Tech Giants: Starting from Bankrupt Companies

150: Chapter 150 Hardcore Negotiations Under the Siege of Chang’anXian, Xidian University Friendship Campus, morning of December 20th.

The winter morning at the northern foot of the Qinling Mountains was shrouded in a thin mist.

Wu Yi walked down the sycamore-lined avenue, the fallen leaves crunching beneath his feet.

The President of Xidian University, Zhang Weihua, accompanied him; the elderly man wore a grey Zhongshan suit and cloth shoes, his stride steady.

”President Wu, this way please,” Zhang Weihua said, leading Wu Yi into an unassuming grey building. ”This is our ’State Key Laboratory of Solidification Technology,’ one of the cradles of Chinese aerospace materials research.”

The laboratory was quiet, save for the faint hum of running equipment.

Researchers in white lab coats operated various precision instruments, and the air held the distinct scent of heated metal.

Zhang Weihua walked to a vacuum smelting furnace and pointed at the silver-grey ingot cooling inside: ”This is a third-generation titanium-aluminum alloy, prepared for the high-temperature components of the next-generation fighter jet. The designed service temperature is 900 degrees Celsius, an improvement of 150 degrees over existing materials.”

He gestured for an assistant to take out a sample and handed it to Wu Yi: ”Get a feel for it.”

Wu Yi took it; the sample was very light, half the weight of steel of the same volume, yet it produced a crisp sound when tapped and possessed excellent rigidity.

”How is the performance?”

”The room-temperature tensile strength is 1200 MPa, and it can maintain 800 MPa at high temperatures of 900 degrees,” Zhang Weihua’s eyes were filled with pride. ”This data is on par with the latest samples from the labs of GE in the United States. But the problem is—”

He sighed: ”The cost. For this 50-kilogram furnace of alloy, the raw material cost alone is 2 million rmb. In laboratory preparation, we can only produce a few hundred kilograms a year. If we want mass production, the cost must be reduced to less than one-tenth.”

Wu Yi carefully examined the microscopic texture on the surface of the sample: ”Where is the process difficulty?”

”Purity control,” the laboratory director took over. ”This alloy is extremely sensitive to impurities. If the oxygen content exceeds 50ppm, the performance drops off a cliff. The laboratory uses electron beam melting and vacuum casting, which can control the oxygen content to below 10ppm, but industrial production cannot achieve this.”

”Spark can do it,” Wu Yi said. ”We have developed an integrated process of vacuum smelting, continuous casting, and rapid solidification. The oxygen content can be stabilized below 5ppm, and the capacity can reach the level of thousands of tons per year.”

Everyone in the laboratory turned their heads to look at Wu Yi.

Zhang Weihua’s eyes lit up, but then dimmed immediately: ”But... are you willing to transfer this process? Or are you only selling the product?”

”We can cooperate on the technology,” Wu Yi replied. ”Xidian University provides the formula and basic research, while Spark provides the industrial process and engineering team to jointly develop low-cost mass production technology. We will share the results and jointly own the intellectual property.”

”And the conditions?”

”Open all laboratory data, including failure data,” Wu Yi looked at Zhang Weihua. ”We know that failure data is often more valuable than success data—it tells us which paths don’t work. But to get this data, we need the highest level of trust.”

Zhang Weihua fell silent; failure data is often regarded as ”imperfect” in academia and is rarely made public, but it is true that for those samples that failed to achieve expected performance, their microstructures, composition deviations, and process parameters are all valuable experience.

The old man paced the laboratory with his hands behind his back, while sunlight streamed in from the high windows, illuminating his greying hair.

Three minutes later, he stopped: ”I will sign a non-disclosure agreement. As long as it is good for the country, as long as we can turn the laboratory’s technology into a true pillar of the nation, I will give you the keys to the laboratory.”

This sentence was spoken plainly, but the eyes of the several old professors in the lab turned red.

They had been doing materials research all their lives, published countless papers, and won various awards, but their biggest regret was that the results were locked in a safe, unable to be turned into equipment, unable to defend the country.

Now, the opportunity had come.

Shaanxi Provincial Office of Science, Technology and Industry for National Defense, afternoon of December 20th.

Zhao Gang, the director of the Office of Science, Technology and Industry for National Defense, had a simple office, but a special map hung on the wall—a distribution map of military enterprises in Shaanxi Province, with 147 red dots scattered like stars.

”President Wu, please look,” Zhao Gang pointed to the map. ”Around Xian, the aviation industry chain is complete: Xifei does final assembly, Xihang does engines, the 618 Institute does flight control, and the 631 Institute does avionics. Further out, Baoji has special materials, Hanzhong has radar, Weinan has pyrotechnics... From a screw to an airplane, Shaanxi can build it.”

He pulled up a set of data: ”But these enterprises generally face the problem of insufficient orders. In peacetime, military procurement is limited, and the civilian market cannot be opened. The average capacity idle rate is 30%, and some individual enterprises reach 50%.”

”So we hope,” Zhao Gang looked directly at Wu Yi, ”that if Spark settles in Xian, it can subcontract some military orders to these enterprises. For example, structural parts for drones, missile shells, radar antennas... These are things they can all do, and the quality is not inferior to companies in the east.”

Wu Yi thought: ”Technically, there is no problem. But what about the cost? Logistics costs in Shaanxi are higher than in the coastal areas.”

”This is the preferential treatment we want to give,” Zhao Gang pulled up the policy document. ”First, tax exemption for three years, and then halved for the next five years. Second, provide a ’green channel for military qualifications’—confidentiality qualifications, production licenses, and quality systems that normally take two years to review, we will coordinate with relevant departments to get it done in six months.”

He paused and lowered his voice: ”Third, if you need it... deep in the Qinling Mountains, there are ruins of Third Front factories built during the Cold War. They are all cave factories, with constant temperature and humidity, nuclear strike protection, and some even have dedicated railway lines. We can rent them to you at a low price as a strategic backup production base.”

Wu Yi’s heart rate accelerated.

Third Front factories—those were national defense industrial bases built in the deep mountains and forests by China in the 1960s and 1970s to cope with a possible war; many had been abandoned, but the infrastructure remained, and all-cave factories meant natural electromagnetic shielding and anti-strike capabilities, making them excellent places for military production.

”Can I go see them?” Wu Yi asked.

”Yes, but it requires special approval,” Zhao Gang said. ”We will arrange it for this afternoon.”

Deep in the Qinling Mountains, evening of December 20th.

The military vehicle drove on the mountain road for two hours before entering a tunnel; the tunnel was long and dimly lit, and it took a quarter of an hour to reach the end.

The scene before them opened up—a huge space hidden in the belly of the mountain, the size of ten football fields; the dome was reinforced natural rock, and three-story factory buildings surrounded the area, with railway tracks extending from the tunnel directly to various workshops.

”Codename ’Project 714’,” Zhao Gang introduced. ”Construction started in April 1971 and was completed in 1978. It was originally planned to produce parts for strategic bombers. Later, the situation eased, and it was sealed in 1985. But all the equipment has been well maintained and can be used once powered on.”

Wu Yi walked into a workshop, where Soviet Union-style heavy machine tools were kept; although old, they were wiped clean, and there was anti-rust oil on the guides.

”The temperature is 18-22 degrees all year round, and the humidity is 40%-60%,” Zhao Gang said. ”No air conditioning is needed; it’s naturally constant temperature. The cave has independent diesel generator sets and reservoirs, so it can persist for a month even if power and water are cut off.”

”What about security?”

”There is only one entrance and exit, which is the tunnel we came through. There is a concrete bunker at the entrance, and a company can be stationed inside,” Zhao Gang pointed to the observation holes on the rock wall. ”These are firing ports, which can form crossfire. In theory, even a battalion cannot break in.”

Wu Yi was shocked; this wasn’t a factory, it was a fortress, and if a production line for key components were established here, it would be almost impossible for external forces to destroy it.

”Rent?” he asked.

”A symbolic amount, 5 million rmb a year,” Zhao Gang said. ”But there is one condition: if the country has a need, this place must prioritize ensuring national tasks.”

”Of course.”

When walking out of the cave, it was already dark; the starry sky of the Qinling Mountains was exceptionally clear, with the Milky Way spanning the horizon.

Wu Yi looked at the starry sky, having already made his decision.

December 21st.

But Wu Yi did not immediately announce the choice of Xian; he still had to solve one last problem: talent.

Spark’s R&D center in Xian needed at least 3,000 high-end talents—materials scientists, chip designers, software engineers, and mechanical experts, but where would these talents come from?

Xidian University, Xian Jiaotong University, and Northwestern Polytechnical University graduated more than 5,000 students in related majors with master’s and doctoral degrees every year, but according to random interviews of 100 graduates by Wu Yi’s team, the results were worrying.

The retention rate of Xian-native students after graduation was as high as 70%, but the retention rate of out-of-town students was only 30%.

”It’s not a salary issue,” a Ph.D. from Jiangsu said. ”Spark’s salary is higher than in the east, but my girlfriend works in Shenzhen, and there is no suitable position for her in Xian. And for children’s schooling in the future, Xian’s educational resources...”

A master’s student from Hunan said more bluntly: ”The air quality in Xian, the smog is severe in winter. Medical resources are also tight; Xijing Hospital is good, but you have to wait a month to register.”

These practical problems could not be solved by high salaries alone.

That night, Wu Yi drafted a plan in his hotel room, titled: ”Spark Xian Base Talent Ecological Construction Plan”.

Core contents include:

Build Spark School: Introduce famous teacher resources from Beijing and Shanghai, covering everything from kindergarten to high school, with priority admission for employees’ children.

Co-build Spark Hospital: Cooperate with Xijing Hospital to set up a branch in the park, with a green channel for employees and their families.

Spouse Employment Service Center: Provide vocational training, job matching, and entrepreneurial support for employees’ spouses, with the goal of solving 80% of spouse employment.

Talent Apartment Community: Build 2,000 exquisitely decorated apartments, which employees can buy or rent at cost price, with community facilities like gyms, libraries, and cafes.

Scientific Research Ecological Environment: Establish the ”Qinling Scholar” program, providing 100 free exploration research funds every year, with no KPIs, only requiring the output of original achievements.

After finishing the plan, it was already three o’clock in the morning; Wu Yi sent it to Su Chen and attached a sentence:

”What we need are not workers, but settlers. This may mean that Spark must use the power of an enterprise to reshape the high-end talent ecosystem of a city. The cost is huge, but if successful, Xian will become the Silicon Valley of Western China.”

An hour later, the reply came:

”Approved. But the requirement: within three years, the Xian base must produce at least three world-class technical achievements. This is an investment, and there must be a return. — Su”

Wu Yi smiled.

He knew that this four-city game already had a result.

Chengdu’s advantage lay in comprehensiveness and openness, Wuhan in cost and logistics, and Zhengzhou in speed and sincerity.

But Xian had a complete military industry chain, strategic backup facilities, and extremely strong local talent stickiness; more importantly, it had the historical mission and patriotism to turn technology into a pillar of the nation.

This was exactly what Spark needed most.

Outside the window, the ancient city wall of Xian stood silently in the night; this ancient capital of thirteen dynasties had witnessed too many rises and falls.

And now, it might witness a new technological revolution taking root and sprouting on this ancient land.

Wu Yi walked to the window, looking at the lights of the Bell Tower in the distance.

Under Chang’an City, a hardcore technological long march was about to begin.