'Mr. China' -- Pittsburgher's status borders on mythical

Wild Wild East / Third of a series

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Photo courtesy of AsimcoJack Perkowski, chairman of a Beijing auto parts company, is a living example of what it takes to build a business as China embraces capitalism. Although he is known as Mr. China, Mr. Perkowski does not speak Chinese, nor does he own a home there. "Having the title of 'Mr. China' is not necessarily a bad thing. It kind of works to my advantage," he said.
PPG prospers in China after a hard lesson

BEIJING -- Jack Perkowski, the burly, pug-nosed descendant of Pittsburgh steelworkers, claims to have eaten every part of every animal while in China pursuing investment opportunities -- "With the emphasis on every," he says.

During a memorable 1993 tour of China's industrial Northeast, a local government official ended a day of meetings by plying Mr. Perkowski with, as a former colleague recalled, shots of Chinese moonshine followed by plates of black scorpions, steamed rabbits ears, fish lips, cow's lung, duck tongues, goose stomachs, goats' feet tendons -- even deer penis.

"Yeah, ... I had that," he says nonchalantly. Then he rolls his head back, chuckles and adds: "I don't think I knew it at the time."

Not that it would have made a difference. "I'm from Pittsburgh," he said. "I can eat anything."

Perhaps no one has more China war stories to tell than the 58-year-old Mr. Perkowski, a living example of what it takes to hustle business inside an opaque, Communist-led nation as it embraces capitalism for the first time, a place Mr. Perkowski describes alternately as "the Wild, Wild East" and the "Vietnam War of American businesses."

Chairman of a Beijing auto parts supplier that employs 12,000 across 18 factories, Mr. Perkowski does not speak Chinese, nor does he own a home here -- he and his wife share an apartment while in town. But after 15 years in Asia, his status among China business boosters borders on the mythical, aided by his media savvy (The New York Times columnist Thomas Friedman devotes several pages to Mr. Perkowski in "The World Is Flat"), his many speaking appearances, his evangelistic views of the so-called Middle Kingdom's economic potential, and his nickname: Mr. China.

"Having the title of 'Mr. China' is not necessarily a bad thing," he admitted, smiling. "It kind of works to my advantage."

The moniker comes from a 2005 book of the same title penned by former employee Tim Clissold, who was with Mr. Perkowski during that nine-month, 40-city tour of 100 factories, the same black-scorpion, duck-tongue-eating odyssey in 1993 that rolled through the mountains of inner China, where communist leader Mao Zedong hid manufacturing plants in the 1950s to deter bombings from the United States, the Soviet Union and Taiwan.

Mr. Clissold's book, both a memoir and a cautionary tale about doing business here, presents Mr. Perkowski as the central character, but it does not use his real name, referring to him only as "Pat." Mr. Perkowski claims not to have read "Mr. China," which he dismisses as glass-half-empty account.

"Why would I read the book? I lived it. I don't need Tim to tell me what I lived through."

A graduate of North Catholic High School, Yale University and Harvard Business School, Mr. Perkowski left a lucrative Wall Street job in 1990, convinced that Asia was where the next great fortunes could be made, that China would be what the United States and Pittsburgh were in the late 1800s -- a place of wild, unfettered capitalism.

But before he could make money in the auto parts industry, he had to lose lots of it during a series of nightmarish mishaps that tested his theories about China's potential.

There was the electric components factory manager who swiped $5 million and fled to Las Vegas (making matters worse, an anti-corruption official wanted cash and a car to investigate the incident). There was the partner in a rubber seal factory who transferred land to a rival plant. There was the $58 million that disappeared from a newly-purchased Beijing brewery -- one of two Mr. Perkowski bought and then sold for a loss.

There were factory fist fights, street riots involving knives and broken bottles, a severed ear belonging to a factory manager. Police. Anxious investors, one of whom, according to Mr. Clissold's book, told Mr. Perkowski that "You wanna be Mr. China, and Mr. China ain't gettin' it done in China!" Mr. Perkowski denies that such an exchange ever took place and claims his investors were always patient with him. Some cashed out in 2004, though, and lost part of their original investment made in the 1990s.

And then there was the near-death experience of Mr. Clissold, who was so taxed by the strange series of events that at age 38, according to his book, he collapsed from a "weird viral attack that had inundated my heart and liver and gotten into my joints." A heart attack, apparently.

Mr. Perkowski rolls his eyes at the mention of that last incident, calling it a sign that his ex-colleague is "not from Pittsburgh" and that "truth be known, he probably caused a lot of the problems we had and never took personal responsibility for them."

Mr. Clissold could not be reached for comment via e-mail.

"Yeah, I anticipated issues," said Mr. Perkowski. "But how can you anticipate someone setting up a factory in competition with you, how can you anticipate somebody transferring land out from under your nose from your joint venture into their company? How can you anticipate that? You can't. Yeah it was worse than I thought. But it was also better than I thought in a lot of ways."

Making money was much easier once Mr. Perkowksi fired all his factory managers and brought in new recruits -- following the example of former Steelers coach Chuck Noll, who built a Super Bowl dynasty by starting over with rookie draft picks.

Mr. Noll, football -- Mr. Perkowski played at Yale -- and Pittsburgh come up again and again with Mr. Perkowski, who said he has a Terrible Towel hanging in his office, that he saw last year's Super Bowl in person, that the team's current struggles pain him.

Both his grandfathers worked in Pittsburgh-area steel mills, and his 87-year-old mother still lives in the family house on Dorseyville Road, in O'Hara, the same property his father purchased for $7,500 in 1949.

Growing up, he knew little about Asia. Only what his dad told him, about World War II. In school, Asian history was infrequently taught, if at all. Before 1990, he had never been anywhere in the Far East.

But once he got over here, many observers give him credit for betting on mainland China (as opposed to Hong Kong) before it was safe. After visiting all those factories in 1993, Mr. Perkowski went back to Wall Street and raised more than $400 million to invest.

It was the largest private equity amount then raised by any single individual for Chinese projects -- and it immediately made Mr. Perkowski one of China's largest foreign investors and a popular man in the local newspapers. He instantly became a traveling salesman for the new China, wooing investors with talk of country's repudiation of Maoist principles, its massive industrialization, the new wealth to be found amid a population of 1.3 billion and its embrace of market forces.

It is still his favorite subject, by far. At dinner, over a plate of oysters, he can talk of little else. His company sells 70 percent of its parts to Chinese companies and China already is the world's second-largest car market, with 7 million sales last year.

It is on track to someday overtake the United States, with predictions of 130 million cars on the roads by 2020, up from 33 million today. Here, in Beijing, 1,000 new cars hit the streets each day.

"Companies, no matter where they are located, what business they are in, how big or small they are, they have to come to grips with China one way or another," he said. "If you pass on China and you are not here 10, 15 years from now, guess what, it is going to be very difficult for you to be global leader.

"I don't care who you are."

The Chinese are prodigious savers -- a concern for companies dependent on a consumer market -- but "that is changing," he said, pointing out that many diners in this upscale restaurant on this night were Chinese, not foreigners.

"I have a lot of credibility," he said. "So when I start telling people what will happen over the next 10 years, people listen.''

Dan Fitzpatrick can be reached at dfitzpatrick@post-gazette.com or 412-263-1752.


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