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Persuade Lei Jun not to build a car? Wang Chuanfu said it was a misunderstanding!BYDNegotiating auto business cooperation with Xiaomi
Source: Red Star Capital Bureau
At the Yabuli China Entrepreneurs Forum on June 9, Wang Chuanfu talked about the current enthusiasm of giants in cross-border car building in an interview with the media. He “proclaimed” Lei Jun, “5 billion is not a big deal for Lei, and 100 billion is not a problem. , The key is to waste three years of your time. How much are these three years worth?”
The speech was interpreted as saying that Wang Chuanfu advised Lei Jun not to build a car, so as not to waste time.
On June 13, Wang Chuanfu, Chairman of BYD (002594.SZ), stated at the China Automotive Chongqing Forum 2021 that it was a media misunderstanding that BYD had previously advised Xiaomi (01810.HK) not to build cars. BYD not only supported Xiaomi’s car building, but even We are negotiating some auto projects with Xiaomi.
According to BYD WeChat public account
As soon as this statement came out, it immediately triggered the speculation that the two parties would cooperate in car manufacturing. In addition to the previous BYD OEM of Xiaomi mobile phones and Huawei mobile phones, many media speculated that BYD might OEM for Xiaomi cars. The Red Star Capital Bureau interviewed both parties on this issue today, and no response has been received as of press time.
“Persuade Lei Jun not to build a car” is a misunderstanding
Wang Chuanfu said that he is discussing cooperation with Xiaomi
“It’s wrong to say on the Internet that BYD persuades Lei Jun not to build a car. Xiaomi and we have a very good cooperative relationship. We OEM a large number of Xiaomi mobile phones, which is a strategic partnership. I cited an example at the time, which was misled by the media.” On June 13, BYD President Wang Chuanfu clarified the previous media reports at the 2021 China Automotive Chongqing Forum.
According to previous reports, at the Yabuli China Entrepreneurs Forum on June 9, Wang Chuanfu “proclaimed” Lei Jun, “5 billion is not a big deal for Lei, and 100 billion is not a problem. The key is to waste three years of your time. How much is a year worth?” The speech was interpreted by some media as saying that Wang Chuanfu advised Lei Jun not to build a car, so as not to waste time.
On June 13, Wang Chuanfu explained this argument again, saying that in the field of automotive iteration, the strategic direction is very important. “A good strategic direction will avoid detours, otherwise you will lose 3 or 4 years. Then there may be no chance in the fierce competition.”
In addition, Wang Chuanfu also revealed important news, saying that he is negotiating cooperation with Xiaomi. “In the future, BYD will support the development of Xiaomi cars in the automotive business, and not only support, BYD and Xiaomi are negotiating some projects in the automotive field.”
As soon as this remark came out, it immediately sparked the suspicion that the two parties would cooperate in building a car. In addition to the previous BYD OEM of Xiaomi mobile phones and Huawei mobile phones, many media speculated that BYD might OEM for Xiaomi cars. The Red Star Capital Bureau interviewed both parties on this issue, and had not received any response as of press time. The Economic Observer reported that BYD “does not comment” on this.
OEM or acquisition?
Various conjectures about Xiaomi’s car
On March 30 this year, since Xiaomi officially announced the production of the car, there have been constant speculations in the industry about how it will build the car. In view of the asset-heavy characteristics of the auto industry and the production model of Xiaomi mobile phones, the industry generally believes that Xiaomi will choose OEMs or acquire qualified car companies.
Xiaomi’s latest car-making development was at the first-quarter financial report exchange meeting at the end of May. Xiaomi Group President and Acting CFO Wang Xiang said that it may take three years to build a good car, but he does not think the chip shortage will continue for three years. Do not consider this issue now. He bluntly said that Xiaomi’s car building is still in its early stages.
In Xiaomi’s OEM conjecture, the scandal target has been changed several times, andGreat Wall Motor(02333.HK) and BYD are among the popular players. In March of this year, Reuters reported that Xiaomi was negotiating with Great Wall Motors to build cars, and Great Wall Motors issued an announcement to deny this rumor. However, three months later, some media reported that on June 8, Lei Jun visited the Great Wall Motor R&D Center in Baoding at night, and neither party announced the contents of the trip. Relevant media speculated that the night visit or the Xiaomi foundry plan related.
In addition to Great Wall and BYD, at the end of May, Lei Jun also visited the new energy workshop of SAIC-GM-Wuling Liuzhou. Earlier, Yundu Automobile also denied the rumors of foundry or cooperative car manufacturing.
Regarding the speculation about Xiaomi’s acquisition of a car company with complete vehicle production qualifications, the current “scandal” car companies include Borgward Auto, Zotye Auto, FAW Xiali, etc., Red Star Capital Bureau combed and found that the relevant car companies did not respond.
Wang Chuanfu said that domestic new energy vehicle technology has surpassed joint ventures
At the 2021 China Automotive Forum in Chongqing, Wang Chuanfu not only revealed that he was discussing cooperation with Xiaomi, but also analyzed the current domestic new energy vehicle situation.
Wang Chuanfu said that only from a technical point of view, “the current Chinese brands have fully surpassed in terms of technology. By 2030, the proportion of new energy vehicles in the Chinese market is expected to reach 70%.” Whether it is styling technology, or batteries, motors, and electronic controls Such as the core technologies of new energy vehicles, as well as intelligent technologies such as intelligent networking and smart cockpits, Chinese brands have achieved a level of technology that surpasses that of joint venture brands, leading the development of global new energy vehicles.
However, Wang Chuanfu also said that while Chinese brands are becoming more and more competitive in new energy products and their market share continues to increase, they also face the problems of brand recognition being inferior to joint venture brands, and consumption concepts have not been completely transformed, and continuous technological innovation is required. To solve consumer pain points.
“Whether it is a platform or a mobile phone, in fact, we need them to come in and build electric vehicles. The market penetration rate of electric vehicles in China is only 12%.” Wang Chuanfu believes that expanding the new energy vehicle market is the current key. Said that it can borrow the traffic and fans of mobile phone manufacturers and the platform traffic and ecology of Internet companies to attract more consumers to buy electric vehicles and share the cake of fuel vehicles. As for how much each car company can cut the cake after it gets bigger, Wang Chuanfu said “it depends on the technology.”
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