2003: Starting with Foreign Trade

Chapter 1062 The biggest move yet.

Details determine success or failure. BMW's lack of attention to detail and its outdated mindset in dealing with the market made failure inevitable, and the management of Yuchi Power must be under the most pressure.

The pressure they faced after being publicly questioned by their controlling shareholders is unimaginable.

BMW has not yet given a public response to the decision to remove the MINI EV from the market. In fact, they are too busy with their own problems to pursue this matter right now.

At this point, executives at Wychi Power had no choice but to distance themselves from BMW and come up with concrete remedial measures to deal with the upcoming market impact. Senior Vice President Zimmer personally went to the Shanghai Auto Show to distribute ice cream and bowed to all the audience members in his broken Chinese to apologize.

"From now on, all ice cream at this booth will be unlimited and free for all visitors, no matter where you come from. The incident on the 19th was a serious mistake on our part, and we take full responsibility for it. It has nothing to do with the two staff members."

In coordination with Zimmer, Qin Zhi, General Manager of Weichi Power, distributed ice cream on site and announced a series of rectification measures, including substantial compensation measures and a thorough review of the erroneous handling of the incident, as well as a revised process.

In the following week, Weichi Power will release a promotional video themed around respect, and will also launch a thank-you and care campaign for existing MINI owners, including exclusive after-sales discounts, owner events, and more.

For the MINI brand, the priority is to stabilize its core user base and prevent its reputation from collapsing from within. It is worth mentioning that all of these actions were launched in the name of Wichi Power and MINI.

In addition, there are a series of public welfare activities that transform negative events into charitable actions. By compensating vulnerable groups in society, the public's anger towards foreign worship is transformed into goodwill towards brands that admit their mistakes, correct them, and have a sense of social responsibility.

Since BMW has shifted the blame to the MINI brand, they have no choice but to save themselves. After reviewing their specific remedial measures, Tan Jincheng promised that, based on the assessment of the turnaround in public opinion, they would consider relisting the MINI EV.

However, all of this is several months from now. At least for the next three months, Weilai will not consider relaunching the MINI EV. It will be difficult to digest the substantial impact of this matter in less than half a year.

"If used properly, this is also a great opportunity to replace apologies with concrete actions. With the huge traffic, we might be able to retell and strengthen the brand's core values ​​and achieve a comeback."

The auto show is still going on. Starting from the 19th, the ice cream incident has been making headlines for several days, dominating most of the trending topics and causing some difficulties for the publicity of various companies. The first international auto show after the opening of the country is not just about these minor incidents.

"That's true, but speaking of which, you came at the worst time this time. The hype has already been stolen."

When it comes to marketing, Lei Jun is a master. In fact, many marketing models did not originate from him. Recently, Lei Jun has been sharing their car manufacturing process on Weibo every day, which is something he learned from Li Xiang.

Lei Jun also attended the Shanghai Auto Show, carrying their new Xiaomi 13. He garnered a lot of attention on the first day, but unfortunately, it couldn't withstand the sudden ice cream incident, and the hype died down after the second day.

Xiaomi, which has repeatedly declared its "all-in" approach to car manufacturing, has shown great ambition in public. Lei Jun has repeatedly stated on multiple occasions that the only way for Xiaomi Cars to succeed is to become one of the top five in the industry and ship more than 1000 million vehicles annually.

Since announcing its foray into car manufacturing, Xiaomi's three-pronged approach can be described in three ways: First, it focuses on defense, using cost reduction, efficiency improvement, and high-end positioning to safeguard its core businesses of smartphones and AIoT in response to the market downturn.

The second is to conquer the market, investing the entire company's resources and sparing no expense in car manufacturing to open up a second growth curve for the future. The third is to shape the brand's spirit, unifying thinking and stabilizing morale through Lei Jun's personal speeches and remarks, and shaping a brand image that dares to face difficulties and adheres to long-termism.

All the actions and statements are laying the groundwork and making preparations for the release and official launch of Xiaomi's car technology in the second half of this year. During this window of time before the official launch of the new car, it is very difficult for Xiaomi, which started by relying on traffic, to maintain its popularity.

To be fair, the traffic generated by cars far surpasses that of mobile phones. Before announcing his car manufacturing venture, Lei Jun was an internet celebrity, but his influence was not nearly as great, just like Tan Jincheng was also very popular before founding Weilai, but it was far less than it is now.

The status of automobiles is unmatched by any other consumer product, and the social status they bring is far beyond what any other product can achieve. Lei Jun, who has always been committed to building his personal brand, also saw his popularity rise rapidly after starting to manufacture cars.

The same applies to Yu Dazui. No matter how far ahead he is in the mobile phone industry, the influence he brings is far less than that in the automotive industry. The overall image of Chrysanthemum has also been greatly improved after it started making cars.

So many companies are investing in car manufacturing, not only because they value the profits in the automotive industry chain, but also because of their social status.

The newly released Xiaomi 13 series, with prices ranging from 3999 yuan to 6299 yuan, is a testament to Xiaomi's determination to move into the high-end market. However, it has also sparked considerable controversy, as the increasing price of mobile phones seems out of place in the current economic climate.

Cars are seeing widespread price reductions, while mobile phones are becoming increasingly expensive. Xiaomi's user base is completely different from Huawei's. For price-sensitive users who value cost-effectiveness, this price increase will likely lead some users to abandon the Xiaomi brand and choose other brands instead.

"It's alright. We don't need this much traffic right now. This time, we're mainly here to look at cars."

As the joint venture, Weichi Power, stepped forward and handled the follow-up matters with sincerity, issuing apologies in various public forums, the public outcry shifted towards the BMW main brand, and the heat gradually subsided.

Tan Jincheng also took some time to visit the auto show again during the last two days. Wei Lai had made quite a few moves at this auto show, and this incident shouldn't affect him.

In addition to the newly upgraded ES6, the E series is launching a new car after many years, namely the ET7.

The ET7 is back on the road. It was previously released by Weilai, but it was discontinued due to its mediocre performance and inability to reduce technical costs. This time, the ET7 is priced as a C-class sedan.

The target market remains the gasoline-powered car market led by BBA (Mercedes-Benz C-Class, Audi A6L, and BMW 5 Series). In the C-class sedan market, gasoline-powered cars still dominate, and despite the significant price reduction, sales have increased rather than decreased.

In this segment, the performance of new energy vehicles is still average. The only competitive models are the BYD Han series and the Jike 001. The Han EV is cheaper, while the Jike 001 is more expensive.

"Is there a sales target for the ET7?"

In an effort to gain attention, Lei Jun even went so far as to approach Tan Jincheng again during his visit to the exhibition area. He had previously made an appointment with Tan Jincheng on the first day of the auto show, but Tan Jincheng's schedule was too full that day to make the appointment.

"For the time being, I don't have any big goals. I'll just adapt to the market first."

As it was a second-time listing, the ET7 did not receive much promotion, nor was its price significantly lower. In the second quarter, the starting price of the BYD Han series dropped to 18.98 yuan, and the starting price of the Jike 001 was also adjusted to 26.90 yuan.

Meanwhile, Weilai has also adjusted the price of its own ET5 to 19.98 yuan. In addition, the ET7 is positioned to compete with the fuel vehicles of BBA (BMW, Mercedes-Benz, Audi), with an average price of over 33 yuan. Therefore, Weilai has not directly engaged in a price war with Geely and BYD.

Playing the price war game is not just about lowering prices. Competition in technology and configuration is also part of the price war. The way competition is carried out, both overtly and covertly, is also part of the price war.

The starting price of the ET7 is set at 27.98 yuan, making it the most expensive among the three brands. This is an attempt by Weilai to gain a brand premium in the competition with Geely and BYD.

The ET5's starting price is higher than the Han series for this reason. In the first quarter, the ET5 performed very well in the market, and its ability to keep pace with the Han EV series has given Weilai a certain degree of confidence.

Although it's more expensive, Weilai is still very sincere, offering full-grain top-layer genuine leather, power-adjustable second-row seats, L2+ level intelligent assisted driving as standard across the entire range, and a 140 kWh battery in the high-end version. They've really given a lot.

As for sales expectations, there are some. Based on the current price range and configuration, I estimate that the ET7 will sell around 5000 units per month on average.

Overall, Weilai is quite optimistic about the sales forecast. Deliveries of the ET7 began in April, and market feedback has been very positive.

Overall, the brand premium that WILI has tried to enhance with the E series is doing quite well so far. Compared to Geely and BYD, WILI is generally considered to be able to sell for a higher price in both the domestic and overseas markets.

Of course, given Weilai's strength, it deserves the brand premium.

The main brand aims to command a premium price, targeting consumers with stronger economic power. However, Weilai will not do much advertising in this regard, given the current trend of consumption downgrading and the natural resistance to high-priced products in the public opinion environment.

Catering to the market sometimes involves more than just product strength; it also requires effective marketing.

The Shanghai Auto Show can be said to be the most significant move by Weilai in terms of models in recent years, with new cars launched from all brands across the entire range, including even Yangzi Pickup, which launched an electric version of its pickup truck.

Electric pickup trucks are primarily targeted at the Australian and Middle Eastern markets, especially the Australian customer base. As one of the world's most pickup truck-loving regions, Australia consistently sees pickup trucks ranking among the top sellers.

However, electric pickup trucks are currently scarce and expensive. To date, no domestic companies have models for sale in the Australian market. Yangzi Pickup aims to seize this market vacuum.

That's right. The pioneer of Weilai in the Australian market is not the main brand, nor the sub-brand, but the inconspicuous Yangtze Pickup in the whole system.

"Our pickup truck, which can be translated as Qilin in Chinese overseas, will officially launch in Australia, Mexico and other regions this June. The customers at this auto show have been quite satisfied with this model."

Lei Jun was very patient in order to ride the wave of popularity. He not only visited the main brand exhibition area of ​​Weilai, but also appeared in the exhibition areas of various sub-brands with Tan Jincheng. The first place he visited was the exhibition area of ​​Yangzi Pickup.

"This car is beautiful and imposing. Isn't it sold in China?" Tan Jincheng shook his head: "It's not sold in China. It's too expensive, so it's not very meaningful."

Although some restrictions have been lifted in the domestic pickup truck market, various limitations still exist, and the overall market remains at around 50 vehicles per year, with the overall structure remaining one dominant player and many strong competitors.

"One dominant player and many strong competitors" refers to Great Wall Motors and others. Great Wall Motors has long maintained a large market share, while the other strong competitors include Yangzi, Jiangling, Nissan, Isuzu, and others. Yangzi's main pickup truck model in China is the Qilin series.

How much will it cost?

Lei Jun was somewhat curious. Judging from the vehicle's appearance and the configuration it was described, this model was definitely not cheap, and it did seem a bit pricey in the domestic pickup truck market where prices are generally low.

The brand strength of Yangzi Pickup cannot support its high-end positioning: "It's probably in the 40 yuan range, and it's also branded as Weilai."

Yangzi Pickup's brand strength in the domestic market is insufficient to support its high-end positioning, and the same may be true in overseas markets. Therefore, in terms of exports, it will be branded as Captain. That said, although the market share of pickup trucks in China is not very large, it still has a significant global market.

According to industry forecasts, the global pickup truck market will remain in the range of 5.5 million to 6 million vehicles. North America and the domestic market together account for about 60% of the market. On a global scale, Yangzi pickup trucks only account for one percent of the market share.

The market expectation for Yangzi Pickup is to gradually increase its global market share to around 3% from 2023 to 2025 by using hybrid and pure electric technologies to break through the existing technological framework.

Within five years, we aim to increase our global market share to 5%, which translates to annual sales of around 30 vehicles. By boosting global sales, we hope to catch up with Great Wall Motors.

"That is indeed a bit expensive, but foreigners have that level of spending power."

Lei Jun was speechless for a moment. If this were sold at this price in China, it would probably be criticized to death. However, if it were sold at this price in overseas markets, it would not only not be criticized, but would be praised by the public.

"I have to say, your initial strategy was really correct. This top-down approach was indeed very effective in the later stages."

Lei Jun made this remark, considering how difficult it is for Xiaomi to move upmarket. The pickup truck is branded as Weilai overseas and is taking a high-end route. It is clear that Weilai is continuing its top-down approach even in the global market.

Starting from the bottom up, it's relatively easy to open up the market initially, but transforming a brand into a high-end brand is extremely difficult. Among domestic brands, the rapid success of Chihuahua's high-end transformation has an element of "luck" to some extent.

Other brands, no matter how hard they try, will find it difficult to succeed.

"Going from the top down is much more difficult in the early stages and requires more perseverance. We also went through a lot of hard work when we were in the European market."

The brand maturity level in mature overseas markets far exceeds that in China. The effort required to achieve a breakthrough is far greater than in China. Moreover, local protectionism and consumer support for their own brands are global phenomena, not just limited to our country.

“If you want to enter the Australian market, even if you sell for around 40 yuan, it will be much cheaper than other brands. I believe that as long as the quality is up to par, it will not be difficult to open up the market.”

"Yes, that's what we think too."

The 40 yuan range is roughly equivalent to the 8 to 9 Australian dollars range. The pickup truck market is a stable market with North America and the Asia-Pacific region (including Australia) dominating, allowing for a good concentration of advantages.

If you do it well, it's an industry where you can make a fortune quietly.

"We won't be doing much advertising for these two models in China. That said, our main model this year is a small car."

New models have been launched for the ET7, pickup truck, and L series. In addition, hybrid models have been launched, including those for the Tank series. The L series has completed its product lineup of three models.

Currently, in terms of product portfolio, the pickup truck, tank series, and Yuechi series all have new energy vehicle models, leaving only the Exeed and Zhidou series with relatively weak product portfolios.

Of course, there will be another model in the ET series to be launched, but that will be next year or later.

"Starry Night, Starry Wish?"

Lei Jun clearly knows WooLang Auto very well. After the celebration at the beginning of the year, WooLang announced a series of new car plans, among which the new car of Exeed attracted the most attention from the consumer market.

Contrary to market predictions, the Exeed S01 debuted as a blockbuster and has secured the top spot in sales across the entire Exeed lineup this year. However, Exeed has not launched any more expensive models to enhance the brand's influence.

Instead, they launched an A0-class sedan to compete with ORA and BYD Seagull, something no organization had predicted.

The Exeed sedan, in the A0 class, did not follow the naming convention of Exeed SXX, but instead debuted on the market under the name Exeed Wish.

Still cool and technologically advanced in appearance, with various ranges from 310km to 410km, but these are not the key points. The key point is the starting price of the Star Wish.

After the BMW ice cream craze subsided, Weilai officially announced the price range for the Starway Wish.

In the second quarter, apart from the Wuling Bingo, the starting prices of all models in the A0 class and on the edge of the A0 class exceeded 7.38 yuan. Although the Wuling Bingo's starting price was only 5.98 yuan, its range was the worst, offering only two range versions: 203 kilometers and 333 kilometers.

Star Wish, priced from 6.98 to 9.98 yuan! The starting price is 4000 yuan cheaper, and the range starts at 300 kilometers. Moreover, during the pre-sale period, Star Wish offers a limited-time subsidized price, which can be obtained for 6.58 yuan.

At this price and with this range, it's already on par with A-class sedans, a true game-changer. After Xingyuan announced its starting price today, the focus of the auto show immediately shifted to Weilai.

Many netizens are already urging Weilai to open pre-sales ahead of schedule. According to Weilai's announcement, Exeed will open pre-sales on the first weekend after the end of this auto show, which is April 22.

With Weilai moving upwards, Xingtu moving downwards, and Yuechi positioned in the middle, the brand strategy is crystal clear. Weilai has also successfully salvaged its image after being affected by the MINI incident, thanks to Xingtu's starting price and a series of previous operations.

It has to be said that in the current market trend of consumption downgrading, Weilai has fully captured the minds of users with a model that is like a game-changer, and with a very attractive price, making Lei Jun, who studies the automotive market, very envious.

"By the way, how much is your SU7 priced? It should be over 20 yuan, right?"

Xiaomi has finalized the model of its car. Speaking of which, Xiaomi is quite fast. Its supply chain integration capabilities are far stronger than before. After the road test photos appeared on the Internet, it is clear that it is a coupe.

Lei Jun laughed and said, "Why do you think it's over 20 yuan?"

Although he has denied more than once that the Xiaomi SU7 will be priced at 9.9 yuan, that doesn't mean it has to be priced at 20 yuan or more.

“That’s normal. If the price is below 20 yuan, you don’t need to manufacture cars, or it would be more appropriate to call it Redmi Car.”

Why are they so eager to build cars? It's all for the sake of brand premiumization. With its mobile phone premiumization strategy failing to break through and its overseas market limited to India, where it is frequently taken advantage of, Xiaomi is in a rather awkward position right now.

Cost-effectiveness is the gene of Xiaomi's success, but it is also the gene that restricts Xiaomi's development. This can be seen from the market's call for Xiaomi's first car to start at 9.9 yuan after Lei Jun announced that he would be making cars.

Furthermore, with a true price of 9.9 yuan, unless it's sold at a loss and offers features that are significantly higher than its class, like the Star Wish, to open up the market, how can it compete with Exeed and the Qin series?
In the new energy vehicle market priced between 10 and 15 yuan, WYI and BYD are currently two behemoths that no new car company dares to challenge head-on.

This is market appeal.

"Hehe, anything is possible, don't be so absolute."

On the surface, Lei Jun appeared calm and cheerful, but inside he was extremely bitter. Wei Lai's aggressive tactics this year have put tremendous pressure on emerging brands like theirs. Traditional automakers have their moats, but emerging brands don't.

The price war strategy employed by Weilai in the first quarter has hurt not only gasoline-powered vehicles but also emerging brands that dominate the low-end market. Xiaopeng's sales declined by 47.25% year-on-year, Leapmotor's sales plummeted by 51%, and last year's top-selling emerging brand, Nezha, also saw its sales decline by 13.19% year-on-year, relinquishing its title as the top-selling emerging brand.

Xiaopeng Motors and Leapmotor have already successfully gone public, and their sales have declined sharply in the short term due to factors such as product upgrades. However, for Nezha Motors, which has not yet gone public, the decline in sales is purely due to market factors, even though its product line is complete. Their transformation product, Nezha S, launched last year, has not made any waves at all.

It can be said that whether emerging brands can survive better depends on whether Wei Lai or Tan Jincheng are willing to be more aggressive.

(End of this chapter)