Author |Gong Chenqian.
Edit |Li Guozheng.
Produced by |Bangning Studio (GBNGZS).
Chen Hong has been at the helm of SAIC for nine years. Born in March 1961, Chen Hong is almost the eldest among car bosses, and has been serving for a long time over his age - in more than three months, he will turn 63 years old. Many people judge from various signs that it is unlikely that Chen Hong will succeed him after the expiration of his term of office in June 2024. Perhaps, 2023 is Chen Hong's last full year at the helm of SAIC. This "first brother in the automobile industry" has made great contributions to the development of SAIC and even China's automobile industry. During his tenure, until 2023, SAIC Motor maintained the leading scale in China, maintained the first place in the country for 17 consecutive years, and was the first automobile group in China with annual sales of "double million" new energy vehicles and overseas markets. In the list of the top 100 enterprises in Shanghai in 2023, the first place is Baowu Group (China Baowu Iron and Steel Group*** The second is SAIC. However, the heroes are late, and the company cannot escape the curse of the market. Compared with the past, SAIC's performance this year seems to have taken a step back. It is difficult for an elephant to turn around. Although Chen Hong led SAIC to lay out the new energy route in advance and increase the transformation along the way, the performance still declined uncontrollably. In the first 11 months of this year, SAIC's cumulative sales volume was 43840,000 units, down 8% year-on-year02%, lower than the average level of industry development - from January to November, China's automobile sales increased by more than 10% year-on-year. In terms of revenue, in the first three quarters of this year, SAIC's overall revenue was 5233500 million yuan, which is not a small gap from the annual target of 800 billion yuan. The main reason for this is that the joint venture segment has supported SAIC's performance in the past. Since the beginning of this year, as the halo of the joint venture car has intensified and dimmed, SAIC's "profit cow" production has been reduced, its income has shrunk significantly, and its profitability has continued to be under pressure. It's a big deal. The automobile industry is the pillar industry of Shanghai. In April and September this year, the Secretary of the Shanghai Municipal Party Committee and the Mayor of Shanghai made a rare visit to SAIC to conduct research and hold on-site meetings to deepen research and continue to promote SAIC's innovation and transformation and the development of new energy vehicles. In the face of the nearer and closer countdown to resignation and the continuous pain brought about by transformation, Chen Hong hopes that the leadership team of SAIC Motor will inject new blood and let the younger generation lead the transformation of the times. On the evening of December 12, the Shanghai State-owned Assets Supervision and Administration Commission issued a pre-appointment announcement, announcing that three senior executives of SAIC Motor Group planned to serve as vice presidents of municipal enterprises, namely Jia Jianxu, general manager of SAIC Volkswagen, Wu Bing, general manager of SAIC Passenger Vehicle and CEO of Feifan Automobile, and Jiang Jun, CEO of Zhiji Automobile. 
If nothing else, these three people will become vice presidents of SAIC. They are all post-70s, and two of them are still post-75s, and their new appointments will undoubtedly make SAIC's management team younger. This is also Chen Hong's wish, he once said: "Cultivating and strengthening a young and professional team is not only the general trend of development, but also the inevitable requirement of carrying forward the past and forging ahead into the future and passing on the torch." "History is always strikingly similar, but not simply repeated. Nine years ago, when Chen Hong was at the helm of SAIC, it was also a personnel change reform that kicked off the prelude to SAIC's "Chen Hong era". Nine years later, Chen Hong pushed SAIC to start with similar reforms again, igniting a new fire for the next load. 
New troika
In fact, judging from the sales volume in the first 11 months of this year, SAIC Motor is still firmly in the top spot among Chinese automobile groups, and has opened a big gap with the second place. Even better, in the past two months, SAIC's impulse performance has exceeded expectations, especially in November. According to the data, under the strong pull of the "new troika" of independent brands, new energy and overseas business, SAIC's sales in November were 5150,000 units, a new high this year, achieving a year-on-year increase. 
Among them, 30 of the sales of independent brands60,000 units, up 10% year-on-year8%, accounting for 59% of total sales;New energy vehicle sales 1510,000 units, a year-on-year increase of 16%, a record high;Overseas market sales 1180,000 units, up 6% y/y. Under the leadership of Chen Hong, SAIC Motor has made outstanding achievements in new energy, intelligence, and going overseas this year. In terms of new energy vehicles, in the first 11 months of this year, SAIC's new energy vehicle sales were 9040,000 units, ranking second among Chinese automakers. In terms of model layout, from the Shanghai Auto Show in April to the Guangzhou Auto Show in November, SAIC Motor has successively released a number of new cars such as the Zhiji LS Feifan R7, the Roewe D7 DMH, and the SAIC Maxus Datong 7. According to the research report, the launch of a number of new energy models of SAIC is expected to boost sales in the fourth quarter. In terms of intelligence, SAIC has gained a lot, as Chen Hong said in 2021, taking the "soul" into its own hands. On December 1 this year, SAIC Motor said in response to investors' questions about the layout of autonomous driving that it has mastered the development of a number of intelligent driving functions such as high-speed driving guidance, NOA in urban areas, L4 automatic driving in limited areas, navigation assistance, and automatic parking. In the first half of the year, SAIC Motor's SAIC Intelligent and Youdao Zhitu obtained the first batch of driverless road test licenses in ChinaAt the same time, the smart heavy truck project has been commissioned and operated in Ningbo Port and Quanzhou Port to accelerate the development of new scenarios for the commercial development of autonomous driving. 
On December 18, Zhiji Auto announced that its vehicles equipped with L3 autonomous driving functions have obtained the Shanghai high-speed road autonomous driving test license, and will carry out L3 high-speed road autonomous driving road tests in designated areas to accelerate the development and implementation of high-end intelligent driving products. From chips, operating systems, software, data closed-loop, motion control systems, three-electric systems to corresponding scenarios, SAIC is shaping vehicle integration capabilities and technological innovation advantages, and creating a "scientific and technological life" with a strong heart, agile body, and intelligent brain. After more than two years, Chen Hong no longer sticks to the "soul" as he did at the beginning. On December 15, an investor asked SAIC: "After Changan and Huawei establish a new company, does SAIC have any intention of joining?"The latter replied that in the process of accelerating the transformation to a new track of smart electric vehicles, the company has always adhered to independent innovation and open cooperation, and has always adhered to an open and cooperative attitude towards technology companies, including Huawei, ......If there is a major event, the company will publish it on the official platform or designated **. 
In fact, SAIC has built intelligent business with a number of external companies, covering automotive-grade advanced performance chips, intelligent driving algorithms and platforms, and smart travel ecology, including NXP, Amazon, Horizon, Momenta, etc. In terms of overseas business, SAIC's sales volume in overseas markets in the first 11 months was 10670,000 units, a year-on-year increase of 208%, which has exceeded the whole year of last year, and the sales of independent brands account for more than ninety percent, leading Chinese car companies. In terms of models, the MG4 EV has landed in more than 80 countries on six continents around the world, with overseas sales exceeding 10,000 per month, and in November, it won the "Carsales Car of the Year" award, Australia's top car award, becoming the first Chinese tram to win the "British, French, German and Australian Model of the Year Grand Slam". With the help of the new track of electric and intelligent networking, SAIC Motor has continuously optimized and enhanced the breadth and depth of global cooperation through organizational adjustments while growing rapidly in overseas sales. On December 16, SAIC Motor established an international trading company. 
During this year's Guangzhou Auto Show, SAIC's first open-top electric sports car MG Cyberster was launched. This is SAIC's second global car after the MG4 EV and will be launched in Europe next year. Up to now, SAIC is the only domestic automobile company with a "whole industry chain going overseas", and has built a full value chain of the automotive industry overseas, including innovation and R&D centers, production bases, marketing centers, first-chain centers and financial companies, and its products and services have entered more than 100 countries and regions around the world. At present, SAIC has 3 overseas R&D and innovation centers, 4 vehicle manufacturing bases, more than 100 parts production and R&D bases and more than 2,800 marketing service outlets, and has established the first overseas financial service company in Indonesia, and has also opened 7 self-operated international routes from China to Southeast Asia, Mexico, West South America and Europe. These should be Chen Hong's big strokes. 
Labor pains continue
A huge automobile group naturally receives attention and comments from all aspects of society. In addition to the glamorous noodles, SAIC also exposed a lot of regrets to the outside world. First of all, the upward transformation of new energy is slow, and the landing of new electric intelligent models is not as expected. Although SAIC ranks second in terms of new energy sales, a considerable part of the data is ** SAIC-GM-Wuling, which is positioned at the low end. Taking November sales as an example, SAIC-GM-Wuling is still the top seller of new energy vehicles in the SAIC Group's system, with a total of 590,000 new energy vehicles, accounting for nearly 40%. Among them, the price of Wuling Binguo is less than 90,000 yuan, and the sales volume is 3460,000 units;The well-known Wuling Hongguang MINI EV has a sales volume of 2350,000 units. As for the high-end brand, Zhiji Auto, although sales exceeded 8,000 units for the first time in November, reaching 8,700 units, 8,100 units were contributed by the Zhiji LS6. Zhiji Auto has L7, LS7, and LS6, and its products are positioned as medium and large cars, with prices ranging from high to low. 
The starting price of the Zhiji L7 is $33880,000 yuan, while LS6 focuses on cost performance, with a price of more than 200,000 yuan, and the gap between the two is large. The LS7 and L7, which represent the high-end series, now sell no more than 500 units per month, and if they do not rise, they will gradually be forgotten by the mainstream market. In the first 11 months of this year, Zhiji sold 280,000 units, 4 percent from the annual target50,000 units is far behind, and its performance lags significantly behind independent high-end new energy brands such as Zeekr, Deep Blue Automobile, and VOYAH. As for Feifan Automobile, which once represented SAIC's high-end brand, it has now faded out of the public eye, and it is even difficult to find a trace in the group's monthly sales report. Since the beginning of this year, a number of research reports have suggested that SAIC has the risk of "the landing of new electric intelligent models is not as expected". Some analysts believe that the high pricing, the lack of significant differentiation advantages, and the lack of brand power are the pain points that are difficult for SAIC to implement in the high-end. 
The second is that the joint venture brand is suffering from the pain of transformation, and profits have been greatly reduced. SAIC has three major joint ventures, namely SAIC Volkswagen, SAIC-GM and SAIC-GM-Wuling, the former two of which have been its "profit cows". In order to get out of the pain, SAIC Volkswagen is making every effort to transform to new energy, and has lowered its ID many timesMost of the prices of family models are discounted by more than 30,000 yuan, and the product with the highest decline is ID3。This has brought good results to SAIC Volkswagen and even SAIC in the field of new energy. In November, SAIC Volkswagen IDThe family sales volume is 1560,000 units, a new high in a single month. Among them, id3 in November delivery reached 120,000 units, up from the previous month for the fourth consecutive month. 
When the surging news recently visited a SAIC Volkswagen 4S store, it was seen that the Volkswagen ID was originally placed3. The booth for pure electric models has been vacant. Sales consultants said Volkswagen ID3. The cost performance is higher, and due to the recent surge in sales due to the price cut, the show car has also been sold. However, exchanging price for volume has cost SAIC Volkswagen a decline in profits. Jia Jianxu revealed in an interview with ** that Volkswagen ID3 is still in a state of loss, before the price reduction, every car sold will lose 270,000 yuan, and the loss of each car after the price reduction is more than 40,000 yuan. This has a direct impact on the Group's financial results. In the third quarter of this year, SAIC's net profit fell by nearly 10%. In order to alleviate the operating pressure, starting in the first quarter of next year, Volkswagen ID3. Lithium iron phosphate batteries will be used instead, and the production cost will be reduced by 190,000 yuan. SAIC Volkswagen expects that in the second quarter of next year, ID3. Will turn losses into profits. SAIC's problems are not limited to this, but also include: the influence of its own brands Roewe and MG needs to be improved;SAIC-GM is in turmoil;The group's overseas going overseas encountered the ...... of "shorting" in IndiaAccording to this trend, it is expected that it will be difficult for SAIC Motor to achieve its 2023 target of 6 million vehicle sales and total operating income of more than 800 billion yuan. In the face of these problems, how should Chen Hong play his cards?What should SAIC do in the future?He has defined the basic policy and general direction, and the strategy is to seek progress while maintaining stability. The transition to new energy is certainly the first priority. In April, SAIC Motor released the "Three-Year Action Plan for the Development of New Energy Vehicles", and promoted the implementation of a number of important measures, including innovating the organizational system, clarifying brand positioning, and improving product camps. SAIC Motor has set up a three-year action plan headquarters for the development of new energy vehicles to make rapid decisions on major issues in the development of its own brand new energy business, and has established two major teams for tackling key problems: Zhiji Automobile and Passenger Car Company. At the same time, it also further clarified the positioning of its own brands such as Zhiji, Feifan, Roewe, MG, and Wuling, forming a new energy brand camp with full coverage of the "high, medium and low, domestic and foreign" markets. In terms of product layout, by 2025, Zhiji Automobile will launch three more pure electric vehicles, and SAIC Motor Passenger Vehicle will launch 10 new models to enhance its product competitiveness in the pure electric and plug-in hybrid markets. In order to promote the three-year action plan, at the end of May, Chen Hong determined three points at the SAIC Workers' Congress: continue to work adhering to user thinking and forming a closed loop of business;In the insistence on integrity and innovation to improve the energy level, continue to work hard;In adhering to the market orientation to stimulate vitality, continue to work hard.
At the meeting, Jiang Jun, Wu Bing and other executives signed a military order, promising that SAIC's new energy vehicle sales will reach 3.5 million units in 2025. These two are newly promoted group executives. The personnel changes at the end of this year are also part of the three-year action plan. Through the high-level personnel layout, SAIC is ready to build the next young leadership team. In December 1984, the young Chen Hong joined SAIC. In December 2023, he built a young new SAIC.
For 39 years, he dedicated the best years of his life to SAIC.