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Just found this off wikipedia (which was also quoted from a reliable source, of course), which confirms the following.

During the first quarter of 2011 Lenovo controlled 31.7% of the Chinese personal computer market when measured by units sold. Lenovo reported a 98.3 percent rise in profit to $108.8 million during the first quarter of 2011, up from $54.86 million during the same quarter of the previous year. Lenovo shipped 10.28 million personal computers in the first quarter of 2011.
Lenovo reported a 54-percent rise in profit for the third quarter of 2011, beating analyst predictions, in spite of slowing growth in sales and a shortage of hard drives.[22]

Don't forget, the following is just the Chinese market alone, which is only about half, if not less, of Lenovo's income. Consider its expansions in other regions, it's very easily achievable.

This could be easily understood using real life experiences. It would be hard to increase your annual income from 60 to 80 thousand. But you are careful, you can easily save 5000 dollars extra per year. That is the case here. Although the gross sales figures are astronomical, the net profit is actually quiet low.

vesicles said:

it might be a typo in the article then. A 54% increase in net profit for a company that size? That's like more than doubling the size of the company in 2 years. I just did a calculation and found that if Lenovo grows like this, it will be 2.4 times its current size in 2 year...

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Well go search "lenovo" in the news section of your preferred engine.

It's not just WSJ reporting the 54% number, clearly it ain't a typo.

You can easily verify more accurately than from the replies here by googling. When all the major media, especially the financial, reports as such, you can be sure you won't be fooled with a mistake in one decimal place. Especially when Lenovo said part of the increase came from overseas acquisitions.

Bltizo said:

Well go search "lenovo" in the news section of your preferred engine.

It's not just WSJ reporting the 54% number, clearly it ain't a typo.

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Well, often they all just copy from the same source.

But really,for an economy China's size to grow 12-13% year-on-year was unheard of too. Until it happened.

vesicles said:

it might be a typo in the article then. A 54% increase in net profit for a company that size? That's like more than doubling the size of the company in 2 years. I just did a calculation and found that if Lenovo grows like this, it will be 2.4 times its current size in 2 year...

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It's not strange because we are talking about profits, not revenues or the value of the company itself. You could have had large expenses last year that were not incurred this year, for example.

Lenovo has pretty large reserves so it can buy other companies to increase it market and profit. I remember reading recently it bought the German company Medion, which sells cheap computers. That has a large turn over with moderate profits, but if that means Lenovo can buy computer components cheaper because it is bigger buyer this will greatly add to the profits. The profit calculated is also influenced by the way the take over of those companies is accounted for.

XCMG Cradles Largest-tonnage Telescopic Oil Cylinder of 1,200-ton Truck Crane in China



XCMG Group QAY1200 model 1,200-ton mobile crane is currently the largest class of wheeled crane in the world. A single unit costs over 100 million RMB.

The telescopic oil cylinder of 1,200-ton all-terrain truck crane manufactured by the independent R&D of XCMG’s Hydraulic Parts Division has passed the trial successfully and been delivered to customers. The brand-new oil cylinder, equipped in the all-terrain truck crane with largest tonnage in China, has helped make the breakthrough of large-tonnage truck crane product research and production in China. And the hydraulic cylinder, the key part of the equipment, is completely manufactured by the independent R&D and production of XCMG.

The successful trial of 1,200-ton all-terrain truck crane telescopic oil cylinder does not only satisfy the demands of XCMG’s developing large-tonnage all-terrain truck crane, but also provides a stronger support of its development of the integrated cylinder of the product with larger tonnage and overseas market expansion in the next phase.

This is insane, Chinese car maker Chery/Riich [sub brand, aimed at high end market] recently released their in-house crash test video of their G5 model.
I found 2 videos from youtube, one is done at 120km/h, for those of you unwilling to accept the international standards, it is roughly 75mph.
Another was done at 200km/h [125mph], which is insane. The front row survived even the 200km/h crash, with the A-beam (the beam parallel to the side of the windshield, its degree of deformation reflects the severity of the car's deformation) barely deformed much.
Not to be a basher or anything, but no Japanese or American cars could survive this. Only high end German cars could achieve something close to this.
Quite impressive for a car maker that made their first car only 10 years ago.

This is the 120km/h crash.

[video=youtube_share;ByAU36jSzHo]http://youtu.be/ByAU36jSzHo[/video]


This is the 200km/h crash. There are three parts to this, the first is the same car at lower speed, around 80km/h. The second is some cheap car they make. The third one is the 200km/h crash, quite impressive.
[video=youtube_share;2O-ADtV4IUU]http://youtu.be/2O-ADtV4IUU[/video]

Thanks CottageLV for the wonderful videos. I particularly enjoy seeing the kinetic energy going past the car as the metal bends and ripple across it in slow motion. Why of course Germany engineering is still top of their game when it comes to car design. I just wish the Germans would produce some pick up trucks. GM, Ford, and Toyota still have a monopoly on the market for it. I believe China would become a big truck market in the next five to ten years as more manufacturing and development moves inland.

Equation said:

Thanks CottageLV for the wonderful videos. I particularly enjoy seeing the kinetic energy going past the car as the metal bends and ripple across it in slow motion. Why of course Germany engineering is still top of their game when it comes to car design. I just wish the Germans would produce some pick up trucks. GM, Ford, and Toyota still have a monopoly on the market for it. I believe China would become a big truck market in the next five to ten years as more manufacturing and development moves inland.

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they're still too expensive for inland populations, especially those that need those pickups. Those are mostly small merchants that need to haul small but decent amount of merchandises. The problem is that those merchants can't afford those things, and those could afford it, drive Audis and BMWs.