Driving ambition in road to opportunity

Andy Palmer, CEO of Aston Martin, expounds on what it takes to succeed as China moves to center stage in the auto industry

Andy Palmer is convinced his dealings with China have given him a firm grip on his role as CEO of Aston Martin, saying he believes a lot of growth and building can be achieved by working with Chinese institutions.

The 53-year-old British executive, who has spent half his career in Asia, says, "We're moving into the world where China is one of the dominant forces, and the relationship between Britain and China is moving into a new era."

Aston Martin is one of the many British companies gaining opportunities by partnering with Chinese businesses. Driven by the policy in China to move more toward green development, the luxury carmaker secured an investment worth more than $70 million from investment group China Equity to develop its electric Rapid E sports car, a deal struck during President Xi Jinping's visit to Britain in October.

Although Aston Martin started late in the e-vehicle business, Palmer says the company is working hard to make sure it will be among the first to provide an all-electric model in the luxury sports car segment, and he hopes Chinese customers will reward that innovation.

In February, Aston Martin, which makes James Bond's iconic DB5 sports coupe, partnered with LeEco, a Chinese consumer electronics firm, to further its electric car project.

Palmer spoke to China Daily about his vision and strategy and the new opportunities for Aston Martin in China. Following are edited excerpts of the interview:

What are the prospects for your company in China in the current economic situation?

I'm still relatively bullish about the Chinese economy despite the recent slowdown. The luxury industry may have struggled in China's economic climate, but as we don't have a really high exposure in China - we sell about 200 cars a year - the effect is rather small.

As the new Aston Martin DBX crossover SUV is in the pipeline, and as China is a country that rewards entrepreneurs, which has been the key to its growth, I'm confident Aston Martin will be put in a new arena.

What is your company's biggest achievement in the China market?

Our dealerships in China are some of the best in the world in terms of quality and customer service. When customers buy a luxury car, they expect to buy it in a place of luxury and expect to receive unbeatable service. Our Shanghai and Beijing dealerships are exemplary in that sense.

I'm very pleased with the way our company has stepped up to improve its understanding of the Chinese market by establishing a significant local presence. The route to success is by understanding Chinese marketing; we employ Chinese people and promote Chinese people. The president of Aston Martin China and his first line of executives are all Chinese.

Also, the partnership with LeEco shows we're not simply looking to the West when we talk about technology. We're not just looking at Google, Apple and Tesla, but also to the East and seeing the potential for a Silicon Valley-type operation coming out of China. Some of the most innovative companies right now are coming out of China, and we happen to be lucky enough to be partnered with LeEco.

What do you consider important when cooperating or dealing with local Chinese partners?

Honesty and integrity. Chinese people are honorable and deserve honorable treatment. The business culture is different from the West, which means you need to take time and not bring your existing mental model to the table. If you bring the Western mental model to a negotiating table with a Chinese partner, it will inevitably end up in confusion and difficulty.

We have to adapt to the Chinese model and understand how to negotiate, discuss and collaborate, and at the core of that is being honorable.

Westerners, especially Britons and Germans, concentrate very much on the business relationship, exchanging business cards and creating an understanding inside the office. This may not work well in Chinese business networks.

What essential leadership qualities do you consider important when leading your team to grow in the Chinese market?

Chinese people, both businessmen and women, respond very well to ambitious goals and are quite entrepreneurial. In China, what you need to do is to be bullish in setting out your ambitions for your businesses.

For example, being a Chinese executive doesn't mean that is the end of your career, or that the pinnacle of your career is being the president of Aston Martin China. In fact, the staff members we have in Shanghai could equally have the opportunity to continue their career in any part of Aston Martin, including back at head office. So as a global CEO it is very important that you paint a picture of both professional and personal growth for your Chinese nationals.

How do you handle your international team?

To handle the international team efficiently and successfully, you have to work very hard on communication. Because of the different construction of the language between English and Chinese, it's often easy to find errors and misunderstandings. It is obligatory for British executives - me, for example - to spend more time ensuring that the message is well understood by my Chinese counterparts. Almost every six weeks I go to China and visit different parts of the country, as China is not one holistic culture and if you want to understand it you need to go to each province.

What are your strategies in adjusting to China's initiatives like the new normal of slower but sustained economic growth and the Belt and Road Initiative?

Every year at our global conference, we take the opportunity to renew or adjust our long-term business plan, the Second Century Plan. This year, we had Michael Peng, president of Aston Martin China, who contributed a lot to what the plan should look like for China - adapted but not fundamentally changed, taking into consideration the Chinese economy, the Belt and Road Initiative and where the Chinese president is taking the country.

We adapt annually to what we know, but it is more adjustment than massive directional change.

How do you handle the challenges your team encounter in China?

As a low-volume manufacturer, one of our challenges in China is how to meet ongoing regulations. In most countries, there is a small-series exemption clause, which allows a company to move at a slightly slower pace. However, the exemption clause doesn't exist in China explicitly today.

We have to learn to negotiate with different areas of the Chinese government so they get a better understanding about what our business is and why we are important to the future of the Chinese economy. Not having Aston Martin in China would be a shame.

What do you think about the Chinese Dream? What dreams do you have for your company in China?

What Aston Martin represents in Britain may be slightly different from that in China. In Britain, it is understood better by a slightly older generation. I'd like China to be our leading edge in terms of our new generation, and I hope the generation born after the 1980s will be the champions for allowing Aston Martin to be meaningful in the next century of production.

So, in the same way, my generation loves Astons because of the DB5 and the Vantage V8. I'd like to think the Chinese young generation will love Astons because of the DB10, the DB11 and the DBX.

wangmingjie@mail.chinadailyuk.com

Andy palmer says as a global CEO it is very important to paint a picture of both professional and personal growth for Chinese employees. Provdied to China Daily

(China Daily European Weekly 06/24/2016 page31)