Yu Chengdong, too aggrieved

Head picture丨Visual China

Produced 丨Tiger Sniff Car Group

Author 丨 thoughtful

Editor丨Zhang Bowen

"Some people, departments or partners are messing with Huawei's reputation. After these things are clarified, the brand that Huawei has worked hard to build will not be used casually. Huawei does not build cars, nor does it have any brand of cars. At Huawei's annual earnings conference held on March 31, Xu Zhijun, the company's rotating chairman, expressed his views in a rare way about the recent change in the brand name of Qianjie Auto from "AITO" to "HUAWEI".

Obviously, Xu Zhijun's spearhead is directly at Yu Chengdong, executive director of Huawei, CEO of Terminal BG, and CEO of Intelligent Vehicle Solution BU. In the face of the highest instructions from the group level, the feedback from the front-line stores can be described as "like an arm". On April 1, nearly 1,100 stores nationwide removed materials related to "HUAWEI", which had been online for less than one month.

In an instant, the phenomenon of "Huawei does not build cars, but HUAWEI cars are available all over the country" was strangled in kindergartens. However, Teacher Yu Chengdong is never a person who is willing to lie flat.

On the same day that the store cleared the old materials, Yu Chengdong delivered a keynote speech at the high-level forum of the "China Electric Vehicle 100 People's Association". In the forum, after summarizing Huawei's technical capabilities in automobiles, he straightforwardly poured bitter water, telling about the difficulties of Huawei's automotive business and his own difficulties.

Originally, we wanted to become a cross-border cooperation brand, so we added "HUAWEI" in front of it. As a result, in the past two days, our company said that it would remove "Huawei", and the media hyped up. Huawei does not build cars, it is to help car companies build good cars together, and we have always adhered to this concept. It's just that we want to make "HUAWEI Boundary" an ecological brand, so that consumers are not confused when choosing.

After listening to Mr. Yu's speech, the author could not calm down for a long time, and could not sleep horizontally. I opened Yu Chengdong's speech script and carefully read it in the middle of the night, only to find that there were two words written between the lines:

"Grievances".

Yu Chengdong's bitterness

On March 31, Huawei released the latest version of the Resolution on Huawei's Not Building Cars, signed by Ren Zhengfei, the company's founder and chairman. In the resolution, Huawei not only reiterated that it "does not build cars", but also put forward strict regulations on the application of Huawei brands in the automotive business. Not only should the words "Huawei/HUAWEI" not appear in vehicle promotion, but it also emphasized that related terms such as "Huawei Question" and "HUAWEI AITO" should not be used for publicity.

If you look, you will report Yu Zong's mobile phone number.

However, according to Yu Chengdong, Huawei's automotive business is also facing huge obstacles and challenges. The first is Huawei's "intelligent car solution HI (HUAWEI Inside)", which has been unable to open the situation.

The completely unpopular Extreme Fox α S HI edition

On October 30, 2020, Wang Jun, then President of Huawei's Intelligent Vehicle Solution BU, officially announced the strategy of "Huawei does not build cars, but helps car companies build good cars" at the Huawei Mate 40 mobile phone series product launch conference. At the press conference, Wang Jun revealed that more than 20 mainstream car manufacturers have cooperated with Huawei in the field of computing chips and sensors for intelligent driving. In addition, a large number of domestic and foreign automobile manufacturers have used some of Huawei's software and hardware systems in the field of intelligent cockpits.

However, as Huawei's fist product to "help car companies build good cars", the HI solution has been snubbed. According to the official introduction, the solution includes computing and communication architecture, intelligent cockpit, intelligent driving, intelligent networking, intelligent electric, intelligent vehicle cloud services and other software and hardware. Intelligent components such as lidar, AR HUD, and MDC chips that everyone is familiar with are included. In other words, what Huawei hopes to sell to car companies is a "family bucket" solution from software to hardware, covering cockpit, intelligent driving, three electricity, and cloud services.

In fact, Huawei has listed HI solutions as the highest priority at the level of business strategy. Compared with those car companies that only purchase part of Huawei's technical capabilities, automotive companies that choose the HI solution can obtain the most advanced MDC chips and higher resolution lidar. At the same time, Huawei will also give priority to partners in the HI solution during subsequent supply.

Frankly speaking, Huawei's way of prioritizing the supply of "brothers" as a supplier is understandable. But car companies don't pay for it. At SAIC's shareholders' meeting on June 30, 2021, Chen Hong, then chairman of SAIC, made surprising remarks when faced with "whether he would consider cooperating with Huawei and other third-party companies in autonomous driving": We cannot accept Huawei becoming the soul and SAIC becoming the body.

Although it seems somewhat contradictory to shout the "soul theory" in socialist countries, the question raised by Chen Hong has indeed touched the backlash of car companies. Because compared to standard components such as engines, transmissions and chassis, which are provided in a "turnkey" mode, software, algorithms, artificial intelligence and cloud for smart cars are "new" components that need to be customized and developed. In the process of cooperation, Huawei needs to work with engineers from automotive customers to define, develop, and even participate in subsequent operations. Among them, Huawei is bound to communicate deeply with multiple departments such as products, software, testing, manufacturing, and even marketing of automotive companies, and obtain vehicle data.

To use an inappropriate analogy, this is equivalent to car companies inviting Huawei as a consulting company for themselves. It's just that this consulting firm is not the same as McKinsey, and in the future, it will not only provide similar products for other car companies, but may even transform to build cars. This kind of approach, which is comparable to "leading wolves into the house", how can any car companies be happy?

So two and a half years after the launch of the HI model, Huawei was really in trouble. On the one hand, the number of car companies that once adopted the HI solution has changed from three to one. After Beiqi Extreme Fox and GAC Aion, only Avita, founded by Huawei, is still hanging the tail mark of HI. On the other hand, most car companies may essentially resist cooperation with Huawei for one reason or another.

"In the face of a sanctioned company, it is difficult for European, American and Japanese car companies to use Huawei as the main intelligent supplier, so we can only find domestic car company partners; Li Xiang and Li Bin and other new force car companies have their own pursuits and will not choose us; Traditional car companies will not choose us if they are afraid of losing their souls. Yu Chengdong said a few words, expressing his and Huawei's helplessness.

To put it bluntly, decent car companies will choose full-stack self-research in the field of intelligence. Only those companies that do not care about the soul and are already on the edge of China's auto market will cooperate with Huawei.

This may be why Huawei announced a cooperation with Cialis in December 2021 to jointly release the AITO brand. However, after a short and brilliant hot sale, the two cars in the world, the M5 and M7, quickly encountered difficulties after entering 2023.

Even, even if AITO asked the world "top wind crime", rubbed on the Huawei brand to become "HUAWEI question", its sales results are also difficult to say.

Yu Chengdong who "trespasses" and Ren Zhengfei who "rectifies chaos."

Since the HI model is "not welcomed" in car companies, Yu Chengdong, who was originally the CEO of Terminal BG, began to ponder the rich terminal channel resources in his hands. Due to the impact of US sanctions, Huawei's mobile phone business has been hit hard, resulting in the sales stores of its agents being idling in a state of "no stock to sell". Therefore, using idle stores to sell cars and quickly expand sales channels, so that Huawei's partners can make money and not be overwhelmed by rent and various costs, which has become an inevitable option for Yu Chengdong to "pick grass and beat rabbits".

If Huawei's role in cooperating with other companies is "supplier", then the company simply picks out its role as a "partner" in the Qianjie brand. Huawei has participated at different levels in product definition, research and development, exterior and interior design, testing, marketing, and service operations. In fact, in the eyes of the outside world, except for the tail marks of M5 and M7, as well as the product announcement of the Ministry of Industry and Information Technology, Cialis has basically no sense of existence in the boundary of the question.

For this model of "full participation from software to hardware, full leadership from marketing and service, and car companies are responsible for manufacturing", Huawei collectively refers to the "smart car" model. New cars produced under this mode will also be sold in Huawei intelligent hardware terminal stores.

Talking about his thoughts on smart cars, Yu Chengdong said: "This is to use our complete set of To C capabilities to help car companies build and sell cars well by leveraging Huawei's experience in user experience design, product design, industrial design, brand marketing, and channel retail accumulated over the past decade of To C transformation." ”

However, Huawei's successful experience in the mobile phone and smart hardware markets does not seem to be effective in the automotive market. In March this year, Cialis (the name of the announcement of the world) brand cars achieved a total of 3,679 sales, not only down 21.98% from the previous month, but even the total amount was less than half of the sales of the M5 car in August last year.

You know, this is still the sales result of the brand announced a price reduction of 30,000 yuan in March this year and added the brand with the "HUAWEI" logo. It can be seen that the brand of Qianjie, which has only sold two cars for a long time, has been in full decline. And such dismal results have lasted for 3 months. This may be why, Huawei reiterated the "no car" policy, and tried to pull the focus of the company's automotive business back to the road of "becoming Bosch in the era of intelligent cars".

In the minds of the company's top management, Huawei, which has defeated Cisco in the global ICT field and led the high-end Chinese market in the smartphone market, is not suitable for entering the automotive business that requires asset-heavy operation. After "allowing" Yu Chengdong to create the Qianjie brand and try it for more than one year, Huawei executives want to take back the power they once delegated and guide the company's automotive business back to its main channel.

However, the author believes that Huawei's "rectification of chaos" led by Ren Zhengfei may be difficult to achieve the expected results. In fact, after Yu Chengdong has tried all the possibilities based on Huawei's own conditions, the company may follow the path that Baidu, the pioneer of China's autonomous driving, once followed.

Huawei, is following Baidu's old road?

According to the author's understanding, at the beginning of its establishment, Huawei's intelligent vehicle solution BU once calculated such an internal account: if each smart car has an average of 10,000 yuan of Huawei intelligent car parts, then when the penetration rate of smart cars in China's automobile market exceeds 50%, more than 10 million vehicles will be equipped with related products. At this time, Huawei's revenue in the automotive market alone will exceed 100 billion yuan.

Coincidentally, such a wonderful abacus, Baidu has also played it internally. But as far as the current business development of Baidu IDG (Intelligent Driving Business Group) is concerned, it is clear that this road is not going smoothly.

At the technical level, like Huawei, which has deep accumulation in the ICT field, Baidu, as China's leader in autonomous driving, also once had technical advantages in the field of intelligent driving and artificial intelligence. In fact, when entering the automotive industry crossover, Baidu is facing an embrace from almost the entire industry.

In the chart above, almost all of the players in China's auto industry and even the technology industry are listed. Whether it is software and hardware, enterprises, universities and even local governments, Baidu's Apollo ecosystem is almost all-encompassing. Both at home and abroad, all players in the smart car industry chain seem to have opened their doors to Baidu.

But we all know that the Apollo ecology ended in vain. One of the reasons for this is, of course, that Baidu itself does not have strong enough technical resources and landing capabilities to help car companies achieve corresponding product capabilities. On the other hand, there are huge differences in vehicle platforms and needs of various car companies, and Baidu needs to carry out customized development one by one to achieve landing and delivery, and it is simply too busy.

More importantly, when all car companies have realized that intelligence is becoming the winner of the Chinese and even global auto market, naturally everyone is not willing to risk data leakage and cooperate with the platform. The company in the picture above, just like Yu Chengdong said, no longer chooses to carry out in-depth cooperation with external suppliers, but begins to self-research or invest in industrial chain companies to help them obtain intelligent technology.

Because of this, Baidu Apollo's development has entered a bottleneck in recent years. In terms of intelligent cockpit, car companies' procurement of Baidu Apollo is often limited to a few modules such as maps, voices and mini programs, and basically does not choose the overall solution. At the level of intelligent driving, the only models that have been mass-produced are Great Wall Haval Divine Beast, GAC AION'S Y, LX PLUS, V PLUS and S PLUS. By the way, there is also WM W6, which has become history because the company is on the verge of bankruptcy.

What's more, Baidu's pilot assisted driving product ANP from the L4 level robotaxi downgrading has not yet announced its installation except for the WM W6. The deep-seated reason behind this is that Baidu, as an external supplier, does not get the treatment of "hearts" from car companies. In contrast, Huawei, which has mass-produced urban NCA under the Extreme Fox and Avita models, is obviously slightly better, but it is not much higher than Baidu.

In this regard, Baidu's choice is to build a car angrily, in order to fully realize the technology and product capabilities it envisions in a car company that can completely grasp the right to speak. Obviously, there is no better way to win market persuasion than to create a benchmark product. But this is already the last card in the hands of Baidu's smart car business.

So, Huawei, which once again issued a "resolution not to build a car", will not follow Baidu's old road?

Written at the end:

During this year's Spring Festival, Yu Chengdong drove the M7 back to his hometown in Lu'an, Anhui. During the short vacation, Yu Chengdong not only held a discussion with the secretary of the Lu'an Municipal Party Committee, but also clocked in at the local Qianjie store. He also personally served as a salesman, and came out to recommend the M7 to users who came to the store.

At that time, he probably did not expect that the question of the right sale in 2022 would become so miserable this year.

As a migrant worker, Yu Chengdong is trying to find a breakthrough for Huawei's automotive business from every possible direction. But at present, 2023, affected by the stampede price reduction of fuel vehicles and unfavorable economic expectations, is not a good year for Yu Chengdong or Huawei.