2003: Starting with Foreign Trade

Chapter 963 CEO Wei Lai's Succession Plan

November 12, Jiangcheng.

After concluding his trip to Luzhou, the newly crowned richest man, Tan Jincheng, rushed overnight to Jiangcheng, another major industrial city in Weilai and a key center of my country's automobile industry.

At this moment, a light drizzle was falling from the sky over Jiangcheng.

"Boss, you've come here so many times, it seems like you've rarely encountered rainy weather, right?"

Jiangcheng is a city with a strong sense of local life. Li Xiang, who has lived here for several years, has inevitably absorbed this atmosphere. When entertaining his boss, he chose a very famous snack street in Jiangcheng.

"Yes, in my memory, Jiangcheng is very hot and it rarely rains. This may be related to the season I came here."

A gentle night breeze, temperatures in the teens, and a light drizzle, combined with the bustling crowds on the streets, made the city of Jiangcheng appear vibrant under the night sky.

Jiangcheng is currently holding a sports meet, and Tan Jincheng chose this day to come in order to reduce the amount of attention he receives.

"Actually, although it's hot here in Jiangcheng, the weather is still pretty good, and there's been plenty of rain."

It rains about a third of the year in Jiangcheng. Li Xiang, who came from a high-ranking family in Hebei and lived in the capital, thought the weather in Jiangcheng was quite good. It was not as dry as the north, nor as humid as Ningbo.

While Li Xiang and his friends were having a late-night snack, people would occasionally come up to take photos with them. Fortunately, the shop owner would quickly step in to stop them, which showed that Li Xiang was already quite familiar with the shop owner.

Residents of Wuhan enjoy a vibrant nightlife, have a relaxed lifestyle, and possess considerable spending power. During the recent Double Eleven shopping festival, according to data from Tmall, Wuhan residents spent 53.7 billion yuan, accounting for 53.92% of the total spending in Hubei Province.

Based on Jiangcheng's current permanent population of 1108 million, the average Jiangcheng resident spends 480 yuan on Tmall, which is quite considerable.

"By the way, how were Orange Products' Singles' Day sales figures?"

This year, Orange Products did not release specific Double Eleven data, only announcing that orders exceeded 2000 million. Unlike the various good news from Tmall and JD.com, Orange Products kept a low profile.

Pinduoduo also did not release its Double Eleven data.

"It's alright, but growth has become somewhat sluggish. The sluggish consumer market is one aspect, and the ceiling of vertical e-commerce is also one of the reasons for Orange Products' sluggish growth."

Leading brands all claim to have achieved significant growth, but everyone knows the actual situation. Take Taobao and JD.com for example; their Double Eleven promotions started on November 1st.

The transaction volume statistics also start from the first day, which is highly inflated. In addition, the lower-tier market has seen a large-scale boom this year, and Pinduoduo, which focuses on third- to sixth-tier cities, has already captured nearly 13% of the e-commerce market share.

The rapid growth of Pinduoduo shows just how bad the current consumer market has become. To be honest, Pinduoduo's reputation was really bad. Although it launched a 10 billion yuan subsidy program to boost its brand value, most of its products are still counterfeit.

This thing isn't even a fake, but what can you do? It's 9.9 yuan with free shipping, what can you do about it?
"That's the current situation, and there's not much that can be done. It's already quite good that Orange Products can maintain its core business."

Li Xiang offered a word of comfort, saying that Orange Products' current market share is around 7.3%, ranking fourth. Compared to other companies' various tricks, making a Double Eleven promotion look like an Olympiad math competition, Orange Products still doesn't use any tricks.

There weren't many stacked mini-games or many demands; it was simply a low price with a discount for purchases over a certain amount, which won the favor of many online shoppers. In addition, Orange Products also developed the lower-tier market.

With a solid foundation and a good reputation, Orange Group's stock price performed very well during the Double Eleven shopping festival, with an overall increase of nearly 15%, officially surpassing Baidu.

This adds another layer to Tan Jincheng's status as the richest man. However, Orange Products is not without its weaknesses. One of the biggest changes in e-commerce this year is the rise of live-streaming e-commerce. Although Douyin's e-commerce has not yet taken off, it has also joined the fray through live-streaming.

The ceiling is obvious. The flash sale model relies on brand inventory, and the decrease in brand inventory pressure may affect the stability of the supply. In order to ensure the stability of the supply, Orange Products also acquired outlets from Jinpeng Industry at the beginning of this year.

This transaction cost Orange Products 29 billion yuan, all in cash. This transaction also made Jinpeng Industry very rich. In Zhang Xupeng's words, it's no wonder that so many people flock to the investment circle.

Jinpeng Industrial has been operating for so many years, but the profits it has made are not as much as the investment in outlet malls. The pure cash transaction has been of great help to Jinpeng Industrial.

After having a late-night snack and chatting about the recent Double Eleven shopping festival, on the way back, Tan Jincheng suddenly said to Li Xiang, "I've heard about an unknown disease recently. You guys should be careful, and you yourself should be especially careful."

Jiangcheng first appeared in the public eye in December, but in fact, there were already some rumors circulating through certain channels in November. People like Tan Jincheng had already heard some of these rumors, although they still didn't understand the origins of these diseases or how serious the threat was.

But everyone has a fear of the unknown. Li Xiang, being in Jiangcheng, had certainly heard such rumors, but he didn't expect his boss to specifically mention it.

"Any idea?"

Recalling his boss's previous nonsensical purchase of a medical equipment company and subsequent restructuring of various companies, Li Xiang couldn't help but become wary.

Li Xiang's expression made Tan Jincheng smile: "Don't be too nervous, just be careful. The company should continue as usual, and just pay attention to the employees' schedules."

Knowing the situation, but being unable to do many things in advance, is quite frustrating.

Fortunately, the Jiangcheng Lutes Industrial Park is a relatively independent environment. The industrial park has its own technology companies, factories, dormitories, canteens, shops, etc., just like a small society, which can meet most of the daily needs.

Basically, this is the case for large industrial parks. In addition, Lotus also provides its own shuttle bus service for employees who live outside the industrial park. The rest are those who own their own cars.

The environment is relatively independent and safer. In addition, the Lotus factory is highly automated and currently has a relatively small number of employees.

Lotus's operations in Jiangcheng are divided into three main parts: the global smart factory, the global headquarters and R&D center, and the main vehicle manufacturing entity. Among the three main entities, the technology company, which focuses on R&D, supply chain management, and global marketing, has the fewest employees, less than 500.

In addition, the total number of employees in the main vehicle manufacturing and global smart factories is about 4000, and the total number of employees in the three main entities is about 5000.

Managing 5000 people is relatively easy.

"Oh fine."

The boss was unwilling to say more, and Li Xiang didn't press the matter, but he did keep a watchful eye on things.

The next day, photos of Tan Jincheng at the Lotus factory in Jiangcheng appeared on the internet, and netizens joked that the richest man was very busy.

From the end of October to now, in just half a month, Boss Tan has traveled from Ningbo to Shanghai, then to Suzhou, Changzhou, and even to Huzhou and Luzhou, almost non-stop.

The online opinion on Tan Jincheng becoming the richest man is quite positive. Tan Jincheng has always been seen as an industrialist, with his success in light industry and automobile manufacturing, all of which are hard-earned.

They don't get involved in real estate, nor do they engage in online lending, even in the most profitable internet industry. In addition, the employees of their factories have always received higher salaries than their peers, resulting in products that are of good quality and offer good value for money.

Tan Jincheng becoming the richest man is not entirely deserved, and everyone knows that he probably won't hold this title for long. In just over ten days, Ali will be listed in Hong Kong for the second time, and the expectations are quite high.

In the e-commerce sector, although Ali has lost a significant portion of its market share, it still maintains its leading position with over 54% market share across all platforms, and the dominant position among the many strong players in the e-commerce landscape remains unchanged.

Ali's moat in the internet field is still very deep; of course, although Jack Ma has retired from Ali, Alipay, this powerful weapon, is still in his hands.

Compared to Taobao and Tmall, Alipay's value is immeasurable. With rumors circulating that Alipay is rushing to IPO, it's only a matter of time before Jack Ma becomes the richest man again.

The fact that four of the top ten richest people are from the post-80s generation has made the public aware of the power of this generation. However, everyone knows that it will take a long time for the post-80s generation to completely dominate the mainstream.

How well has Lotus achieved its sales targets for this year?

After inspecting the factory, Tan Jincheng, accompanied by Li Xiang, went to Lotus's headquarters to inquire about Lotus's sales figures for the year.

Li Xiang smiled and said, "It's pretty good. Speaking of which, the market this year is really strange. Luxury cars are selling very well. We have already achieved more than 80% of our target."

The automotive market, and even the entire consumer market, in 2019 was quite extreme. On the one hand, there was a significant downgrade in consumption, while on the other hand, the high-end consumer market was extremely hot.

High-end brands, primarily BBA (BMW, Mercedes-Benz, and Audi), are selling very well with promotions, as are ultra-luxury brands like Ferrari and Porsche.

Take Lotus as an example. The newly relaunched Lotus had a global sales target of 3000 units this year, and so far, Lotus has already sold more than 2500 units worldwide.

Based on the current situation, Lotus's overall sales this year are likely to be around 3500 units, which is quite good.

“That’s certainly possible, but this will probably be the norm in the future.” Lotus is a niche brand, and Tan Jincheng never expected Lotus to be a big seller. In addition to enriching his portfolio, the most important reason he bought Lotus was because he valued Lotus’s technology.

Although it has declined, Lotus was once a star on the F1 track and still has a lot of technical expertise, with its lightweight design and aerodynamics being quite impressive.

Aerodynamics, in particular, is quite important for the design of electric vehicles. If Wei Lai can integrate and digest Lotus's technology, it will be very important for the design of new models.

Many seemingly unusual design features in electric vehicles, such as hidden door handles, can mostly be categorized under aerodynamics, aiming to reduce wind resistance and lower energy consumption.

"Putting you in Lotus is a bit of a waste of your talents, but we still have to make do with you for a few more years."

For Weilai, Lotus represents an improvement in brand image, technological capabilities, and product lineup, as well as international strategic development. Its strategic significance outweighs its actual sales volume. Tan Jincheng did boast that he would increase Lotus's global sales to over 5000 units within a certain number of years.

To be honest, he was just bragging and never took it to heart. But he didn't expect Li Xiang to actually do such a good job, doubling Lotus's sales in just a few years.

"Boss, you're too kind. If being the CEO of such a global luxury brand is considered a grievance, then that's a bit of an exaggeration."

As one of the four young entrepreneurs in Beijing back then, Li Xiang had seen far more of the world than Tan Jincheng. When he was at Autohome, Li Bing approached him and invited him to partner with him to start a car company.

Like Li Bing, Li Xiang also had a dream of building cars, but after Autohome merged with Bitauto and he took a rotational training position in Weilai, Li Xiang gradually lost that idea and also declined Li Bing's invitation.

Whether it's pure electric or range-extended electric vehicles, he always felt that his boss's philosophy on products and users was extremely similar to his own.

Especially after seeing how well the Weilai L1, which he personally participated in, sold this year, Li Xiang knew that his ideas could not defeat Weilai, which had a complete industry chain. Even if he founded his own car company, he would only be cannon fodder.

Emerging electric vehicle manufacturers pursue a differentiated market and must have their own selling points. Li Bing's Wenjie's selling points are service and battery swapping, which is a bet on the future. He Xiaopeng's Xiaopeng Motors' selling points are technological and intelligent driving.

The selling point of the recently popular Nezha Auto is its cost-effectiveness and affordability, while car companies like Leapmotor pursue a full-stack R&D approach. Every new force must have its own selling point, otherwise it will be eliminated in the fierce competition, just like those new forces that have been eliminated.

Li Xiang had also thought about what the selling point would be if he founded a new energy vehicle company.
Without technological advantages, the selling points are range extension, large space, and intelligent experience. These are almost all the selling points of the Weilai L1. When he had the idea of ​​making cars, Weilai already had a mature design plan and even a marketing plan.

Besides these, Weilai also has a cost advantage. Can it compete?
We simply can't beat them.

In the domestic new energy vehicle market, even established companies like BYD and Geely don't want to go head-to-head with Weilai, and all the emerging brands are trying their best to avoid direct competition with Weilai.

Since he can't beat them, he might as well join them. After joining Wei Lai, he will also have a lot to achieve.

“Let’s work for a few more years. Once we’ve almost fully absorbed Lotus’s technology, I’ll adjust your position.”

Tan Jincheng's words were practically a direct statement, and Li Xiang finally heard what he most wanted to hear.

Zhang Yong has his own advantages, namely his capabilities in the B2B market. This is undeniable. Ever since he had the idea of ​​bringing the Tank series and ET5 series into the official vehicle market, Zhang Yong has acted swiftly.

Several local departments have already expressed interest in this area. Once the Tank series and ET5 enter the official vehicle market, it will greatly boost sales to consumers.

The Aion series has caused consumer concerns in the C-end market due to its use in ride-hailing services, but it can enhance the image of government vehicles. That's how Audi became popular back then.

However, Zhang Yong also has his weaknesses. Although he has made great progress in marketing and dealing with C-end customers under the influence of Tan Jincheng, he is still lacking in some aspects.

There's no way around it; it's hard to change a long-standing B2B mindset. Tan Jincheng wouldn't force Zhang Yong to do something he's not suited for. Over the years, Tan Jincheng has been in charge of Weilai Auto's C2C market.

The automotive consumer market, however, depends more on the C-end consumer market.

Li Xiang proved his ability in this regard during his years of operation of Lotus. Li Xiang, who is six years younger than Zhang Yong, is the most suitable successor to Zhang Yong.

In fact, Wang Fengying is also quite suitable for the CEO position, but she is older, being 49 years old this year. It would be most appropriate for her to serve as a second-in-command and assist him.

"Thank you, boss. I'm quite happy with my job at Lotus right now."

Li Xiang has bigger ambitions, but what he said is indeed true. Lotus is completely independent of Weilai, and its finances and sales are not included in Weilai's financial statements. If Yuechi Auto's independence is somewhat of a fake independence, then it is a different story.

Lotus is truly independent, and Tan Jincheng doesn't usually manage Lotus's operations. Apart from not being Lotus's controlling shareholder, Li Xiang is practically no different from a car company boss in the true sense.

Moreover, Lotus is a well-known luxury brand. Although it has declined somewhat, it still retains its prestige.

"Boss, don't think I'm just saying this for show. I'm actually quite happy with what I'm doing. Lotus's financial situation is getting better and better, and I'm even planning to take Lotus public."

Besides boosting sales, listing Lotus is what Li Xiang wants to do most at this stage. After listing, Lotus will be able to obtain more financing, which will also be more conducive to enhancing the brand's influence.

“That’s great. I also hope that Lotus will do better and better under your leadership.”

Tan Jincheng no longer has much feeling about going public, but not everyone is like him. Going public is still very tempting for many people. Li Xiang is not short of money, but the fact that Autohome was merged with Bitauto and failed to go public is also one of his regrets.

Leading Lotus to the IPO is Li Xiang's biggest goal at this stage.

In fact, it's not just Li Xiang; within the Weilai system alone, many subsidiary heads have this idea. The previous attempt by Yangzi Automobile to push for an IPO is one example.

"Are you free today? If you are, why don't you come with me to an event?"

As a city known for its automobiles, Jiangcheng is home to many car companies. During the traditional peak sales season in November, there are also many automotive industry-related events in Jiangcheng. In addition to inspecting Lotus and related parts companies in the industrial park, Tan Jincheng will also attend several events during his visit to Jiangcheng.

Li Xiang's work schedule these past few days has basically consisted of accompanying Tan Jincheng on his inspection tour; wherever his boss goes, he goes too.

"Nothing much planned, just going along with the richest boss to make an appearance."

Tan Jincheng was speechless for a moment: "Why are you joking about this too? Do you even believe in this kind of thing?"

What makes him the richest man in the country? He's just someone the higher-ups need to step in for a while to make the list look more vibrant.

"Haha, boss, no need to be modest. You can use this title for at least another half month. Use it as you see fit, as long as it doesn't annoy anyone."

"Yeah, haha, let's go."

Although Tan Jincheng and the entire Weilai Group have kept a low profile, and Weilai's executives have even been given a gag order by Tan Jincheng to not discuss the topic in public, it has indeed brought benefits to Tan Jincheng's businesses.

The most obvious examples are Meizu mobile phones and Weilai cars, two core products. Meizu mobile phones saw a significant increase in sales during the Double Eleven promotion compared to last year, showing a very impressive performance.

Double Eleven is driven by price, with low-end models dominating the sales charts. In the low-end market, Honor and Redmi remain unbeatable, and the competition is fierce. However, Meizu, with its extreme cost-effectiveness, has also squeezed into the top ten of low-end model brands.

Judging from public opinion data, the halo of being the richest man in China does have a significant boosting effect, and another major boost is the sales of Weilai Motors; of course, recent promotions are certainly an important factor.

Mr. Tan can control what his executives say, but he can't control the offline stores.

Offline stores have a certain degree of autonomy, and some stores will definitely use its name to carry out some promotional activities in order to increase sales.

The heads of these regions were aware of this, but the boss didn't say anything. The pressure of KPIs made them turn a blind eye. The market was bad this year, so they could sell as many units as possible.

"Let's go, let's not talk about this anymore. I still have to go to Xiangcheng and Shancheng next."

In November, Tan Jincheng's schedule was packed, with plans every day. He needed to inspect all the key industrial parks before December arrived to check on their preparations.

It is a risk, but it is also an opportunity. If we can seize this opportunity, the future development of Wei will be completely different. You should know that the domestically produced version of Tesla has already started mass production and delivery.

In October, Tesla's stock price rebounded by more than 30%, returning to above $300 and once again becoming the focus of the world. Wei Lai's goal has always been to compete with Tesla.

(End of this chapter)