2003: Starting with Foreign Trade

Chapter 950 Conservative vs. Radical (Seeking Monthly Tickets)
"You're still as outspoken as ever, but I didn't expect we'd agree on the same thing."

At the event, everyone was at each other's throats. Tan Jincheng's answer to the host's question about intelligent driving was very sharp: Why are the major manufacturers present not here?

If we were to summarize Tan Jincheng's answer to this question in one sentence, it would be that these traditional giants are essentially conservative in their thinking, stingy in their investments, and rigid in their management. They are neither able to let go of their arrogance regarding their "iron rice bowl" nor can they muster the courage to break the deadlock.

This "iron rice bowl" refers not only to the company's structure, but also to its advantages in traditional fuel vehicles, as can be seen from the host's question about the future prospects of new energy vehicles over the next five years.

These companies don't seem to value the new energy vehicle market, so how could they possibly be fully committed to promoting intelligent driving?

Falling behind in the wave of technological advancements is almost inevitable.

"Young people are bound to be outspoken, that's normal. But next time, remember to give us old folks some face."

On stage, everyone is a competitor, so there's bound to be some sharp banter. The main focus of the conversation is definitely promoting their own companies. Although Tan Jincheng's sharp remarks have a hint of sarcasm, they are generally speaking the truth. The giants aren't so narrow-minded as to be unable to accept these criticisms.

Among the major players, SAIC's General Manager Chen Hong is most familiar with Tan Jincheng. The two sides have had in-depth cooperation in many fields, including power batteries and automotive chips, since Horizon Robotics.

During his tenure, SAIC was very proactive in promoting the electrification of automobiles. In addition to collaborating with leading new energy companies, it also engaged in in-depth cooperation with internet giants such as Alibaba to advance SAIC's electrification process.

To be fair, SAIC is probably the most proactive company among the traditional giants in promoting electrification, at least for now.

"Don't speak up for this kid. We're not going to bother with these things. You all have to see how many people he's poached from us. But there will definitely be netizens who refute what he said. Let him deal with it himself."

Mr. Xu from BAIC looked at Tan Jincheng with a mocking expression. It was quite reasonable for him to call Tan Jincheng "kid" in private. The initial team of Weilai almost all came from BAIC. They poached many of them. After they grew up, this almost became a joke among consumers to tease BAIC.

Tan Jincheng laughed and said, "The current intelligent driving system is indeed quite chaotic. I'm not targeting you seniors here."

Although Wei Lai emphasized words like "assistance" and "safety" when promoting intelligent driving, attempting to influence the industry's safety planning and indeed setting an example, it had little effect in the face of absolute profit.

While major automakers are still making extravagant claims about their intelligent driving systems, consumers who actually buy and use them find that it's not what they expected at all.

Some manufacturers are extremely stingy with hardware configurations in order to save costs. They use the cheapest sensors, have pitifully low camera resolution, and have insufficient computing power chips.

There is also insufficient investment in technological research and development, and the market is extremely chaotic, which has brought great trouble to companies like Weilai, which have invested heavily in intelligent driving, in terms of marketing and promotion.

If a smart driving system can malfunction even at its launch event, how can consumers dare to use it?

"To be honest, the so-called intelligent driving level of some car companies now is not even as good as LeEco back then, yet they can still make a big fuss about it. Isn't this just playing with consumers' lives?"

When LeEco Auto unveiled its autonomous driving technology at its launch event years ago, it truly amazed everyone. A few years later, many mediocre companies still can't do that.

"That's true, so we still need some time to explore new energy sources."

If we're talking about which traditional giant is the most conservative in the new energy industry, it has to be GAC. Despite the frequent appearances of GAC's new energy vehicles, their entire team is actually quite conservative in the direction of new energy.

Especially with the overall recovery of Japanese brands this year, GAC's strategy seems even more ambiguous; they even rejected cooperation from Japan.

The symposium has just ended. The host asked each company to give their expectations for the percentage of new energy vehicles in their respective car companies' sales over the next 5 years. GAC and FAW gave the lowest figures, only 20%.

Weilai and BYD are the most aggressive, with BYD giving a figure of 90% and Weilai giving 95%.

These are all leaders of major domestic automakers. Their expectations for the proportion of new energy vehicles in their companies over the next five years reveal their respective visions and investments in new energy vehicles.

A seemingly simple expectation reflects the strategic direction of corporate development, and the attitudes of several giants reveal the differences between conservatives and radicals.

The figures given by Mr. Yin from Chery are actually similar to those from BYD and Weilai. However, Mr. Yin categorized plug-in hybrids as gasoline vehicles. All three private independent brands attending the symposium unanimously recognized the development of new energy vehicles.

Meanwhile, companies like GAC, which are thriving in the gasoline-powered vehicle sector, are still hoping to continue enjoying the benefits of gasoline-powered vehicles.

"Five years from now, Weilai's sales target for new energy vehicles is 95%. Does that mean you've given up on gasoline vehicles?"

Those familiar with Tan Jincheng know that his speeches in public, especially at formal industry gatherings like today, may be somewhat radical and sharp, but they are absolutely earnest.

His past statements, whether on housing prices, marriage, the stock market, or other matters, have almost all proven true when viewed in retrospect a few years later, confirming his judgments.

Taking housing prices as an example, before 2015, whenever he participated in events or gave speeches and was asked this question, he would encourage young people to buy houses in first- and second-tier cities and to develop in larger cities.

While participating in university activities in Luzhou, he frequently said that he would regret not buying now. At the time, netizens often criticized him for receiving some benefits from real estate developers.

It can be said that during those years, although Mr. Tan never really entered the real estate industry, real estate developers loved him very much. Every time Mr. Tan attended a public event, they would send several reporters to ask him questions.

Looking back at Mr. Tan's remarks encouraging young people to buy houses, he mentioned it almost every year for at least seven or eight years up to 2015, but he rarely mentioned it after 2015.

They either refuse to answer, or they say they can't afford it and don't need to go through all that trouble; renting isn't out of the question.

Considering the changes before and after, combined with the economic environment in recent years, and Lao Ma's remarks about future housing prices being as cheap as onions, even those of them who are high and mighty have to admit that this guy's grasp of economic trends is indeed accurate.

Of course, the most important thing is that he dares to speak his mind. If you really listen to his predictions about the economic situation, you will benefit from them to some extent.

After refraining from discussing housing, he began encouraging young people to start saving money, not to be misled by online rhetoric about advance consumption, and not to take out online loans. However, within a few years, online lending platforms collapsed one after another, and now they are universally condemned. Internet companies no longer dare to be as high-profile as before.

"You can't say that. Yuechi Auto has been spun off, but we still need to produce gasoline cars. It's a way to accumulate technology, so that we can better cope if the situation changes one day."

"So that's why you've been researching your own engine?"

The person asking the question was Mr. Yin, the general manager of Chery. Wei Lai's businesses in Anhui Province are no less than those in Ningbo. The engine factory is located at the border of Chuzhou and Luzhou, very close to Chery's headquarters.

"Yeah, what if we develop a V8 engine someday?"

"You have ideals!"

Boss Yin gave a thumbs up and said, "It seems that this kid has misunderstood the concept. He is developing two lines simultaneously, just like Chery, rather than going all in like BYD."

That makes sense; with such a strong sales base, how could they possibly give up so easily?

V8 engines are something that no domestic manufacturer currently has the capability to develop. Their significance in the traditional gasoline vehicle sector is self-evident.

"What moves will Weilai make this year? Are they really not planning to release a new car?"

Based on Tan Jincheng's remarks at today's symposium, it's easy to guess that Wei Lai will be making some moves this year, with intelligent driving being one of them. It's clear that he is very dissatisfied with the current chaotic market environment.

Moreover, they could almost all guess that Tan Jincheng was intentionally promoting industry standards for intelligent driving and assisted driving systems, so that Weilai could stand out among standardized industry standards.

Just as he vigorously promoted industry standards for lithium batteries, he even went so far as to conduct public test live streams. Now, such live test streams appear on the internet two to four times a month.

The live stream scenes rotated between various industrial bases in Weilai, much like a touring performance. Local netizens who were paying attention even took the initiative to call on Weilai to arrange for the industrial bases that had not yet been included.

"There are no plans for a new car, but some things have been done, and it should be coming soon. Please be gentle with your criticisms, everyone."

Tesla's success has provided valuable lessons for many emerging automakers. A well-structured model lineup and a vehicle that excels in product capabilities can help a company maintain its competitiveness in the long run.

Just like mobile phones, older models can maintain a sense of freshness through OTA upgrades. The risk of gasoline cars being eliminated from the market if they don't have a new model for three or four years has been significantly reduced.

尉来目前在车型结构上还算比较合理，SUV赛道有ES8以及尉来L1两款中大型SUV以及ES3，ES6两款中型SUV，轿车领域有ET5跟ET7。

With its pricing strategy focused on the mid-to-high-end market, Weilai's strategic structure makes it difficult to maintain competitiveness like Tesla with just a few models, but it also doesn't need to adopt a "car-sea" strategy like Geely and BYD.

In the next few years, Weilai will launch some new models, but there are no plans for SUVs for the time being. Sedans and MPVs will be the main markets for Weilai's new models in the future.

What does Weilai currently lack most in the new energy vehicle sector? It's models in the 10 to 15 yuan price range. "Perhaps it's time to consider a sub-brand."

It was already July when he returned from the capital. Just like the bigwigs had thought, Tan Jincheng visited some departments to try to promote standardized marketing and publicity for intelligent driving, but with little success.

The reason is simply that some people believe this track is still in its early stages and there is no need to impose too many restrictions.

Our business development history has always been like this: the initial stage is chaotic, allowing major manufacturers to fight each other, and then more mature national standards are formulated after a certain scale is reached, just like the National VI standard that was officially implemented on July 1.

This national standard for automobiles, touted as the strictest in history, has arguably reshaped the automotive market. In order to clear inventory as much as possible before the new standard was introduced, major automakers engaged in fierce price wars before July.

Some uncompetitive models and brands have accelerated their closure and the industry reshuffle under the price war waged by industry giants and luxury brands.

"It's indeed time to consider a sub-brand of Weilai. If we want to make a push in new energy vehicles, we must seize the market in the most competitive 10 to 15 yuan price range."

The Aion is a model in this price range and sells well, but it is primarily targeted at B-end customers. Real C-end customers are still somewhat hesitant about this type of model that appears in large numbers in the ride-hailing market.

In fact, if we disregard appearances and focus purely on practical family use, commercial vehicles are really very suitable. These models, which run more than 100,000 kilometers a year, are very comfortable to drive and ride in. In addition, they have a large number of vehicles on the road, a wide service network, and low operating costs.

You want an ES8 or L1 to run as a taxi? It'll probably be obsolete in less than a year.

There's an unwritten rule in the automotive industry: if you want to ruin a brand, send them to drive taxis. But taxis are actually the safest and most reliable vehicles, and the choice of so many drivers who spend so much time with their cars must have its reasons.

In fact, many of the best-selling models in the past, such as the Santana and Elantra, were used as taxis.

Unfortunately, times have changed. Tan Jincheng knows all too well the current consumer market. Even if Aion, which has taken the ride-hailing route, uses all of the most advanced and mature technologies, it will be difficult for the brand to be accepted by C-end users at the same time.

In the rapidly evolving electric vehicle market, the most competitive segment, priced between 10 and 15 yuan, offers an overwhelming number of car models to choose from.

Aion is not suitable for a sub-brand that targets C-end users, so it must launch a brand new sub-brand to enter the market with the widest coverage of C-end users. Besides, ride-hailing services won't be popular for many more years.

Once the number of vehicles in use reaches a certain level, Aion's sales will inevitably stagnate, and at that time, it will never have the sales volume it has now.

The sales figures for the first six months of the year have been published on the official website of the China Passenger Car Association, making the sales figures of each automaker readily available. In a market environment where overall sales declined by 9.3%, the performance of Yuechi Auto and Weilai Auto, which were listed separately for the first time, was quite impressive.

The performance of Yuechi Auto, which appeared on the sales charts as an independent car company for the first time, is what everyone is most concerned about in the first half of the year. The sales of the Yuechi series are the biggest source of confidence for Weilai, but it is also a fact that it has been declining for several consecutive years.

Whether within the industry or among the general public, everyone wants to see where Wei Lai gets the confidence to spin off this series independently, and also wants to see what changes will occur in Yuechi Auto under Wang Fengying's leadership.

The half-year sales reached 39.92 units, covering the Yuechi series, Tank series and Yangzi series. Compared with last year's sales, it increased slightly by 4%. Among them, the overall sales of the Yuechi series reached 35.29 units, an increase of 8.47% year-on-year.

Yuechi Auto, appearing in the sales rankings of domestic brands for the first time, immediately climbed to second place.

Last year, this position belonged to a company called Weilai Automobile, the parent company of Yuechi. This year, the son has taken over.

After spinning off its gasoline-powered vehicle business, Weilai Auto's performance has also attracted much attention. In a year of ups and downs for new energy vehicle startups and major automakers, Mr. Tan seems to have been somewhat silent, and his popularity has not been as high.

However, Weilai Auto's sales in the new energy vehicle sector are quite good, with a growth rate of an astonishing 94.5%.

With 17.86 vehicles sold, representing a 31% market share in new energy vehicles, the overall sales volume also ranks among the top ten domestic brands.

"The combined sales of the two automakers reached 57.78 vehicles, which is quite impressive. It's a pity that Mr. Tan separated the sales figures for the two automakers."

Among domestic brands, Geely, which ranked first, experienced a severe decline in overall sales in the first half of the year, reaching 17.86% to only 59.16 vehicles. The gap between Geely and Weilai, which ranked second last year, is still very obvious.

However, looking at this year, the difference between the two companies is less than 1.5 vehicles. Although Weilai's market share in new energy vehicles is declining further, its growth rate is truly astonishing.

"There's nothing surprising about it. The decline in market share is an undeniable fact, and we need to work even harder."

This year, new energy vehicle startups have made great strides, but safety incidents have occurred frequently, including those involving Tesla. In contrast, WILAY Motors, which has always been willing to spend money on safety, has performed much better. In addition, its efforts in the European market have also brought WILAY a certain sales volume.

Compared to other models in the same segment, these vehicles have advantages in both features and price, and have successfully penetrated the family market, so it's reasonable to expect increased sales.

However, its advantages are indeed getting smaller and smaller.

"In the global market, Tesla is only 10,000 vehicles behind us, and BYD is only 37,000 vehicles behind. Our number one position may be lost in the second half of the year."

"President Tan's requirements are really high. Perhaps it is precisely these requirements that have allowed Wei Lai to maintain its competitiveness."

Weilai, which mainly targets the mid-to-high-end SUV market, still managed to sell 17.86 vehicles in six months, even with the support of the Aion series. Most of these models had a starting price of over 25 yuan.

Among the world's top three new energy vehicle manufacturers, Tesla has a natural advantage in terms of per-vehicle price due to factors such as the environment and its long-standing market positioning.

With an average price of $4.41 per vehicle, equivalent to approximately 31.6 RMB, Tesla maintains an absolute advantage that other automakers find difficult to challenge.

However, the average selling price of WILAY's vehicles is also not low. According to WILAY's half-year revenue forecast, the calculated average selling price of its new energy vehicles is as high as 21.15 yuan, which is 3.68 yuan higher than BYD's average selling price.

Data doesn't lie.

By selling more and at higher prices, the Weilai brand has firmly established its mid-to-high-end brand image. It's worth noting that Weilai, along with Aion, hasn't offered any major promotional activities this year.

Even during the most intense price wars in May and June, Weilai maintained considerable restraint in the field of new energy vehicles.

"It's really good, but we still need to do more in the biggest market of the future."

Selling at a high price doesn't mean you can always sell at a high price. In a rapidly growing market, consumers are willing to tolerate higher prices if there is demand. Look at the domestically produced Maodou 3; even though the price is lower than expected, it is still popular. This is the same principle.

But what if we enter a saturated market? Can we still maintain this advantage?
Geely's significant sales decline in the first half of this year is the best proof. Once pricing fails, consumers will quickly abandon you and switch to other brands. In this year's new energy vehicle market, some car companies' new models were basically doomed from the moment the pricing was announced.

"Currently, the market for new energy vehicles is mainly driven by a desire to try them out, and consumers are willing to accept a certain premium. However, as the replacement cycle arrives and more owners of gasoline vehicles switch to electric vehicles, they will become much more price-sensitive."

The development of electric vehicles capable of handling 10 vehicles must be put on the agenda as soon as possible.

As for the technical aspects, it's actually quite easy to solve. Just apply all the technologies from the Aion system to this area, lower the price without reducing features, and design the models to look more attractive. You won't have to worry about selling them.

It must be admitted that consumers have higher requirements for the appearance of electric vehicles compared to traditional fuel vehicles. If a pure electric vehicle is generally considered ugly, it will seriously affect its reputation and sales.

Wei Lai has always had a good reputation for design, and the designs of its sub-brands cannot be too ugly.

"The new sub-brand needs to have a design aesthetic that can catch the eye of most consumers, and it also needs to have a pretty good name. Do you have any ideas?"

To create a sub-brand, the natural choice was Hu Zhengnan and Thomas, the research institute director and design director, respectively.

Thomas is now quite fluent in Chinese.

He patted his bald head and laughed, "The boss's requirements are simple, but also very high."

Aesthetics is a mysterious thing. While design is certainly important, achieving universally recognized beauty requires a high level of skill. In addition, creating a new brand name is not easy either.

"That's your problem. You should study it and come up with a solution as soon as possible."

"In addition, the launch event for the new architecture platform should be arranged as soon as possible."

Even without launching new cars, there are still plenty of things that can be done. After being silent for more than half a year, Wei Lai really needs to make some moves, otherwise he will not be able to maintain his current advantage.

(End of this chapter)