Text | Tang Chen
One guess is that Yu Chengdong's resignation will take over a heavier burden. The most important industry news last night and this morning was Yu Chengdong's position change. According to 36Kr, on the afternoon of April 30, Huawei issued an internal personnel adjustment document, announcing that Yu Chengdong would step down as CEO of Huawei's terminal BG and still retain the position of chairman of the terminal BG. He Gang, former Huawei Device BG and Chief Operating Officer, took over as CEO of Huawei Device BG.
The successor, He Gang, is shoucheng
According to public information, from 2011 to the present, Yu Chengdong has served as the CEO of Huawei terminal company for nearly 13 years. His successor, He Gang, joined Huawei in 1998 and moved to the mobile phone business in 2012 as president of Huawei's consumer BG mobile phone products, and two years after he took over, Huawei's mobile phone business revenue grew from US$3 billion to US$14 billion in 2014. Prior to this adjustment, he was the Chief Operating Officer of Huawei's Device BG.
In this regard, a so-called person familiar with the matter revealed that Huawei has a sound internal governance structure, and this is a regular non-major adjustment, which can allow Yu Chengdong to have more energy to create high-quality products for consumers. It is also reported that the adjustment has actually been confirmed before, and Yu Chengdong will do 5.5G services.
Many analysts believe that this appointment is very similar to Huawei's car BU adjustment in September last year. At that time, Jin Yuzhi, the former president of Huawei's optical product line, succeeded Yu Chengdong and was appointed as the CEO of the intelligent vehicle solution BU, and Yu Chengdong stepped down as the chairman of the intelligent vehicle solution BU.
At that time, Huawei sources said that it was not a major personnel change internally, but an adjustment based on the business structure. At that time, Huawei said that Yu Chengdong was promoted to chairman of the car BU and would continue to increase investment in the car business.
In Tang Chen's view, He Gang's succession this time is a matter of course, and judging from his resume, there will be no sense of unfamiliarity in business. From another point of view, Huawei's terminal business tends to be conservative, and there are more and more signs that Huawei's mobile phone business is ushering in a strong recovery.
On April 30, the day the appointment was announced, Huawei disclosed its 2024 first quarter report, during which the company achieved operating income of about 178.45 billion yuan, a year-on-year increase of 36.66%, and a net profit of about 19.65 billion yuan, a year-on-year increase of about 564%. Based on this preliminary calculation, Huawei's daily net profit exceeded 200 million yuan in the first quarter of this year.
This wave of profitability is inseparable from Huawei's strong return in the mobile phone business. According to Canalys' latest report, Huawei won the first place in China's smartphone market in the first quarter of 2024, and returned to the first place after 13 quarters of ups and downs. Specifically, in the first quarter of this year, Huawei's mobile phone shipments reached 11.7 million units, with a market share of 17%.
In fact, the strong comeback of Huawei's mobile phone business was reflected in last year. In 2023, Huawei's ICT infrastructure business achieved sales revenue of RMB 362 billion, an increase of only 2.3% year-on-year, while the sales revenue of its terminal business reached RMB 251.5 billion, a significant increase of 17.3% year-on-year.
The biggest boost behind this is the strong performance of the Huawei Mate 60 series. According to Counterpoint data, in the fourth quarter of 2023, China's smartphone sales bottomed out and rebounded, with a year-on-year increase of 6.6%, of which Apple's mobile phone sales fell 9% year-on-year, and Huawei's sales increased by 71.1% year-on-year. Counterpoint believes that Huawei's Mate 60 series powered by its self-developed Kirin 9000S chip is a key driver of Huawei's success.
In addition, sales of the Pura 70 series mobile phones are also very hot. On April 18, Huawei launched the "HUAWEI Pura 70 Series Pioneer Program", and the Pura 70 Ultra and Pura 70 Pro went on sale at 10:08 on the same day, and they were sold out in almost a second. At present, the delivery date on the official website of Huawei Mall has been scheduled for 30 days later. The popularity is no less than that of the Mate60 series, which was launched half a year ago.
Even so, in a specific environment, Huawei mobile phones are still facing the problem of going overseas, which has a significant impact on their sales. At present, Huawei mobile phones need to return to their peak state in 2019, and there are still more hurdles to overcome. And, from the perspective of the industry, the entire smartphone industry has not yet completely gotten rid of the predicament and is still in a difficult state of recovery.
For He Gang, taking over Huawei's terminal business is a tailwind. If you keep it well, you can play it well, and you don't need Yu Chengdong to shout "far ahead" on the front line.
Yu Chengdong continued to open up the territory
In fact, the official did not officially disclose Yu Chengdong's next move, which is also a topic that more people are concerned about. Tang Chen has a guess: Yu Chengdong, who is good at fighting tough battles, will accept a greater task, that is, to focus on smart cars, that is, Hongmeng smart selection business, and develop the new energy vehicle market. It is even possible that Huawei will reverse its past decisions and will build its own cars.
In the past three years, Yu Chengdong has successfully cooperated with car companies such as Cialis, Chery, BAIC, and JAC under the pressure of Huawei's "not making cars", and launched four major Hongmeng Smart (formerly known as Smart Car) brands. Among them, Wenjie is the most mature brand that Huawei Hongmeng Zhixing has built so far. In 2022, Huawei and Ceris jointly launched the M5 and M7 models, with a total sales of 78,000 units that year.
This month, Huawei once again released the Zhijie S7 model launched in cooperation with Chery, which also achieved good results. From April 13th to April 14th, the Zhijie S7 Dading reached 2,079 units. According to Yu Chengdong, from January 1 to April 22, 2024, Hongmeng Zhixing sold a total of 105,000 vehicles, ranking first in the sales of new forces in the Chinese market.
The high sales volume has driven the car BU and smart car business to become profitable. At this year's Electric Vehicle 100 Forum, Yu Chengdong said that due to the influence of mid-to-high-end models in cooperation with OEMs, Huawei's car BU is close to breaking even and is expected to turn losses into profits this year. In the first three months of this year, Huawei's smart car business has achieved profitability.
This achievement is inseparable from Yu Chengdong's promotion. To a certain extent, Yu Chengdong's Huawei automotive business is very screwed. On the one hand, Huawei is "notoriously non-making cars" at the corporate level, and has repeatedly reiterated that it will strictly enforce the ban. For example, Ren Zhengfei, founder and chairman of Huawei, signed an announcement on the decision of the automotive business in March 2023, once again emphasizing that "Huawei does not make cars" and "it is valid for 5 years".
Since 2020, Yu Chengdong has also served as the director of the IRB of intelligent terminals and intelligent automotive components, and the Huawei smart car business, which is jointly manufactured by Huawei and car companies, is under the consumer BG and is in charge of Yu Chengdong. He is almost the equivalent of "dancing in shackles".
Hongmeng's model seems to be running well at present, but under the heavy model, once the brand partner does not cooperate, the business will be blocked. Taking the Zhijie S7 as an example, Zhijie is the second smart car brand cooperated by Huawei and Chery Automobile. Both sides have high hopes for this, and Huawei has poured a lot of resources into it.
Judging from the data, the launch of this model is a gorgeous start. Zhijie S7 was launched on November 28 last year, and by the end of last year, its large order volume exceeded 10,000. However, media reports have reported that since the decision was made, most users of Zhijie S7 have fallen into a long wait, and the pick-up time of users in some areas has even been postponed to April this year - this is the fifth month after the launch of Zhijie S7.
The delivery time continues to lengthen, and the anxiety of Dading users begins to be revealed, and many people continue to update the waiting situation on social platforms. One of them asked the sales to give a clear delivery time in the delivery group, but the reply was "not sure" or the answer was not the same. Frustrated, some users began to try to cancel and transfer orders.
Similar difficulties will appear more in the cooperative brands of Hongmeng Zhixing in the future, which will also involve more energy from Yu Chengdong. In other words, at a time when new energy vehicles are in full swing and the mobile phone business is complete, Huawei needs a new consumer-oriented business curve, and the automotive business is the most mature choice. Yu Chengdong concentrates on building cars and expanding his territory, which may be his new task.
Recently, the Beijing Auto Show was hot, and Yu Chengdong's itinerary was also full, first held a press conference for the new M5 in Beijing, then returned to Shenzhen to participate in Huawei's board of directors, and then returned to Beijing non-stop to participate in the auto show to be interviewed by the media.
During this period, the fire accident of M7 has aroused widespread public attention. Jiemian News reported that on April 26, the M7 vehicle in Yuncheng, Shanxi Province, caught fire after a high-speed rear-end collision, killing three drivers and passengers. On April 29, the family of the accident issued the latest statement, saying that they were grateful to the well-wishers for breaking the window to save people as soon as possible, and did not want to be disturbed again.
Not only that, Yu Chengdong's "retreat as advance" this time may also overturn Huawei's decision not to build cars. Its biggest motivation is the stimulation of Lei Jun and Xiaomi SU7.
The success of Xiaomi SU7 is essentially reflected in two levels. On the one hand, there is a traffic carnival, Lei Jun's "Shuangwen male protagonist", Xiaomi SU7 annual production capacity saturation, etc., have all successfully come out of the circle. On the other hand, the popularity of Xiaomi SU7 confirms the feasibility of Lei Jun's car-making route, that is, the story of "people, cars, and homes" can be told. And this model, Huawei is the one that has the best chance of success outside of Xiaomi.
Taking it apart, in terms of traffic alone, Huawei does not lose to Xiaomi. From the perspective of mode, the limited smart car model can still rush to the head of the industry. If the confinement is lifted and Huawei builds the car itself, the ecological energy that bursts out can be imagined. But this road is not easy to walk, the entire new energy vehicle industry has become a red sea, "chaos into a pot of porridge", fierce knockout, will eliminate a player at any time, no one can guarantee to continue to stay at the table. The latest such as ideal, the loss of MEGA, and the heavy setback to Li Xiang, have brought about the reflection and adjustment of the entire ideal car.
Of course, the ensuing industry rebound is also a huge problem for Huawei. There has been a rumor in the industry that "Huawei is everywhere, and not an inch of grass grows". This is a recognition of Huawei's strength, but it is also a fear. But it is undeniable that as soon as a good drama is played, a new chapter will be staged immediately. This is also a good thing for the entire new energy vehicle industry. With competition, consumers can get more benefits.