Liu Xiaolin, textHow to describe the situation of joint venture car companies this year?The description in the current ** is "like sitting on pins and needles" and "great pressure". This state of affairs is not unique today. In the past few years, due to the stable income of fuel vehicles, joint venture car companies with strong family backgrounds have been able to wave their sleeves and continue to promote the transformation plan according to the traditional rhythm.
But the feathers sink the boat. In the past four years, with the invasion of self-owned brand new energy vehicles in various market segments, the total market share of joint venture brands has been gradually eroded, and today, it has substantially lost its market dominance.
According to data from the China Association of China, in 2022, the market share of self-owned brand passenger cars will reach 499%, forcing the joint venture to the 50% red line area;From January to October 2023, the market share of Chinese brand (i.e., domestic brand) passenger cars has reached 553%, surpassing the share of joint ventures. According to the data released by the passenger association, in November, the share of the German, American, Japanese and Korean joint ventures continued to decline, and among the top 10 passenger car wholesale sales in that month, only four joint venture brands were retained, namely North and South Volkswagen and SAIC and GM (note: SAIC-GM-Wuling is closer to its own brand from the product level).
From 60% of the market share in 2019 to 45% today, the slow response of the joint venture brand has made the industry regret, and the voice of the decline has also reached the maximum volume. But at the same time, joint ventures are starting to stand up for themselves: at the CIIE in November, Dong Changzheng, senior executive vice president of Toyota China, was the first to fight back: "The development of electric vehicles in China has been so good in recent years is the contribution of our mainstream car companies." We're paying taxes, we're nurturing talent. The joint venture is 50 against 50, and looking forward to the failure of the joint venture is by no means a prospect that China should see. ”
Two weeks later, at the Guangzhou Auto Show, the slogan "Joint venture is not a backward representative" was played on the large screen around the GAC Toyota booth. Ironically, Trumpchi, a member of the GAC Group, confidently played the slogan "half a step ahead of the lead" on the screen of the press conference.
So, should the joint venture car companies be sung?To answer this question, we might as well change the angle and ask whether the joint venture car company is worth looking forward to.
Joint ventures can't be down?
First of all, there is no need to list the various situations in which the joint venture brand cannot keep up with the rhythm. In the past two years, even Volkswagen, the multinational brand with the largest market share in China, has been complained about its unsatisfactory intelligent functions and software applications.
Secondly, catching up with and surpassing international brands has always been the goal of China's auto industry, and the facts of the past decade have proved that new energy vehicles have indeed made this goal approached quickly. From these two perspectives, it seems to be an expectant and inevitable trend for joint venture brands to be fully suppressed by independent brands.
However, one concept that needs to be clarified is that joint venture brands, joint venture car companies and multinational brands and multinational car companies are not the same thing, at least in the name of most domestic joint venture car companies, the name of the Chinese party is put in front, and in the localization process of the past two decades or so, the interest correlation between the joint venture car company and the Chinese side has already exceeded 50% of the equity ratio.
In addition, joint venture car companies are still the core sector of many local automobile manufacturers, especially in the new energy vehicle business continues to burn money, and it will be difficult to make money in the next few years. As Dong Changzheng said: joint ventures are mainstream car companies, and the scale of the industrial chain system they cultivate and support is much larger than that of new energy vehicles that are currently on fire. It can be said that the success or failure of the transformation of the joint venture is related to the future of the entire Chinese auto industry.
Therefore, for this group of "elephants", the best expectation is to let them quickly keep up with the team, and expect them to speed up the elimination of disadvantages and benefits under the stimulation of independent new energy.
The car companies themselves are best aware of the problems of joint venture car companies. What is often overlooked by the outside world is that the transformation of joint venture car companies is indeed much more difficult than that of independent brands. Limited by 50:50 or the shareholding structure of foreign holdings, the decision-making process of any decision made by a joint venture car company will cost at least twice as much time and labor as that of an independent car company.
On October 31, at the 2023 Global New Energy and Intelligent Vehicle ** Chain Innovation Conference, Wei Jianbin, full-time deputy director of the manufacturing headquarters of Dongfeng Nissan Passenger Vehicle Company and general manager of Guangzhou Fengshen Automobile, delivered a complaining speech, bluntly saying that "the epidemic has covered up the unsuitability of many joint venture brand cars in the Chinese market", and he listed that both Chinese and foreign parties are quarreling at the level of technology and marketing (each has its own ideas), technology cannot keep up with China's consumption trends and regulations, and the core of new energy" The "three electric systems" do not accept local products resulting in high costs, and "the joint venture focuses on the needs of the global market, and there is no characteristics for the Chinese market" and other internal problems, this rare "self-exposed" speech, truly presents the common problems faced by the joint venture car companies, as well as the helplessness and anxiety about it.
In addition, although the joint venture car companies have also launched a high-level reshuffle in response to the business downturn, due to the limitations of the system, they still follow the way of internal system promotion, and it is rare to hunt for talents with high salaries like their own brands. The CEO of a joint venture car company personally admitted that in terms of introducing intelligent technology talents, the joint venture car company does not have advantages in terms of working environment or salary.
What to look forward to
Under the pressure of internal and external pressures, joint ventures have shown signs of substantial changes, which is worth looking forward to. Since the beginning of this year, joint venture car companies have made frequent moves, launched new strategies and new products, landed new investment plans, and carried out asset restructuring between the two sides of the joint venture, and even took the initiative to "roll" up in the field of new energy and intelligence that led to their own backwardness. These actions signal the same thing: the old joint venture model is changing.
The most obvious change is that joint venture car companies have begun to invest in the individual needs of the Chinese market, including setting up local R&D teams, investing in or cooperating with local Chinese technology companies, launching customized products in China, accelerating the product development cycle, etc., no longer sticking to the development cycle of up to 4-5 years, and have announced that they will shorten the product development cycle, improve the local technology content, and keep up with their own brands.
The biggest change comes from the inside, almost all joint venture car companies are aware of the problems in internal communication, not only the time difference between Chinese and foreign parties needs to be considered in communication, but also the lack of timely communication brings about low processes and efficiency. Therefore, it has become a common choice to shorten the decision-making process for businesses in China, and to make decisions and implement them quickly. At the same time, the idea of solving the Chinese business in China has also begun to be accepted by more foreign parties to the joint venture.
Since the second half of this year, these actions have been accelerated. SAIC-GM announced the establishment of a software and digitalization center, considering that overseas software and functions will not be adapted to China, and the development of many functions will be done by local teams. GM's North American headquarters not only agreed to let SAIC-GM play with China's own 'circle of friends', but also set up a dedicated R&D team to connect with China. With a multi-pronged approach, SAIC-GM's new vehicle launch cycle will be greatly shortened.
There are complaints from Dongfeng Nissan, and there are also blessings from SAIC-GM. Late consensus is even more rare. In contrast, the German localization stance has been consistently positive. Volkswagen has made a particularly frequent move, investing in Xpeng, setting up a technology company in Anhui, and software company CAAD has already formed three technology joint ventures with local Chinese startups such as Horizon. These investments will directly accelerate and support product development for the three vehicle joint ventures. Volkswagen has announced that it will complete the development of two China-specific electric vehicle platforms within three years, which previously took at least 48 months to complete. At the same time, Audi has also reached a platform cooperation with SAIC Zhiji.
In September, Dongfeng Honda released the new energy vehicle brand "Lingxi", which belongs to the joint venture car company, announcing that it will face the fierce market competition with new concepts, new technologies, new designs, new services and new channels. Toyota chose to join hands with BYD in new energy and cooperate with Pony.ai in intelligence.
There are also joint venture car companies that have begun to stop losses and cede more management rights to the Chinese side. In May, Ford announced that it would streamline its operations in China, reducing investment and focusing more on high-return businesses. In September, Changan Automobile and Changan Ford jointly invested in Changan Ford New Energy, with a shareholding ratio of 40% and 60% respectively, with Changan indirectly holding 70%.
In October, the French Stellantis Group, a joint venture partner of Dongfeng Group, made two China-related decisions: 17The company sold its plants in Wuhan and Xiangyang to Dongfeng for CNY 1.4 billion and acquired a 20% stake in Leapmotor, a local Chinese new energy vehicle company, for EUR 1.5 billion. According to Dongfeng, the joint venture sells the plant in order to create synergies and allow Dongfeng to more actively integrate Dongfeng into Dongfeng's new energy business territory.
In any case, from the current point of view, the clean-up of the clean-up, the integration of the integration, the increase of local investment and the transfer of rights have also been taken into action. Joint ventures are already accelerating in the direction of catching up with their own automakers.
Three points of thin fields and 300 million base plates
Another factor that cannot be ignored is that joint venture car companies have an absolute advantage in the user base. As Dong Changzheng said, in the country 3Of the 300 million cars, joint ventures account for more than 300 million. For such a large number of base users, joint venture car companies are pondering how to increase the conversion rate of new energy vehicle consumption. SAIC-GM said that 40% of its new energy customers come from base users.
From Volkswagen ID3 and Buick E5 this year's active participation in the first battle, with the launch of more new products, as well as the continuous improvement of cost-effective advantages, the combat effectiveness of the joint venture brand is expected to continue to improve. As for the criticized idea of "putting too much emphasis on safety", it is difficult to say whether this kind of caution and value sticking to will be transformed into a unique advantage in the large-scale application of new energy vehicles in the future. Imagine when a user who has not yet made a choice learns about the FAW-Volkswagen ID7. When the crash test at a speed of 80 kilometers per hour was done 73 times before the market, more than 30 vehicles were scrapped, and each collision cost more than 1 million, will the balance in my heart tilt slightly?
From another point of view, although China's new energy vehicles have led the global trend, the shortcomings are also obvious - serious homogeneity and low profitability, which proves that the innovation ability of independent car companies still needs to be improved, and innovation needs to be stimulated by more competition. From this point of view, it is a normal competitive format for joint venture brands to catch up with the big troops.
Half of the joint venture is connected to the domestic and half to the foreign. After all, the vast majority of the other half are still the world's top car companies, and I believe it is too early to say that independent brands have completely surpassed those of the world's top car companies. I believe that there will be a day, but not now. This passage of Zhuang Jingxiong, general manager of SAIC-GM, shows that he knows that it is a luxury for joint venture car companies to return to the glory of the era of fuel vehicles, but he thinks that the idea that the joint venture is only a three-third thin field for fuel vehicles is too shallow.
It is undeniable that joint venture car companies will be in a state of anxiety for a long time. At present, it will take two to three years for the deeply localized products of joint venture car companies to be launched on the market, and how to maintain the expectations of users during this period will be the biggest challenge.
However, one of the major advantages of large companies is that they have abundant funds and enough family funds to survive the losses in the early stage of new energy and survive the tragic war. "Whoever makes the money stays" is thought to be the format of the knockout rounds in the coming years. Therefore, in the list of those who have the last laugh, how many seats can be occupied by joint venture car companies, and the conclusion cannot be made too early.