Great Wall Motor's Wei Jianjun: Build cars with passion and go global with a mission.
From being large to being strong and going global is the mission of this generation of Chinese automotive professionals.
Whether it is the new car-making forces such as NIO, XPeng, and Leapmotor, or the established enterprises like Great Wall, BYD, Chery, and SAIC, they are all striving to "go global".
The transformation of energy forms has accelerated the pace of Chinese automobiles going overseas. When the three-electric system replaces the three major components of fuel vehicles, the inherent deficiencies of China's automotive industry have begun to be compensated. Coupled with the maturity of the electric vehicle industry chain, new energy vehicles made in China are continuously sold to countries and regions such as Japan, Europe, Southeast Asia, and South America.
However, beneath the thriving export of new energy vehicles, there are also hidden dangers. The price war and cost war that started in the Chinese market have spread from domestic to overseas, and all automakers are deeply involved.
Wei Jianjun, the chairman of Great Wall Motors, recently mentioned in a public interview his views on the overseas expansion of Chinese automobiles, "We should not be overambitious. We should aim to become a strong automotive country. Safety and quality are built with costs. Simply being cheap will lead to extremely worrying product quality."
As one of the private automakers with the earliest establishment time among the mainstream Chinese automakers, Great Wall Motors has stepped out of the country as early as 1997 and has been doing so for 27 years. Years of overseas experience have made Great Wall Motors realize that Chinese new energy vehicles are in a "delicate moment" in the global market.
If going overseas means selling cars at zero profit or even triggering a price war in the local market, forcing the automotive development standards to continuously decline, it can only make the brand image and future of Chinese automobiles stagnate.
Wei Jianjun is an older-generation automotive professional with a passionate and sincere attitude. He believes that the automotive industry should follow the rules and logic that have been accumulated over the years to ensure that every vehicle provided to consumers is a fully safe, reliable, and thoroughly researched, developed, and tested product, not a semi-finished product. The product standards should not be lowered due to the price war.
This is not only the greatest harm to consumers but also a stumbling block that hinders the establishment of the image of Chinese automobiles overseas.
Looking at the history of the automotive industry, there have been too many incidents where the development standards have been ignored due to the blind pursuit of profits. Chinese automakers have also reached this critical moment of choice. Great Wall Motors has taken the lead in sounding the alarm for the industry. Going overseas for automobiles should be based on quality and safety, and the rules should be respected rather than violated.
Part One: Breaking the Rules, and the Only Ones Paying Are Consumers
In the past two years, the price war has been a lingering shadow over the Chinese automotive market, and all automakers are trapped and unable to extricate themselves.
Recently, the China Automobile Dealers Association released a report stating that the price war has caused the new car market to lose 138 billion yuan from January to August. Even more shocking is that from January to August, the profit margin of China's automotive industry is only 4.7%, lower than the average profit margin of 6.2% of downstream industrial enterprises.
Zeng Qinghong, the chairman of GAC, strongly criticized the price war at this year's Chongqing Auto Show in China, voicing the thoughts of the majority. "The goal of enterprises is to make profits and contribute to the country. We should have a broad perspective and a long-term vision, rather than engaging in short-term competition. Enterprises cannot survive without profits."
Yang Xueliang, the vice president of Geely, also shares the same sentiment: "We should not engage in a simple and crude price war, but rather a high-quality price war, as well as a technology war, a quality war, a service war, a brand war, and an ethical war for enterprises."
In the situation where automakers and supply chain enterprises are complaining incessantly, some enterprises have begun to test the red line of quality and safety.
In the food industry, there is a popular online term called "Technology and Ruthless Tricks", referring to the production process of some counterfeit and shoddy, and falsely advertised foods. Now, the Chinese automotive industry has also begun to have its version of "Technology and Ruthless Tricks".
Wei Jianjun has a deep love and a sense of responsibility for the automotive industry. He pointed out, "The price of new cars has been continuously reduced, which seems to benefit consumers. However, the excessive cost reduction has forced some manufacturers to cut corners or even engage in fraud. Once a quality crisis is triggered, it is ultimately the consumers who will have to pay the price."
In a situation where the manufacturing process cannot undergo a disruptive change in a short period of time, if the price is continuously lowered, the quality will definitely decline. The final result is that more and more good products are being driven out by inferior ones.
For consumers who bought cars earlier, the frequent price reductions are like a stab in the back, not to mention those who bought vehicles from bankrupt automakers.
"In the past ten years, 24 of our automotive brands have gone bankrupt, and more automakers will continue to fail in the future. Consumers may buy cheap cars now, but the future costs are impossible to estimate." Wei Jianjun is very distressed.
The competition in the automotive industry is increasingly exceeding the rules, and performance false marking has become the norm, "Marked as 1200 kilometers, but actually only runs 600 kilometers". Consumers can only discover the problem after driving the car home.
The automotive development cycle is continuously shortened, and the prices are continuously reduced. In the short term, it stimulates sales and appears prosperous, but if this continues in the long term, ignoring the details will definitely lead to major problems.
The development process of automotive products is complex and lengthy. Before the launch of each new car, it undergoes two winter tests, one summer test, as well as rigorous tests on thousands of items including durability, stability, NVH, and many others.
Whether these development and tests are completed is the basic guarantee that consumers will not need to have their cars repaired frequently after purchasing. In order to make the products more reliable, automakers often increase the test intensity to a mileage that a car cannot reach in its entire life cycle.
This is a complex and large-scale systematic project that requires repeated verification, accumulation, and reasoning through comprehensive working conditions to reach the final conclusion, and it has extremely high requirements for equipment conditions, funds, and the quality of personnel.
However, with the intensification of competition, the development process of automakers is continuously shortened, and various components have also begun to lower their requirements in order to reduce costs. Some automakers have even shouted the slogan of developing a new car in 12 months.
Vehicles produced under such a rough development process with a lower price may have few major problems, but there are continuous minor issues such as insufficient tire pressure, ineffective assisted driving, and vehicle machine bugs, among others.
In the end, it is not only the automakers who are working diligently that are harmed, but more importantly, the consumers who are paying for it. If these "minor issues" continue to appear in the overseas market, the damage to the Chinese automotive industry will be even more difficult to recover.
Part Two: Sounding the Alarm for Overseas Expansion, Great Wall Leads the Industry
According to statistics from the General Administration of Customs, in 2023, new energy vehicles, lithium batteries, and photovoltaic products have become the "new three specialties" of China's exports, with a total export volume of 10,600, which is a remarkable achievement.
Going overseas has become one of the annual buzzwords in the automotive industry. However, beneath the rapid development, there are also many chaotic situations. If the full score for automotive overseas expansion is 10, Wei Jianjun believes that currently, it is only 3 points.
He pointed out that there are many pain points for Chinese automobiles in the global market, such as no brand premium and inability to localize production. There are many experiences of overseas automakers that Chinese automakers should learn from.
Take the Hyundai Motor Group as an example. Its new car sales in China are continuously declining and almost impossible to recover. The Chongqing factory even has a "50% discount sale". However, globally, Hyundai still has a significant market share. Its global sales last year exceeded 7.3 million units, and its profit exceeded 81.3 billion yuan.
Wei Jianjun said, "Most of the exports from China are complete vehicles or parts for assembly. In our industry, it is called CKD. But most of Hyundai Kia's vehicles are manufactured overseas and sold locally. In this way, your costs cannot compete with theirs."
Therefore, Great Wall Motors has been promoting global localized production. Overseas, Great Wall Motors has established 3 full-process vehicle production bases in Thailand, Brazil, and other places, and has several KD factories in Ecuador, Pakistan, Indonesia, Malaysia, and other places.
Great Wall Motors has established a complete global R & D, production, marketing, and sales system. In terms of sales, Great Wall Motors has exported to more than 170 countries and regions, with more than 1,300 overseas sales channels and a cumulative overseas sales volume of more than 1.7 million units. From January to September 2024, Great Wall Motors' cumulative overseas sales in 2024 were 324,200 units, with a year-on-year growth of 53.16%.
As a pioneer in overseas expansion, Great Wall Motors has a lot of experience. However, as more and more automakers go overseas, some automakers have begun to ignore the bottom line and challenge the rules.
Some automakers sell cars overseas at zero profit, indirectly leading to the European Union and other regions increasing taxes on Chinese automakers. Some automakers in Thailand have continuously reduced prices within one year, triggering a price war and causing consumer resistance. These are all challenging the local market rules.
If Chinese new energy vehicles have quality problems in the overseas market due to the price war, the damage to the brand image of Chinese automobiles will be the most severe, and all overseas automakers will find it difficult to remain unaffected.
The strictness of overseas market regulations is obvious to all. General Motors was fined 145.8 million US dollars by the US government for excessive emissions; Volkswagen was even fined a staggering 14 billion US dollars for using illegal software in diesel vehicles to cheat emission tests.
Faced with such vivid cases, Chinese automakers should not mourn without learning from them.
Establishing a sound overseas production and marketing network is the ladder for Chinese automobiles to go global, and it is the gap that we need to fill. However, excellent quality and strong technical strength are the foundations that cannot be ignored for the globalization of Chinese automobiles.
Now, after three years of rapid development, the Chinese new energy vehicle industry has also reached the doorstep of high-quality development. Who can truly step into this door, and who will bypass it, will become a fork in the road for automakers.
At a time when Chinese automakers are trapped in the vortex of the price war and find it difficult to extricate themselves, someone in the industry needs to stand up and remind everyone: When going overseas, rules must be followed. As the only veteran in the automotive industry who has been in office for 34 years, Wei Jianjun, the chairman of Great Wall Motors, has taken on this role without hesitation.
[Vice President of Brazil Meets with Chairman Wei Jianjun of Great Wall Motors]
He steps forward, facing the public and the unfamiliar Internet, and speaks frankly. "Those who engage in financial fraud, product fraud, and dishonesty should not be at this table!"
Wei Jianjun has always stood on the position of consumers and the Chinese automotive industry. He may not be able to drive the change of the entire industry, but he always has his own persistence.
Any automaker should realize that whether it can adhere to the bottom line of the rules and whether it can return to a healthy order not only affects the development of the automotive industry in China but also determines the fate of Chinese automobiles going global.