China Focus: Chinese Toy Producer in Dead End After Mattel Recall
Operation of a Chinese toy">http://news.tootoo.com/”">toy maker has come to a full stop after its U.S. partner Mattel Inc. recalled about 1 million lead-tainted toys. More than 2,500 employees with the Lida Plastic Toys Co. Ltd. based in Foshan City of Guangdong Province, which is a longtime contract manufacturer of Mattel, are temporarily laid off without pay since the world's largest toy maker announced the recall early last month.
Export business was suspended and toys worth about 50 million yuan (6.6 million U.S. dollars) have been overstocked, resulting in a halt of capital inflow, said Xie Yuguang, board chairman of Lida. Seeing no way out, Lida's boss Zhang Shuhong, a Hong Kong businessman in his 50s, hanged himself on Aug. 11 after paying off due salaries to all employees and sending them home. It was estimated that the factory, which had been producing toys to Mattel for more than 10 years without any bad records, would suffer 30 million yuan (about 4 million U.S. dollars) in economic losses.
About 70 percent of toys in Guangdong are made for overseas clients according to their design and requirements, said Zhang Xiaolue, an official with the Guangdong Provincial Administration of Quality Supervision, Inspection and Quarantine. "Both sides should shoulder the responsibility of supervising the whole process of production, including material quality," saidGuo Zhuocai, vice chairman with China Toy Association (CTA).
Recall of substandard products is not unusual in the U.S. market, as the U.S. Consumer Product Safety Commission announced some 30 recalls in July, said Li Zhuoming, vice-chairman of Guangdong Provincial Toy Association. The media vigorously propagated unsafe made-in-China toys but paid less attention to some non-Chinese toys that even caused injuries, Li claimed. A senior official with the European retail giant Carrefour on Tuesday called upon foreign media to stop exaggerating quality problems of made-in-China products, claiming that such reports would not affect Carrefour's purchase in China.
Jean-Luc Chereau, advisor to the chairman of the management board of the Carrefour Group and president of the Carrefour (China) Foundation for Food Safety，said he is happy to see the Chinese government's awareness of the significance of quality control and the efforts it has made. "China has already improved the quality of its products by a great deal," said Chereau. More than 300 Chinese toy makers have had their business licenses suspended or revoked in a national quality overhaul, said Li Changjiang, director of the General Administration of Quality Supervision, Inspection and Quarantine. China, the world's largest toy exporter, has been paying great attention to safety and quality of toy products, according to officials with CTA and China Chamber of Commerce for Imports and Exports of Light Industrial Products and Arts-Crafts (CCCLA). The two organizations have pledged to strengthen quality inspection over Chinese goods along with foreign toy makers and importers and push domestic enterprises to improve self-supervision. Soon after Mattel's first recall, many Chinese toy exporters and CCCLA jointly called on domestic toy producers to reject product orders beyond their production capacity or without explicit quality standards, and maintain strict quality tests of purchasing, production and sales.
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