Joachim Fuhrländer, Fuhrländer AG
Release Date: 2009-05-29
There is a widespread belief among executives in the European wind industry that you have a unique vision, would you agree with that?People say that it is different, but I do not know why. We are doing the same thing, we make wind turbines.
Where did the idea to start manufacturing wind turbines come from?
I started working at the small locksmith company that my father created in the 1960s. I am a simple man, nothing else.
Most of today’s wind turbine manufacturing companies were created by engineers who saw their hobby gradually being turned into a multi billion euro industry. What was the opportunity that you identified?
In the early 1970s, the forest was dying from acid rain, NATO wanted to install Persching II missiles, we went through the oil crisis, and I was sensitive about peace in the world and environmental issues. At that time I started looking at renewable energy and decided to do something.
What did your father say when you told him that you wanted to steer the company into the wind industry?
He thought that I was crazy, but he handed the company over to me and told me that I should go in this direction if I believed that this was the best way to make a difference in the world.
Did you also play a role in getting wind power accepted as an energy source in Germany?
At the time, the wind industry was very small and it was not difficult to get in touch with people with similar ambitions. I developed the business in small steps and installed the first 30kW wind turbine in Germany, which was a big adventure. At the same time, there was a small fight in the family because for every Deutsche Mark we earned we invested two Deutsche Marks. We started with empty pockets, which was very difficult. In the early 1990s, when we received an order for 100kW turbines I asked our bank for 100,000 Deutsche Mark to buy components, but the bank said that it did not finance hobbies. Then I was down again and had to look for another bank. Eventually, I invested my personal money as well as the money of my family and my wife. She wanted a new bathroom but I invested the money for the new bathroom in developing new wind turbines.
Who were the people that inspired you to pursue this ambition at the time?
That is difficult to answer because in the 1970s and 1980s a lot of people talked about the change in the world. People in the peace movement not only talked about Persching II, NATO problems, and the Russians, they also talked about the global environmental issues. Some of these people hated me because I was starting to develop large wind turbines, while there was a small group that believed that this was a great development. However, I did not need a clap on the shoulder because I had an aim. I never had a doubt.
Did you aim to make the world a better place or was there more to it?
I was located in Waigandshain, a village of 200 people in the middle of nowhere, without any opportunities. Nobody comes to invite you for something because nobody will find Waigandshain, and at the time there was no GPS. We had a small company with eight people and we had to grow, because only living from hand to mouth is not really social. This way you can only satisfy yourself, and this is not what I like to do. Since nobody would come to satisfy the people of Waigandshain, and feed their families, I decided to do something. From the beginning it was clear for me that we had to think global because there is only one world. We have the same environmental problems around the world; they do not stop at state borders. It was absolutely clear that I had to find a product that would address global problems while satisfying the people here and providing long term jobs. I decided that wind turbines were the perfect product since they are useful for the whole world and they can be exported. That was very clear for me.
When did you export your first wind turbine?
We started to go to the Hannover Messe in the early 1990s. A few weeks later, the Governor from Baku in Azerbaijan, the Governor from Ulan Bator in Mongolia, some people from Japan and a lot of Europeans visited our facilities to talk about wind turbines. Before Christmas the same year we received a call from Deutsche Bank that we received money from Japan into our account, while we were not doing business with a Japanese company. In January the Japanese delegation returned to Waigandshain to negotiate a contract to supply small wind turbines to Japan. It turned out that they sent the money to me because they had to spend it for tax reasons. Even though we did not have a contract, and there were no guarantees, they decided to do this because they trusted in me. This was the start of our export to Japan. Since the export from Waigandshain to Japan worked we realized that exporting to Portugal or Spain would not be a problem. This was the start of our internationalization. Over time we realized that going international is the best way to hedge our market risks, which is very clear today. At the moment there are problems in the US market, which I believe will recover early next year. Meanwhile our business is growing in countries like China and Vietnam. For example, our license partner in China, A-Power Energy Generation Systems – a 50% private and 50% state owned company listed on the NASDAQ and located in Shenyang – has constructed a facility in China that we can use for life free of charge. Mr. Jinxiang Lu, A-Power's Chairman and CEO, has said that there is no possibility of making money in the Us because of the financial crisis, but China offers opportunities. The Chinese government continues to invest in wind power and as a partially state-owned company A-Power can provide us with a large order volume for the next eighteen months. This shows that when you are international enough, and we are working in more than forty countries, the risk of each country is not a problem. At the moment, there are economic problems in the US, grid connection problems in South Africa, but in Asia the market is growing rapidly so we do not have a problem. If you are all over the world then something happens somewhere.
You started with an idealistic vision and mission but created a very successful international company operating in high growth market around the world. Of course the business case for investing in countries like China is very strong, but where do you draw the balance between striving to make money in developed and developing countries and striving to make a difference in less developed countries?
My aim is to make a lot of money in order to take care of my social responsibility. I am an entrepreneur, I am not a manager. When a manager takes too much risk he will be thrown out but I do not care about that, I can take risk, I can go forward, and I can pursue new ideas. I am not a manager, I am an entrepreneur.
What are your entrepreneurial priorities outside of your core business?
I have four aims, which are visions of course. One is making wind turbines, and developing the next 5MW turbine for onshore application. At the same time, we are very committed to the development of young people. When you take care of renewables, you take care of sustainability. When you take care of young people in the world, you take care of sustainability. When you take care of food and medical needs of people, you take care of sustainability. However, our core business is making wind turbines and with the money we earn we do the rest. Personally, I like to have three good meals a day and maybe a glass of wine at night. That is all I need.
Your apprenticeship program and numerous other social and environmental sustainability efforts are good examples of your commitment to sustainability. How did this philosophy become such an important and successful part of the business?
Besides energy the world also needs water, which will be the next problem, as well as education and training for the exploding global population. For example, India’s land area is about 65% smaller than Brazil and has a population of 1,166 million while Brazil has a population of 199 million. Nevertheless, Brazil has a lot more problems with crime, drugs, corruption, and prostitution. Education and training will play a crucial role in developing such countries.
Does the fact that you had a limited education play a role in your ambition to educate and train people around the world?
Of course, I was not in school for a long time. I learned English by listening to songs.
In Germany, young people have a clear picture of the profession that they want to enter in the future. As a country, we have developed a system to enable these people to follow a three or four year trajectory aimed at fulfilling the requirements to obtain a government approved diploma that will enable them to enter their chosen profession. We have a clear picture of what you have to do to enter a certain profession, and once you have obtained a diploma you have a job. In Germany people have to go through nine years of basic education, while in other countries such as Brazil or Vietnam this is only six years. As a result, there is a big difference in the knowledge of young people leaving school in these countries compared with the German situation. Therefore, we have to translate the German model to the realities of these countries. If we do not give people around the world education opportunities then they will not be able to participate in society, will become aggressive and they might eventually become religious extremists. We can only solve this problem if we start immediately to offer education opportunities.
We offer our people English training free of charge, and we are looking for secretaries and assistants all over the world who will then be trained here. Before we enter a country we want to have people from that country working with us in Germany in order to understand the culture and have a taste of the country. Also, we employ engineers from over the world to give them the know-how that we need at our foreign locations. When we invite people here for training I like to have people speaking their native language within our company to ensure that they do not get homesick and feel that we take care of them and understand their philosophy and culture. We are well prepared for the world. We transfer our technology to foreign engineers when they come to our German headquarters as preparation for running our business in their home countries later on. The fact that we have very open technology transfer probably differentiates us from our competitors. We give a lot and the more we give the more we receive in return. If you want to do business in China it is not useful to simply open your own workshop to satisfy the Chinese market and make a lot of money. My philosophy is work in partnership with people you can trust and engage in very open technology transfer. As a result, there is no need to steal and the partnership will become stronger every year.
What do you think about the many German companies that are afraid to enter China because of intellectual property rights issues?
They are crazy, but they are not allowed to decide because they are managers. If a manager goes to China and he loses only a small part of the technology he will be fired. In these companies the managers are competitors who are fighting to be the best, so they do not want to take risk. Entrepreneurs and managers have different roles in the economy. Entrepreneurs own the majority of the shares in a company and can pursue opportunities, while shareholders force managers to optimize the profit and do not help companies to enter China or to create apprenticeship positions. Everybody wants to optimize the profit, but for me optimizing profit means optimizing sustainability. Managers should learn that they should take risk and that sustainability is the key word. Politicians in Germany think in four years electoral cycles, managers think in contract terms and annual results, while I think in a time period of two, three or four generations.
At the European political level it has been decided that all countries will move towards increased sustainability by boosting renewable energy and energy efficiency initiatives based on binding targets for 2020. Do you believe that politicians or the business community should ultimately be the key drivers of sustainable development?
A lot of politicians come to our company to exchange ideas, which is very interesting. I believe it is important to emphasize that we must all think more global and look at how countries can cooperate to keep the world at peace. Wars like the war in Iraq that are fought over oil should not happen in the future. We share global problems in areas such as energy, water and climate change, and we should look for global solutions rather than taking a nationalistic approach.
In November, world leaders will meet in Copenhagen to define a strategy to address the climate change challenges. What is your suggestion for how we should go forward?
It will take too long if we have to wait for politicians to finance technological progress and investment in renewable energy and energy efficiency. Therefore, we are pooling the funds for technology development of different groups to grow the Fuhrlander academy. In the coming years I will take a serious amount of money out of the company, without negatively impacting the growth potential of Fuhrlander, to develop my own global education initiative. That is the next step.
Essentially, we will first be creating a university offering degrees focussed on both the technical, political and legal side of renewables in Germany that we can then copy around the world. We have the full support of the state to develop this initiative as a public private partnership. We can enable international students to obtain Master’s degrees in the field of renewables and knowledge that they can then take back to their countries. Afterwards, we will set up a network of twelve country headquarters from where we can serve different regions with our know-how, education and training. Education will be second fastest growing market in the world since in 2050 there will be 9 billion people in the world, and many will be young.
What are the main things that you have learned from doing business in China and your interaction with the Chinese people?
Twelve years ago, when I went to China for the first time, it was a different country compared with the China of today. It was a China where the people were really friendly, where they were talking in a very open way, and where they were looking for opportunities to cooperate. The contacts that we have today in China are also really friendly. For example, I am the godfather of the son of the second child of Mr. Jinxiang Lu, A-Power's Chairman and CEO. But I can see now that China is going to change face. The next generation of young professionals coming out of university is not entering into a real discussion with me, they shout that they want to have my technology. Some of them say that if they cannot have my technology today, they will steal it tomorrow. That happens, so the people are changing. In China we offered education and training centres, but they said “we don’t need them, we don’t have problems”.
What is the contribution that you would like to make to the development of China?
To be more true, to recognize the problems they have, and to talk openly about these problems and ask for support. Everybody is ready to offer support. China and India do have problems because of their large population. The Chinese system has worked until today because of communism, but I think that the younger generation would not like to be taught like their parents, and then something might change in China. The country might think about becoming a democracy, which would be a terrible plan for China. It would disturb the country.
What is your great personal ambition for the coming years?
First I have to decide where I am going to live. I would like to live three months in Europe, maybe in Italy or Portugal, three months in Asia, three months in Brazil, and three months in Africa.
In that case, it sounds like you would have to appoint a manager to run the company…
Of course. I am going to be fifty years old this year and I have very different plans for the second part of my life.
What is the final message that you would like to send to China?
Share. The more you share, the more you will receive. If you try to protect what you have, people will try to steal it or they will not believe in you. Be open, be true and learn to trust. That is the first thing I did with the Chinese people. Everybody warned me that a joint venture in China would be like a joint venture between the pig and the chicken. The pig and the chicken decided that it was a good idea to enter into a joint venture and they signed a contract. Then the pig asked what would be the products, and the chicken replied: “no problem, ham and eggs”. This is what people are afraid of when entering into a joint venture in China. You have to find people who you can trust in China, and I have found them. In our joint venture with A-Power there is no pig on board, perhaps they are the chicken and I am the rooster.
| Company: | Fuhrländer AG |
| Position: | CEO |
| Country: | Germany |