2003: Starting with Foreign Trade

Chapter 1028 The Extravagant Lieutenant's Year-End Bonus
Zhang Xuhui has arrived.

The power battery business is really profitable; just look at Zhang Xuhui's radiant face.

"It's a bit early to gain weight in middle age, but she's still in good shape."

Zhang Xuhui has gained weight, but he doesn't have a big beer belly; his body proportions are still relatively balanced.

"Hehe, I've been working out recently, so I can't let it affect the company's image."

A company's image largely comes from its senior executives. No consumer likes a pot-bellied, greasy-looking middle-aged man giving a speech on stage. A well-proportioned, well-dressed public image is much more appealing.

Therefore, there are certain requirements for the physical management of middle and senior-level leaders. To earn more money, they must bear a different workload and requirements than ordinary people, which is inevitable.

"Your turn. Take a look at your surprise this year."

Power batteries are indeed very profitable. Since the new energy market began to boom in 2015, with Jinsheng Technology achieving a net profit of nearly 10 billion yuan, Jinsheng Technology's annual revenue and net profit have been increasing year by year.

From an annual net profit of over 30 billion yuan in 2016 to over 50 billion yuan in 2020, the company has expanded its market size and customer base step by step. However, even so, as of 2020, Weilai's revenue still mainly came from Yuechi Automobile, and its main operating income still depended on Yuechi Automobile.

The reason is simple: although the new energy vehicle market is booming, it's more hype than substance. Consumers aren't that enthusiastic about new energy vehicles, and their overall sales share is still quite limited.

If the sales volume of complete vehicles does not increase, it will be difficult for the revenue of power batteries, which rely on the number of installed units, to achieve a qualitative leap.

Therefore, even after Jinshidai's revenue exceeded 10 billion yuan in 2020, its total revenue in 2020 was only 503.2 billion yuan. The reason for exceeding 50 billion yuan in revenue was the expansion in the European market and the increased production of Jinshidai's lithium iron phosphate batteries.

"1303.6 billion yuan, 159.3 billion yuan, and a net profit of over 12%, selling batteries is really more profitable than selling cars."

It's almost impossible for a car manufacturer to achieve a 12% net profit margin, but power battery companies can. However, what excites Tan Jincheng the most is the explosive growth in Jinxin New Era's revenue this year.

Benefiting from new energy policies, from its initial dismal business to achieving technological breakthroughs by securing core clients such as BMW, and then expanding globally overseas with the production of its German factory, Jinshidai's revenue truly entered a period of explosive growth in 2021 as sales of new energy vehicles increased.

"The biggest change this year is that our revenue no longer relies entirely on the power battery business, and our business structure is healthier."

In 2021, Jinshidai's main revenue came from four categories. Among them, the core business segment, power battery system business, accounted for 70.19% of revenue, with RMB 1049 billion mainly coming from the supply of lithium-ion power batteries for new energy vehicles.

With a growth rate as high as 132.06%, and the ability to expand into other businesses, Jinshidai not only experienced a major sales boom this year, but also optimized its business structure, transforming from a traditional "battery-selling" component company into a comprehensive energy company.

Energy storage has become another major growth driver for Jinshidai this year, with a year-on-year increase of 601.01% and revenue of 136 billion yuan. Energy storage solutions applied to power grids, base stations, and homes have shown significant growth, and their revenue has already accounted for 10.45% of Jinshidai's total revenue, making it Jinshidai's second largest core business.

In addition to these two core businesses, there is also the supply of lithium battery materials, which has contributed RMB 155 billion in revenue to Jinxin. Furthermore, other businesses, including technology licensing and services, have also contributed RMB 105 billion in revenue to Jinxin.

Each of the business segments generated over 10 billion in revenue, with growth rates exceeding 100%, which is extremely rare.

"The explosive growth of new energy vehicles has made the leading companies in the industry extremely profitable."

Jinxin's core power battery business has accumulated more than 50 customers. The batteries for Tesla's Shanghai factory are supplied by Jinxin, and the batteries for the Model 3 and Model Y are sold all over the world along with Tesla's domestic sales and exports.

BYD's battery suppliers include leading automakers such as Wenjie, Xiaopeng Motors, and traditional car companies including SAIC, GAC, and Geely. When BYD faced production shortages in the middle of the year, some of its models were supplied by Jinshidai batteries.

In terms of international automakers, Weilai has customers such as BMW, Volkswagen, Daimler, Hyundai, Honda, and Toyota. Once Tesla's factory in Berlin goes into production, its battery supply in Europe will also be supplied by Jinxin's factory in Germany.

This model is somewhat similar to Foxconn's relationship with Apple. Wherever Apple plans to build a factory, Foxconn will build the factory there. However, there are still some differences between the two. Compared to Foxconn, Jinxin is more independent.

In addition, Jinxin has no plans to build a factory in North America. Tesla's battery supply in North America mainly relies on companies such as Panasonic and LG. Although Tesla has plans to produce its own batteries, its production capacity cannot keep up with its explosive sales.

Even a company as strong as BYD had to temporarily seek help from other domestic battery suppliers in 2021 when its production capacity exploded. Only Weilai could fully guarantee its battery supply. The fundamental reason is that although Jinshidai belongs to Weilai Group, it has maintained completely independent operation from the beginning.

Its establishment predates that of Weilai Auto, and it has a very clear understanding of strategic planning. In addition to consolidating its financial statements, Jinshidai is even an independent financial system.

"This year we suddenly gained two more subsidiaries with assets exceeding 100 billion yuan. This achievement is undeniable. Tell us about it. When would be a good time to announce it? Also, should we increase employee benefits?"

The three major groups, Yuechi Automobile with annual revenue of 1019.2 billion yuan, Weilai Automobile with annual revenue of 1264.5 billion yuan, and Jinshidai with annual revenue of 1303.6 billion yuan, had a combined revenue of 3587.3 billion yuan.

This also includes the revenue of some of Weilai's other parts subsidiaries, and of course, many others that have not yet been consolidated into the financial statements.

For example, Zhidou Auto, although still in a loss-making state, still has about 20.58 billion yuan in revenue for the whole year. Although the profit per vehicle is very thin and the scale cannot cover the costs, Zhidou Auto is still in a loss-making state.

However, Zhidou Auto's contribution to Weilai is not reflected in revenue or only in revenue and profit. Zhidou Auto has enriched Weilai's model matrix structure and provided Weilai with nearly 50,000 new energy vehicle credits throughout the year.

These credits are extremely useful. Take Yuechi Auto as an example: its sales of gasoline vehicles will generate approximately 38.5 negative credits throughout the year. Without credits for new energy vehicles, such a huge credit gap would require a massive amount of cash to purchase credits from other automakers to offset it.

The income from points is pure profit, with almost zero cost. Although points became much cheaper in the second half of the year due to increased sales, large point users like Wei Lai still earned a very considerable income from points this year.

In terms of net profit, the total reached 311.66 billion yuan, averaging 8.69% of net profit, which is a significant achievement among domestic car companies.

"Then we'll announce it in early March?"

After thinking for a moment, Li Xiang replied that the actual heads of the three companies with revenues of over 100 billion yuan all had happy expressions on their faces. Apart from the major automakers, Weilai Group's revenue this year should be the top-tier position among all automakers.

BYD's revenue should be over 2000 billion. The two groups have some similarities in their industrial structure. In addition to complete vehicles, they both have battery businesses. In addition, BYD also has an electronics manufacturing business, and their overall revenue is relatively high.

Other car companies, especially emerging ones, are unlikely to exceed 100 billion or even 50 billion yuan in revenue, while domestic brands generally maintain between 100 billion and 150 billion yuan.

In terms of revenue, there are four distinct camps among domestic automobile manufacturers: SAIC, FAW, BAIC, and GAC form the first camp. Dongfeng should have been added as well, but it hasn't been doing well in recent years.

The second tier consists of Woolai and BYD, the third tier includes Geely, Changan, Great Wall, and Chery, and the fourth tier includes some small and medium-sized car companies, including emerging players.

The difference is clear.

"Early March is fine too. Since we're ready, there's no harm in announcing it sooner."

Wang Fengying agreed with this point. Wei Lai has a history of announcing its performance in early March. A-share listed companies have always been eager to be the first to announce their performance, but of course, this requires your performance to be outstanding, otherwise it is not about being the first to announce your performance.

"Okay, you can make the arrangements. Now let's discuss this year's year-end bonus."

As a large global company, WIL's year-end benefits mainly include cash incentives, stock incentives, car purchase discounts, and other standard benefits.

With the Spring Festival just around the corner, in order to ensure production capacity during the peak season, Weilai has always offered very generous bonuses for employees staying on duty during the Spring Festival. With the significant increase in revenue and net profit in 2021, the administrative department had already raised the issue of these bonuses, and Tan Jincheng had already approved them.

Frontline employees who are present for the entire month during the Spring Festival can earn a net income of 15,000 yuan. Some factory employees, with bonuses for staying on duty plus performance-based pay, can earn between 18,000 and 20,000 yuan per month.

This does not include year-end bonuses. For frontline employees, the main incentive is cash. Ordinary workers will only feel more at ease when they have money in their hands. Stocks and options are still a bit far away for them.

In addition to cash incentives, incentives for R&D employees also include stock options, and there is an upgrade to the housing security plan for outstanding employees.

Interestingly, when Tan Jincheng first started his business, fearing bankruptcy and losing everything, he bought 100 houses for investment purposes. These 100 houses have long since been acquired by Wei Lai.

It's considered an old neighborhood now, but the renovations have made it very popular for employee rewards. Compared to most new homes, although the environment of old neighborhoods is worse, their livability is not bad. At least most old neighborhoods are better at soundproofing than new homes.

Nowadays, the sound insulation in new houses is getting worse and worse.

In addition, the car purchase benefits for all employees of Weilai Group and its subsidiaries are also a major benefit for Weilai employees. Taking Weilai L1 as an example, the purchase price for group employees is 15% cheaper than the market price.

With the average selling price of the L1 at 29.8 yuan, this translates to a discount of 4.47 yuan, which is quite substantial. Of course, with such a significant discount, there will definitely be restrictions on employee car purchases, otherwise employees would become scalpers.

In addition, models with tight production capacity, such as the Exeed S01 and Galaxy P1, are not included in the employee purchase discount program. The employee discount program will only be opened when production capacity is alleviated.

"This year we really should increase some benefits to boost employee morale."

Zhang Xuhui also expressed his opinion: among the group's major subsidiaries, Jinxin is the most profitable and has the highest net profit. In terms of benefits, Jinxin also has the best benefits among the group.

Most college students in the Luzhou area hope to receive an offer from Jinxin after graduation, especially for the R&D department. If they can't get into Jinxin, Weilai Research Institute is their first choice, even though it means working in Ningbo. The next best option is Weilai's various subsidiaries. "Alright, since you're all so generous, I can't be stingy either. Let's increase the year-end bonus by 20% on top of the existing one, and also make the New Year's red envelope bigger."

Procuring year-end benefits for large corporations is a major undertaking, especially for companies like Weilai with hundreds of thousands of employees. There are many shady dealings involved, so Weilai has gradually canceled some in-kind benefits.

Cash must be deposited directly into employees' accounts, and everything must be done in a transparent and open manner to minimize the risk of internal corruption.

"That's doubled, that's great."

Weilai employees receive a 13th-month salary, and the year-end bonus is based on approximately 180% of their monthly salary. Assuming a monthly income of 6000 yuan, the base year-end bonus would be 1.08 yuan. This is just the base year-end bonus.

Depending on the employee's performance, the year-end bonus is generally three to six months' salary. Based on the plan for employees with a monthly salary of 6000 yuan, this employee's year-end bonus would be at least 3.24 yuan and at most 6.48 yuan.

This year's year-end bonus will range from 3.6 yuan to 7.2 yuan, which is equivalent to receiving an extra mobile phone.

While routine improvements have been made, the special cases definitely deserve another mention. This year's performance has seen a major surge, especially in the new energy vehicle division, which initially gained market exposure, and companies like Jinshidai, which jumped directly from 50 billion yuan in revenue to 100 billion yuan. Their performance scores will certainly be high enough to earn them generous bonuses.

What did the Yuechi team say?

Wang Fengying asked with a smile, "While some are happy, others are sad. The Yuechi team, which has been the backbone of Weilai for more than ten years, has not only been completely surpassed by Jinshidai this year, but also by the new energy vehicle department that they previously disregarded."

In terms of the overall environment, they can say it's due to the trend of new energy vehicles, but within the internal fuel vehicle system, the Tank series saw a surge in sales while the Yuechi series experienced a significant decline in sales. Can't they find another reason for that?
Moreover, while most automakers in the traditional gasoline vehicle sector have experienced declining sales, some have seen growth. For example, Great Wall Motors has seen good growth in gasoline vehicle sales, as has Changan Automobile.

"The Yuechi team."

Tan Jincheng tapped lightly on his desk. The new generation surpasses the old, and within the entire Weilai system, two subsidiaries with revenues of 100 billion yuan were created within a year, and they have achieved comprehensive breakthroughs.

In Big Mouth's words, they are far ahead.

Whether we admit it or not, the moment the financial reports of the three subsidiaries were placed on Tan Jincheng's desk, the resources that the gasoline vehicle business could obtain within the group would only decrease in the future, which was like adding insult to injury for the Yuechi team.

However, it's unfair to say that we've been heartbroken by the contributions of our employees over the past decade or so; it's a bit unreasonable to just use them and then discard them.

"Let's also talk about the basics. Performance bonuses can be reduced appropriately, and the internal distribution should also be biased, for example, giving more to the tank team."

We need to stabilize morale, but we can't be too lenient. The decline in sales of gasoline-powered vehicles is a general trend, but we still need to create some internal competition. We can't just rest on our laurels.

The biggest breakthrough facing the Yuechi team right now is the sales and technological breakthrough of hybrid models, with the Xinghe P1 as the main product. Once the sales of the Xinghe series officially surpass those of range-extended models, it will be their second spring.

"This arrangement is acceptable."

Wang Fengying also agrees with this. Judging from the boss's attitude towards the Yuechi team, Wang Fengying knows that her incentive this year should be the worst among the senior executives of the three subsidiaries, but Wang Fengying can accept it.

Sales of new energy vehicles have indeed seen a qualitative increase, and Yuechi has also made technological breakthroughs in hybrid vehicles. However, in terms of gasoline vehicles, their performance has indeed fallen short.

As the person primarily responsible, Wang Fengying is dissatisfied with her work in 2021.

Although the boss didn't say anything and gave them enough time to transform, and didn't cut back on resources too much in 2021, this time is limited.

If the transformation cannot be achieved within the boss's expectations, Wang Fengying is absolutely certain that the boss will cut Yuechi Auto directly, just like cutting some poorly selling models, and let Yuechi Auto return to the group headquarters.

The time left for her is actually limited.

January 31, 2022, the 1th day of the twelfth lunar month, Lunar New Year's Eve.

All employees of Weilai received an email at the same time, and upon receiving the email, a large sum of cash was deposited into each person's salary account.

"Holy crap, why is it being released today?"

Today is Chinese New Year. Except for the employees who stayed on duty, most of them are on holiday. Before the New Year, there were rumors that this year's bonus would be very generous, but no one expected that the bonus would be distributed on New Year's Eve.

The email to all employees was very simple. Besides the routine New Year's greetings, it explained the details of the funds deposited into the bank account, and that each employee received a New Year's red envelope of 5000 yuan, which was the same for all employees.

When it comes to red envelopes, Tan Jincheng is the one whose employees are most satisfied with. He gives out red envelopes from time to time without discrimination. From the group CEO to the most junior front-line employees, even those in the probationary period, everyone gets one and everyone receives the same amount.

The 5000 yuan year-end bonus is an extra bonus, a pleasant surprise. For most small families, this 5000 yuan is enough to cover their expenses during the Spring Festival, especially for employees who did not return to their hometowns for the holiday.

The special events at the end of the year are still quite serious. Like last year, various places have called for people to stay at home for the Spring Festival. There is also such a call within Weilai, and most employees have responded positively.

Besides New Year's red envelopes, year-end bonuses are of course their biggest concern.

"Hey, our company gave out year-end bonuses today."

He Wei, an employee of the Beicang headquarters in Guizhou Province, had not been home for several years. This year, he returned to his hometown for the Spring Festival. Although the journey was difficult and he did not have the opportunity to run around after arriving home, the joy of being home still lingered in his heart.

"How much did they issue? Weren't the banks supposed to be closed today?"

The question was asked by He Wei's wife. The family was preparing for the New Year's Eve dinner. The elderly mother was cooking, the wife was chopping vegetables, and the elderly father was chopping firewood at the kitchen door while keeping an eye on his two grandsons who were playing with firecrackers.

He himself squatted behind the stove.

"Our company is so big, what do we mean by holidays? The boss can pay us whenever he wants."

Speaking of his company, He Wei is still very proud. His work experience in Ningbo over the past few years has not only broadened his horizons but also made his wallet fatter. His trip home for the Spring Festival this year is not just because he misses home.

After the New Year, he plans to take his wife and two sons to Ningbo. His sons will attend his school in Weilai, and his wife will try to find a job at the company in addition to taking care of their sons.

He has already spoken with his supervisor about this, and his two sons can enroll in school after the New Year. The company will help with the paperwork.

"How much money was paid out?"

The elderly mother also asked a question. She didn't know whether the bank was closed for the holidays, but she did know that her son had been making money in recent years.

"With the 5000 yuan New Year's red envelope, it's a total of 57,000 yuan. Our company is really generous."

He sighed. His basic salary was 6500 yuan, and based on his performance, he received a year-end bonus equivalent to four months' salary, which was 5.2 yuan. This was much more than in previous years, when he would only receive a three-month year-end bonus.

"so much?"

The amount was close to 60,000 yuan. Not only was his elderly mother shocked and stopped what she was doing, but his wife was also shocked. His elderly father, who came in after hearing the commotion, was also surprised.

Sixty thousand yuan is a large sum of money in rural areas of your province.

Compared to He Wei, the surprise that the company gave the Xingtu S01 and Weilai L1 teams on New Year's Eve was even greater. Although the internal outstanding team has not yet been announced, each team member received a generous year-end bonus of 28.8 yuan today.

"Damn, I told you our boss is capable."

In the last few working days before the Lunar New Year, it was rumored that BYD's car factory employees could initially receive year-end bonuses of 18 to 20 yuan due to the surge in car sales in 2021, which made employees of many competitors extremely envious.

Of course, BYD's internal employees are also envious. The high bonuses are not all of them; they are limited to the automotive division. BYD's battery division did not meet its performance targets in 2021, so there were no bonuses.

It's unimaginable how Tan Jincheng would treat Jinxin if Weilai Auto had to ask other companies for help due to insufficient battery production capacity.

"Let's reduce the heat a bit during the Chinese New Year."

At Tan Jincheng's home, the discussion also revolved around distributing year-end bonuses today. Giving money during the Lunar New Year is somewhat unusual, but Boss Tan explained that it was to reduce the buzz, since everyone is busy during the holiday and there's also the annual Spring Festival Gala.

This year's bonus is very generous, and Wei Lai doesn't want to cause too much of a fuss, as the environment is quite different from what it was back then.

(End of this chapter)