"Get rid of the strategy of only pursuing sales and promote high-quality development" – Cui Dongyou, General Manager of Beijing Hyundai

Chen Maoli, a reporter of this newspaper, reported from Beijing

In 2021, China's automobiles alternate between challenges, shocks and hopes, and the market pattern transformation and technology drive are more intense. On the one hand, the global "lack of core" crisis, high raw material prices and supply chain problems have made all car companies undergo severe tests; on the other hand, driven by technological changes such as electrification, intelligence and networking, China's auto industry has shown strong resilience.

For Beijing Hyundai, which is in the period of brand transformation, it is very important to stabilize the established rhythm and find a breakthrough in the turbulent market. In 2021, Beijing Hyundai terminals will sell nearly 400,000 vehicles. Compared with the cumulative sales of 502,000 vehicles in 2020, the conclusion drawn from the absolute indicator of sales is "decline", but in depth, it will be found that beijing hyundai will go up the upward curve at the value level in 2021, and the reshaping of beijing hyundai's business philosophy - from a single pursuit of development speed to a comprehensive pursuit of development quality.

Focusing on the successful transformation of "sales-centered" mentioned by Beijing Hyundai into high-quality development based on "enhancing internal strength", what will Beijing Hyundai do next? Focusing on the electrification transformation under the background of "carbon neutrality", what actions and layouts will Beijing Hyundai have in the future? On the above issues, a reporter from China Business Daily interviewed Cui Dongyou, general manager of Beijing Hyundai.

"Sales-centric" has become "to enhance internal strength"

China Business Daily: What do you think about Beijing Hyundai's market performance in 2021?

Cui Dongyou: In 2021, due to the impact of the epidemic and the lack of chip supply, Beijing Hyundai is facing a situation in which the overall operating situation is not satisfactory. Compared with 2020, 2021 saw a certain decline, with sales of about 385,000 units in the whole year.

It is worth noting that Beijing Hyundai's operation in 2021 has successfully transformed from the original "sales-centric" to high-quality development based on "enhancing intrinsic strength". Although sales have declined compared with 2020, the gold content of enterprises has been relatively improved.

One piece of evidence is that dealer profitability has improved greatly, and according to Beijing Hyundai statistics, dealers at the end of 2021 compared to the end of 2020 are: 80% of the realized profitability and 80% of the unprofitable huge change.

China Business Daily: What exactly do you mean by "high-quality development"?

Cui Dongyou: From a product point of view, "high quality" means that we don't want to sacrifice quality to cater to the market. If you want to perfectly control the quality of the car, it is understandable to invest more time.

In 2021, why is there a small gap period for Beijing Hyundai? I think that if you are hard to meet the market demand, regardless of quality defects, just to fill the gap and rush to push a new car, it is not responsible for consumers. We don't want to go that way, we have to follow the cycle of car development.

It takes about 2 to 3 years for new automotive technologies to be developed and installed on new models, such as the new technology on the fifth-generation Tucson L, which was developed three years ago. This product may not be able to meet the latest consumer needs when it is launched, but what problems will it encounter if some new technology is rushed to meet consumer demand? That is, the quality may not be 100% guaranteed.

If you change the technical content due to customer needs, and wait until the product is on the market, there are quality problems, and the consequences are unimaginable. So our general idea is to manage and control product quality, which is our commitment to consumers, which is our first consideration.

From the perspective of enterprises, "high-quality development" means "not forgetting the original intention", for a period of time, we indulged in the glory of the past, prematurely forgot the original intention. We need to re-sort out what Beijing Hyundai has done right, ignored, and given up in the past 20 years of development, and needs to find the right direction as soon as possible.

China Business Daily: Focusing on "high-quality development", what will Beijing Hyundai do next?

Cui Dongyou: In the future, Beijing Hyundai's development strategy will get rid of the strategy of only pursuing sales. We realize that if we follow the past model, Beijing Hyundai will be in an extremely dangerous situation, so the next step is to focus on cost management and product price management to continue to promote high-quality development.

Why price management? Before 2018, China's auto market was in a stage of rapid growth, everyone wanted a car, in such a market environment, we will appropriately reduce prices in order to sell more. But now China's car consumption environment has changed. For example, a family buys a new car and chooses to buy it after a few years. If you say that you buy it once every three and a half years, such as a new car that costs 100 yuan, when it is sold, the current price of the new car of this model becomes 80 yuan, then the new car purchased three years ago will be lower after it becomes a second-hand car. In this way, in the process of exchange, consumers will face relatively large losses.

In response to this phenomenon, automakers must manage the market price of their products. Do not do product market price management, the loss is our customers.

Streamline dealer network with the logic of "fine and specialized"

China Business Daily: In 2021, the profitability of modern dealers in Beijing has greatly improved, how is this improvement achieved?

Cui Dongyou: In the past, our blind pursuit of sales has brought great pressure to dealers, which has directly led to dealers in the sales link, and they cannot improve customer satisfaction. Now, Beijing Hyundai not only considers its own interests, but also takes into account the benefits of dealers.

In recent years, we have begun to adjust the dealer network accordingly, and after a series of structural adjustments, the number of dealers has been reduced from 800 to 590 by the end of 2021.

Our goal for 2022 is to continue streamlining. On this issue, it is not a simple "last-place elimination" mechanical logic, but a "refined and specialized" logic. We will evaluate the comprehensive operational ability of dealers and the ability to give voice to Beijing Hyundai brand.

The general direction of the entire structural adjustment is "subtraction", that is, streamlining in areas where the network overlaps. However, if it is an area with a weak market foundation, we will redevelop some powerful stores and return the entire network to a healthy development model through such measures.

"China Business Daily": At this stage, the new forces of car manufacturing generally adopt the "direct sales" sales model, has Beijing Hyundai taken innovative measures in sales channels?

Cui Dongyou: When many automakers launch new energy products, they want to adopt different sales channels or strategies than in the past. For example, Tesla, as well as the top three Chinese brands in the field of new energy, did not follow the sales model of traditional fuel vehicles, but chose the direct sales model. Gradually, consumers believe that the sales of new energy vehicles should adopt a direct operation model.

Like Tesla and China's new car manufacturers why not sell through 4S stores? After decades of efforts, traditional car companies have formed a particularly mature 4S shop system, but if emerging car companies like Tesla want to establish a sound 4S shop system like traditional car companies, the time and financial investment is very large, so they directly overtake in curves and directly adopt a direct operation model.

The sales model is not something that automakers can decide, it is determined by customers and the market, and we can flexibly change the sales model according to market demand and adopt diversified sales channels for sales. We will become a customer-oriented brand, not a brand-oriented brand.

The new energy war will be fully rolled out in the next 2 to 3 years

China Business Daily: In the context of "carbon neutrality", what are the priorities of Beijing's modern future?

Cui Dongyou: At present, the global auto market is ushering in a new era of development, and at the same time facing a macro environment of "carbon neutrality", if car companies cannot keep up with the great changes in the market and consumption upgrades, they will be left behind by the times. Therefore, the focus of Beijing Hyundai's next work will keep up with the changing layout of the times, which is the development path of Beijing Hyundai.

"Carbon neutrality" determines that the general direction of future development of car companies is electric vehicles, and global automakers are also concentrating on the development of electric vehicles, and technological evolution is also concentrated in this field. On the whole, the new technologies advertised by automobile manufacturers now pay no less attention to the global environment, vehicle safety, and ease of use.

The future of Beijing Hyundai and the past will be different, the future direction of Beijing Hyundai's new technology development direction will focus on the environment, safety, convenience and economy, the next step of the launch of electric vehicles, to be equipped with new intelligent networking, OTA, assisted driving and other the most advanced technology.

"China Business Daily": Focusing on the transformation of electrification, I would like to ask you to introduce some specific actions of Beijing Hyundai in 2022.

Cui Dongyou: First of all, in terms of new energy vehicle product lines, Beijing Hyundai has launched several electric vehicles so far, but these electric vehicles are based on the original internal combustion engine models, and these products have limited space in the Chinese market, so our next step is to launch exclusive electric vehicles in the Chinese market, which are expected to be listed in the middle of 2023.

In the past, Beijing Hyundai also had Exclusive Chinese models, but after market research, it was found that Chinese consumers still hope that Hyundai's global models can be launched in the Chinese market at the same time. In the past, some consumers were dissatisfied with the fact that many of our models were listed in the Chinese market and lagged behind Europe and the United States, so we will adjust accordingly in these aspects.

We are ready to introduce the modern IONIQ5 to the Chinese market. It is worth mentioning that this car is not the Hyundai IONIQ5 currently on sale worldwide, it is a mid-term modification of the Hyundai IONIQ5, and its listing will not lag behind the European and American markets, and will be listed simultaneously in the global market.

"China Business Daily": In China's new energy vehicle market, consumers recognize the products produced by tesla, Weilai, Xiaopeng and other new car-making forces, but they do not recognize the electric vehicles produced by traditional car companies.

Cui Dongyou: Why does Tesla have such a large market share in the electric vehicle market? Because it has been working in this field for 15 years. Even so, we feel that the "real war" in the electric vehicle market has not yet begun. Now it has just entered the stage of comprehensive upgrading, and the all-round war of new energy will be fully rolled out in about 2 to 3 years.

China Business Daily's 2022 Beijing Hyundai 20th birthday, is there anything to say to partners, distributors, and consumers?

Cui Dongyou: People pay attention to a "personal relationship", Beijing modern is also like this, with a certain person to establish or form a "personal relationship", in fact, it is very difficult, once the establishment of "personal relationship", to maintain a good maintenance, can not easily destroy it. Although Beijing Hyundai is now encountering some difficulties, once we establish a "relationship" with consumers, distributors, suppliers and other related parties, we will be responsible for the end.

(Editor: Zhang Shuo Proofreader: Zhang Guogang)