During the tumultuous years of Mao Zedong's (毛澤東) Cultural Revolution in the 1960s and 1970s, few Chinese dared to buy a piano, which symbolized the West's decadent and bourgeois society.
"We didn't have to stop making them but we can't have sold more than a hundred or so a year back then. Learning the piano was frowned upon," said Tong Zhicheng (童志成), a 63-year old piano maker who is now director general of Pearl River Piano Co (珠江鋼琴).
How times have changed.
Tong said the state-owned firm, based in Guangzhou, is now the world's largest piano maker. Two hundred and eighty pianos a day roll off the production line at Tong's spotless factory, like cars in a Detroit auto plant.
Pearl River's net profit has surged from 14 million yuan (US$1.69 million) in 1992 when Tong took the helm of the unlisted firm, to 164 million yuan last year.
Under his tutelage, it has become a global player in the manufacture of musical instruments, forging a joint venture with rival Yamaha of Japan and buying German brand Ritmuller in 1999.
China's one-child policy has created a culture where parents invest heavily in their children's education -- a boon for piano makers like Pearl River.
"It's not just in developed areas. People like to spend money on their children to improve their educational level. It's a cultural investment," said Tong, seated beneath a picture of former president Jiang Zemin (江澤民) taken during a factory visit.
Chinese piano prodigies Lang Lang (郎朗) and Yundi Li (李雲迪) all started out practicing their scales on a Pearl River piano.
Nearly 80 percent of Pearl River's pianos are sold in China. The firm also exports its low-priced upright and grand pianos to the US and Europe, where the cost of making a piano is six or seven times more than in China.
According to Music Trades magazine, US piano sales had retail value of US$649.35 million last year, down 6.3 percent from 2002 despite a 4 percent increase in the number of pianos sold -- largely due to cheap imports from the likes of Pearl River.
But Tong reckons the China market holds the greatest potential. Under 1 percent of Chinese families have a piano at home, compared with 15 percent to 17 percent in Japan and more in Europe.
For those who can't afford to buy a musical instrument, huge music studios have sprung up in major cities with dozens of private teaching rooms for after-school and weekend classes.
Tong has worked for Pearl River since 1959, three years after a group of organ makers established the firm. The company employs 4,000 people, a relatively lean workforce for a large state-run firm, and invests heavily in technology.
In Hong Kong, a polished mahogany upright piano made under Pearl River's Ritmuller brand sells for as little as US$1,770 compared with US$2,885 for a basic Yamaha model and US$35,650 for a top of the range upright Steinway model.
Tong is adamant that his firm's quality rivals competitors.
Each piano is tuned at least five times before it leaves the factory, where the discordant din of workers tuning pianos was punctuated by the crash of thunder on a humid June afternoon.
The 350,000m2 plant gobbles up some 80,000m3 of wood a year -- enough spruce, pine and maple to cover nine football pitches.
Tong expect sales to grow this year but like other Chinese firms, profits could be hurt by rising material costs and as China moves to rein in its booming economy.
"I think profits will increase by 3 percent to 5 percent but it's very difficult to evaluate at the moment," Tong said.
Prices began rising in China last year after years of deflation. The firm has to buy strings, polyester and felt from overseas which Tong said is "very expensive."
The firm also grapples with power shortages which are plaguing China's rapidly growing economy. Since April, staff have taken off Friday and Saturday and worked on Sunday instead to conserve electricity.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to