According to the financial report of China Central Television, on March 4, Japan’s Sony Group and Honda jointly announced that they would jointly fund the establishment of a new company to develop pure electric vehicles. The news has aroused great concern in the industry. It is not uncommon for non auto industry giants to cross-border “build cars”. Previously, Huawei, Xiaomi and Baidu have entered the auto track in different modes. According to the current situation, there are three modes for leading enterprises in other industries to cross into the auto track, such as “helping auto enterprises make good cars”, “building cars hand in hand with traditional auto enterprises” and “building cars independently”. What are the characteristics of these three models? Who will be the winner?
“help car enterprises build good cars” mode
For the leading enterprises in other industries who want to make a layout on the car track, the mode of “helping car enterprises build good cars” is the main means for them to give full play to their own advantages.
Since 2018, Huawei, which has made it clear that “Huawei does not build cars, focuses on ICT technology, becomes a supplier of incremental parts for smart cars, and helps car enterprises build good cars”, has made more and more actions on car tracks. For example, the establishment of intelligent vehicle solution Bu, joint communication, vehicle, parts and Internet enterprises to create an intelligent vehicle ecosystem, the release of BAIC Zihu alpha s equipped with “Huawei hi intelligent vehicle solution”, and the entry of the first Huawei intelligent selection ecological vehicle product Thalis Huawei intelligent selection SF into Huawei flagship store. On March 5 this year, Huawei’s in-depth partner Thales’s AITO’s first car M5 was officially delivered in more than 100 user centers in 35 cities.
It is reported that Huawei is responsible for all intelligent parts such as motor, autopilot, sensor, domain controller, cockpit screen and vehicle networking system, and BAIC is responsible for main engine parts such as shell, interior and exterior decoration, battery and chassis; The M5 car is a model designed by Huawei in the whole process. The core links involved include system software, industrial design, engineering technology, Hongmeng ecology, etc. Huawei will not only release the brand and products, but also lead the marketing and sales channels, while Thales is responsible for manufacturing and production. It can be said that Huawei’s positioning on the car track is mainly the overall solution supplier of car intelligence. It does not bind with a car enterprise and does not directly build cars, but carries out strategic cooperation with many companies, including but not limited to product sales, technical support, system research and development, service provision, etc.
Like Huawei, oppo and Dajiang insist on the mode of “helping car enterprises build good cars”. It is understood that oppo not only holds a number of patents related to automatic driving, vehicle networking and vehicle control, but also has reached cooperation with ideal automobile, SAIC, Weilai, Byd Company Limited(002594) , Chang’an and other vehicle enterprises, such as Chongqing Changan Automobile Company Limited(000625) , Byd Company Limited(002594) and so on. Dajiang vehicle, a brand of intelligent driving business under Dajiang, landed at 2021 Shanghai International Auto Show to display intelligent driving solutions and core parts. According to SAIC GM Wuling, it will jointly develop a new generation of intelligent driving system and explore a new ecology of intelligence.
Xiaomi “independent car making” mode
Xiaomi’s cross-border vehicle manufacturing is an “independent vehicle manufacturing” mode, which does not “bundle vehicle manufacturing” with traditional vehicle enterprises, but builds its own factory and applies the advantageous achievements of its original industry to vehicles.
The reporter learned that since the announcement of car making at the end of March last year, Xiaomi has been making layout for cross-border car making, such as applying for automobile related trademarks and patents, completing industrial and commercial registration, officially establishing Xiaomi automobile, investing in and acquiring technology companies related to car making, forming automobile teams, increasing investment in industrial chain enterprises, etc. According to the announcement of Beijing Economic and Technological Development Zone on November 27 last year, Xiaomi automobile will officially settle in the area. Xiaomi automobile headquarters base, sales headquarters and R & D headquarters will be built in the area. At the same time, Xiaomi automobile will build a complete vehicle factory with an annual output of 300000 vehicles in Beijing in two phases. At present, Xiaomi automobile headquarters and the location of the first factory have confirmed that it will further promote the realization of the goal of “offline and mass production of the first car in 2024”.
Xia Jun of Guosheng Securities pointed out in the research report that Xiaomi will integrate the experience of mobile phone and IOT into the vehicle design, strictly control the vehicle quality and create differentiated products. At present, Xiaomi’s intelligent electric vehicle business has been smoothly promoted, and the team members have exceeded 500. It is expected that Xiaomi will increase the investment in vehicle manufacturing business from 2022.
“hand in hand with traditional car enterprises” mode
Some leading enterprises in other industries chose the mode of “building cars hand in hand with traditional car enterprises” when entering the auto track. The two sides adopted the mode of “specialized in technology” to build cars together for mutual benefit and win-win results.
For example, Sony, which has previously unveiled two concept cars, confirmed the car making mode of “building cars hand in hand with traditional car enterprises” through the latest cooperation. Sony and Honda will jointly set up a new company to develop pure electric vehicles within this year. At the same time, they will also provide travel services to realize commercialization. The first pure electric vehicle will be sold in 2025. In this cooperation, the joint venture is expected to carry out the planning, design, development and sales of pure electric vehicles. Sony is mainly responsible for developing automobile software, in car entertainment system and providing travel service platform, while Honda focuses on manufacturing and production.
Baidu also chose the mode of “building cars hand in hand with traditional car enterprises”. In January last year, baidu officially announced that it would officially establish a smart car company to enter the automotive industry as a vehicle manufacturer, and Geely Holding Group would become a strategic partner of Baidu’s new company. In March of the same year, Baidu’s new company “Jidu Automobile Co., Ltd.” was officially incorporated and jointly funded by Baidu and Geely. The two sides will jointly build the next generation of intelligent automobile based on Geely’s latest global leading pure electric Architecture – vast sea intelligent evolution experience architecture. According to the information disclosed at present, Jidu automobile completed a round of financing of nearly US $400 million on January 26 this year. The first Siasun Robot&Automation Co.Ltd(300024) concept car will be released at the Beijing auto show in April this year, and the mass-produced models will be listed in 2023.
expert opinions
cannot simply determine which mode wins the most
“The difference between the three models lies in their different businesses and scales entering the automotive industry. The deeper they enter the automotive industry, the greater the investment, the greater the risk, but correspondingly, the greater the harvest once they succeed.” Zhang Xiang, a researcher at the automotive industry innovation research center of Northern University of technology, told reporters that it is not easy to determine which model has the largest winning face, because winning faces have risks, and the key depends on the size of the risk.
Zhang Xiang said that in terms of risk level, at present, Xiaomi’s “independent car making” model has the highest risk level, because Xiaomi has invested and done all links from brand operation, marketing, product design to industrial chain management, and it needs to carry losses by itself; Secondly, Sony’s mode of “building cars together with traditional car enterprises” also needs to invest in many links of car building. Once the car building fails, the early investment may face losses; Finally, there is the mode of “helping car enterprises build good cars”. Under this mode, car enterprises are directly facing the market. Even if a car enterprise has a poor market response, those enterprises that “help car enterprises build good cars” can transfer their original business to other car enterprises, so their loss is not very large.
