BYD has now become the hardest hit area by dismantling, and some time ago, three institutions in Japan, Europe and the United States dismantled a BYD respectively. (For the specific content of the car dismantling, you can review our article "The United States, Japan and Europe dismantled 3 BYD")
Many domestic media have also reported it, but the style of painting is mainly like this:
The Americans broke the defense!
Europe is completely panicked!
The Japanese are starting to steal teachers!
These statements sound really exciting, but if you only see them, you will inevitably indulge in simple self-praise and ignore the real problem. These institutions didn't come to dismantle the car because they were scared by BYD.
Their real purpose is to test whether BYD has the strength to go overseas in the world and compete with them for the market.
European, American and Japanese car companies have dominated the world for decades and almost monopolized the profits of the global automotive industry. Except for being robbed of a few mouthfuls of soup by the Korean family, there is no real opponent anymore.
But now, BYD has beaten the joint venture car in China to "fall in volume and price", if BYD sells the "798" and "998" Qin abroad, then European, American and Japanese car companies still have a way to live?
Resolutely making money is like killing parents, so these overseas car companies and institutions are particularly concerned about how much BYD has real skills.
Looking at the dismantling of these three institutions, we also found that if BYD wants to compete with these old manufacturers around the world, it must climb over three mountains.
If these three mountains can be crossed, then there will be no suspense about the change of industrial power on a global scale; If it can't be crossed, then BYD, and even the entire Chinese automobile, can only continue to roll themselves.
What are the three mountains?
These three mountains have to start with the three overseas institutions that dismantled BYD, they are Swiss Bank in Europe, Nikkei BP in Japan, and a consulting company in Detroit, USA.
These three institutions also represent the three unique models created by European, Japanese and American car companies.
The American company CaresoftGlobal dismantled the seagull
What are the three modes? If you only use one keyword to describe it:
That Ashkenazi must be an advantage in scale
The Japanese system must be lean manufacturing
The U.S. system is globally integrated
And these three keywords are also the three mountains that BYD must climb.
The reason is very simple, people have relied on these three tricks to eat and drink spicy food in the global market for decades. Now, if BYD wants to grab food with others, it must first study and understand their patterns, and then use magic to defeat magic.
Of course, these three models are not isolated from each other, and they also learn from each other.
German - scale advantage
Let's take a look at Germany first, the first wave of German cars made a fortune before World War II by introducing Ford's large-scale assembly line production, and since 1937, the Beetle that drove off the assembly line has created the most successful page of German manufacturing.
After World War II, the European economy recovered rapidly, and automobiles became a mass demand. German cars seized this wave of demand and took full advantage of large-scale production, producing 10 million Beetles by 1965.
After the end of the Cold War, Germany integrated its internal resources, looking for cheap workers from Eastern Europe, cheap energy from Russia, and new markets from the former Soviet Union, giving full play to its advantages of scale.
Scale, on the other hand, is the most effective means to reduce costs.
Therefore, when UBS dismantled BYD this time, it was most concerned about the cost, but after dismantling it, it was found that the BYD seal was 35% lower than the similarly positioned cars produced by Volkswagen in Europe.
The screenshot is from the official website of UBS
The reason is not difficult to explain, Volkswagen has a scale advantage in oil cars, but in trams, BYD now has a scale advantage.
Japanese - lean manufacturing
Japanese cars rose in the 70s of the last century, when German cars were already popular in Europe and the United States by virtue of their scale advantages.
Japanese cars are definitely not enough to rely on scale, so lean manufacturing was invented. Some people who have studied the history of the automobile industry even say that lean manufacturing and Ford's invention of assembly line production have the same revolutionary significance.
The essence of lean manufacturing is to "eliminate all waste". From all aspects of design, production and sales, all possible waste is removed.
Toyota's engine assembly line
More plants and land cannot be wasted, so one production line produces N kinds of cars at the same time;
Employees can't waste any superfluous actions, so a few steps of screwing together must be actuarial;
You can't waste an extra cent of inventory costs, so don't have inventory, parts are not in stock, and the cars produced should not be in stock.
Relying on this set of lean manufacturing methods, the Japanese system has played well in the world, and the dividends have been eaten to this day.
In the process of dismantling the car, Nikkei BP also pays the most attention to lean manufacturing, they are the most detailed in the dismantling, the whole car is divided into more than a dozen modules, and the dismantled parts will be analyzed one by one.
It is an exaggeration that even the rearview mirror and fuse box have been removed. The whole process of dismantling was also compiled into a book, which is called "The Complete Decomposition of China's BYD Seals".
If BYD has any waste of costs, it will not be able to escape the dismantling of Nikkei BP, and they have finished dismantling, and the overall evaluation is very high. It shows that BYD is not inferior to the Japanese in lean manufacturing.
U.S. – Global Integration
Speaking of American cars, the three traditional American manufacturers have declined, and now the most representative American car companies are undoubtedly Tesla.
Tesla's biggest feature is global integration, which is best exemplified by R&D in the United States, produced in China, and sold to Europe.
As for the agency in the United States, the reason why they wanted to dismantle the BYD Seagull was originally to prove that the Seagull, which was only sold for $12,000, was shoddy and cut corners.
As a result, after dismantling, I was dumbfounded, this car is not only full of power and texture, but also has 6 airbags, and even the stitching of the leather seats is very delicate. The company's CEO also said: If this car were built in the United States, it would cost at least three times as much.
After the operation, this agency turned into a fan completely, not only did not question BYD, but also went to the Associated Press to issue an article, saying that the BYD Seagull sounded the alarm for the American industry.
Screenshot from the Associated Press
Software translations, for reference only
Talking about this, it seems that these three mountains have been overturned, and BYD seems to have beaten European, American and Japanese car companies, and the world is invincible.
But is that really the case? This is indeed the case in China, and the sales volume of BYD and joint venture brands has already explained the problem.
But then, there is a key question: can it still be possible after going to sea in China?
The whole world is pushing us
Go overseas to build a factory
Last year, China exported more than 5 million cars, surpassing Japan to become the world's first, and this year, Europe, the United States, and even Turkey have raised taxes on our tram exports.
In other words, we have basically come to the end of vehicle exports, and if we want to go to sea, we can only go overseas to build factories.
The reason why BYD can defeat the three mountains of European, American and Japanese car companies in China depends on one point, that is, low cost.
In fact, the three mountains of Europe, the United States and Japan seem to be three things, but in the final analysis, they are also one thing, whether it is lean manufacturing, scale advantage or global integration, it is ultimately to reduce costs.
New BYD plant in Hungary
Speaking of which, I need to say a few more words
Since childhood, our teachers have told us that science and technology are the primary productive forces
This is true, but this can only be used as a guiding ideology.
That is to say, it can only guide the ideology, and cannot really use it to guide the operation.
In the real life-and-death business war, cost is always the first competitiveness!
BYD has a lot of special cost advantages in China, and it is a big challenge to be able to lower the cost of competing products after going overseas.
Some people say that BYD is a sweatshop, and the labor cost is high after going to sea, so it can't be played. Whether BYD is a sweatshop or not, this matter is too sensitive, let's stay in the next issue to talk about it.
But at the end of today, I want to say one thing, that is, I have heard someone say that China's auto market is so big, 30 million vehicles a year, why do we have to go to sea?
Let's share a set of data:
220 billion VS 50 billion
220 billion is Toyota's net profit in fiscal 2023, and 50 billion is the sum of the profits of 18 mainstream Chinese car companies in 2023.
Why is the gap so big?
Because Toyota is facing the global market, while Chinese car companies are mainly desperately involuting in China.
Therefore, if Chinese car companies want not to be swept up to death, if they want to stop losing money and making money, then going overseas is the only way out.
Because only by going to sea can there be profits, only with profits can we continue to develop and develop, and only with profits can we continue to maintain our lead.
In other words, if they don't go overseas, these leading advantages that BYD and Chinese car companies are now achieving are likely to be temporary. So, finally, let's borrow a sentence from Wei Jianjun of the Great Wall:
Chinese car companies, even if they die, will die on the way to sea!