What's wrong with me being a rich man?

Chapter 443 Narrative of Car Manufacturing
LeEco is known for its high-profile approach to business, and it has always been so.

With its official announcement of entering the automotive industry, LeEco has not only confirmed a comprehensive strategic launch event after the new year, but has also been explaining the significance of its car manufacturing venture for the industry. It aims to break down barriers, embrace openness, and provide a new possibility for the integration and transformation of the internet and automobiles.

This high profile and the significance of its rise naturally garnered extensive media coverage, leading to a slight increase in LeEco's stock price before the Lunar New Year.

Can LeEco make good cars?

Yu Xing never expected that this question would come from his own mother.

Looking at his mother, whose eyes were full of curiosity, he asked, half-laughing and half-crying, "Mom, why...why are you asking me this?"

Chu Qiying said earnestly, "I saw the news."

She arrived in Lingang with Yu Guosheng yesterday. Today, having nothing to do and knowing that her son's side wasn't too busy as it was near the end of the year, she came to the office to take a look around the work environment.

As for LeEco Auto, Chu Qiying has been paying attention to related news, intentionally or unintentionally, ever since his son got busy building cars.

"The car hasn't even been built yet, and we haven't recruited many people, but the attitude is already like this," Yu Xing said with a smile. "Our approaches are different, what can I say?"

Chu Qiying glanced at his son: "Just say it."

Yu Xing: "..."

He said it bluntly: "I'm not optimistic."

Chu Qiying pressed for details, asking curiously, "Why aren't you optimistic about it? Isn't LeEco a listed company? LeEco even said it wanted to create the ultimate user experience, and your silicon carbon car also aims to start with customer experience, doesn't it?"

Yu Xing chuckled: "Mom, you dropped out of school, and now you want to come and build cars with me? You're even getting involved with my projects?"

“That’s all from news analysis.” Chu Qiying thought for a moment and then said, “But there’s not much news about you. Sometimes I have to search for it myself. Why don’t you talk to reporters more about your car manufacturing business?”

Yu Xing sensed his mother's "spiritual shareholder" stance and laughed, "Our paths are different; I'll just do it first and see what happens."

He briefly mentioned his work over the past two years, when he suddenly received a WeChat message from Xu Xin on his phone. In addition to wishing him a Happy New Year, Xu Xin also brought up the topic of LeEco's car manufacturing project.

Yu Xing was pondering how to reply when he saw Liu Wanying push the door open and enter the office, so he shifted the topic of his mother to her.

Liu Wanying listened with a smile, and knowing that Capital Today had made initial contact with LeEco, she said her thoughts: "The problem with LeEco's car manufacturing project is that Mr. Jia is not using a listed company to manufacture cars, but placing this project in a non-listed company, yet it is still related to a listed company."

"In our experience, transactions involving related companies are where ambiguity is most likely to exist."

What experience?
Of course, it's the experience of crossing mountains.

She continued, "On the silicon carbon side, the project is clear and the funds are transparent. Yu Xing even relinquished his position as president of Baixiaosheng Company and only serves as a director. The investors only need to consider the project itself. The LeEco situation is so vague that it makes people more cautious."

Chu Qiying remained curious: "So LeEco's motivation was just to boost its stock price?"

Liu Wanying pondered for a moment, then shook her head and said, "There should be some. I heard Yu Xing mention it before. LeEco has expanded quite rapidly in the past two years, so its finances must be quite tight. If we're not optimistic about this..."

She carefully crafted her words.

After replying to Xu Xin's message, Yu Xing continued, "It's already quite good that LeEco has reached the mold-making stage in its car manufacturing. From the information I've gathered so far, I don't sense that they're seriously preparing to build cars."

This time, Liu Wanying also turned her gaze towards them, seeking an explanation.

Yu Xing explained, “Talking about the industry, telling stories, and buying press releases are all things that can be done with a lot of talking. Including finding land, recruiting people, and designing in the early stages, these don’t cost much. But if you actually make the molds, that costs a lot more. The cost of mold development alone can account for 4% of the total cost of the vehicle tooling development.”

For automakers to go from PowerPoint presentations to actual mass production, they need to make large-scale investments in tooling development. If they really do that, the cost of starting production will be too high.

Yu Xing is quite clear about LeEco's situation. The narrative of building cars is to alleviate financial pressure. Based on his current experience in running a silicon carbon group, his suggestion to Xu Xin was to wait until LeEco starts making molds before considering investment.

He felt that LeEco was absolutely incapable of completing this step, and for narrative purposes, they would likely use parts from other car models for manual modification, which would also make it look plausible.

This process is also easy to verify. Just go and see if there is a complete stamping production line or mass-produced car body parts, and you'll immediately know the truth.

Xu Xin was clearly very satisfied with the answer, and sent a thank you message on WeChat, and even made plans to have dinner after the New Year.

Yu Xing had barely put down his phone a minute before he was considering whether Xu Xin, that little short seller, was of any use when Zhang Suyang from IDG called, also asking for his opinion on LeEco's car manufacturing.

He couldn't help but laugh and ask, "If LeEco is making cars, why don't you all ask LeEco?"

“I heard that several companies that wanted to build cars came to Lingang last year. You, Mr. Yu, are now one of the people in China who know the ins and outs of this business the most. Of course I have to ask you, and I trust you,” Zhang Suyang said immediately.

Yu Xing was quite satisfied with the answer and briefly explained the ideas he had previously shared with Xu Xin.

This is just his suggestion; whether the two institutions listen to it is up to their own judgment. However, LeEco just announced its car manufacturing plans, and now they're already contacting investors, which seems rather urgent.

He put down his phone, smiled, and said to his mother, "LeEco even invited me to their press conference after the New Year."

"Are you going?" Chu Qiying asked. Yu Xing shook his head: "Buying my car is fine, ordering equipment is fine too, but I don't need to do anything like showing up."

Chu Qiying frowned slightly, looked at Liu Wanying, and then at his son: "Aren't you being disrespectful to your colleagues by doing this?"

"I chose to locate the factory in Lingang because I want to keep a low profile and avoid any hassle. I won't get involved in the affairs of the underworld," Yu Xing said calmly. "If others want to come and visit, then they can come. As for anything else, forget about it."

Chu Qiying felt that his son's evaluation of LeEco's car manufacturing was really low.

"Auntie, if you think about and learn more about these things, you can come work for my Red Falcon after the New Year," Liu Wanying joked.

Chu Qiying shook his head, explaining that he was simply following his son's lead and wanted to learn more about his career.

She got up and walked around the office, then took out her phone and scanned the "福" (Fu, meaning good fortune) character with WeChat.

Seeing this, Liu Wanying laughed and said, "I think the user groups of Alibaba's WeChat and Tencent's WeChat are gradually becoming different. It seems that the age range of WeChat users is older than that of WeChat users."

"Really? They provided the data?" Yu Xing was interested in this topic.

“There’s no official data, just third-party observations, and I think this assessment is pretty much consistent with what’s happening around me,” Liu Wanying said. “I don’t know if this has anything to do with Tencent having more content, games, and other businesses, but WeChat accounts can all be logged in with one click.”

Yu Xing pondered the potential changes this situation might cause for a while, and after a moment of contemplation, he said, "I wonder how the daily active users of these two companies are. I'll ask them when I send them New Year's greetings via text message."

Liu Wanying smiled slightly: "I'm afraid I won't tell you, but Carbon Silicon Data Company is slowly becoming a threat."

Despite the emergence of comparable products from Tencent, Silicon Carbon Data's three major software programs are still developing rapidly.

The fact that Silicon Carbon Data Company broke even in 2013 was not disclosed to the public, and those who knew about it kept quiet. However, some clues were found, and brands that placed ads there found that the conversion rate of their ads seemed to be better.

Silicon Carbon data provides advertising data; however, this data may be manipulated, but the actual traffic-driving effect is something each company can be very certain of.

In this way, we can get a rough assessment of the development of the silicon carbon data company.

The company's development trajectory is very clear, especially considering that Alibaba had previously expressed interest in acquiring it. Even Yu Xing, the "father of WeChat," was willing to strain his relationship with Alibaba to keep the company as an asset that was not for sale. All these factors have led the industry to begin to study the matter.

Given this situation, Alibaba and Tencent probably can't be so outspoken.

Yu Xing stretched, walked to the window, put his arm around his mother's shoulder, and laughed, "If you don't want to tell me, then don't. Let these two keep fighting forever."

The tense relationship between Alibaba and Tencent has actually brought more opportunities to the industry. It's unclear whether Carbon Silicon Data is the biggest beneficiary. However, while MusVid's overseas ventures are progressing well, Weishi, which lost Xing Hongyu, has not declined immediately.

Also before the Lunar New Year, Weishi (a short video platform) gathered a large number of celebrities to release short videos, resulting in an astonishing increase in both user base and daily active users.

According to a WeChat message supposedly from Xing Hongyu, Weishi's daily active users have surged to 3000 million in the past few days, and it has also entered the top five of the Apple App Store's free app chart, indicating a very promising situation.

What does 3000 million daily active users mean?
It's roughly at the level of "Weishi has succeeded".

Of course, Xing Hongyu, the former boss of Weishi, was also surprised, but he still helped to dispel the myth in private. Weishi's daily active users only count the number of times the app is launched, which may contain a lot of inflated figures.

According to his calculations, once the Spring Festival marketing campaign is over, the relevant data for Weishi will shrink significantly, which can then be indirectly verified through data from the Apple App Store.

Yu Xing found this statement quite interesting and teased Xing Hongyu: "Tencent's Weishi is in the top five on the charts, which is pathetic. Our Mus chart is in the top 100, which is very impressive."

On the same Apple App Store charts, compared to the dazzling performance of Weishi, Mus, which has been quietly climbing with Facebook's streaming ads, has also reached the threshold of the top 100 overall charts, and its current daily downloads have exceeded 10,000.

The data feedback from the Singapore team indicates that Facebook's targeted advertising accounts for approximately 60% of daily user growth, with 25% coming from organic traffic and the remaining 15% from word-of-mouth marketing among users.

Mus has revised its Q1 target to 350 million users, showing optimism about future growth.

On January 30, China celebrated the traditional festival. Yu Xing spent a quieter Spring Festival in Lingang than in previous years, but he and Liu Wanying were closely monitoring the movements of Vania and Allergan across the ocean.

As a target of a hostile takeover, Allergan clearly had no intention of sitting idly by. On the 30th, it mentioned its "shareholder rights plan," which stipulates that if any shareholder holds more than 10% of the shares, other shareholders can increase their holdings at half price, thereby diluting the acquirer's equity.

This is also known as a "poison pill" plan.

In addition to dealing with Vania, the main hostile takeover bidder, Allergan also did not forget Ackman, an accomplice, and directly filed a complaint with the U.S. Securities and Exchange Commission (SEC), alleging that Ackman engaged in insider trading and purchased shares after knowing about Vania's acquisition intentions in advance.

It filed an emergency application requesting a freeze on transactions at Ackerman's Pershing Square.

Yu Xing observed the dynamics of these three parties and felt that he had gained a lot of practical experience.

He discussed this with Liu Wanying that night: "When should we make a move?"

"Let's see what tricks Ackerman and Vania have up their sleeves. What's the rush? Do you really think you're a white knight?" Liu Wanying remained calm. "If you're a big short seller, you have to find the right moment and then get called a 'dog-eat-dog' situation."

Yu Xing felt somewhat helpless, sensing that this mastermind behind the mountain peaks seemed to be quite content with the situation.

(End of this chapter)