I urge you to read this
http://money.cnn.com/magazines/fortune/fortune_archive/2009/04/27/toc.html
Warren Buffett takes charge
Warren Buffett hasn't just seen the car of the future, he's sitting in the driver's seat. Why he's banking on an obscure Chinese electric car company and a CEO who - no joke - drinks his own battery fluid
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HIGHLIGHTS
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When Deng Xiaoping designated Shenzhen as China's first "special economic zone" in 1980, inviting capitalism to take root, it was a fishing village; today, it's a sprawling megacity of 12 million to 14 million people, most of them migrant workers who toil in vast factories like
those run by BYD and earn about 1,300 renminbi, or $190, per month.
Deploying the armies of laborers at BYD is an officer corps of managers and engineers who invent and design the products. Today the company employs about 10,000 engineers who have graduated from the company's training programs - some 40% of those who enter either drop out or are dismissed - and another 7,000 new college graduates are being trained. Wang says the engineers come from China's best schools. "They are the top of the top," he says. "They are very hard-working, and they can compete with anyone."
BYD can afford to hire lots of them because their salaries are only about $600 to $700 a month; they also get subsidized housing in company-owned apartment complexes and low-cost meals in BYD canteens.
"They're basically breathing, eating, thinking, and working at the company 24/7," says a U.S. executive who has studied BYD.
Wang typically works until 11 p.m. or midnight, five or six days a week. "In China, people of my generation put work first and life second," says the CEO, whose wife takes responsibility for raising their two children.
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So, you have high level engineers making 1/10th what their american counterparts make, without considering healthcare costs, which the government covers.
If BYD had their factory here, instead of having 10,000 engineers they probably could only afford to have 500-800.
Protectionism wont work either. I don't know if there are any easy answers. I think part of the problem, is the sense of entitlement we have. Yes, we expect better standards; we don't employ 10 years olds on loom machines anymore. But, does that mean an engineer is worth 90K a year?
Hayek -- "If you want the benefits of competition, then you have to realize that when your time comes to adapt to changing economic conditions, you have to adapt and not lobby for protection."
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