From organization to strategy, from decision-making mechanism to talent system, from marketing to supplier management, from production to research and development, all of them are new and neat, and Yueda Kia is nothing less than starting another stove.
Author 丨Zice
Edited 丨tian grass
Produced 丨 Automan Media
On February 7, the first working day after the Spring Festival, Kia and the government of Yancheng City, Jiangsu Province, held a signing meeting on "expanding investment cooperation".
The two sides reviewed the 20-year history of cooperation and stressed their desire to continue cooperation. Among them, "expansion" means that the two sides should increase resources and capital investment, and the two sides define the relationship as "comprehensive strategic cooperation" and point out that new energy is the key direction.
The two sides signed a contract to sell 25% of the shares of "Dongfeng Yueda Kia" after Dongfeng was listed, before Kia announced the name and strategy of the new company in China. At such a time node, holding such a high-profile "Lunar New Year premiere" activity, the attitude is unprecedentedly resolute.
1
The joint venture relationship is repositioned
The three parties become two parties, and how to go next is a concern in the industry.
What the industry has seen at present is that after the withdrawal of Dongfeng, both Kia China and Yueda Group are embarking on business integration and strategic restructuring. Both sides are deploying strategic changes, which is consistent with the current tone of both sides.
This relates to how the relationship between the two parties will be defined in the future joint venture. The outside world does not know whether the two sides have not yet negotiated or whether it is not yet time for announcement.
This can be seen from the fact that neither the equity division plan nor the name of the new company has released information. On December 17, 2021, on the Shanghai United Assets and Equity Exchange, Dongfeng's "Transfer of 25% Equity Project of Dongfeng Yueda Kia", which has been listed for nearly a month, was delisted at a transfer price of 297 million yuan, but it did not say who the bidder and delister were.
There are rumors that this part of the equity is held by Yueda, and Yueda Kia has become a 50:50 equity ratio relationship, but this statement has not been confirmed.
Before the Spring Festival, Kia said through the media channel that on the eve of the opening of the Beijing Auto Show in April, it announced "the new company name and new brand strategy under the new stock ratio structure".
Regarding the name, there are currently two speculations, one is "Yueda Kia" and the other is "Kia China". The former means an equal share ratio, while the latter means that Kia holds a majority stake (not necessarily 75%). Therefore, the new company name and the share ratio plan have a linkage relationship.
Kia hinted that the new company name is "close to" "Kia China", but it still needs to be approved by the relevant state departments. If this comes true, it means that Kia dominates the strategy, products and channels of the new company, while Yueda continues to play the role of "partner". However, since the headquarters and production are still in Yancheng, Yueda's status as the host has actually been strengthened.
It is unclear what level kia has released the informant on the side, and it means the credibility of the message. But it was Kia who announced sales and product initiatives in 2022, and Yueda performed low-key. Therefore, the "Kia-led" argument has some legitimacy.
Kia is obviously holding its breath, after the release of the joint venture share ratio, for the first time to fully grasp almost all the business mouths, is destined to make a big fist, at least to bring the Chinese business to the same height of global business, Kia called it "integration into the global system".
2
Kia Global is stronger than its China business
Kia is indeed qualified to say so. In 2021, despite the impact of the global epidemic and supply chain problems, Hyundai Kia's global sales still reached 6.668 million units, ranking third in the world, behind Toyota and Volkswagen, with 80% of its sales coming from overseas markets.
Moreover, contrary to the stereotype of Kia holding Hyundai's thigh, Hyundai sold 3.891 million units, up 3.9% year-on-year; Kia sold 2.777 million units, up 6.5% year-on-year, with overseas markets up 9.1%. Obviously, Kia is more growth-oriented.
On a global level, Kia's brand tone is young, sporty, and fashionable, and its brand equity and labels are rich, especially sports. Kia has sponsored the Football World Cup and the European Championship consecutively, and has also participated in the CTCC Touring Car Championship in China, winning the "5 years and 4 crowns". The sports brand image must rely on excellent power performance to effectively convey.
In ward's Auto World magazine "Ward's Top Ten Engines and Powertrains" selection, Kia had 2 models and 6 models shortlisted. Since 2014, it has been selected as one of the "Ward Top Ten" 12 times. Its unique CVVD power technology (continuous variable valve duration technology) is equivalent to an upgraded version of CVVT (continuously variable timing valve), while improving fuel economy, performance, and reducing exhaust emissions, which is likely to be the last glory of the era of fuel vehicles.
The new electric i-GMP platform makes Kaiku stand at the forefront of the global new energy mass production vehicles. "Technology Kia" is widely recognized around the world because the internal combustion engine, HEV, PHEV and EV, FCV all have a deep technical accumulation, and are one of the few companies that compete with Toyota Power In all aspects.
3
Kia's new China strategy
After 2017, Dongfeng Yueda Kia's sales in China were not satisfactory. Some people believe that it is the rise of domestic cars that has caused its loss.
Kia probably has a deeper understanding of why, and now emphasizes "looking forward." Kia China, the first time to fully liberate its hands, will have the ability to replicate global commercial success, necessitating the implementation of a new China operation strategy.
It needs to be made clear that Kia's "2022 Strategy" has been implemented with "Yueda Kia" as the main body. Kia is committed to transforming both marketing and brand strategy, strengthening marketing investment, strengthening customer awareness and reach, and striving to achieve brand localization while localizing talents.
In terms of products, the first exclusive electric model EV6 has been sought after since pre-sale, which is a good sign. Kia has already announced a focus on electric vehicles and mobility solutions in 2021.
By 2026, Kia plans to expand its electric model to 11 models, including 7 exclusive electric models based on E-GMP, a dedicated platform for electric vehicles (6 of which will be taken to China).
At the same time, it is expected that by 2030, the annual sales volume of eco-friendly models will reach 1.6 million. This year, Kia will also unveil several highly anticipated models such as the EV6 GT and the new Niro to demonstrate Kia's commitment to becoming a "sustainable mobility solution provider."
Kia has long recognized that China, as the world's largest auto market, is the focus of the brand's taste and technology demands of young people. Kia vowed to carry out "rejuvenation" to the end, in fact, it is to move the global brand marketing strategy to China for the first time and implement the integration of the global strategy.
In October 2021, Hyundai Motor-Kia China's Forward-Looking Digital R&D Center was inaugurated in Shanghai. This is another clear sign that both Hyundai and Kia will expand their R&D presence in China to accommodate this single market with the greatest complexity.
Liu Changsheng, General Manager of Dongfeng Yueda Kia, said: "Kia will use hybrid as a stepping stone to the Chinese market to promote and expand. "This means that PHEV will gain a higher status than before, with equal emphasis on EVs.
Liu Changsheng, general manager of Dongfeng Yueda Kia
Among them, the focus is on the "high-quality" products and the reorganization of efficient organizational systems. This means that the price war at any cost is a thing of the past, and Kia's product lineup positioning will go up as a whole, while rebuilding a tight organizational structure and "going hand in hand" with dealers.
4
Yueda low-key integration of resources
Compared with Kia's confident "start again" tone, Yueda still keeps a low profile, and does not know whether it is the reason for the undetermined share ratio of the new company.
However, in June 2021, Yueda began to quietly implement strategic actions, that is, the establishment of "Jiangsu Yueda Automobile Group".
With the support of the Yancheng government, Yueda has concentrated almost all of Yancheng's auto industry resources under its own umbrella. From related parts manufacturing to vehicle product development, production and sales, from Yueda Kia to Huaren Express, Guoxin New Energy, from commercial vehicles to passenger cars, all are included in unified management and operation.
Yueda is a typical example of low-key big things. In terms of the Yancheng government, it is clearly stated that the automobile industry is the pillar industry of Yancheng and even Jiangsu (more than a dozen provinces have also mentioned this). Yancheng's advantage lies in the strong chemical industry and complete supply chain of auto parts, and the complete range of commercial vehicles and passenger cars.
Yueda took advantage of this integration opportunity to take new energy as the vanguard of the group's value system. One of the more groundbreaking ideas is that Yueda proposed that in the future joint venture relationship, Yancheng will serve as a global production base and export hub. The idea has gained Kia's approval.
This means that the production capacity of Yueda Group in Yancheng is incorporated into Kia's global capacity allocation system, and its position is completely different from the era when it was a corner of itself. Both sides have released their sincere intentions and taken out key resources for the prospects of the new joint venture.
With the support of Yancheng, Yueda Kia's joint venture company is full of morale and full of expectations for the prospect of "new joint venture". This is a scene that many general managers have not been able to achieve since 2015.
The simplification of the decision-making process brought about by the change in equity alone is not enough to revitalize the company at once.
However, in the case that the new strategy has not been announced, the organizational structure has not yet been reorganized, and the 2022 new energy strategy has just started, it can improve morale to this extent, not by "fighting chicken blood", but Yueda and Kia have seen strategic opportunities, and at the same time carried out their respective strategic loosening, with the support of their respective "big rear", the two sides suddenly made up enough money to start the strategy again.
Kia called 2022 a key step in the global "Turn-around strategy," which includes consideration of a return to the position of Chinese business. "Turn-around" cannot be simply understood as turning or turning, and in the context of Kia, it seems to be a bit of a rebirth and a fight.
Yueda Kia's efforts to rebuild its competitiveness are likely to see results in a short period of time, just before and after the scheduled Beijing Auto Show.
Nowadays, Yueda Kia is nothing less than starting another stove, from organization to strategy, from decision-making mechanism to talent system, from marketing to supplier management, from production to research and development, all of which are new and neat, and have higher expectations, which is very reasonable. However, the trough rebound is easy, the long-term upward is difficult, and the next step after the victory of the first battle is the key.
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