Image source @ Visual China
Wen | city boundaries, the author | Feng Chenchen, Editor | Liao Ying
In the summer of 2018, C Ronaldo stunned the world with his Hat-Trick in the World Cup after bidding farewell to Real Madrid. People can't believe that the 33-year-old veteran can once again become the savior of Portugal. It was also this year that Great Wall Motors signed the football superstar and let him endorse the WEY brand.
01, the AB side of the eye-catching financial report
When the light is focused, all the details are revealed.
According to the data released by the Association in mid-January, the retail sales of new energy passenger vehicles reached 2.989 million units in 2021, an increase of 169.1% year-on-year. Sales of traditional fuel vehicles were 17.16 million units, down 6% year-on-year. Oil to electricity has become the trend of the times, mercedes-benz, BMW and other traditional car giants, have listed new energy vehicles as the focus of development. This is undoubtedly a huge challenge for Great Wall Motors, which is known for its traditional fuel vehicles.
In fact, Wei Jianjun has long-term reservations about new energy vehicles, as early as 2016, when Great Wall Motors handed over a report card of net profit exceeding 10 billion, he bluntly said, "Now is not a good time to get on electric vehicles."
Therefore, it was not until 2018 that Great Wall Motors launched a real electric brand - Euler in the field of new energy that has long been "in full swing", and targeted female users to carry out a differentiated layout, while Tesla, as the "overlord" of electric vehicles, earned 11 billion yuan in revenue in China in the same year, and BYD sold 247,000 new energy vehicles a year, basically achieving an equal footing with its fuel vehicles.
Also at the beginning of this year, Great Wall Motor's gross profit margin has fallen sharply, from 24.46% to 18.43%, officially bidding farewell to the era of 20% gross profit margin, and has fallen to 16.16% by 2021, once again refreshing the new low in more than ten years of listing.
However, Wei Jianjun, who returned to God, has realized the seriousness of the problem, "foreign brands have begun to accelerate their layout in the world, and if Chinese brands want to achieve real transcendence, only in these three to five years, rapidly enlarging the advantages, it is possible to lead the new track of new energy and intelligence, and there is only one opportunity."
According to his plan, Great Wall Motor will achieve the goal of 4 million vehicles worldwide in 2025, of which new energy accounts for 80% and the total revenue exceeds 600 billion yuan.
But it is not easy to achieve this goal.
In 2021, Great Wall Motor's sales volume was 1.28 million, of which only 139,000 new energy vehicles, accounting for less than 11%, although this data is higher than Geely Automobile's 7.5%, but with BYD's 81% of new energy vehicle sales and 604,000 sales, it is a small witch.
It is worth mentioning that Great Wall Motor's annual net profit of 6.7 billion yuan in 2021 also includes subsidy fees. According to the data, Great Wall Motor's subsidies from new energy in that year were 1.626 billion yuan, an increase of 722 million yuan year-on-year, but the proportion of revenue decreased from 22.83% to 14.66%. According to the current policy, this year will be the last year to implement subsidies for new energy vehicles.
As a key year of transformation, in 2021, in addition to the R & D expenses soared by 76%, reaching 9.07 billion yuan, Great Wall Motors also paid more attention to the spread of the brand, and the sales expenses also increased by 26.53% to 5.192 billion yuan, and made Wei Jianjun and the "zero advertising policy" gradually drift apart. In his eyes, "after the transformation, it does not sell well, just because of the ability to engage in marketing and the whole concept, it is not as good as Wei Xiaoli."
At present, Great Wall Motor has a total of five brand car series, in addition to the two traditional plates of Haval and Great Wall pickup trucks, there are three new brands of WEY, Euler and Tank created in recent years.
At the same time that Great Wall Motors is striding forward, quality problems are also beginning to be put in the spotlight.
According to data from The China Automobile Consumption Network, since October last year, Great Wall Motors' complaint volume has begun to rank among the top, reaching 76 cases in January this year. In addition, on the black cat complaint, you can see that there are situations such as delivery delays, quality problems, and appeals of Great Wall Motors, and the most eye-catching is Euler's "core changing door". The incident began to ferment in early November 2021, and the owner and Great Wall Motors staged a fierce tug-of-war, which slowly cooled down after more than a month.
"Euler and other rights protection incidents have a great impact on word of mouth, which is itself a deception of consumers, and after discovering problems, they have not remedied them in time." Quality is the lifeblood of the enterprise, and once there is a problem, the user will quickly change his attitude," Zhang Xiang, an automotive analyst and dean of the New Energy Vehicle Technology Research Institute of Jiangxi New Energy Technology Vocational College, told the city.
02, Hebei Fu second generation and car friendship
Compared with BYD founder Wang Chuanfu, 58-year-old Wei Jianjun is not actually self-made.
Wei Jianjun's father was the first generation of entrepreneurs in Baoding, Hebei Province, and his solid family fortune made him a rich second generation born with a golden key. After failing the college entrance examination, Wei Jianjun worked for a while in the Beijing micro-motor factory until his father gave him a Soviet second-hand Lada as a birthday gift, which made him completely fall in love with the thrill of driving and gain the title of "Baoding Car God" by drifting at the airport.
If it were not for that accident, Wei Jianjun's current identity might have been a famous racing driver. In 1989, his uncle Wei Deliang died after a car accident, and the great wall industry, a collectively owned enterprise, also fell into debt of 2 million yuan after the storm, and fell into the predicament of bankruptcy. Wei Jianjun, 26, chose to contract the company that his uncle had devoted his heart to and start a new journey.
"I have always told myself that the Great Wall has no choice, nor do I, when a company, a person does not have more choices, the chance of doing a good job is greater", with the modification of light passenger vans and the production of camper cars, the Great Wall quickly achieved a turnaround, and built a car after accumulating capital. In the same year, 27-year-old Wang Chuanfu was still studying batteries, accumulating knowledge and capital for the creation of BYD. It can be said that Wei Jianjun started earlier.
In the 1990s, with the rise of automobiles in China, the market competition based on cars was fierce, while there were relatively few domestic pickup truck manufacturers, so Wei Jianjun chose to avoid the front and start with smaller competition pickup trucks. "What really makes the Great Wall stand on its feet is the decision to switch to pickup trucks, domestic large enterprises mainly focus on cars, and imported brands often pay 200,000 to 300,000 yuan, making pickup trucks a marginal model, so it has great potential," Wei Jianjun recalled.
Facts proved that Wei Jianjun had chosen the right one.
In 1996, the first Great Wall Deer pickup truck rolled off the production line, and with its high practicality and the advantages of only tens of thousands of yuan, it was deeply loved by small business owners and self-employed households, and gradually gained the upper hand in the competition with Baoding peer field cars. In 1997, the Great Wall sold only 1,700 pickup trucks, and two years later reached 13,000 units, ranking first among similar products, and he even believes that "the Great Wall has guided the demand for pickup trucks in the Chinese market to a certain extent." ”
After gaining a firm foothold, Wei Jianjun transformed Great Wall Industry into Great Wall Motors and obtained 46% of the shares, becoming the largest shareholder. The millions of yuan used to buy shares, in an era when tens of thousands of yuan households were not common, was undoubtedly an astronomical amount, and Wei Jianjun's response was "self-financing". It is not impossible to have a father as a backer.
With the increase in national income, driven by consumption upgrading, Wei Jianjun transformed to a more lucrative SUV. In 2002, Great Wall Motors launched a Toyota-like and cheaper SUV, which sold 40,000 vehicles in a year and a half, with products such as Saiying and Saijun similar to Paladin, quickly occupying the domestic low-end SUV market, which was called "Saifu Phenomenon" by the industry.
However, this also made Great Wall Motors once fall into a "plagiarism storm", although Wei Jianjun said that there was "absolutely no infringement", it still caused a lot of turmoil. After the pain, Great Wall Motor immediately launched the self-developed Haval CUV, which marked the birth of the Haval series. Since then, Wei Jianjun has launched haval H3 and other models priced at only 90,000 yuan, quickly occupying a place in the domestic SUV market.
At that time, Wei Jianjun was full of confidence, "As the boss of the Chinese market, our economic SUV is not worse than foreign countries, and the price is lower." There will be a lot of fun in the fierce competition, there is no pressure without competition, and the greater the pressure, the more it can stimulate motivation. Wei Jianjun also gave up luxury cars such as Mercedes-Benz BMW and instead drove the Great Wall SUV to commute to work.
Not only that, Wei Jianjun thought of the female consumer market at that time, and launched the Genie series, but it was not favored, and the monthly sales in the early thousands were half the difference from the target, and were ridiculed by the outside world. Until 2011, the birth of a model called Haval H6 earned him face, not only became China's first SUV brand with millions of sales, won the titles of "National SUV" and "National God Car", but also made Great Wall Motors earn a lot of money.
In 2010, Great Wall Motor's net profit was only 2.8 billion yuan, which increased to 8.2 billion yuan in 2013, soaring by nearly 200% in three years, and became the second car company to return from H shares to A shares after BYD. However, the issue price of 13 yuan and the situation of the opening broke the situation, which made Wei Jianjun very annoyed, "Knock the gong and you can go, don't let me get on fire." Let me see how much red the Hong Kong stock market has been divided since the listing of 30 yuan, and how much return has it brought to the shareholders? ”
In addition, due to the continuous hot SUV market, Wei Jianjun also gave up the car business for a time and issued a military order that "SUVs do not achieve the world's first, do not produce cars". In his cognition, "you can't focus on a certain field, just like mobile phone manufacturers, after a round of Red Sea competition, nothing will be left." The technology of SUVs and cars is common, but the problem of steamed buns, flower rolls, and bean bags is not much in the future. ”
03, there is not much time left for the transformation of the Great Wall
Choices mean trade-offs, and no one can predict what the other path will lead to.
After Wei Jianjun chose to "walk on one leg", with the arrival of the red sea of the automobile market, the adverse effects soon began to appear. In 2016, Great Wall SUV sales reached a new high of 950,000, fell to 920,000 in 2017, fell again to 870,000 in 2019, and only 830,000 remained in 2020. At the same time, the absolute lead of the Haval H6 began to waver.
According to data from the China Association of Industry, in September 2021, the Haval H6's SUV sales champion was taken away by the Tesla Model Y, ending the myth of the first SUV sales in the cumulative 99 months. According to the data of the association, in February 2022, the Haval H6 was surpassed by BYD Song and Honda CR-V, ranking third in the SUV sales list. This means that the SUV base camp that Great Wall Motors relies on has begun to fall.
Source @ Multiplying Association
In fact, in order to alleviate the pressure of the low-end market and seek a higher brand premium, Wei Jianjun founded a high-end SUV sub-brand - WEY as early as 2016, but the effect was not satisfactory. From 2018 to 2021, WEY handed over 139,000, 100,000, 79,000 and 58,000 vehicles respectively. Geely's high-end brand, Lynk & Co, which came out a year later, sold 220,000 in 2021 alone, close to the sum of WEY's sales in the next three years.
However, compared to the Haval series of SUVs, powerful off-road vehicles, the displacement is relatively larger, in March this year, the newly listed tank 500, has reached 3.0T, obviously contrary to the trend of low energy consumption, if the Haval series can also rely on the field of hybrid vehicles to solve, then the tank series where to go, is also a problem that Great Wall Motors needs to consider.
Under all kinds of pressure, in July 2020, Wei Jianjun, who was the thirtieth anniversary of car manufacturing, did not choose to celebrate the feast, but through a video, issued a soul torture question of "Can Great Wall Motors survive next year", saying that "in the past thirty years, I have gone through many detours and made many mistakes. ”
After painfully thinking about it, Great Wall Motors' 2025 plan was born. However, if you want to reach the annual revenue of 600 billion yuan at that time, it means that Great Wall Motors will have to increase its average annual revenue by more than 110 billion yuan in the next 4 years before it can barely reach the standard. In addition, because the sales channels of traditional cars and new energy vehicles are not the same, Wei Jianjun is forced to change his previous playing style.
In the eyes of industry insiders, direct operation can really grasp the service and price, which is also the key to the success of new energy vehicle companies such as Tesla. Generally speaking, traditional car manufacturers are better at production and wholesale, and it is relatively difficult to do direct stores similar to ideal car companies, and they need to face resistance from dealers, and in the dealer channel, the promotion of new energy vehicles is not easy.
Wei Jianjun was also apparently aware of these problems and tested the waters in the two major plates of pickup trucks and tanks. Great Wall Motor revealed in its annual report that pickup truck franchise stores have opened in 30 cities to further improve the layout of marketing channels. The tank brand is also preparing to set up a sales and service network, and built the first experience center in Guangzhou in November last year to create a direct channel model.
In addition, after WEY's attempt was blocked, Great Wall Motors also hatched a new independent operation of the automobile sector - Salon Mecha Technology, focusing on the luxury pure electric market in the price range of 400,000 to 800,000 yuan, which is a real high-end. The CEO of Sharon Zhixing even made a bold statement, "To break the Monopoly of Western Technology that has ruled the automobile industry for more than a hundred years."
However, with the imminent arrival of Baidu's first concept car, the launch of Xiaomi's 10 billion car manufacturing plan, Huawei's layout has become more extensive and deep, and BYD's announcement of abandoning the production of fuel vehicles has made the track of new energy vehicles more and more crowded. This makes Wei Jianjun not only have to face the squeeze of new and old car manufacturers, but also can not underestimate the determination of cross-industry challengers to get a piece of the pie.
The capital market will not stay for anyone, backwardness means abandonment, and the transformation of new energy vehicles is a huge challenge for all traditional car companies. As the "curse of the successful" theory says, people who adapt to the past environment will succeed, but the environment will change, most successful people will find it difficult to keep up with the changes in the environment, and the successful experience of the past will lead to failure.