preface
Strategic thinking is the wisdom of choice, but "giving" does not mean that it is necessary to "get". After the suspension of the fuel vehicle business, how does BYD focus on the new energy vehicle business? How to achieve the market breakthrough of intelligent and high-end new energy vehicles? This is still an important question that BYD and Wang Chuanfu need to think about and answer.
Author : Liu Hongbing Keywords: BYD New Energy Strategic Thinking
Wang Chuanfu said frankly: "The biggest difficulty now is that we can't see through the market, and the changes are too fast, so we have to look at the penetration rate every week and go to the front line to see the trend." "After the suspension of fuel vehicles, how do BYD's pure electric vehicles and plug-in hybrid vehicles stand out in the fiercely competitive new energy vehicle market? How to form a core competitive advantage that is ahead of competitors? With limited resources, how does BYD deal with the relationship between the car and the other two businesses: mobile phone components and assembly, batteries and photovoltaic businesses?
1
How does BYD walk on two legs?
After the suspension of fuel vehicles, in the field of new energy vehicles, BYD adopts a "two-legged walking" strategy: that is, pure electric vehicles and plug-in hybrid vehicles are parallel. However, from the perspective of strategic posture, BYD's opportunity and challenge status in the pure electric vehicle market and the plug-in hybrid market are not the same, so "walking on two legs" can only be "parallel", but not "in tandem".
Regarding the method of business competitive strategy selection, in the previous article "Discontinued Fuel Vehicles, BYD's Strategic Wisdom", I introduced the SWOT four-quadrant distribution method, that is, the basic strategy of business development is determined according to the quadrant position of the business in SWOT.
First, let's look at the plug-in hybrid market: from 2016 to 2021, the domestic plug-in hybrid vehicle market sales increased from 98,000 units to 603,000 units, and demand increased by 6.2 times. In the next 5-15 years, the global hybrid vehicle market, especially the Chinese market, will enter a period of rapid growth. In the plug-in hybrid market, BYD has a very big competitive advantage with its powerful DM-i super hybrid technology. Take the first model equipped with DM-i, Qin PLUS, as an example, the car's 100-kilometer power loss fuel consumption is only 3.8L, and the comprehensive endurance of full oil and full power can reach 1245km, and its excellent performance can be said to be outstanding in the industry. Therefore, from the perspective of the external environment and industry, BYD plug-in hybrid vehicles have a very large room for development.
Therefore, we will find that BYD plug-in hybrid vehicles and pure electric vehicles are not in the same quadrant position in SWOT.
△ Picture copyright Liu Hongbing Strategic Execution Research Office original development
BYD plug-in hybrid vehicles in the SO quadrant: its basic development strategy is based on speed, is an export-oriented development model, under the premise of maintaining the advanced technology of DM-i super hybrid technology, the focus is to strengthen marketing capabilities, rapidly expand the scale of hybrid vehicles, the core indicators are sales and scale.
BYD pure electric vehicles in the ST quadrant: its basic development strategy is to strengthen, enhance the competitiveness of its e-platform 3.0, focus on the advanced technology and system competitiveness, the core indicator is market share.
2
How does BYD achieve intelligent breakthrough?
Regarding the new round of automotive industry revolution, the general view in the industry is that electrification is the first half, and intelligence is the second half. The competition in the automobile industry ultimately depends on intelligence.
The doubts and concerns of the outside world about BYD's intelligence are mainly reflected in two aspects, one is the lack of first-mover advantages, and the other is the doubtful technical strength. Previously, an industry media launched a review of the automatic driving assistance system for mass production vehicles, among the 14 models participating in the test, BYD's flagship model Han EV scored at the bottom, not only far behind Tesla, Weilai, Xiaopeng, Ideal and other new car brands, but also lagged behind traditional independent brands such as Geely and SAIC. Although BYD has also developed intelligent core technologies such as DiPilot intelligent driver assistance system, e-platform 3.0, ANDD OS, and installed them on many models, compared with other car companies, especially the new car-making forces that have shined in the field of intelligence in the past two years, it is indeed not prominent, and even somewhat backward.
Therefore, if we carefully analyze the internal and external environment of BYD intelligent technology, we will find that BYD intelligent technology is in the third quadrant of SWOT analysis, that is, WO, under the WO situation, the basic strategy adopted by enterprises is hump strategy and transformation strategy, that is to say, BYD can achieve intelligent breakthrough through acquisition, merger and reorganization or joint.
At present, BYD adopts the method of self-research and construction and cooperative sprint in the intelligent strategy, but the implementation of this method is not smooth. As early as April 2018, BYD joined the Baidu Apollo ecosystem, and then launched the DiLink intelligent networking system, launching the D++ ecosystem, aiming to create a "super car ecology". But since then, BYD's pace in intelligence has slowed down.
BYD cooperates with Baidu, and the level of intelligence of its new cars can indeed be rapidly improved. But the instinct of self-development and self-creation has long been integrated into BYD's genes. There are still variables in BYD's cooperation with Baidu. Looking back at the cooperation between WM and Baidu in the past, although Baidu's automatic driving technology has greatly improved the competitiveness of WM's products, the non-compete clause of that year also restricted WM's independent research and development of autonomous driving technology. If BYD cooperates with Baidu, it is difficult to guarantee that Baidu will not take the same approach. On the other hand, in 2021, Baidu has also confirmed the next car manufacturing, and jointly established Jidu Automobile with Geely, which means that Jidu and BYD are likely to have direct competition in the field of intelligent driving.
Therefore, for BYD, which has self-research and self-creation instincts, cooperation may not be the best way. Under the current conditions, the relatively reliable way for BYD to break through intelligent breakthrough is to acquire intelligent technology companies through mergers and acquisitions to achieve intelligent breakthroughs. On the one hand, this method conforms to BYD's instinct of self-development and self-creation, and on the other hand, it is also conducive to the creation of intelligent core competitiveness in the future.
Whether it is rapidly expanding the scale of hybrid vehicles, or rapidly strengthening the pure electric vehicle business, or achieving intelligent breakthrough through mergers and acquisitions, BYD needs to invest very large resources. Under such conditions, how does BYD deal with the relationship between the automotive business and the mobile phone accessories and assembly, and the battery and photovoltaic business? We will continue to follow up and study.
"Willing to give" is the wisdom of strategic decision-making, but "giving up" does not mean that it is necessarily "gained"! After "giving up", only by focusing resources on their own advantages and making a difference can we "get". It is expected that BYD can lose the "fuel vehicle" and collect the "new energy"!
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Liu Hongbing's original strategic content selection
Liu Hongbing
Doctor of Philosophy in Management
Focus on strategy execution for twenty-four years
Senior management consulting expert Senior trainer
2018 China Management Consulting and Training Person of the Year
Winner of the 2021 Taishan Award for Enterprise Education in China
2021 China Management Consulting "Individual Outstanding Contribution Award"
Professor of Strategy at Concordia University
He was the chief lecturer of the International Enterprise Strategic Planner Certification Program of the National Development and Reform Commission
China Entrepreneur Club "2020 Trusted Management Consulting Service Expert"
Distinguished lecturer of Tianjin University, Zhejiang University, Shanghai Jiaotong University, Jinan University and many other universities
Strategic management consultant of many enterprises such as CRRC Changke and Quanxin Shares
He is a special contributor to Peking University Business Review, Sino-Foreign Management, and Frontiers of Chinese Medical Care
| Classic course |
Strategic thinking, strategic decision-making and strategic planning, strategic decoding and strategic execution
| Research Field |
Corporate strategic management, strategic leadership development, corporate culture management
| Best-selling books |
Strategic Thinking and Decision-Making: Wrong Direction, Forward is Backward
"The Most Effective Way to Implement Strategy In This Way- The Study of Strategy Implementation"
"Wintering - Where Chinese Enterprises Are Going"
*The above three Dr. Liu Hongbing books can be purchased by themselves in online bookstores such as JD.com
Be an explorer, practitioner and disseminator of China's original management ideas
Dr. Liu Hongbing is a pioneer and leader in china's strategic execution research, focusing on strategic research for 24 years, and is an expert in strategic landing system service of strategic consulting, strategic training and strategic research. In 1998, he began to systematically study strategic management, serving more than 60 top 500 enterprises, and is the only senior expert in China who has a full range of its own intellectual property strategic management models.
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