Chapter 1057: Chapter 422: The Super Counterattack_2 Chapter 1057: Chapter 422: The Super Counterattack_2 Yan Fei said, “Yes, their plan is exactly as you suspect. At the start of this plan, they’ll have dealers around the world sign large smartphone supply contracts with you in the na of surging sales, and stipulate high compensation for breaches of contract. Then, those companies up there will delay the supply of critical smartphone components, making it impossible for you to fulfill orders in the allotted ti, leading to huge claims for damages from the dealers.”
Mr. Ren from the Four Major frowned and said, “But these component suppliers have also signed agreents with us that guarantee supply, with huge compensation for breaches of contract included. If they fail to perform on ti according to these agreents, we can likewise claim damages from them, passing on the huge claims from the dealers.”
Yan Fei said, “If you aren’t aware of the insider details, you will be deceived by the illusion of surging sales and confidently sign contracts with dealers that include hefty compensations. When the ti cos, you will find that the compensation amount you agreed on with the dealers and the amount with the suppliers will have a huge discrepancy. If all the compensations are enforced according to the contracts, the amount you will have to pay for contract breaches will be astronomical, enough to bankrupt and shut you down.”
Mr. Ren said, “Now that we are aware of their detailed plan, we just need to avoid signing contracts with high damages for breach with the dealers, and we can avoid huge compensation, foiling their conspiracy.”
Yan Fei smiled and continued, “Now, the entire Western World is coming to strangle China’s smartphone industry, aiming to seize the discourse power of the next industrial revolution. It’s a do-or-die struggle. So with so many resources mobilized and such extensive planning, how could they not foresee this? Even if you don’t take the bait in the contracts, they have other contingency plans to deal with you, like causing the factories that manufacture your smartphones on contract to stop cooperating with you and not to produce smartphones for you. At that point, you won’t have enough products, and you’ll still face huge claims from the dealers, as those agreents were already signed.”
Boss Wang took a sharp breath and said, “That can’t be possible, can it? Our cooperation with the contract manufacturers has always been pleasant, and their big boss is, in the strictest sense, also Chinese. He wouldn’t break off our cooperation for the sake of outsiders, would he?”
Yan Fei said, “Previously, to pursue maximum profits for yourselves, you significantly reduced the profits of the contract manufacturers, making them synonymous with sweatshops. So your relationship is not as harmonious as it seems. Representatives from the Western World have already contacted the big boss of the contract manufacturer and have convinced him with high profits. Once all of you, the Chinese smartphone manufacturers, go bankrupt, the contract manufacturer will regain production orders for products from Apple Inc. and the Simsung Group, and by then, his profits will be at least more than double what they are now.”
Hearing Yan Fei’s words, everyone fell into deep thought; they hadn’t expected the enemy to strike at this crucial link. In order to easily exploit the contract manufacturers, they didn’t sign long-term agreents with them, and the penalties for breaches in those agreents were unbelievably low. All this had been for their own convenience, but now, with the contract manufacturer preparing to turn against them, these agreents had bestowed trendous freedom and discourse power upon the manufacturer. In contrast, the Four Major Chinese Smartphone Manufacturers were facing a massive crisis.
It was known that there was only one sizable contract manufacturer in China; other factories were too small to handle orders from the Four Major Smartphone Manufacturers. Looking around the world, they realized they couldn’t find a new contract manufacturer to replace the largest one in a short ti. Just the thought of their products not being produced on ti sent chills down the spines of these bosses.
Not only were the contract factories producing their products a huge problem, but so were the chips, caras, and mory. Most crucially, their smartphones used the Android System from Google. If Google blocked their access to the system, their smartphones would face a true catastrophe.
Since the second half of last year, a new state-owned enterprise erged within China, starting the production of 5nm high-tech chips. The technology of these chips is globally leading and fully capable of eting the high-end demands of the chip market.
However, due to the managent capabilities of this state-owned enterprise not yet catching up, even though they possess two of the world’s most advanced high-performance chip production lines, their production levels have not peaked, unable to satisfy the chip needs of all Chinese smartphone manufacturers. Therefore, most of the chips still need to be imported from GaoTong Company. But what will they do about producing their smartphones if GaoTong Company stops supplying them with phone chips?
It’s not just phone chips that are the problem; critical components like surveillance caras and mory also face similar issues. As long as others withhold their supply of products, they’ll imdiately find themselves in a predicant without raw materials.
Boss Liu sighed, “I always thought that our developnt had reached its peak, but it turns out all of this was a mirage, all an illusion. As soon as soone chokes off our supply, we are imdiately beaten back to our original form. These old tricks of Western companies to ‘fatten the fish by loosening the net’ might be outdated, but they’re quite effective. Not only do they hit their competitors, but they also control the lifelines of their competitors.”
Mr. Wang thought for a mont and said, “I guess GaoTong Company, Sony, Google, and Apple Inc., as well as Simsung Group, are not exactly united. They also have their differences, so they won’t entirely follow in the footsteps of Apple and Simsung. What these companies want is profit; if we et their price demands, they will imdiately resu cooperation with us, and their alliance will crumble. As for contract manufacturers, they are solely motivated by money; as long as we satisfy their profit demands, I believe they would not refuse to continue contract manufacturing for us.”
Mr. Ren sighed, “I have always said that technology enterprises must take the road of self-innovation; otherwise, others will control our destiny, making our path narrower and narrower. But everyone only thinks about how to make quick money and lacks a long-term plan, handing over their lifeline to soone else willingly. Now that these others have suddenly made their move, just a slight tightening of the rope and we’ll beco fat on their chopping block, ready to be sliced as they please. If we fully comply with their demands, I’m sure that we companies will lose our independent autonomy and turn into satellite companies for them, and from then on, there will no longer be any purely Chinese smartphone companies.”
Mr. Wang looked at Mr. Yan Fei, who had been silent beside them. His eyes lit up and he said, “Mr. Yan Fei, you didn’t bring us to Dream Island just to convey this piece of news. You must have a solution, right?”
Everyone was invigorated, realizing they had overlooked Yan Fei’s presence. Although the four major smartphone manufacturers were making a lot of money, the one earning the most was not them, but rather Dream Island standing behind them. Should they all be crushed, Dream Island’s losses would be greater than theirs; it was not possible for Yan Fei not to be anxious about this matter. After being reminded by Mr. Wang, they all imdiately turned their eyes to Yan Fei, filled with hope.
Yan Fei took a sip of tea, coughed lightly, and said indifferently, “The Western World’s actions against our Chinese smartphone industry this ti are very despicable and malicious. But Dream Island will not fear their assault. We have formulated a corresponding action plan. As long as everyone is willing to trust , willing to work with Dream Island, we will launch an unprecedented, super counterattack. Through this counterattack, we will break the Western World’s technological blockade against China, not only solving the crisis you all face but also claiming the technological high ground. From now on, we will never again be strangled by the Western World.”
Hearing that Dream Island indeed had an action plan, everyone was pleasantly surprised, eagerly listening and waiting to know how Yan Fei intended to conduct an unprecedented, super counterattack.
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