By Doug Green
Fisher & Paykel, the Kiwi company with the fantastic Kiwi can do attitude, has been around since 1934 starting out selling surplus fridges in Auckland’s Queens Arcade. When high import tariffs arrived in 1938 the company commenced their own manufacturing of appliances.
Now look where they are today. The Chinese company, Haier, which brought into Fisher & Paykel Appliances in 2009, wants the intellectual property – which raises the point how long will Fisher & Paykel continue to manufacture in New Zealand?
Share prices are being bandied around at present – everything from $1.20 to $3.31 each. Shareholders are currently scratching their heads about selling the 63 percent of the company that Haier doesn’t own.
Some of Fisher & Paykel’s products like direct drive motors and compressors help boost revenue through sales to other manufacturers. The drives could add up to $35m to pre-tax earnings in the next four years while compressors could add up to $7m in licensing royalties.
It’s possible that Haier wants the whole Fisher & Paykel package included in its bigger operation, taking the IP back to China.
With Haier raising its head again it begs the question: How do we keep the iconic industries that make great products and employ our people from being sold overseas?
It’s a very good buy for Haier and the shareholders and not too good at all for the people who work there, if it comes to pass that future production takes place in China.
Globalisation is rife, it doesn’t need to raise its head it’s everywhere. The world is a small (business) place. Fisher & Paykel comes from a small country, initially started by two men with ancestry from Russia. Look how far the company has come.
Where’s it going to go next?