-auto market hot question and answer (No.280)
He Lun, Dean of Netcom Automotive Research Institute
In the 40 years since the joint venture between Chinese and foreign car companies, the market share of joint-venture brand passenger cars was as high as 85% in 2000, and it took 22 years to slow down to 50.1% in 2022. In September this year, the market share of mainstream joint-venture brands was only 25%, which was a cliff-fall. Whether joint venture car companies with 40 years of scenery will quit the historical stage and how joint venture car companies can save themselves has become a hot topic. On the other hand, self-owned brands are still in full swing, and even chewing gum brands can’t stand to build cars, and it is said that they will challenge Rolls-Royce. Some people ridiculed that Laoganma and Antarctic people are just around the corner. What is the big contrast?
Q: Why did the joint venture get to this point today?
A: First of all, they are too late and too slow in the field of intelligent cabin and intelligent driving.
For example, as early as 2016, I told Mullen, the newly-appointed president of audi ag, in an interview that your joint venture partner SAIC has released the first car-connected car in China, which is based on the zebra system developed independently, and the experience is quite good. Should Volkswagen learn from its partners? Mullen said that SAIC has strong strength in internet vehicles, and the two sides are also discussing cooperation issues. Later, when I met with Mullen’s successor, Diss, and Diss’s successor, Bloom, I focused on the serious backwardness of Volkswagen and even German car companies.
Imagine if Volkswagen actively cooperated with SAIC in this respect eight years ago and gave full play to their respective advantages. What would be the result today? Even if you keep trying and making mistakes, you can still accumulate considerable data, and data accumulation is very important for the development of intelligent cabin and intelligent driving technology.
At that time, however, the Germans didn’t seem to realize that the smart cabin would make China consumers fondle it, regarded it as a gesture of ostentation, and were somewhat careless about it. Moreover, they didn’t seem willing to cooperate with China to develop this kind of system. It was not until 2018 that they established a wholly-owned car system development company in China, but so far they haven’t seen any results. Perhaps the reason is that this company lacks iterative thinking on the Internet, and only develops software according to German standard process, which can’t keep up with the rapid iteration rhythm of China car and locomotive system.
It wasn’t until the market share dropped sharply that Germans realized that the smart cabin had become the new standard for trams in China, and China consumers liked it. However, this kind of software-based system usually needs user experience and feedback to be continuously improved and matured, and this development method is difficult to be compatible with the traditional German standard development process, and the development advantage lies in China. Therefore, Volkswagen quickly established joint ventures and cooperated with a number of China enterprises to develop related technologies, even giving people a feeling of being hungry.
The same is true for another new standard of trams-intelligent driving. Audi is the first manufacturer in the world to introduce L3-class driver assistance system. It has been almost seven years, but the result is that it got up early and caught a late episode. The reason is also that the local adaptive development speed is too slow. In the end, the domestic Audi A5L will use Huawei’s L2+++ class driver assistance system (see "What’s special about Audi’s new brand new car? 》）。
Q: Do you think the joint venture will catch up?
A: I think it is very difficult. Unless foreign partners let Chinese partners develop new cars according to China standards and China speed, they will never catch up, let alone surpass them.
I remembered an article I wrote 13 years ago, "Who was the initiator of the Great Leap Forward of electric vehicles? 》。 There is such a passage:
A few days ago, the head of an independent brand R&D department told me privately that they had signed a military order with the relevant government departments: electric vehicles and plug-in hybrid vehicles must be listed before the end of next year. Otherwise? He made a gesture to commit suicide.
Is it voluntary or is it difficult to violate military orders? Answer: Of course, military orders are difficult to violate.
However, the normal automobile development process will take at least three or four years, or with enough technical data accumulated, you just started to engage in electric vehicles. Can you finish the process? Answer: of course not, but you have to go public if you can’t finish it.
Isn’t this an experiment with users? Answer: No, we must ensure that the car is sold to ourselves and continue to go through the development process, otherwise, something will happen … (He made another gesture of committing suicide).
Then why don’t you make it clear to the relevant government departments that the automobile development process is not a joke? Answer: Of course, but they asked, if other enterprises can do it, why can’t you? We call it bragging. However, they said that those famous experts and scholars said that in the field of electric vehicles, we are at the same starting line with foreign countries, and some technologies such as batteries are still ahead, so we can completely overtake in corners. Now many multinational companies have electric vehicles, and we should be faster than them. Are these experts and scholars also bragging? So, we had to bite our teeth and sign.
How much did you invest? Answer: More than 10 billion yuan has been invested, and more than 20 billion yuan will be invested.
Think about it, it was 13 years ago. Now, what is the speed of development and application of new trams and related technologies and all kinds of bluffing tricks? The rapid iterative thinking of the Internet has gone viral, and cats and dogs are chasing after each other at all costs, and they are far ahead (see "The first bad style in the car circle: Speed is not fatal" and "The third bad style in the car circle: Far ahead, mainly relying on Mongolia"). Do foreigners have the courage to follow and surpass it? Even if the development speed keeps up, can you afford the price and the cost?
Q: It seems that the joint venture is really in a bad situation. Will things get better in the future?
A: In the short term, it will be terrible.
Nowadays, the traditional standards such as technology, quality, reliability, durability, supplier relationship, employee income and social responsibility brought by multinational giants are out of date, giving way to gaudy, plagiarism, low price is king, cutting corners, shoddy construction, endless mouth guns, crazy squeezing, giant babies running rampant, all kinds of spontaneous combustion, mental retardation, mental disability, black screen, crash, broken shaft and sprain. ","Safety and quality, the key to puncture the tram bubble? ","High-level intelligent driving ",the owner is a mouse that is upside down? ","Mouth guns and singing in the circle ").
In this crazy volume, the joint venture is subject to its own corporate culture, car-making concept and standard process. Naturally, it is run out of luck and it is not surprising that it is eliminated. But this is not a complete victory of independent brands over joint venture brands at all, but a war of all brands against all brands, a crazy roll of bad money driving out good money, and those independent brands that originally wanted to build cars in a down-to-earth way are doomed to be involved and unable to extricate themselves, and they can only resign themselves to fate.
Q: It’s really chaotic now. Internet companies, real estate companies, mobile phones, televisions and air conditioners are all doing trams, and some of them are still doing well. Even the show of making chewing gum has to be inserted into trams, but trams are still an overall loss-making industry, and the capacity utilization rate is serious. Don’t they know?
A: Hyun Mai’s car-making clearly shows two points: First, it knows this with them, but it believes that as long as you stand on the tuyere of the tram made by the relevant departments, you can fly even if you are a pig. Although the tram is a loss-making industry, it is still profitable. As for what kind of profit, you know (see He Lun: Don’t let the tram grow into a giant baby! 》）； Second, the technology and manufacturing threshold of domestic trams is very low. Anyone can play and be far ahead. Strong joint ventures can’t afford to play, and some people dare to play and can play.
This is an absurd scene, and the result must be a chicken feather.
Q: How can we change this situation?
A: The answer is actually very simple:
-gradually, but as soon as possible, cancel all kinds of subsidies and preferential treatment for trams, realize "oil and electricity have the same rights", turn off the blower on the tuyere, let the pigs with poor flying ability fall freely, and let the competition return to normal (see "Avoid changing lanes and rolling over, the countdown to" oil and electricity have the same rights "should begin? 》）；
-faithfully implement the laws and regulations on product and technical standards, quality standards, product recall, anti-unfair competition, anti-monopoly, advertising, supplier contracts, labor contracts, consumer rights protection, etc., and the missing or imperfect laws and regulations should be supplemented and improved as soon as possible so that violators will be punished;
-allow the media to supervise enterprises and their products by public opinion according to law, instead of arbitrarily banning them, so that unscrupulous products and enterprises have nowhere to hide.
There is only one purpose: to really let consumers compete with the normal market to decide the fate of products and enterprises.
But can it be done? At present, I can’t see it, because it’s too heavy to return. The deformed giant baby urged by hormones has grown up. Pushing it down is too costly and shocking. There are too many pigs flying, which will be ugly and dangerous for the people below. Perhaps, we should follow the traditional practice and wait for the "problem has reached the time when it must be changed"?
(Photo/Wen Netcom He Lun)
