When something is stamped, "Made in China" no one believes that is a mark of quality. Considering China's notorious construction history, we would have to pause if we saw that same stamp on a construction project. If Chinese construction causes us to pause, then why, at a time when our construction sector is struggling to find opportunities and recover, are significant projects being awarded to foreign construction companies, particularly those from China?
Some of China's particularly popular construction gaffs include:
A hotel assembled in 15 days, in which I would not stay; and
In 2009, Chinese construction companies were awarded in excess of $2 billion worth of construction projects in the United States. These projects included a high school in South Carolina, rail stations, and the Chinese embassy. Of these projects, only the Chinese embassy makes any sense. These other projects should have been awarded to U.S. based construction companies.
By 2011, Chinese construction companies were awarded in excess of $100 billion in foreign construction projects. One Chinese state owned construction company had 31 overseas offices and projects in 70 countries worth at least $9.5 billion. These projects included significant projects and investment in the Caribbean staffed by flotillas of Chinese workers.
If the Chinese cannot even get pavement right, how do we expect them to construct our projects and infrastructure to the quality we expect?
Some of the American projects awarded to Chinese construction companies included:
The Bay Bridge in San Francisco, worth $7.2 billion;
The Alexander Hamilton Bridge in New York City, worth $400 million; and
Ventilation systems on the New York City subway, worth $100 million.
These Chinese companies have advantages that allow them to under bid on and win work on projects that a private American company does not have. Chinese companies are subsidized and essentially run by the national government, they have vast numbers of employees who know nothing other than state work, and they have China fund the projects on which the work is performed.
We have protections, particularly with immigration, organized labor and better inspection requirements, that may limit the problems experienced with Chinese construction firms and labor overwhelming the local market. In addition, our domestic construction industry shed some players who may not have been prepared for foreign competition. The strong survivors should have a developed reputation for quality that cannot be matched and be in a position to compete directly with these competitors.
Regardless, Chinese contractors are here and it looks like they want to stay.