In 1989 I read an outstanding book called Beijing Jeep: The Short, Unhappy Romance of American Business in China by Jim Mann, later an illustrious author on defense policy. It recounted the troubling experience of American Motors Corp. and Chrysler in failing to navigate a joint venture in Deng Xiaoping’s China. I had just graduated from college and, at the time, a wonky debate in Washington, D.C., where I was living, centered around the merits of having an industrial policy. That was then.
I thought repeatedly about this book and how far China has come while reading Scott Cendrowski’s outstanding feature in the new issue of Fortune about Tesla’s impressive turnaround of its China operations. The lesson from Mann’s book is that any company foolish enough to think about manufacturing in China for the domestic market needed to go in with its eyes wide open. It probably would be robbed blind, as AMC/Chrysler were, and it likely would fail.
Fast forward to 2017, and Cendrowski’s feature is a case study in how a company, even an auto company, can thrive in China without manufacturing there so long as it pays attention to what customers want. As it happens, according to Cendrowski—who time and again has illuminated Fortune’s readers with trenchant analyses of China’s most relevant business players—Tesla is considering a manufacturing joint venture in China. This is exactly what AMC/Chrysler did 30 years ago.
Times have changed, though, as has China. This will be fascinating to watch.
Typos tend to come in threes, which means another is on its way. Thank you to those of you who pointed out that Priceline’s impressive 10-year run dates from 2006, not 2016.