How are the three major state-owned automobile enterprises planning to develop new energy vehicles? Learn from Huawei's comprehensive reform of the system and mechanism

Introduction

The automobile industry is a very important bright spot in China's economic development in recent years, and new energy vehicles have become a bright spring in the current economic pessimistic environment. Why can China's new energy vehicles suddenly rise and take the lead? We try to explore the reasons behind the success. This is closely related to the new quality productivity, industrial transformation and upgrading, and the development of strategic emerging industries that we are constantly learning and researching.

3. Comments from lawyers who eat melons

(1) How can the central automobile enterprises win in the fierce competition?

The assessment of the new energy vehicle business of the three major automobile central enterprises by the State-owned Assets Supervision and Administration Commission has been converted into a special assessment, and the assessment indicators of one profit and five benefits are no longer applied, which is conducive to the vigorous investment of automobile central enterprises and the promotion of scientific and technological innovation. But just throwing money at it obviously simplifies the problem. In addition to money, how should the central automobile enterprises carry out reform and innovation?

For so many years, the development of China's independent automobile brands mainly relies on a large number of private automobile enterprises, and many local state-owned enterprises have developed well.

Recently, the leader of Dongfeng Group said in an interview that the idea of the development of automobile central enterprises is different from that of the new car-making forces, because the new car-making forces obtain funds through the capital market and continue to raise funds. More than 80% of the sales volume of automobile central enterprises and even as high as 90% are joint venture brands, and a large number of joint venture companies have supported almost all the scale profits and market share for automobile central enterprises, which is still relatively in line with the assessment of the State-owned Assets Supervision and Administration Commission in the past. Because the SASAC assesses business performance, that is, sales volume and profit.

Automobile central enterprises have a lack of their own brands, their own brands have no combat effectiveness, their own brand sales and market share are negligible, and the money invested by their own brands in the field of new energy has been wasted, can not be converted into sales, and has not been recognized by consumers, etc., such a phenomenon is not unseen, but because the glory of the joint venture brand has been covered.

Dongfeng Group believes that the current SASAC is no longer only to assess profits and sales, but to pay attention to the core competitiveness of automobile central enterprises in the field of new energy vehicles, how to win the future market competition, such an assessment method will be new energy business and joint venture business, fuel vehicle sector to separate, separate assessment, will inevitably promote the three automobile central enterprises in the investment structure, product structure, brand structure, corporate governance structure and incentive mechanism and other aspects of the reform and deepening.

Specific to Dongfeng Group, after the transformation of assessment, the development orientation of efficiency and value creation is highlighted. Dongfeng Group will fully turn to the field of new energy vehicles, especially through equity investment and mergers and acquisitions, and acquire some emerging companies in society, such as artificial intelligence and autonomous driving companies, to achieve the two-wheel drive of scientific and technological innovation and investment and mergers and acquisitions.

In terms of the reform of the internal system and mechanism of the enterprise, Dongfeng Group will also undergo profound changes, through the implementation of the "Leap Project" to integrate the R&D units originally belonging to different business units into four major plates, so as to better support the R&D needs of subsidiaries while achieving greater large-scale cost reduction effects. In addition, Dongfeng Motor has also established a matrix project management mechanism, introduced a PM management system, project co-investment and VAM mechanisms, and stimulated the company's vitality and improved the effectiveness of reform through changes in the system and mechanism.

(2) Dongfeng Group fully develops new energy vehicles

Due to the strong dominance of foreign-funded companies, the contribution of the three joint ventures of the three central automobile enterprises has fallen off a cliff in recent years, even if the central automobile enterprises want to continue to lie under the big tree of the joint venture, it is impossible. Therefore, both the external environment and the internal assessment pressure require the central automobile enterprises to carry out a comprehensive transformation, forcing the system and mechanism to deepen the reform.

Taking Dongfeng Group as an example, in 2023, it will experience a change of leadership in the group, which will bring significant shocks in internal personnel management, and at the same time make full efforts to new energy vehicles. Since the end of 2018, Dongfeng Motor has built a new pattern of independent business, created brands such as VOYAH Automobile and Mengshi Technology, and realized the integrated management of Dongfeng Fengshen, Dongfeng Yipai and Dongfeng Nano, covering the luxury, high-end and mainstream new energy vehicle markets respectively.

At the technical level, Dongfeng Motor also has a lot of original and underlying technologies, including three technology platforms: M TECH Mengshi luxury electric off-road architecture, Dongfeng quantum intelligent electric modular architecture, and DSMA multi-energy low-carbon energy-saving modular architecture, and has launched new energy and intelligent technologies such as Mach hybrid special engines, hybrid gearboxes, self-developed chips, and vehicle-grade chips. In addition, it has also carried out in-depth cooperation with Huawei and CATL, and has realized the export of some new energy technologies, and companies such as Renault and Nissan will use Dongfeng technology platform to develop products, but many investments have not had a great impact on the market and consumers.

From this point of view, although the state-owned central enterprises have realized that they need to invest, transform and innovate, they are suffering from the fact that consumers do not buy the products they have launched, and the customer experience is unsatisfactory, which forces the central enterprises to carry out deeper institutional reforms, which is also the purpose of the deepening and upgrading of the reform of state-owned enterprises.

Next, whether the transformation of the central automobile enterprises can be successful, from the marginalization of new energy vehicles, counterattack, by no means can be achieved by shouting slogans. Although things are difficult, they will be done, and although the road is far, they will be done. If the three central automobile enterprises can deepen the reform from 2024, cooperate with the relevant leading enterprises in the industry, and truly comprehensively reform the system and mechanism, I believe that we can see results.

At that time, Dongfeng Group had a shareholding company Dongfeng Xiaokang, and now the predecessor of Celis is a small company that produces automobile springs, and it has become a rising star of new energy vehicles in just a few years, and even Celis's question can rank first in the field of subdivisions, which is inseparable from Huawei's empowerment.

The first automobile company that Huawei Hongmeng Zhixuan cooperated with was Celis, who was unknown and had no other choice, and resolutely decided to cooperate with Huawei, and handed over all its soul and body to Huawei to polish, be reborn, and achieve nirvana rebirth.

Although Seris is a private enterprise, it has fully opened its doors to Huawei in terms of shareholding structure, corporate governance, operating mechanism, and modern management, without any reservations, and has introduced Huawei's full shareholding, rotating chairman, salary incentives, procurement and production, quality control and other mechanisms. In terms of R&D investment, although Huawei's technology was introduced in the early stage, in the past two years, Cialis's R&D investment has been in the forefront of the automotive field, and the number of new energy vehicle patents applied for has increased significantly, which is the real reform.

I suggest that the cooperation between state-owned central enterprises and Huawei is not only technical cooperation, but also learning from Huawei's corporate governance and refined management. Instead of learning from many so-called advanced management experiences that are invisible and unattainable abroad, we should learn from Huawei's own advanced management experience.