PulteGroup, Inc.

PulteGroup, Inc. (Pulte Homes) is an American homebuilder that was cited in Vanke’s 2006 letter to shareholders as the benchmark company for Vanke’s “new decade.” According to that document, PulteGroup’s market share more than doubled over the ten years up to 2006, and its target at the time was to capture 20% of the entire US market; the document further stated that if this target were achieved, a company with annual sales on the order of US$100 billion would emerge.

In 2006, the four largest US homebuilders together entered the Fortune 500 list, the first time pure homebuilding companies had appeared in the ranking, and PulteGroup was one of them. Vanke analysed in the document that the rise of US homebuilders into the Fortune 500 was related to three factors: the level of housing industrialisation kept rising, allowing housing components to be produced in factories at scale; customers’ demands for quality and value for money were becoming more refined, and housing brands were drawing increasing attention; and real estate financing had kept innovating since the 1980s, producing a pattern in which large companies raised funds mainly through low-cost channels such as bonds while small companies still relied on high-interest loans.

Vanke also noted in the document that PulteGroup had a complete set of customer-centred management tools, and that in the course of learning from PulteGroup, these management tools were gradually integrated into Vanke’s operations and management.

According to an April 2010 report by the Economic Observer, PulteGroup followed a pure homebuilding model and had entered the Fortune Global 500 in 2006, at the peak of the US property market; but under the impact of the financial crisis, PulteGroup had suffered heavy losses in each of the previous two years, with losses exceeding 20% of revenue, its assets and revenue had shrunk sharply, and its share price was only one-fifth of its peak. The report also said that other large US homebuilders similar to PulteGroup were in broadly similar situations, while non-pure homebuilders such as GLP and Simmons had performed much better during the crisis.