In a dramatic collapse that has become the talk of southern China business circles, Kelon, a top Chinese appliance maker specializing in refrigerators and air conditioners, has stopped production after its top managers were arrested in late July, and the company’s future is now gravely in doubt.
Asia Times Online visited Kelon’s headquarters in Guangdong province’s Shunde city, where employees have resigned en masse and a parts supplier has claimed arrears against the company. Last year, bank loans to Kelon were cut back drastically, and distributors began selling off its stock to offset looming losses. According to a local source, Kelon began to slash production and cut staff in June. Many workers were already thinking about resignation because they had been preparing for the worst ever since production began to fall earlier in the year.
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