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The automotive supply chain still needs to be globalized

by:VIPUTRANS     2020-07-30
 

'At present, China’s auto sales are over 20 million vehicles a year. We cannot grow as high as we did in the past. The phenomenon of “hunting for cars” in the seller’s market no longer exists. Therefore, after the country has issued a number of policies to stimulate auto consumption, we cannot expect It is also unrealistic to achieve high growth in the past.” Recently, Zhu Yanfeng, a member of the National Committee of the Chinese People's Political Consultative Conference, chairman of Dongfeng Motor Group Co., Ltd., and party secretary, said in an interview with a reporter from the Beijing News.

   However, in his view, the country’s policy of expanding consumption will also have a positive effect on market recovery and, to a certain extent, will drive the entire market cycle to accelerate and transform and upgrade. Dongfeng Company will make full use of various policy advantages and innovate marketing methods.

   At this National Two Sessions, automobile consumption and new energy vehicles have become high-frequency vocabulary in the automotive industry.

   The government work report on May 22 pointed out that it firmly implemented the strategy of expanding domestic demand, expanding consumption, and promoting new energy vehicles. On May 24th, Ning Jizhe, deputy director of the National Development and Reform Commission, stated at a press conference of the State Council Information Office that the next step will be to take multiple measures to promote consumption recovery, further promote automobile consumption and the circulation of second-hand cars, and implement new energy vehicle purchases. The fiscal and taxation support policies make it convenient for residents.

   Dongfeng Motor's sales in Wuhan, Hubei Province, the epicenter of the epidemic, also experienced an industry decline in the first quarter. At the same time, its industrial chain and supply chain production faced major challenges. Zhu Yanfeng revealed that, assuming the responsibility of state-owned enterprises, Dongfeng made great efforts in the first quarter to stabilize nearly 2,000 upstream and downstream enterprises in the industrial chain supply chain. At present, the upstream and downstream supply of Dongfeng's industrial chain has returned to normal levels.

   In addition, Zhu Yanfeng gave detailed answers to questions about Dongfeng Motor’s new energy strategy, the highly-regarded h business unit, and the new opportunities for new infrastructure during the interview.

  The automotive supply chain still needs to be globalized, and the key technologies and components that are stuck in the neck need to be localized

  Reporter: Dongfeng is at the center of the epidemic. What is the current progress of resuming work and production?

  Zhu Yanfeng: At present, we have fully resumed work and production. At the center of the epidemic, it is indeed much more difficult for Dongfeng Motor to resume work and production than other companies in the industry. In fact, since February 11, Dongfeng has begun preparations for the resumption of work and production, and is the first large enterprise in Hubei Province to resume work and production. Timely and rapid preparations have also done a lot of demonstration, preparation and exploration for the rapid resumption of work and production in the later period of the province and the normalized production after resumption of work and production. For example, we have prepared response measures in dozens of scenarios, such as how employees go from the community to the factory to work, eat, take rest, change jobs, and how to deal with a team epidemic or office epidemic. As of the end of February, Dongfeng has basically established a management system to deal with normalized epidemic prevention and control; at the end of March, Dongfeng fully resumed production in light of actual market demand.

  Reporter: In the process of resuming work and production, what impressed you most?

  Zhu Yanfeng: Dongfeng Company is at the epicenter of the epidemic in Wuhan, Hubei. In addition to grasping the overall situation of its own prevention and control, it must also participate in the local 'Fighting the Defense War of Wuhan and Hubei'. The task is extremely heavy.

  Dongfeng Company puts forward the principles of “accurate information, stable action, good door management, good management of people, calm expression, and courageous responsibility”.

   Our first batch of employees who returned to work were very cooperative in performing nucleic acid tests and doing chest radiographs. In the face of the epidemic, the organization, discipline, overall awareness and sense of responsibility of state-owned enterprise employees have been concentrated. On the one hand, we will fight for the 'resumption of work and production', and on the other hand, we will do a good job of social responsibility. For example, we have provided Wuhan with more than 1,000 community service vehicles to cooperate with the government to complete a large number of epidemic prevention tasks.

   In the first quarter of this year, Dongfeng Motor made great efforts to ensure the stability of the industrial chain and supply chain and to stimulate enterprises at all levels in the supply chain.

  Reporter: Specifically, how to ensure the stability of the industrial chain and supply chain?

  Zhu Yanfeng: This epidemic has brought great challenges to our industrial chain and supply chain, especially the company’s profit and cash flow in the first quarter. As far as Dongfeng is concerned, it currently has 1928 first-level supporting enterprises in Hubei, involving nearly 230,000 people. Maintaining the stability of the industrial chain is not only a need for industrial development, but also a social responsibility.

   At present, the upstream and downstream supply of Dongfeng's industrial chain has returned to normal levels. The supply chain can meet market demand from the end of May to mid-June. The future situation will depend on changes in the international environment.

  Reporter: In response to the current situation where the supply chain is relatively heavily influenced by external sources, some people in the industry have suggested that the localization of the industry chain should be further deepened. What is your opinion?

   Zhu Yanfeng: I think that at present, we still emphasize globalization and oppose anti-globalization. Especially in the face of the epidemic, the global industry needs to face it together, and it is not a narrow distinction between whether to achieve localization. Localization of critical and “stuck-neck” technologies and components should be realized; for the numerous first-, second-, and third-tier suppliers and even upstream material suppliers involved in the automotive industry chain, reasonable resource allocation and global procurement should be realized , Is not a generalization.

  Expanding automobile consumption policy has played a positive role in the recovery of the market, hoping to lift the purchase restriction

  Reporter: Recently, many national ministries and local governments have issued many related policies on the expansion of automobile consumption. How do you think the above policies have contributed to the expansion of automobile consumption?

  Zhu Yanfeng: This year is a decisive year for achieving poverty alleviation and building a well-off society in an all-round way. I think the establishment of an automobile society and the entry of automobiles into families are one of its important signs. At present, my country's automobile sales are more than 20 million vehicles a year, and we cannot grow as high as in the past, and the phenomenon of 'hungry for cars' in the seller's market no longer exists.

   On the basis that the automobile society has been established, first of all, the state's policy of expanding consumption has a positive effect on the recovery of the market, and to a certain extent promotes the acceleration and transformation of the entire market cycle. But at the same time, I think that while advancing the policy of expanding consumption, more attention should be paid to speeding up the construction of emission regulations. The design and implementation of new emission standards can not only speed up the flow and renewal of the automobile market, but also benefit the improvement and development of the entire ecological environment. At the same time, it will also help traffic safety and economic growth.

   In addition, in terms of energy transition, we hope that relevant national departments can conduct evaluations, calculations and scientific analysis on the future development plans of traditional energy vehicles and new energy vehicles. Driven by the market configuration, the automobile market is guided to develop more standardized.

  Reporter: What is Dongfeng going to do?

  Zhu Yanfeng: Dongfeng Company must make full use of relevant policy advantages, and each of its brands actively introduce timely marketing policies to apply the policies to the best effect. At present, the various brands of the company are studying the above policies and introducing some new marketing strategies. At the same time, it will improve the channel management and dealer system.

   Speeding up the construction of new energy vehicles on the market side, achieving brand improvement through the 'dual forces' of the h brand

  Reporter: This year's government work report mentioned the construction of 'two new and one heavy', and mentioned the 'promotion of new energy vehicles.' In this regard, what opportunities do you think this has for the automotive industry? What new plans, new measures and new developments does Dongfeng Motor have in the new energy vehicle industry?

  Zhu Yanfeng: The national new energy strategy has been carried out for many years. It should be said that Dongfeng has never stopped in terms of technical preparations. On the market side, we make real-time adjustments in accordance with policies based on market development and benefits; in terms of product development, we propose the '583' plan. Including controlling 5 core resources, developing 8 key technologies, and innovating 3 business models, it will seize the commanding heights of new energy vehicles in terms of product competitiveness, business model, market share and market size.

   After this epidemic, while speeding up our deployment, we also paid more attention to market-side construction. The state has also given environmental and policy support to the construction of the market. Dongfeng will strive to seize the opportunity to introduce more high-quality electric vehicle products to users.

  Reporter: Dongfeng is now integrating the power of the entire group to develop the h brand. What was the original intention of doing so? What do you expect from the h brand?

Zhu Yanfeng: The current trend of lightweight, electrification, intelligence, networking, and sharing in the automotive industry is unstoppable. The high integration of the automotive industry and the Internet has brought many new ideas, new concepts, and new models. Dongfeng Motor is committed to new energy vehicles. Route, strive to promote the transformation of traditional fuel vehicles to new energy vehicles, lead and promote the future of new energy vehicles, and meet the diversified needs of consumers of high-end new energy vehicles.

The   h division was established based on this. h stands for 'Hi' and also means high-end. It is a 'Hi Platform' for young people's innovation and entrepreneurship created by Dongfeng Company, which gathers many young people with ideals and aspirations. At the same time, China Automobile has solved the problem of starting from nothing, and is currently transforming and upgrading from something to a higher level. The h division is committed to meeting the diversified needs of high-end new energy vehicle consumption. This is brand improvement.

   The young people of the h division put forward 'new energy・new strength'. Dongfeng h division has 'dual strength': that is, the technical advantages of traditional auto companies are combined with new Internet thinking and new technologies to produce good products down-to-earth. Therefore, the h brand is full of Dongfeng brand's upward belief. Previously, although independent brands had an advantage in cost performance, there was a large gap between brand premium capabilities and joint venture brands. This gap cannot be improved overnight. It requires continuous accumulation and hard work. This is also the goal of the h brand.

  New infrastructure is a new opportunity to accelerate the pace of Dongfeng smart car innovation

  Reporter: In February this year, the state released the 'Smart Car Innovation Development Strategy', which proposed to accelerate the innovation and development of smart cars. So what is Dongfeng's progress in smart cars? What new plans are there?

  Zhu Yanfeng: In terms of autonomous driving technology, Dongfeng is ahead of the market, and the landing depends on the degree of regulation. Specifically, Dongfeng’s current overall technical routes and arrangements are 1-2 stages faster than the national regulations and strategic requirements.

For example, unmanned delivery vehicles, port unmanned trucks, unmanned engineering vehicles, sanitation vehicles, logistics vehicles, and some autonomous driving experiments done in mines, related products are being tested and optimized, and once the conditions for commercialization are available Launch the market as soon as possible. This year, Dongfeng's 5G+V2X mass-produced vehicles will be released, the group's connected car platform will be officially launched, the artificial intelligence vehicle system WindLink is constantly iterating, and the AI ??experience is also leading the industry.

  Reporter: What kind of opportunities do you think the new infrastructure will bring to the automotive industry?

   Zhu Yanfeng: 'New infrastructure' will bring new opportunities to restore the vitality of the auto market. 'New infrastructure' emphasizes the development and application of Internet technology, 5G technology, smart technology, network connection technology, and new energy technology in the era of new technology. The 'new infrastructure' is highly consistent with the automobile 'five modernizations' proposed by Dongfeng. We are accelerating the deployment of emerging businesses such as new energy, intelligent network connection, and travel services, and we also want to seize opportunities in the 'new infrastructure'.

In addition, Dongfeng has recently cooperated with COSCO SHIPPING and China Mobile to realize the demonstration application of 5G unmanned driving to empower smart ports. This is an important way for Dongfeng to participate in the 'new infrastructure' and it is also Dongfeng's 'new infrastructure' business model. An exploration. At the same time, Dongfeng has also worked with Xiangyang City and Huawei to jointly build the 'Smart Travel Longzhong', to build the 'Four Major Projects' of Smart Car Valley, Smart Mobility, Smart Logistics and Smart Transportation Cloud Platform, and jointly build a 'Smart City'. There will be many 'new infrastructure' models to explore. (Reporter Wei Shuai)
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