2003: Starting with Foreign Trade

Chapter 951 Breakthrough in Intelligentization (Seeking Monthly Tickets)

P.S.: It's the last day of double rewards, so I'm asking for another round of monthly votes!
"No problem, but we'll have to wait until I get back. I'm about to go to Jinxin Technology right now. Boss, would you like to come along? They've come up with something."

The Weilai Research Institute wields immense power, and Hu Zhengnan, as its director, is naturally in charge, but he also bears heavy responsibilities and is one of the busiest people at Weilai.

He had to handle the tasks assigned by his boss, but there were priorities. He had an inspection tour today, and the establishment of a new sub-brand wasn't urgent; this matter was more important at the moment.

Tan Jincheng was taken aback at first, then overjoyed: "You've made something? We have to go and see."

The transition from new energy vehicles to intelligent vehicles represents a new phase. Currently, electric vehicles can only be considered part of the new energy vehicle category, not true intelligent vehicles. Whether they have the technology or not, they are more focused on improving range and infrastructure development.

What's currently trending? It's battery packs, fast charging technology, fuel cell technology, and electric drive systems. Overall, it still revolves around the original architecture of electric vehicles.

Although everyone is touting and developing intelligent driving, and some high-end models are even equipped with L3 intelligent driving systems, they are completely different from the intelligent driving systems of a few years from now.

To compete with Huawei in the field of smart cars, it is necessary to increase research and development and investment in key areas such as intelligent driving, intelligent cockpit, intelligent connectivity, and intelligent electric vehicles, such as higher precision sensors, advanced autonomous driving algorithms, and efficient battery management systems.

Improving product performance and reliability is not just empty talk. This year, Weilai's R&D budget is as high as 112 billion yuan, accounting for 8.56% of last year's total revenue. The actual expenditure even exceeded the net profit of last year, which is enough to prove how determined they are.

At the beginning of the year, while reforming the supply chain, Weilai also integrated its various departments. Previously, in the field of intelligent driving, Weilai adopted a method of independent development by various departments, subsidiaries and suppliers, and multi-departmental collaboration.

For example, Jinsheng New Era is responsible for developing a more efficient battery management system, Horizon Robotics is developing automotive chip systems for Weilai, and Orange Group is responsible for research and development in areas such as cloud computing and intelligent connectivity.

This approach may seem like a case of each company working independently, but the benefits are obvious in the early stages of research and development. Each company focuses on its own strengths, which not only allows for greater investment but also enables more efficient technological breakthroughs.

The key is to perfect a particular technology. For example, Jinsheng New Era's battery management system is quite good. Li Bing sought their help because Jinsheng New Era has this technological advantage.

Aside from some difficulties in integration, there aren't any major problems.

However, the situation is different now. Weilai's technology in various aspects has matured, and its goals have been identified. At the beginning of the year, a separate intelligent driving department was officially established and placed under the research institute, forming a complete business system covering five areas: intelligent vehicle cloud, intelligent connectivity, intelligent cockpit, intelligent driving, and intelligent electric vehicles.

Now, the entire intelligent driving team of Weilai has been built. Among domestic car companies, besides SAIC Motor, only Xiaopeng Motors, which just completed its intelligent driving team in June, has built a complete intelligent driving team like Weilai.

In addition, there are Baidu from the Internet company, and Huawei, which is currently struggling in the field of intelligent driving. For the time being, Weilai's technical level in intelligent driving is still in the first tier in China.

Baidu does everything like a monkey picking corn; its businesses and investments are all abandoned after a short time. But it's really persistent with autonomous driving; it's been seven years since 2013.

Seven years is nothing for many companies that persevere, but it is extremely rare for Baidu. For Baidu, which has always been uncertain about the future and profitability, it is amazing that they have been able to persist in the smart car project, which is not profitable at all, for seven years.

We must even persevere.

In reality, it is difficult for intelligent driving systems to be profitable without the support of a large number of models on the market. The intelligent driving division of Weilai is currently losing a lot of money, just like the early days of Huawei.

If Seres hadn't exploded in popularity, it would have been very difficult to make it happen.

The inspection Hu Zhengnan mentioned was of the intelligent cockpit factory managed by Jinxin Technology. The "refrigerator, TV, and sofa" was a joke about the L1 extended-range electric vehicle, but the reason why the "refrigerator, TV, and sofa" is popular in the consumer market is that consumers' needs have been upgraded.

Moreover, the refrigerator, TV, and large sofa are not simply common household appliances moved into the car. They involve advanced smart cockpit technology, which integrates various devices and systems in the car to provide users with a more intelligent, convenient, comfortable, and safe driving experience and cockpit environment.

Weilai focuses on mid-to-high-end models, so in addition to safety, it also needs to make great efforts in comfort. The intelligent cockpit system is Weilai's current key focus, besides the battery.

Improving comfort and handling first makes it acceptable to consumers even if the car has minor problems. Given the limitations of technology, it's reasonable to start from the actual user experience.

How well are we doing in terms of domestic substitution?

Upon arriving at Jinxin Technology's production workshop, the brightly lit workshop was bustling with activity as machines and workers worked diligently. Since the implementation of the dual-track supply chain system, all workshops in Weilai have been busy, with core components being stocked up as much as possible.

The production line, with its orderly yet somewhat "mechanical" process, saw workers simply nodding and smiling when the big boss came to inspect, without putting down their work.

Normally, every factory has its peak and off-peak seasons, but since April this year, the factories in Weilai have had no concept of an off-peak season. They are all operating at full capacity, and due to the weather, the workers' condition is really not good.

Even with a salary 30% higher than the industry average, a busy and demanding work schedule makes it impossible to be in a great state of mind.

Tan Jincheng saw it all, but didn't say anything.

Ultimately, these were all decisions he made, so it would be unfair to criticize his subordinates.

"For the time being, there are still some key components that cannot be replaced, but we are working hard to cooperate with domestic manufacturers to develop them. These things take time, so please don't be too anxious, boss."

A smart cockpit system involves components such as display, interaction, and smart device integration. The display system alone includes components such as displays, instrument panels, and head-up displays (HUDs), and involves many suppliers.

The supply chain system is divided into two major systems: hardware and software. The hardware system includes suppliers of chips, displays, sensors, automotive electronics supply systems, etc. Chips are the brain that provides computing power.

For products like chips and sensors, there's simply no way to break free from overseas supply chains for the time being; Qualcomm and Bosch have too obvious advantages.

The US's comprehensive control over Huawei, and the occasional addition of companies to the Entity List, is more like a large-scale military review of China's high-tech industry. The impact is not limited to Huawei alone; any company with ambition will be very wary.

According to the boss, Weilai no longer plans to develop the North American market, so apart from parts, there is almost no need to worry about tariffs and other issues. Tesla, the most important supplier of parts, will also see this problem greatly alleviated with the start of production at the Shanghai factory.

Since there are no plans to enter the North American market and there is no threat to them, Wei Lai's risks have been greatly reduced, and his troubles have also been significantly reduced. However, this does not mean that Wei Lai has no other worries. For example, what if one day they suddenly decide to cut off the chip supply to China, or raise tariffs again?

These are all possibilities. Over the course of more than a year, Hu Zhengnan has realized that all of his boss's previous concerns could come true.

Domestic substitution must continue, even if it means lower performance; it is still something that must be done.

"Let's go check out the finished product section, start with the chairs. I heard they've got some pretty interesting stuff. Boss, you can try them out then?"

"Okay, let's go and have a look."

Tan Jincheng was also very interested.

To Tan Jincheng's surprise, there was a batch of office chairs in the finished product area, and these office chairs were obviously modified from car seats.

"This is what you meant by 'interesting'?"

"Yes, let's sit on it and try it out, and let the staff teach us how to use it."

Hu Zhengnan smiled and replied that he knew the factory had produced such things, but this was the first time he had seen them. These things were simply high-end chairs from Weilai with an added office chair base, which transformed them into office chairs.

"Ha, it has seat ventilation and heating functions, as well as various memory functions, that's interesting."

Basically, all the functions you can enjoy in a car can be enjoyed in this office chair, and the experience is quite good, which Tan Jincheng finds quite interesting.

"Yes, the experience is quite good. Everyone says Nissan has a big sofa, we should learn from Nissan. We bought a lot of them to disassemble and study."

When it comes to the comfort of a smart cockpit, the most direct experience for consumers is, of course, the seats. Japanese brands generally have similar characteristics, and Nissan, as a Japanese brand, is one of the few brands that has experienced a decline in sales this year.

Nissan cars are known for their stability and few flaws, but they also don't have many highlights. They are most famous for their seats, which are known as Nissan's "big sofas," and their product performance is indeed quite good.

The process of building cars in Weilai is a learning process. We learn from the strengths of various companies and integrate them. The interior requirements for models such as ES6, ES8, and L1 are relatively high, so we have also learned a lot about the interior design of high-end models.

"What's the meaning of this? Are you planning to sell it?"

While focusing on their main business, large factories often develop some "side businesses" in the design and production process. For example, a chair factory may actually become a furniture factory.

Previously, Wei Lai's own chair manufacturing plant was forced to close down because it failed to meet various requirements. Jin Xin Technology learned from this lesson and has relatively high requirements for its chair manufacturing plants.

"Well, one of our staff members thought it was fun and made this set of office chairs. The original intention was to test how well these car seats perform outside of cars. There are no plans to sell them for the time being."

Standing up from his chair, Hu Zhengnan chuckled, "What, boss, are you trying to boost the car's brand awareness by using the same office chair as yours?"

"Yes, I tried it out and it felt pretty good. It's not that we can't try using this method to promote a brand."

Selling chairs isn't the key point, and making money isn't important either; the important thing is promotion. "It's possible, but the question is what price is appropriate. If it's too expensive, the promotion won't be effective enough, but if it's too cheap, it won't work either."

Too cheap and it lowers your class.

In the seating market, high-end ergonomic or gaming chairs are generally priced around three to five thousand yuan, with some exceeding ten thousand yuan. There are also some co-branded with car brands, such as those co-branded with Mercedes-Benz, which can sell for over twenty thousand yuan.

Even products co-branded with Wuling can sell for four or five thousand yuan, so pricing is indeed a problem.

The biggest selling point of this seat is not the genuine leather material, but its high technology and intelligence. The intelligent sensors built into the seat form an electronic skin that can monitor the passenger's body pressure distribution in real time and accurately sense changes in posture.

In addition, through training with real user data and combined with AI core algorithms, the seat can automatically adjust the support points for the back, waist and legs to achieve a seamless and dynamic support.

There are even optimizations for comprehensive motion sickness prevention.

Basic features like ventilation, heating, and massage are not particularly noteworthy.

These are all technological breakthroughs that Weilai has made in the intelligent cockpit system. At present, they have not been applied to existing models and are considered to be relatively cutting-edge technologies.

"How are the results? How many people did you have tested?"

"We haven't found a huge number of testers, but there are still about 1500. The algorithm optimization might not be very mature yet, but if we actually produce a batch of office chairs to sell, I believe we should be able to collect some useful data."

The environment in which office chairs are used is certainly very different from that inside a car, but once we have the data, we can analyze it in detail.

"It's not impossible. What's the cost? Forget it, I'm too lazy to ask about the cost. Let's just set the price at 8888 yuan. But it will be limited. As for how many units to limit, you can figure that out yourselves."

Generally speaking, the cost of seats in luxury SUVs is usually quite high, typically accounting for 5% to 10% of the total vehicle price. With so much high technology incorporated into these seats, the cost is certainly not low.

It's impossible to make money from this thing; just try to minimize the losses.

The price of 8888 yuan is a good gimmick, which can generate a certain amount of hype and attract a group of consumers with purchasing power who are willing to try it. It's not bad.

"8888 yuan? Isn't that too cheap?"

"It's not cheap anymore. You really expect this thing to sell? It's just a gimmick. You could send a batch to car reviewers and big livestreamers and ask them to help promote it."

Needless to say, most car reviewers are paid to do their jobs. If you pay them a lot, they'll praise even the most mediocre products to the skies. If you can get them a decent office chair for free, I believe many people would be happy to help promote it.

Can you handle this?

As for top streamers, like DaMaHou under Orange Live, they need to stream for long periods every day, so their requirements for seats are quite high. Their exposure is no less than that of car reviewers.

"It's a good idea, but we can't send too many. I'd feel a bit bad if we sent too many, these things are really not cheap."

The person in charge muttered to himself, "It's really not cheap. The integration of built-in sensors and technology alone took them a long time and a lot of money. In addition, the research and development of materials cannot be explained simply by saying it's genuine leather."

"Haha, you're actually feeling sorry for me now. You figure it out yourself."

Despite spending a considerable amount of money, Mr. Tan was in a very good mood because he had witnessed a real technological breakthrough.

Seats are just one aspect of Weilai's intelligent cockpit system, but even this breakthrough is quite remarkable, as 5G is just emerging and all technologies are still in their infancy.

The fact that Weilai's intelligent driving division was able to keep up with the times in the very first year of 5G means that the money spent was worthwhile.

To keep pace with the times, we must keep up with technological trends, such as the application of artificial intelligence, 5G, and blockchain in the field of intelligent vehicles, and promptly integrate new technologies into our products and solutions.

For example, by using artificial intelligence technology to improve the voice recognition and natural language processing capabilities of the smart cockpit, Hu Zhengnan took the big boss to experience it after leaving the seat factory.

"iFlytek does have some merit."

As a core supplier of speech recognition technology, iFlytek's stock price has rebounded by almost double from its low point in 2018, reaching a market value of 800 billion yuan. Although it is often ridiculed by consumers, it has indeed made great progress in recent years.

In terms of in-vehicle voice technology, Wei Lai has high requirements, and iFlytek is forced to deliver a good solution. Tan Laoban often asks iFlytek's voice assistant some very tricky questions during his spare time, sometimes even asking questions in the dialects of Yicheng and Ningbo.

If he didn't get a good answer, he would call the actual controller of iFlytek to complain and ridicule him, regardless of the time. He would also visit the person in charge of the company when he went to Luzhou from time to time to make fun of him. He was basically a part-time tester.

Liu Qingfeng, the actual controller of iFlytek, has talked about these interesting stories in public on more than one occasion, with a tone that is both proud and somewhat helpless.

Both being key enterprises in Luzhou High-tech Zone, Weilai has sold very well in new energy vehicles this year, and Xunfei has also benefited a lot from it, with its market value remaining very strong. However, our Dr. Liu is quite helpless about this partner who often calls late at night to complain.

However, Dr. Liu secretly admired Tan Jincheng's behavior, and this spirit of pursuing technology could inspire them to develop better products.

"Dr. Liu said that in order to save you from calling him in the middle of the night, we have to do it, even if it's not possible."

"Not bad, not bad. This experience was much better than before. Next time I go to Luzhou, I'll treat him to a meal as an apology."

On the software side, it is based on NIO Pilot and Flyme's self-developed operating system, which can support the operation of various programs. The map developer is its own AutoNavi Map, and the voice is provided by iFlytek.

Entertainment and content services are plentiful, with domestic companies like Tencent, Ali, and Baidu. Through the reach of Orange Group, Weilai still has a significant advantage.

"Unfortunately, we are still lacking in hardware."

Deep down, Tan Jincheng and the senior executives of Weilai all want to build a full-stack intelligent system, and build a full-stack self-developed capability from chips, hardware, software to the cloud by improving core technologies.

A multi-layered solution enables synergistic optimization across all stages, thereby enhancing overall competitiveness.

Unfortunately, the chip sector remains a major weakness. Many people believe that automotive chips do not require such high performance, or that they do not require such high performance as mobile phone chips.

However, the requirements for automotive chips are also very high. The most basic principle is that automotive chips must achieve the best in terms of safety, stability, and compatibility.

While cell phones can explode and threaten personal safety, the probability of such incidents is relatively low.

Cars are different; reliability is the most important factor for cars, and achieving this is not easy. It not only places demands on suppliers but also puts a great strain on the tuning capabilities of the car manufacturers themselves.

Horizon Robotics has done a decent job in the last two years, helping to address some of the needs of the company, but only a portion.

Speaking of this, we have to admire Brother Boatman. BYD has a semiconductor company. In the second year of officially starting to manufacture cars, Brother Boatman established the semiconductor company, which was the same year that Tan Jincheng went ashore.

In 15 years, Dizi Semiconductor has become a domestic leader in automotive-grade chips. Although it cannot be listed on the stock exchange, its strength is still very strong.

In addition to some overseas suppliers, Weilai's current partners in automotive-grade chips also include many domestic alternatives. These efforts started a couple of years ago, but the results have not been very significant.

"Our company started a bit late. If you had become successful ten years earlier, it would have been about the same."

Hu Zhengnan's words of comfort made Tan Jincheng feel a little better. This was a huge project, and in fact, it was already considered late around 2000, not to mention that he didn't have the capability to do it even by 2010.

"Let's go to the next place and see the other results."

Acquiring an automotive-grade chip company is not out of the question. Which domestic company currently has the potential to make such an acquisition?

"Yes, we still have time."

The boss was in a good mood, and so was Hu Zhengnan. As the dean of the research institute, Hu Zhengnan was actually the number two person in Weilai. He joined Weilai less than three years after its establishment.

Although he was somewhat famous in the automotive industry back then, he was still just a nobody. In less than ten years, along with Wei Lai's growth, he also reached the pinnacle of his life. After renewing his contract, his career prospects were almost tied to Wei Lai.

The company's future is his future. With technological breakthroughs, he, as the leader, is equally full of vigor and ambition.

There's still time, what's there to be afraid of?
PS: Thank you Stephen Fenfen and Wang Xiaomao for the donations, thank you very much!

(End of this chapter)