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Published: 7 January 2010      

Guan Tongxian retires

Guan Tongxian has retired as president and CEO of Shanghai Zhenhua Heavy Industries (ZPMC)

In a statement ZPMC’s parent company China Communications Construction Company Limited (CCCC) said that Guan – who will be 77 this year - had resigned “on grounds of age." It is thought that Guan has been suffering from ill-health for some time.

He has been succeeded by Kang Xuezeng, who was born in 1958 and has a Masters in Industrial Economics from the Chinese Geological University. Kang has held various positions within the Navigational Affairs division of the Ministry of Communications. His appointment is a temporary one, at least until early April 2010 when it will be considered at the next general meeting of shareholders.

Kang made his first public appearance as CEO of ZPMC (at least outside China) late last month in San Francisco, when the first shipments of sections for the new Bay Bridge arrived from the fabrication site at Changxing Island on ZHEN HUA 17.

CCCC’s Board and independent directors have expressed “heartfelt thanks and lofty respect” to Guan, whose achievement in building ZPMC into the company it is today is nothing short of remarkable.

Guan was 59 when he formed Shanghai Zhenhua Port Machinery in 1992, from the start known as ZPMC, with a staff of 10 from within Shanghai Port Machinery Plant (SPMP), with the goal of exporting container handling equipment worldwide.

Before that, he had served as deputy division chief in the Water Transport Bureau of the Ministry of Communications and as marine engineering division chief of China Harbour Engineering Co Ltd.

The [then] SPMP had won its first order from the Port of Vancouver, BC in 1989. ZPMC entered the US market in the early 1990s with a controversial order from the Port of Miami, which led to a legal suit by a competitor alleging theft of its designs, while its partner in the project was later indicted on unrelated corruption charges.

The European market took longer to crack and ZPMC got its first orders from operators in Bremerhaven and Antwerp on the same day in 1999.

ZPMC’s phenomenal record is well known. It is of such a scale that the company can justifiably be considered a cause, as well as an effect, of the remarkable growth of the Chinese economy.

Without ZPMC, or something very much like it, the global expansion in container trade in the past decade could not have occurred, since the ability to handle it would not have existed.

ZPMC introduced a production line philosophy to large crane production. Since 2000 the company has supplied more than 1800 ship-to-shore container cranes worldwide as well as thousands of RTGs and RMGs, other port cranes and bulk handling equipment.

It thus played a vital role in the spread of containerisation, as well as the expansion of ports in mature containerised trade areas. ZPMC has also been held up as one of the few in China to create successfully a global brand.

In an article posted on the company’s website last year, ZPMC described how its early success created a problem for the established container crane manufacturers:

“In the following years, senior colleagues of other countries had one big headache: no cheap labour, worst of all, ZPMC could imitate, copy and improve their products in the area of container machinery of which the production technologies and production methods were known to all. No one can refuse good bargains.”

Guan himself was justifiably proud of ZPMC’s ability to bring massive scale to container crane manufacturing while keeping prices reasonable. Key points in the company’s success include its decision to introduce its own fleet of delivery vessels and successfully securing Changxing Island as its main manufacturing base.

In his most recent interview with WorldCargo News, Guan spoke with pride about ZPMC’s commercial success, but he also spoke of the importance of working to ensure that ZPMC maintained a culture of fair compensation as the company grew.

He was proud of the fact that incomes within the company were better “balanced” than in western corporations - the highest executive salary within ZPMC last year was reported to be Yuan350,000 (US$51,000), just under three times the level of the lowest paid of ZPMC’s 4000 white collar workers.

The self-effacing Guan is a character straight out of China's turbulent history. In his early years the country was racked by the Japanese invasion, followed by years of bitter civil war and the eventual triumph of communism under Mao Zedong.

Trained as an engineer, Guan rose to prominence in the 1950s, but he was labelled a "bourgeois intellectual" during Mao's nihilistic "Cultural Revolution" in the 1960s and suffered great privations. His survival was nothing less than remarkable and it is said that his monumental drive was acquired at this time.

We hope that Guan enjoys a long and happy retirement.

There are several other personnel moves to report:

K-Line is reassigning Hiroyuki Maekawa, up to now president and CEO, as Chairman of the Board. Kenichi Kuroya, currently managing Director of K-Line Pte Ltd, will be the new president and CEO. These changes take effect from this April, although Mr Kuroya has already assumed office as a vice president.

Timothy J Farrell has stepped down from his position as executive director of the Port of Tacoma. John Wolfe has been appointed interim executive director. Erin Galeno has joined the port as CFO.

Stephen G Branscum, group vice president, consumer products, BNSF Railway Company, has been elected as chairman of the Board, Intermodal Association of North America (IANA) for 2010. Branscum succeeds Greg Stefflre, CEO of Rail Delivery Services. David L Howland, VP, Optimodal, was elected IANA’s vice chairman. Steve Rubin, president of Seacastle Chassis, was again named as IANA's Treasurer.

UK-based security and access control specialist Norbain has appointed Colm O'Brien as business development manager for Ireland.

The Port of San Antonio, Texas has appointed Antonio R Salinas III as manager, business development team. Salinas will focus on the port's East Kelly Railport.

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