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Kohler Enters Engine Joint Venture in China

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Yard & Garden Magazine Article Wednesday, August 15, 2007 YardnGarden.com Green Industry News Kohler Enters Engine Joint Venture in China Kohler Co. has created a joint venture company between Kohler Engines and YinXiang Ltd. for the development, manufacture, marketing, sale and distribution of general-purpose gasoline engines. The joint venture, Kohler-YinXiang Ltd, based in Chongqing, China, will provide Kohler an increased global presence in the worldwide small gasoline engine market and establishes a new cost-effective manufacturing location to support the Kohler engine business. "Kohler has been seeking a strategic partner over the last two years to help us grow our presence in the small engine market and enhance our product offerings," said Paul Bartelt, president of Kohler Engines. Scott Chen, a Kohler Engines veteran, has been named managing director for this portion of Kohler Engines' business and will report to Bartelt. This joint venture does not have any impact on current employment in Kohler's three other manufacturing facilities in Wisconsin, Mississippi or Mexico. Manufacturing of the new Kohler engines will occur in Chongqing, China. YinXiang, founded in 1997, manufactures motorcycle engines and motorcycles, ATVs, go-carts, and general-purpose engines and equipment.

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DMedal
You can guess who is next. "no impact on current employment" means they won't lay anyone off this month I think. But really, what choice do they have? If the new enterprise uses good quality control techniques they might even build good engines, that's as well known a science as internal combustion. Without it US firms can manufacture junk too, look at Harley Davidson in the 70's. Still, one gets the sense one is watching the sun set. -Don

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Simplicity314
Why not? Chinese engines are just stolen American designs and patents anyway. This will cost Kohler, especially when the engines don't meet emission and safety standards, like the rest of the junk coming out of that country. I am remodeling my house as we speak, including kitchen and 2 baths. Rest assured there will be no Kohler fixtures going in.

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AGCO918
You have to blame American Companies for the Greed of the dollar. Walmart started it, now eveybody else is following. That is why i buy Simplicity. I dont care if briggs owns them or not. They make quality tractors. As long as they make AGCO tractors, i will be happy. People will get tired of this junk from china one of these days when it is to late, when nobody has jobs that pay good wages. Thank your neighbor that buys the cheap junk, for evrything going across the border & to china. Say on the news tonight a recall of 9 million toys make in china. When are people going to wake up?

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Woodydel
To not buy Kohler makes no sense. Briggs was there first. I'm amazed at what people don't know. Briggs in China: http://query.nytimes.com/gst/fullpage.html?res=9A0DE3D71F31F932A15755C0A960948260 More Briggs and China syndrome: http://www.jsonline.com/story/index.aspx?id=386311 Do you still think Briggs is going to make lawn mowers here? Notice the words "ramped up" in this article. Still think they will make lawn mowers in the United States?: http://www.jsonline.com/story/index.aspx?id=645054 Simplicity does not exist. It's Briggs and Briggs is a Chinese loving company. About these Chinese engines being junk. They're not. Kohler knows this and is sticking it to their employees while lining the executives'pockets.

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Al
Hi, I believe that the engine market they are addressing is in the smaller engines. The 6 hp Kohler "Kart" engine was a Yamaha joint venture, and that is over now. It is my understanding that they are going after the push mower and under 10hp market with this venture. Tecumseh is in very dire straits right now and there is a lot of speculation as to their future. Many are saying that if they can survive this year they may make it. If Kohler is successful with this venture, they may well find some open arms of manufacturers that aren't particularly thrilled to see their engine vendor also be their competitor in power equipment. Note the MTD Chinese engines (not Briggs) that power their push mowers. There were/are rumors going around that MTD tried to buy Tecumseh, and Tec mgment said they would go down before they would sell out. Tecumseh built the big plant in South America, and has never seemed to get that making money like it was supposed to. The Tecumseh European division is done. No more Europea engines being manufactured. One other point, I believe all of the cast iron blocks are now cast overseas because of environmental restrictions here. In this case, we are not doing anything for the environment by doing this, we are just moving it. These items for use here are really our issue, we just handed it off. Our laws haven't reduced the polution, just moved it. It will be interesting to see what unfolds in the future. The only thing certain is that there will always be change and people seem to learn to adapt to it. Sometimes it is for the better and sometimes not and sometimes history puts an altogether different slant on it. My thoughts and they are free, VALUE ACCORDINGLY! Al Eden

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DMedal
I for one always value Al's perspective. It's one of the things that I'd pay for on this site. (don't get big ideas, Al, I didn't say I'd pay a LOT) I think we're going very shortly to find some fairly good quality products out of China, the economics favor that and it is relatively easy to do. People forget that "Japanese" once meant "shoddy", a Japanese transistor radio was to say a disposible poorly made radio that wouldn't last. Then they studied Demming and Total Quality Management (pretty much only AT&T was doing that here) and before you know it Sony and Nikon and Nissan and Honda are making products our factories couldn't come close to for quality. There's no real reason the Chinese can't do the same. There are no secrets in this engine business, and the world really has become flat in terms of trade. You couldn't build a radio now with US parts. We don't mind buying Italian and Japanese for small diesels and a popular repower is already Honda. My hope is we'll see both better price and quality for the sort of gas engines this group wants although it is a relatively small slice of the small IC market, push mowers being much more volume. Look at how much longer auto engines last now vs the 1970s. With or without China, the forces acting against the old Simplicity are mostly domestic. (Walmart etc) We have more homes on huge lots than ever but more people than ever buy tractors based mostly on price. Don't get me started on how everything from lawn mowers to TVs are now sent to the landfill vs being repaired, it is (for the moment) cheaper to buy new. That trend means there's no benefit to the manufacturer to overbuild a product, it will be melted down again before the cast steel rear end wears out anyway. So the enemy is, in Pogo's words, us. Not "us" here, of course. Give us your dented and dull and non-green tractors and we'll trade parts and defy modern economics. I know we get a better tractor as a result but the rest of America doesn't seem to be following us. Should we start a pool as to when the first good repower of a SimpleT is going to happen with a Chinese V-Twin? hehe -Don

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andrewk
I have the same understanding of what Kohler is up to with their China deal. If they think its what they need to do to get into pushmower engines, so be it. What I don't understand here is all the Chinese hate. If we weren't such greedy people, manufacturing would still be a big part of our country. Our problem is we want to make dang sure we get a great salary, with all the benefits, but when it comes to buying products, we buy the cheapest thing out there so we can spend our money indulging ourselves with worthless junk. Then we complain when the companies we work for can no longer cut the mustard, and move to a cheaper manufacturer in order to keep business afloat. Of course, its all the CEO's fault, heaven forbid we ever have to give a little. We could all take note from Europeans. They work 30 hour weeks, have nice houses, make good money, and have fun. What they don't do is buy every little fancy item they see on the street. If Americans did things in moderation, we would be lots better off. Instead, we need to supersize everything, and keep on top of technology by blowing our paychecks on things we think we need to make life 'easier'. So long as we continue with our Wal-Mart mentalities, we will continue to see the trends we see. So Briggs has china connections. How does that mean that everything they own will go there? Don't get me wrong, I don't like this anymore than the next guy, but how can one justify getting mad about it, when they are most likely contributing to the problem? I know I do, even though I try not too. I am not trying to offend here, its just my opinion-

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BLT
Remember POGO? He had made a famous statement in one of his cartoon strips, " We have met the enemy, he is us"!! That sums up the move to China for goods. We are all guilty of it bar none. We all looked for a better deal and we stubbed our own toes in the process. Producinf goods first went to Mexico because of cheap labor, then that all went overseas. Nuff said.

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Al
Hi, I agree, but I see something in the future. The Japanese can build Honda and Toyota cars in America cheaper than in Japan. For those of us that can remember the 50s, the war was over. We won it using Dr Demings SPC (Statistical Quality Control) processes in our manufacturing of war supplies. The war was over and Japan, Germany, Russia, Europe and England had been bombed into the ground. A pent up demand for manufactured goods existed. The US was the only game in the world. We could sell anything we could make at any price. The Deming processes were discarded. Cars had trunks that leaked, windshields that leaked, doors that leaked dust. Detroit didn't care, they could sell anything they built. Wage demands were made and were added in the product. Quality wasn't important, the only thing that counted was the numbers at the end of the next quarter. Fast forward to the 80s. The gas crunch and all of a sudden, people discovered that those funny little cars ran cheap, the engines and transmissions were smooth as silk. the seats were comfortable, the doors and trunks closed and didn't leak. Detroit wake up "QUALITY COULD SELL". Detroit had to scramble to match the quality, and I believe they have responded and now build cars as good as the imports. This happened because the Japanese decided that if they were to be a world player, they had to do it with outstanding quality. Quality doesn't cost, It Pays. In our starter shop, John Deere uses both Delco and Nippon Denso Starters and alternators. The Nippon products outlast the Delco units probably 4 to l. When you work on them you can see the difference in quality. The differences don't cost that much at the manufacturing level, but few pennies vs quallity is big to Detroit. When I worked for a Fortune 550 Co, we bench marked Toyota quality programs. One thing we learned was that when the Saturn Project was in the concept stages, Some GM mgrs were at Toyota and when touring th e plant, the plant mgr. came up to the Corp mgr and very excitedly announced that they had 2 line stoppages today. The GM execs.were baffled, why would you be excited that 2 times line operators had stopped the line. The senior exec explained that that was 2 cars that didn't get out with defects. GM guys shook their heads. Toyota uses a process called kiazon, The line operators stop the line whenever anything is bad. Immediately a bunch of Industrial Engineers come running and look at the problem and go work on a fix. If you fix the problems quickly, pretty soon no line stoppages. They engineer quality in the product. Ex. use very few sizes of bolts, then bolts of nearly the same length can't be mixed. Make quality fool proof. Japan has excelled in this. China will move in the same direction. As their economy continues to improve, the workers will want more and the costs will increase as it did in Japan. Once this happens (it will probably not be in my lifetime) there will be a move from China to some other place, like Africa. (Note: Japan, Tiawan, Hong Kong, Indonesia, India etc) Ultimately it will level out. Not in my lifetime, but nothing happens fast. Wall street is so involved in the next quarter numbers that American industry doesn't spend the lead time in development to engineer quality in. Get it built and sold. We don't have time to do it right, we do have time to do it over. Sorry to be so negative, but I feel management can have any level of quality they want, I just think they don't see value of doing it once. I remember is the mid 80s when the Sun Stars came out I was up at the Simplicity factory and out at the proving grounds Briggs, Kohler and Tecumseh had tents set up. I asked all 3 when they were going to put oil pumps and filters and overhead valves on their engine. All 3 said people won't pay for it. Bull, I replied. A couple of years later I was at the Outdoor Power Expo in Louisville. 900 Plus vendors there that yr. All of the industrial equipment was conspicuous with the Honda and Kawasaki engines with pressure oil and oil filters, and OHVs. Wake up call for Briggs and Kohler. They now probably have equal quality engines, but we would still have 50s engines had it not been for foreign competition forcing them. US industry can do it, they must. Wake up Ford, GM and Chrysler. Its a world market. My thoughts they are FREE, VALUE ACCORDINGLY. Al Eden

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Nubian
As far as I can remember upper mgmnt and ceo's benefits and salaries rose dissapportionately as compared to the average worker. Layoff's,cutback's,giveback's were the norm as ceo's salaries and bonuses grew. They are not catering to consumer demands, they are after the almighty greenback! How can anyone say good stuff is coming out of china with a straight face, they can't spell quality control. Here in the "northeast" we are bombarded with recall's on products and foods coming out of our #1 espionage foe. Anyone know how those no name chinese diesel engines are holding up?

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DMedal
China can't do quality? If you bought a TV or computer lately, where did the screen come from? The bulk of the world's production of LCD screens is from China now, and they are cheap and high quality - no one wants a laptop with dead spots on the screen. There are no US made TVs anymore. I'm typing this on an IBM labelled laptop, made in China. IBM no longer even makes PCs or laptops, they sold that line to a Chinese manufacture who currently builds them to the same quality standards IBM did. (I know, we bought over 1000). No reason at all they can't build engines, but they won't be copying Briggs, they'll be copying something Japanese. People used to poo-poo Japan same way. I remember driving my first Datsun just after I got out of the Army in 1972, an acquantance let me borrow his. Hydraulic clutch, smooth engine and transmission, everything fit. It drove better than a Ferrari in some ways. For a Cadillac mechanic it was a shock. Unfortunately GM didn't get the message until the 80s. This disposable economy we're currently in is going to grind to a halt as it costs more and more to landfill a refridgerator vs fix it. People like the members of this club, who can fix stuff, are going to be increasingly valuable. I *hope* it is Al's lifetime, we don't have THAT all long to stop using up resources. Note that the disposable thing has not happened with farm tractors. Nor semi-tractors. -Don

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Simplicity314
You can't compare japan to china--no way. Japan took american engineering and improved on it. They took the automobile and improved on it. They took jet bodies and improved on them. Japanese-built cars were and are more reliable, for no other reason than they can concentrate on building cars rather than negotiating with labor unions, then skimping on the quality so union demands could be met. China just steals, makes it cheaper, then sells it back to us. Second, Japan isn't a communist nation that wants to take us over (Despite China's rudimentary free markets, it's still first and foremost communist, people. They are our enemy). Buy a Chinese car and strap your child in and have blind faith in their "quality control." I dare you. You think the chines care if a tie rod had fractures in it because it was machined on cheap, second-rate metal? Sorry--chinese goods are junk. Okay, the vast majority is junk--I'll give you the LCD screens (no moving parts). Hold a chinese-made fishing rod--just hold it, don't even fish with it, then hold an american-made rod and feel the difference. I'll shell out the extra $25-50 for a decent rod that will last a lifetime, rather than a chintzy dollar store (Wal-Mart) toy rod that will break on your second trip out. And supporting the Chinese and India economy is driving their demand for oil, which is why we are all paying $3 for a gallon of gas. Yeah, real bargains there buying made in china. I can fill my truck bed with chinese crap, yet I can't buy a Cuban cigar, or even visit Cuba. I guess some communist governments, even ones that use slave labor (China) are okay as long as someone is making a buck.

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JohnFornaro
Nice thread. I keep telling the kids my lament that we are living increasingly in a disposable society. I demonstrate it by fixing cars and tractors. I make stuff. I build sheds and decks, etc. They are sort of getting the idea. But the forces of consumerism and electronic gaming and powerful advertising have swayed the majority of children into a mindless complacency. But a lot of old-timers have bought into this as well. If I'm at the local auto parts store, and comment to the salesperson that I'd rather have a US made part, I hear grumblings about "what's the point?", or something. There's also a deep level of greed in America as well, as pointed out above. "I want high wages for little work, and I also want the cheapest stuff available. I don't care about what this means to the economy in general, just so long as I get what I want." Same with the environment. When asked by a pollster, "How do you feel about the environment?", everyone knows what the correct answer is supposed to be. But when it comes to actual energy consumption, most people simply don't care. It's discouraging. But remember: If you're not part of the solution, then you must be part of the precipitate.

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Brian313
[quote]Originally posted by Simplicity314 You can't compare japan to china--no way. I've been to a couple honda outboard engine schools and classes. They actually take PRIDE in their work. As bad as I hate to say it theres not much out there in US made products that can compare to them. At least as far as outboards go. JMO

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Woodydel
This topic started with what looks like a quoted statement made elsewhere. That post is a fact, not an opinion without proof. I try to back up my statements/opinions, as well, with links to support what I believe. This Chinese hatred angle bears no weight. It's not hatred of China motivating my statements, rather it's my LOVE OF AMERICA. The old time America I grew up in my earlier years. Yes, that's me shouting it out. You're not going to change my mind so give up this Chinese hatred argument. I do business with naturalized Chinese Americans every day. In previous posts I presented links to Briggs's lies about it's intentions. Briggs' management will transfer all of it's capacity to China if it could get away with it. Kohler will do the same. Neither company's management is doing so for the benefit of the United States. It's to line their own pockets. If Europeans are doing so well please show me proof. Start off with Germany's retirement system problems. The only reason Europeans stay there is because we blocked them from coming here. This big store bashing doesn't make sense (mention made about Walmart). Here on this site there have been discussions about Deere. This link shows how badly they're doing in the big box store market. Not an opinion, just a fact. Hint, pay attention to comsumer products statement. http://biz.yahoo.com/ap/070815/earns_deere.html?.v=10 I would like to see substantiation of claims being made. Opinions are fine but not always accurate. Prove me wrong. Loving America means buying American and built in America.

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DMedal
Not sure what you mean by proof, Woody. I googled the title, the qouted article comes from Kohler. Are you disputing that they are doing this or what? http://www.kohlerengines.com/pressroom/releases/1176777881727.html

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Simplicity314
That's my thinking too--proof of what? That China is a communist country? That Japanese products are superior to American for the most part? That China sells junk? These are self-evident and obvious. That the Chinese steals patents and designs and takes profits? Here: http://usinfo.state.gov/ei/Archive/2005/Jan/14-57930.html 6th paragraph: "Because of theft and piracy, Evans said, American companies are losing billions of dollars of sales and the reputation of American brands has been damaged. Particularly troubling, he added, is the fact that companies owned by local governments have been implicated in violations."

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Woodydel
duckman, I edited my statement. I read the first post and believed it to be true from the start. That post was not an unsubstantiated opinion. simplicity314 About what I mean concerning proof. My link to Deere is a good example of others opinions not matching the facts. Others claim by opinion that big box stores are putting companies out of business. It's not the big box stores fault. Most times it's the company's mismanagement that kills it. I back up my opinions with links to proof. Chinese do sell junks. Only not here in the U.S. Record and movie companies here are calling Americans thieves in exactly the same language. They're just greedy. Microsoft steals intellectual property and waits to kill the competition in court by running them out of money. I'm not even going to show you all the links. It seems you don't understand that I'm against having all our manufacturing base stolen from us by American corporate mismanagement.

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shanhamm
I can't imagine the impact in Kohler, WI if they quit making engines there. The plant is as big as the city! That would be a lot of land for new condos that people can't afford because there job went overseas!!!!

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