Shulou(Shulou.com)11/24 Report--

In 1886, a 25-year-old German, Robert Bosch, founded the "Precision Mechanical and Electrical Engineering Workshop" (the prototype of Bosch) in Stuttgart, which is actually a small workshop.

In the early days, Bosch had its ups and downs. Since 1897, Bosch began to provide better ignition equipment for cars and became one of the few reliable suppliers at that time.

In 1927, Robert Sr. got out of the business and thought about Bosch's long-term plan. He thought it was not enough to work in the auto industry. Since then, Bosch has embarked on the road of "diversification" and transformed itself from an auto parts supplier to an all-round electrical company in just a few years.

Home appliances are a major direction of Bosch's diversification. Bosch refrigerators shocked their peers at the 1933 Spring Expo in Leipzig, and then launched dishwashers, washing machines and other household appliances.

Up to now, Bosch's business mainly covers four business areas: automotive and intelligent transportation technology, industrial technology, consumer goods and energy and construction technology.

Contrary to Bosch's road to growth, some Chinese companies that have become rich from household appliances, such as Midea, Gree, Haier, Hisense and so on, are currently entering the automobile industry.

At the end of November 2022, with regard to the rumors of car construction, the relevant person in charge of Haier Group said that it would not enter the field of vehicle manufacturing for the time being, but did not rule out getting involved in automobile intelligent solutions and auto parts business. "at present, Haier is laying out around the Internet ecology of the automobile industry."

By reviewing and analyzing the "car-building" process of Chinese household electrical appliance enterprises, this paper tries to answer two questions: what is the difference between the two "car-building tides" of home appliance enterprises? What is the significance of home appliance enterprises making cars to China's automobile industry?

1. In the history of Chinese home appliance enterprises, there have been two "car-building" booms: the first occurred around 2003 and ended in 2008; the second rose in 2016 and is still in development, not only not declining, but also a lot of new changes.

Yangzi and Chunlan are the "pioneers" of "making cars" in Chinese household electrical appliance enterprises.

In 1996, Yangzi Group's main product refrigerator "married", turned to pick-up trucks and passenger cars; the following year, Chunlan, a famous air-conditioning factory, spent 730 million yuan to acquire the professional automobile manufacturing plant of Nanjing Dongfeng Group. "

Six or seven years after Yangzi and Chunlan set foot in the automobile circle, that is, around 2003, other household appliance companies began to follow suit, because at that time the home appliance industry entered an era of small profits, and the automobile industry was booming, and the atmosphere of cross-border car-building in the industry was very strong. It was in this year that Wang Chuanfu, the "battery king", entered the field of automobile manufacturing through acquisition.

Like Wang Chuanfu, home appliance giants have chosen to "buy" the fastest way to build cars; unlike Wang Chuanfu, in this "car-building boom", home appliance companies without exception point to "commercial vehicles".

In January 2003, Xinfei acquired Xinxiang bus General Factory and established the development strategy of taking refrigerated and insulated vehicles as a breakthrough. In August of the same year, Midea signed the "Midea's Yunnan Automobile Integration Project" with the Kunming High-tech Development Zone Management Committee. In the following three years, Midea has acquired three enterprises: Yunnan bus Factory, Yunnan Aerospace Shenzhou Automobile Co., Ltd., and Hunan Sanxiang bus Group Co., Ltd.

In October 2003, ox spent 40 million yuan to acquire 95% of Shuangma Light vehicle Manufacturing Co., Ltd., a subsidiary of Shenyang Agricultural Machinery Group, and established Shenyang ox Automobile Co., Ltd. Two months later, Green Cole of Yangzhou acquired 60.67% of the total share capital of Jiangsu Yaxing bus. After the completion of the acquisition, Yangzhou Green Cole became the largest shareholder of Yaxing bus.

The "home appliance people" who rushed into the car soon realized that car manufacturing could not rely solely on warm blood and a little money, and that it was much more difficult than home appliance manufacturing. Due to the insufficient ability to control the automobile industry chain, frequent quality problems and poor production and marketing, from 2005 to 2008, home appliance enterprises "braked" one after another, some terminated, some transferred, some divested, leaving only "chicken feathers".

After the passion faded, home appliance workers gradually focused on their old profession until the rise of the second wave of "car building" in 2016 and 2017.

Compared with the first round, the same background of the new round of "car-building tide" of home appliance enterprises is that the profit space of the home appliance industry is further narrowed, home appliance enterprises are in urgent need of new growth "flywheels", and cars, especially new energy vehicles, have broad prospects.

The difference is that some enterprises continue to build complete vehicles, while some enterprises dare not easily set foot in "complete vehicle manufacturing" after suffering a loss, but choose matching parts, or layout car networking and other fields.

Gree still builds the whole car through acquisition. In March 2016, Gree Electric Appliance planned to acquire Zhuhai Yinlong New Energy, but the company's board of directors finally failed to approve it. In December of the same year, Dong Mingzhu, chairman of Gree, who was firmly optimistic about new energy, personally raised funds and joined Wang Jianlin and others to buy shares in Yinlong, opening a long way to build cars. In 2017, Dyson, a foreign home appliance giant, said he was also preparing to develop electric cars.

In March 2016, Midea announced that he had reached a strategic cooperation with SAIC GM OnStar on smart home and vehicle networking applications to achieve the Smart + connected development goal of "human-car-life".

Haier is more cautious and lays out its automobile business by way of investment. In November 2017, Haier Capital invested in Flying Magnesia, a provider of vehicle networking solutions, and a month later, it invested in Tongming Hi-Tech, a manufacturer of on-board control panels, intelligent control and other auto parts. Haier has also invested in automotive testing equipment manufacturer Saihe Intelligence, Botai car networking and other enterprises.

With the promotion of China's new energy automobile industry, Gree, Midea, Haier and other household appliance enterprises continue to adjust their strategies to keep up with the changes of the times, while other home appliance enterprises such as Hisense and TCL have entered the bureau one after another. this wave of home appliance enterprises' layout automobile business is in the ascendant.

2. "making cars" VS "getting on the bus" as mentioned earlier, in the era of new energy vehicles, home appliance enterprises layout automobile business, there is an obvious differentiation-"building cars" (manufacturing complete vehicles) and "getting on vehicles" (manufacturing parts).

At present, the "car-building faction" in home appliance enterprises belongs to the "weak force".

Dong Mingzhu originally bought Yinlong with the intention of making the whole car, but it was really made. In mid-2019, Yinlong New Energy launched a MPV called Effie, but the car is not even as existential as a Gree phone.

Dyson's car-building plan also aborted. In October 2019, Dyson had to give up building cars because it was difficult to commercialize.

Interestingly, Haier unveiled a racing product in July 2019, which sparked a lot of heated discussion about Haier's manufacturing of the whole car, but in fact, Haier's racing car is only to demonstrate the performance of Haier's direct-drive motor and has no intention of getting its hands on the whole car.

There is an alternative existence in the home appliance enterprises of "car building school", that is, Skyworth. Strictly speaking, the home appliance brand Skyworth Group was not involved in the automobile business at first, but only the second venture of Skyworth founder Huang Hongsheng.

At the end of 2010, Huang Hongsheng began to build cars. After a series of operations, he reorganized Nanjing Jinlong commercial vehicle business and formed Kaiwo New Energy. In May 2017, Kaiwo obtained the passenger car access qualification again. In November 2019, Huang Hongsheng launched the brand "Timi" and officially entered the new energy passenger car market, but Timi never opened the market.

Considering that Skyworth has a higher brand, in March 2021, Kevo New Energy signed a trademark transfer agreement with Skyworth Group, which paved the way for Huang Hongsheng to build Skyworth Automobile.

Skyworth Automotive is currently at a disadvantage in the power of car-building in China. According to the delivery data released by Skyworth, in November 2022, Skyworth delivered a total of 2859 vehicles, of which 1667 were delivered domestically and 1192 were exported overseas. From January to November, Skyworth sold 19039 vehicles.

Compared with the difficult "car building", Midea, Haier, Hisense, Gree and other home appliance giants, with the development of the era of new energy vehicles, more and more tend to "get on the car" and become a new force in the new energy automobile parts industry chain.

In March 2020, a subsidiary of Midea acquired Hekang Xinneng, formally entered the new energy vehicle industry, and integrated it into the former Midea mechanical and electrical division, upgraded to the mechanical and electrical business group, and became its core business. In May of the following year, Midea's Weiling Automotive parts Company officially announced three major product lines: motor drive system, thermal management system and chassis execution system.

In February this year, Midea invested 11 billion yuan in the strategic new base of new energy auto parts and laid the foundation in Anqing City, Anhui Province. this is one of the projects with the largest total investment in Midea's history.

Haier has repeatedly spread rumors to build the whole car, and cooperated frequently with the whole vehicle factory at the same time.

From March to May in 2021, Haier successively signed cooperation agreements with automakers such as SAIC, Chery and Geely, covering smart driving, materials, smart manufacturing, industrial Internet, smart home interconnection and other fields.

Haier layout at the same time, Hisense is not willing to lag behind, invested about 1.3 billion yuan, holding Japan Sandian holding Co., Ltd., expand automotive air-conditioning compressors, automotive air-conditioning industry. Subsequently, Hisense revealed three major layouts of automotive electronics: vehicle-road coordination, intelligent cockpit and vehicle thermal management.

Liu Hongju, deputy director of Hisense Automotive Electronics Research Institute, once said, "Hisense's positioning is very clear, that is, to serve the mainframe factory and to be a supplier of key components and solutions for smart cars."

At the same time, Li Dongsheng, founder of TCL, also made it clear that TCL does not consider entering the field of new energy vehicles in the future, but will make efforts on new energy vehicle-related products. "We have set up a new on-board products department, and we will take the train of new energy vehicles, but we will not build cars, but we will become a provider of key components of new energy vehicles."

Gree began to make efforts in the field of components. In April 2021, Gree Electric Appliances unveiled a patented technology called "one kind of iron core punching sheet, stator iron core, motor and new energy vehicle". This technology is used in the field of permanent magnet motor, which is an important part of new energy vehicle.

In November 2021, Gree took a 38.78% stake in Dun'an, the leader in the global refrigeration components industry, and began to accelerate the layout of new energy vehicle thermal management business. In addition, in a live broadcast in October this year, Dong Mingzhu admitted that Gree provided manufacturing support for Tesla chassis parts.

Dyson, who gave up building cars, also joined the "get-in-the-car pie". On November 11, 2020, Dyson's founder announced plans to invest $3.6 billion to develop technologies such as electric vehicle batteries, robots and machine learning, and revealed that he would focus on solid-state battery technology.

3. Cross-border significance Home Appliance enterprises once again enter the automobile industry and replace "car building" with "getting on the car". For themselves, it is to open up new business and create new performance growth points, while for China's automobile industry, Chinese home appliance enterprises have become a new force in building an automobile power.

Chen Qingtai, chairman of the China Electric vehicle Association of 100 people, has repeatedly stressed that the bottom of an automobile power is a parts power. Auto parts enterprises not only have focused R & D capabilities, can provide a variety of solutions for vehicle enterprises, but also, more importantly, can ensure the security and stability of a country's supply chain.

Among the top 100 auto parts suppliers in the world, Japanese, American and German companies are dominant, while Chinese enterprises account for a relatively low proportion. Although China has long been the largest auto producer and marketer in the world, it is also "big but not strong" in the auto parts industry, lacking world-class parts giants and their technology.

Due to historical reasons, in the era of traditional fuel cars, it is difficult for China's automobile and its related industries to catch up and cultivate "China's Bosch". However, under the reform wave of automobile electrification and intelligence, at the same time, at the time of reshaping the global automobile supply chain, China has the opportunity and soil to produce new parts giants.

So, who will become the "China's Bosch" in the era of new energy vehicles?

In the era of new energy vehicles, the traditional automobile industry chain can not cover all the new fields, new industries and new technologies, such as electrification, networking, intelligence, etc., and the development of the automobile industry can not be fully carried by a single industry or enterprise. The cross-border new forces of the Internet, artificial intelligence and communication industries and traditional automobile enterprises are naturally and strongly complementary, and promoting cross-border integration can accelerate the process of the "new four modernizations" of China's automobile industry.

This battle has just begun, and home appliance companies from across the border are also determined to win. In fact, not only "home appliance car building", but also "real estate car building", "mobile phone car building", and many Internet technology companies are involved in the automotive field. Cross-border, especially cross-border into the field of new energy vehicles and smart vehicles, has become a common practice.

As Fang Hongbo, chairman and president of Midea, said, "in the great changes of the times, everything is undergoing drastic subversion and reconstruction." in the past, we emphasized the boundary, but now the boundary has gradually blurred. "

When the boundary is blurred, it is normal to "cross the border". To a certain extent, "cross-border" itself is a kind of power. Zhang Yongwei, vice chairman and secretary-general of the China Electric vehicle Association of 100, in his recent thinking on the second half of new energy vehicles, pointed out that all kinds of changes in the future mainly do not rely on existing enterprises, but on technology enterprises that have just entered or are about to enter, because they represent "cross-border" and represent a new kind of thinking.

Whether they are enterprises in the automobile industry or "cross-border" enterprises, as long as everyone gives full play to their advantages, take their respective strengths, and promote integration, they can build new advantages in China's automobile industry, on the one hand, make independent-brand cars go up faster, and on the other hand, work together to strengthen the independent parts industry, so as to accelerate the realization of the goal of becoming an automobile power.

Full-text reference

[1] "does a beautiful car just create a 'loneliness'? "Economic Daily

[2] "an Qingheng: some New understandings on Cross-border Integration and the New Power of Automobile Industry", Electric vehicle Society of 100

[3] "Cross-border Integration and the New Power of Automobile Industry", the Alliance for the coordinated Development of Smart vehicles and Smart cities

This article comes from the official account of Wechat: che Bai think Tank (ID:EV100_Plus), author: Qin Haiqing, Editor: a Feng, typesetting: Haotian

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