Taizhong, along with many other State-owned enterprises, has its own workers' residences, which have fostered a company culture over more than a half-century.
Workers have known each other's families for three generations. They go to the same schools, wear the same work uniforms, eat in the same dining hall and speak the same slang with the same accent, unlike anywhere else in the city.
They go to the same hospital. And, one day, they'll be buried in the same graveyard.
The cradle-to-grave guarantee of Taizhong is known as an "iron rice bowl".
Also hard as iron is the belief among Taizhong people, that "as long as we execute the higher authorities' decisions, whatever difficulties Taizhong faces, the government will pay the bill", a worker said.
Although the Chinese government has been pushing SOEs to become more modern since the 1980s, the dependent mentality of SOE workers hasn't changed much. Taizhong embodies that situation well.
Taizhong vowed to build a modern enterprise system in 1999. The biggest change was that it started paying sales staff and factory workers according to their sales or output.
An anonymous mid-level executive at Taizhong said that the transformation of SOE management and technological innovation is impossible, if the bureaucratic administration system remains unchanged.
High-speed train wheels, axles and wheel sets are relatively new products for Taizhong. But it's unclear how long the company can maintain its advantage over domestic competitors.
Taizhong also manages another high-speed train wheel production base in Taiyuan, which was formerly known as The Zhibo Lucchini Railway Equipment Co Ltd, a joint venture set up in 2006 with investment from a local coal-mining company and Lucchini Inc of Italy.
The company was handed over to Taizhong in 2012 by the Shanxi government after its owner, Ding Shumiao, was charged with bribing ex-railway minister Liu Zhijun, who was given a suspended death sentence for bribery and abuse of power last year.
The company is running at full speed, with estimated annual output on track to hit 10 billion yuan ($1.63 billion).
Contracts and orders secured by Zhibo prior to 2011 were also handed over to Taizhong.
After the Zhibo contracts and orders are finally finished, analysts believe, the authorities will open the domestic high-speed train wheel market up to competition.
At that point, potential competitors need only buy a production and inspection line from Europe to catch up with Taizhong.
But Taizhong, an "early bird" in the wheel sector, hopes it's had an unbeatable head start.
(China Daily 02/25/2014 page18)
