"Carry forward the entrepreneurial spirit and recast the glory of Dongfeng." Chairperson Jiang Zemin’s inscription for Dongfeng people inspired all the cadres and workers of Dongfeng Truck Company to work together and work hard, and achieved the most brilliant results in history. In 2002, the company produced and sold 158,000 cars, achieved sales revenue of 20 billion yuan, and created profits of 1.50 billion yuan. Both operating quality and profitability reached the highest level in Dongfeng’s history. In 2003, the company targeted to sell 160,000 cars, and medium-sized car sales continued to maintain the first market share. Sales revenue was 22 billion yuan, and profits were 1.60 billion yuan. Dongfeng commercial vehicles have entered the second golden age of rapid development in history. The restructuring plan of the strong alliance between Dongfeng and Nissan will surely inject strong impetus into the development of Dongfeng commercial vehicles.

The predecessor of Dongfeng Truck Company was the main part of Dongfeng Motor Company’s production of commercial vehicles. Since its establishment in 1966, it has made great contributions to the country, especially in the 1980s to the mid-1990s after the reform and opening up. With a series of advanced reform practices, it has become a leading enterprise in the automotive industry in our country. However, in the mid-to-late 1990s, due to the constraints of the system and mechanism, the development of the enterprise fell into a trough, and the cumulative loss exceeded 500 million yuan in 1998. At the most difficult time for the company, the Party Central Committee was very concerned about the revitalization and development of Dongfeng. In late May 1999, Comrade Jiang Zemin, General Secretary of the CPC Central Committee, visited Dongfeng Company and pointed out the direction for the future development of Dongfeng Company. At that time, Miao Wei, the new general manager of Dongfeng Company, issued a "military order": to turn Dongfeng Company into a profit within three years and contribute to the reform and development of state-owned enterprises.

So Dongfeng Company underwent a "major surgery" – the main body of the company was adjusted into three levels. The first level was the group company of the decision-making body, which was mainly responsible for strategic planning, asset management, production and operation, and macro-control. The second level was the production and operation entity that bears specific profit or cost responsibilities. According to the business process and region, Dongfeng Company reorganized more than 30 professional factories, more than 10 joint ventures and holding subsidiaries under its original subordinates into several major plates such as the truck company, the parts division, Dongfeng Motor Co., Ltd., Shenlong Automobile Company, and the southern business division. The third level is the basic unit of production and operation that also bears specific profit or cost responsibilities, mainly including the professional production plants directly under the original headquarters. The truck company came into being.

The newly established truck company is under great pressure, with many difficulties, people’s minds change, and everything needs to be prosperous. So, what makes all truck people face difficulties and challenges, so that the company suddenly comes like an "east wind" overnight, thousands of trees and pear blossoms, and thus enters the track of rapid development?

This is a set of very convincing data in the reform process of Dongfeng Truck Company: in 1999, it turned losses into profits of 360 million yuan; in 2000, it made a profit of 250 million yuan; in 2001, it made a profit of 900 million yuan; in 2002, it made a profit of 1.50 billion yuan. This is the company since its establishment, adhering to the policy of "market-oriented, marketing as a breakthrough, service as the center, and taking the road of quality and efficiency". It has based itself on the market with high-quality products, adapted to the market with flexible marketing, accelerated product development, optimized production and sales structure, and increased the proportion of "double high" production and sales with high-tech content and high added value represented by heavy-duty vehicles and special vehicles. All employees have worked hard and made great achievements. Data show that the company’s various businesses have created the highest level in history, and various commercial vehicles are in short supply across the board. Compared with the same industry in the country, Dongfeng Truck Company has the highest output, the highest sales volume and the best operating performance.

These outstanding achievements are mainly due to the company’s deepening of reform and the establishment of a manufacturing, marketing and management system in line with the market. It can capture market opportunities first, make accurate decisions, attack quickly and win successfully. In the words of Yang Shaojie, general manager of the truck company: "Our truck company thoroughly understands the practical significance of the adjustment of our country’s road transportation structure, and keenly captures the business opportunities emerging in the adjustment of the transportation structure, so that the company can do a good job of serving transportation enterprises and individuals, and usher in the peak of its own development."

At the beginning of the establishment of the truck company, the new leadership team took office immediately. Reintegrate the internal institutions, get rid of the chronic diseases that hinder the development of the enterprise, take decisive measures, lead the reform to a deeper level, and thoroughly carry out a "big change".

The company first started by rationalizing the relationship, changing the system, optimizing the mechanism, and strengthening management. It successively established a financial management committee, a product working committee, and a preparation committee, and reorganized a heavy-duty vehicle factory, a special-purpose vehicle company, a telecommunications company, and Dongfeng Bus Chassis Co., Ltd. The original automobile transportation department suffered losses for many years. Through reform, it replanned its business direction and changed its name to a heavy-duty vehicle factory. It became the main position for the R & D and production of heavy-duty vehicles, off-road vehicles, and overseas vehicle assembly, special vehicles, and special chassis of Dongfeng Truck Company. After the reform, the auxiliary functional area of business was transformed into a professional factory directly facing the market. The fourth multi-variety and flexible assembly line of Dongfeng Company was built, and the capacity was increased by more than 20 times. It took only more than a year to turn losses into profits. The reform turned a loss-making enterprise into a "special force" with large profits and the company’s new product development and market rapid response.

The system is the carrier, and the mechanism is the soul. The truck company has achieved tasks in place, responsibilities in place, and management assessment in place by implementing measures such as cadre system reform and post evaluation work. The company has also made breakthroughs in the reform of salary distribution, employee management, and cadre management. The average salary of employees has increased by 25%. The company continues to adhere to the principle of "three rigidities" centered on financial management and budget management, give full play to the enthusiasm and creativity of all units, and encourage them to base themselves on the market, operate flexibly, and seek greater efficiency growth points. Now the company’s more than 30 units have indicators, and everyone is under pressure.

Market-oriented reform, all the market has the final say. Units that do not meet the profit targets set by the company will not receive full wages, and units and individuals who exceed the profit targets will be rewarded. The reform forced all units to go to the market one after another, face the user directly, and everyone picks up the heavy burden, and everyone has indicators. The new management system clarified responsibilities and rights, transforming Dongfeng Truck Company from a slow-to-respond "aircraft carrier" to a flexible and combat-effective "joint fleet".

The market is changing rapidly, business opportunities are fleeting, and products are the top priority among all factors. Today’s market competition is no longer the concept of "big fish eat small fish", but "fast fish eat slow fish". If you can’t establish a fast-changing production, development and marketing system, it is difficult for enterprises to win in the fierce market competition. In order to become a fast-changing "fast fish", the truck company has changed the previous "serial" to "parallel" management mode from market forecast and information feedback to R & D trial production and production organization, and vigorously promoted "synchronous engineering", so that information feedback, process design, production organization, planning finance, quality inspection and other functional areas of business form a joint force, harmonious resonance, shorten the new product development cycle and production organization time, optimize the management system, and improve work efficiency. The company has strengthened macro-control and micromanagement, established a flexible production system that adapts to market changes, established a perfect production and sales regular meeting balance system, changed the passive adjustment of the work plan to the predictive active adjustment of the early decision-making, and flexible manufacturing system has formed a benign value chain for the company’s decision-making, research and development, production, sales and service.

In terms of new product development, vigorously adjust the product structure and increase the intensity of new product development. This made Dongfeng commercial vehicles quickly attack the city and seize the ground, not only regained a large number of lost ground, but also occupied some new markets. For the flat-head gasoline vehicles that are not well sold in the market, resolutely stop production or reduce production. For products with large market demand, not only should we increase production, but also improve and innovate in configuration and technology to make them more mature and better meet the needs of the market and users. The company focuses on "Tianlong" products and forms a series of products from 240 horsepower, 270 horsepower to 300 horsepower to improve the core competitiveness of Dongfeng commercial vehicles. Adhere to the guiding ideology of cultivating core competitiveness with core products, and use the global commercial vehicle technology platform to comprehensively improve the technical content of Dongfeng products. This year, more than 30 models in 16 series of heavy, medium, light and military models have been developed, and new product sales have reached more than 90%. The success rate of new products on the market is 100%. New products are launched every month, and there are market hotspots in Zhou and Zhou. Dongfeng’s new generation of heavy-duty flat-head semi-trailer tractors represented by "Dongfeng Tianlong", "Dongfeng *******" EQ5075 series cars meet the high-end medium-sized van of Europe III emission regulations, "Dongfeng Iron Armor" EQ2050 series cars meet the tactical indicators of the third generation of light off-road vehicles in the army. New vehicles such as high-mobility light off-road vehicles, "Dongfeng Hercules" EQ3260G series engineering vehicles, and "Dongfeng Urban Wind Shadow" EQ6111RC series ultra-low-floor buses have beautiful appearance, luxurious interior, first-class configuration, high technical content, and set comfort Safety, environmental protection, with a world-class technical level, fully reflects the comprehensive strength of Dongfeng Motor Company’s research, development and manufacturing. The continuous launch of new products has brought fresh blood to the Dongfeng Motor family.

Sun Tzu’s Art of War says "know yourself and know your enemy, and win a hundred battles". Only by understanding the market can you defeat your opponents. Yang Shaojie, general manager of the company, and Zhou Qiang, secretary of the Party Committee, often lead scientific research, production, and marketing personnel to conduct market surveys all over the country. They keenly found that, on the one hand, our country’s entry into the WTO will inevitably have an impact on the truck market, and the personalized needs of customers have also put forward higher requirements for production enterprises. On the other hand, the country has implemented a proactive fiscal policy, and the development of the western region has been in full swing, which will provide development opportunities for truck companies to expand their broad market space.

"Can Dongfeng trucks meet the ever-changing needs of users? How many new markets has Dongfeng trucks opened up? Which models of Dongfeng trucks are the most popular? What is the marketing and service network of Dongfeng trucks? How can Dongfeng trucks let users buy with confidence and use them with peace of mind? How can Dongfeng truck company go to the international market?" All of this is always haunting the hearts of the company’s management and ordinary employees.

For example, the same truck, the northwest market of China, needs models with good stability and large load capacity; the southeast coastal market needs models that are convenient, flexible and adaptable, indicating that the variant demand of China’s truck market is accelerating. The same truck, Henan needs a flat-head car, Hebei needs a long-head car, Shanxi needs a flat-head and a long-head, indicating that the Chinese truck market is further segmented. The same truck, in the past, users’ eyes were fixed on the multi-pull fast-running models, but now they not only need to pull more and run faster models, but also drive and ride comfortably, which shows that the demand level of China’s truck market is improving. As the same truck, some areas need to be used for coal pulling, some areas need to be used for long-distance transportation, some areas need to be used for engineering construction, and some areas need to be used for port transportation, which shows that the multi-demand trend of China’s truck market is obvious. In response to the variant needs of the market, the company has fought a war of differentiation, implementing differentiation in product design, production, marketing and service, further segmenting the market, and formulating different marketing strategies according to different regions and different consumption levels.

Change static marketing to dynamic marketing, change "business" to "business", everything from the user’s perspective, to a single sales behavior that only promotes products, to an integrated production, supply and marketing behavior that understands customer needs and serves customer needs. A Dongfeng truck sales company in the west organized personnel to promote products to key western development projects such as the Qinghai-Tibet Railway and Chaer Salt Lake, and drove cars to the construction site, where production and sales met directly. More than 100 Dongfeng trucks were quickly sold to key construction sites.

Implement "a la carte" marketing, tailor-made cars for customers, as long as customers need, the company will satisfy them immediately. "Customer orders, I will fry." In just over 20 days, more than 5,000 colorful and unique trucks were delivered to users.

There is a demand in the market, and the company must act immediately. For the special needs of the domestic truck market, such as the construction of highway concrete mixer trucks and special fire trucks, the company has not been involved in the past, but has now been listed as an urgent project for research and development, and has launched technical research. In order to adapt to the transformation of the truck market from low consumption to low and high consumption, the company has set up a project to develop high-tech, high-value-added trucks with excellent performance configuration, stable and comfortable operation.

In the company’s reform and development, the truck company places people first, perfects the system, optimizes the mechanism, closely integrates ideological and political work with production and operation, fully mobilizes the enthusiasm of employees, and gives full play to the enthusiasm of employees to participate in production and management. The majority of cadres and employees participate in the whole process of production and operation of the enterprise with a sense of ownership, and at the same time enjoy the fruitful results of the company’s reform and development and production and operation.

The company has reformed a new salary distribution system, and the new basic salary system is closer to the market. The company has fully established a mechanism of "enterprise distribution depends on efficiency, and employees’ income depends on contribution". According to job responsibilities, technical requirements, labor intensity, work efficiency, work performance, economic benefits and other indicators, the income level is determined, and the grades are boldly opened. There is no cap, so that those who can do more and do more can get more and earn more, so that those who do not work and do less can not "mix" days. In addition, completely break the original boundaries between the identity of workers and cadres. All on-the-job personnel are employees of the company, and they are divided into managers, technicians, production personnel, and service personnel according to the nature of their positions. No matter the cadres and workers, they must compete for jobs; those who cannot compete for jobs will be sent to the company’s re-employment service center for training. In the enterprise, a competition mechanism of "the capable go up and the mediocre go down" has been formed.

The reform will inevitably touch the interests of some people. Within the company, the implementation of a clear reward and punishment assessment system, the implementation of heavy rewards for individuals and units who complete tasks well, and the deduction of funds, warnings, exemptions or demotions for those who fail to complete tasks make every unit leader and employee try their best to do a good job in the enterprise. In the technical department of the company’s frame factory and forging plant, the minister’s income is not as good as that of the vice minister, the vice minister is not as good as the technical staff, and the technical staff is not as good as some front-line technical workers, which is no longer news. This was impossible in the past. In the engine factory, skilled workers with excellent work can enjoy the same monthly bonus of 550 yuan as technicians, which has long been rumored to be a good idea. In addition, the company also set aside 5 million yuan to reward personnel with special contributions, which greatly mobilized the enthusiasm of employees. At present, the floating part of the company’s employee income has accounted for 70%, and the income difference between employees can reach 5 to 6 times.

The reform has led to the rapid development of the company, which has brought rich profits to the employees, as well as enthusiasm for work and dedication to the factory. The company is serious about financial discipline and has increased its efforts to reduce costs. The procurement and coordination department takes centralized procurement and the assembly responsibility system as the main line, comparing quality and price procurement, and adopting a healthy competition mechanism. In order to save energy and reduce consumption, some branch and workshop workers changed their working habits during the day and chose to work at night with favorable electricity prices; in order to control costs, workers have gradually developed many good professional habits, such as "changing labor insurance supplies according to the piece", "picking up leftovers anytime and anywhere", etc. In order to reduce expenses, more and more workers have begun to pay attention to the operation process of the purchase and sales link, actively exercise their right to know and supervise, and the company has formed a good atmosphere in which everyone has to calculate an account, everyone reduces costs, and refuses to waste. According to incomplete statistics, in recent years, the company has created hundreds of millions of dollars in economic benefits in terms of cost savings alone.

With the strategic goal of "building a learning type and building the first brand of commercial vehicles in China", Dongfeng Truck Company has greatly promoted the learning style throughout the company, formed an atmosphere of learning for all employees, and improved the quality of employees. Enable enterprise employees to update their concepts, change roles, and think from a different perspective, and truly regard users as "gods" and "parents of food and clothing". Firmly establish the concept of "market first, user first, and service first". Focus on the development of third-generation commercial vehicles. From the development trend of commercial vehicles, products will further develop in the direction of large tonnage, high horsepower, high reliability, safety, and environmental protection. Electronic technology, information technology, satellite remote sensing technology, humanized design, and a large number of applications of new materials and new processes have made commercial vehicles develop with each passing day. With their own wisdom and hard work, Dongfeng people have finally developed a leading domestic, international and advanced Dongfeng series of commercial vehicles.

After joining the WTO, in the face of crises and challenges, the leadership team led by General Manager Yang Shaojie, Party Secretary Zhou Qiang, and Deputy General Manager Hu Jianguo is leading all the company’s employees to integrate into the tide of the world’s automobile industry with a new concept and positive attitude. They will learn from others’ strengths and embrace them, speed up the introduction of foreign advanced technology and management experience in various ways, and narrow the distance with the world’s trucks in as short a time as possible, so that the east wind blows China and goes to the world.

With the advanced technology, superior configuration and superior performance of Dongfeng’s third-generation commercial vehicle – "Dongfeng Tianlong" tractor – officially put into trial mass production on the assembly line, Dongfeng Truck Company has entered a period of rapid development through science and technology, scientific management and lean management. This marks that Dongfeng Truck Company has the ability to combine its own characteristics, introduce, absorb and digest international advanced technologies, and independently research, develop, produce and sell high-end and advanced heavy trucks that meet the characteristics of Chinese roads. This also shows that after three years of reform and development, Dongfeng Truck Company has entered a new fast lane of development.

The rapidly developing Xiang’an is thriving, attracting many entrepreneurs and investors. Photo by reporter Huang Rong

Municipal facilities are improving day by day. Photo by reporter Wang Huoyan

A number of large projects and good projects have been signed, and they are about to land in Xiang’an, injecting new momentum into the economic and social development of the region. Lin Muyang, photo

In TPV’s production workshop, staff are debugging equipment. Lin Muyang, photo

The construction and development of major new cities in Xiang’an is in full swing. The picture shows the construction site of the new sports center. Photo by reporter Wang Huoyan

Yesterday afternoon, the 22nd China International Investment and Trade Fair Xiang’an District Signing Conference was grandly held, this fair Xiang’an District signed 33 projects on site, reaching a total investment of 51.80 billion yuan.

The projects signed this time cover electronic equipment manufacturing, new energy, new materials, finance, retail, construction, digital economy application services, food manufacturing and processing, marine equipment, biomedicine and other industries. With the addition of these large and good projects, the industrial development of Xiang’an will be fully supplemented, the industrial strength will be further strengthened, the structure will be further optimized, and new impetus will be injected into the economic and social development of the region, which will strongly promote the construction of the "Five Xiang’an".

To seize the beach in Xiang’an is to seize the opportunity, and to invest in Xiang’an is to invest in the future. In the 19 years since the establishment of the district, Xiang’an District has become the main battlefield and main battlefield of Xiamen’s "cross-island development". It has also become the most dynamic and promising investment hotspot. Just last week, at the 2nd China Urban High-Quality Development and International Cooperation Conference, Xiang’an District was named "Top 10 Urban Areas for High-Quality Development in 2022".

The signing of the new project is a new starting point for Xiang’an’s development journey. Xiang’an looks forward to working with all entrepreneurs and friends to seize the commanding heights and win great opportunities in promoting all-round high-quality development, ride the wind and waves together, and make great strides towards the strategic positioning of high-quality benchmark, high-value model, modern frontier, and international hub.

New project landing Boost the "acceleration" of new city construction

Among the projects signed this time, there are two heavyweight projects located in the Aviation New Town. The Xiamen Airlines Industrial Airport Industrial Park project will be based on the aviation maintenance industry, integrating finance, enterprise acceleration, investment promotion, and R & D to build a fourth-generation industrial park with aviation maintenance and manufacturing bases and aviation innovation industry service bases as the core; the Taikoo Xiang’an New Airport Maintenance Base project in the new city, the total investment of the project is 2 billion yuan, and the total construction area is expected to be about 277,000 square meters.

At the same time, there are also three major projects signed and landed in the eastern sports exhibition new city area. Among them, Tianma Technology, a national key leading enterprise in agricultural industrialization and a national technology innovation demonstration enterprise, plans to establish a subsidiary, and use it as the main investment body to invest in the construction and operation headquarters in the eastern sports exhibition area; Luyan Pharmaceutical, the largest pharmaceutical distribution enterprise in the province, and Blue Star Group, a pioneer in the local mask industry, are preparing to invest in the construction of office headquarters in the area; and Middle East Infrastructure Technology Group Co., Ltd. plans to register and establish a wholly-owned subsidiary to build a new infrastructure project management, electric power, design, municipal road engineering construction, decorative curtain wall and other indoor and outdoor design and construction, intelligent housing construction, fire protection, landscaping and other engineering services.

Within the jurisdiction of Xiang’an, new cities such as the southern new city of Xiang’an, the eastern sports exhibition new city, the aviation new city, and the Tongxiang high-tech city have accelerated their rise, building a new "skeleton" for the future urban development. The signing of these new projects will help the construction of the new city run out of "acceleration" again in the future.

Focusing on key industrial chain groups, precise and strong chains complement and extend the chain

Xiang’an, which is an industrial zone and a strong area, has now become an important advanced manufacturing base in the city. There are multiple industrial parks in the jurisdiction, such as Torch (Xiang’an) Industrial Zone, Tongxiang High-tech City (Xiang’an Area), Xiang’an Industrial Concentration Zone (Xiangbei, Yinlu, Shitou and other industrial zones), and Digital Economy Industrial Park, which have formed four key industrial chain groups such as flat panel display, semiconductor and integrated circuits, machinery and equipment, new materials and new energy – of which flat panel display, semiconductor and integrated circuits account for "half of the country" in the city. The reporter noticed that many of the projects signed this time have carried out precise "strong chain replenishment and chain extension" around key industrial chain groups.

National high-tech enterprise Huilian Electronics will set up a new wholly-owned subsidiary in Xiang’an, with a new annual output of 1,000 tons of cemented carbide bar production line, an annual output of 10 million numerical control blade production line, an annual output of 100 million PCB tool production line, bar blade tool general and special equipment production line, various coating centers and tool cleaning lines, as well as administrative headquarters and scientific research experimental testing rooms; National Technologically Advanced Small and Medium-sized Enterprises Shenzhen Alixin is preparing to land on the optical products project, engaged in video product accessories and automotive interior parts manufacturing, for the whole region flat panel display and new energy industry chain strong chain; Huagong Chaomo (Xiamen) Technology Co., Ltd. plans to build a chip packaging base, Xiamen Xiamen Xiamen Xiamen Technology The company plans to establish a production base for audio-visual display products.

From Hangzhou, Xieneng Technology Company is a national high-tech enterprise specializing in the research and development, production and operation of new energy battery management technology. The company will establish a battery cascade utilization recycling and crushing project in Xiang’an to support the coordinated development of new energy industrial clusters. Xinjiang Goldwind Technology Company is preparing to establish a project company in Xiang’an, mainly engaged in the introduction, service and training of new energy talents, injecting endless vitality into the development of new energy in the whole region and even the city.

In terms of new materials, MIIT specializes in special new "little giants", and the national and Zhongguancun high-tech enterprises Yunji Technology plan to establish the southeast headquarters of OLED luminescent materials in Xiang’an, integrating the research and development and production of new OLED materials.

The fund leverages social capital and empowers development

In the first half of this year, Xiang’an District Fund investment report card shows: investment in CICC, China Resources and other 8 industrial sub-funds, with 600 million yuan district-level financial funds to pry 14.50 billion yuan of social capital, funds prying rate of 25 times, the multiplier effect is significant; 22 projects (including independent investment), has reached 900 million yuan.

In recent years, Xiang’an District has unswervingly played the role of the platform of the District’s guidance fund "to drive investment promotion through funds", and simultaneously explored the investment promotion model of direct investment by funds – in this context, the financial-related projects in the contracted projects have a more obvious role in driving the development of Xiang’an District.

In the big data digital economy development fund project, big data fund of funds belongs to the provincial state investment assets, as the first provincial industrial investment fund in Xiamen, will set up a digital economy development fund in Xiang’an District, including but not limited to fund of funds 1 (scale 2 billion yuan), several sub-funds, etc. The total size of the parent and sub-fund cluster is expected to exceed 12 billion yuan.

In the Far East Horizon strategic cooperation project, The Far East Horizon Co., Ltd., a holding subsidiary of the central enterprise Sinochem Group, will cooperate with Xiang’an District and Xiamen Torch Group on financial leasing projects and other businesses to provide funding and financing plan support for Torch Tongxiang High-tech Zone, which is conducive to leveraging the late project of the park.

New industries continue to develop All-round economic and social development

At present, Xiang’an is making great efforts to develop a new generation of information technology, biomedicine and health, marine economy and other emerging industries, and actively integrates into the construction of Xiamen Science City, Xiamen National Independent Innovation Demonstration Zone, BRICS Innovation Base and Southwest Fujian Coordinated Development Zone – a closer look at the many projects signed this time shows that Xiang’an is actively expanding and entering more and more tracks, so that economic and social development can be extended to more fields.

On the track of digital economy and application services, Unigroup plans to establish a Fujian smart business regional headquarters in Xiang’an District, focusing on digital city, industrial cloud, industrial Internet, industrial brain, smart education, smart park, government and enterprise digital transformation and other sections; Tongtu Zhiying will take Xiang’an as the headquarters, establish a cross-factory textile industry alliance, and create a new industry model for sharing textile factory production capacity resources; Kyushu Yuanqi plans to build a Southeast regional business headquarters centered on Xiang’an, mainly to carry out digital content services, corporate image event planning, conference services, exhibition and display services, etc.

The Ministry of Commerce’s supply chain innovation and application demonstration enterprise and China’s top 50 logistics enterprises, Cross-sea Logistics, plans to build a logistics warehouse in Xiang’an to provide logistics supply chain services for large manufacturing enterprises, which will help Xiang’an to further develop the smart logistics supply chain. Focusing on high-end marine equipment, Xinnuo Beidou Aviation Information Technology (Xiamen) Company plans to invest in the construction of a production base to develop and produce high-end marine equipment, Beidou communication and navigation equipment, and high-end equipment for ships’ intelligent cockpits.

In terms of science and technology research and development, Professor Feng Yongjian from Xiamen University plans to set up a project company in Xiang’an, focusing on the development of MEMS sensors, microelectronic MEMS integrated chips, semiconductor sensing materials and other products and market; in terms of biomedical health, Nanjing Joy, the largest disinfection and sterilization service provider in the country, plans to set up a radiation processing base for disinfection products and related health Products Research & Development and production.

In addition, the China Chemical Construction Project, the China Railway Construction Port and Shipping Bureau Construction Project and the Lyster Photovoltaic Project will enable Xiang’an to gain greater assistance in the future development and construction; the Xtep E-commerce Cloud Center Project will build a brand business operations complex integrating retail experience centers, various mid-to-high-end fashion sports halls, global headquarters and business reception centers, which will help to enhance Xiang’an’s retail industry; the Kelly Wei Food Project and the Xinguoyuan Oil Project are the strengthening of the traditional food production and processing industry. (Reporter, Shao Lingfeng, Correspondent, Ye Xiaofei, Lan Yu)

Matters:

Changan Automobile and Huawei signed the Memorandum of Investment Cooperation. Huawei plans to set up a company (hereinafter referred to as the target company) engaged in R&D, design, production, sales and service of automotive intelligent systems and components solutions. Changan and its related parties plan to invest to acquire the equity of the target company (the proportion is not more than 40%) and carry out strategic cooperation.

Peace view:

Huawei’s smart car core technology will operate independently based on the principle of marketization to realize equity diversification.

The business scope of the target company established by Huawei includes intelligent driving solutions for automobiles, intelligent cockpit for automobiles, intelligent digital platform for automobiles, intelligent Che Yun, AR-HUD and intelligent lights, etc. Huawei will inject relevant technologies, assets and personnel dedicated to the business scope of the target company into the target company. The company operates independently based on the principle of marketization, and adopts a market-oriented management system and salary incentive framework.

In principle, the components and solutions within the business scope are provided by the target company for vehicle customers. In principle, Huawei does not engage in businesses that compete with the business scope of the target company. In the future, the target company will gradually open its equity to investors such as existing strategic partner car companies and car companies with strategic value, and become a company with diversified equity. In addition to Changan, Huawei’s existing strategic partner car companies include Cyrus, Chery, Jianghuai and BAIC. From the perspective of business scope, the target company is basically equivalent to the independent operation of Huawei BU Division.

Huawei will operate its loss-making business independently.

Judging from the operating results announced by Huawei in the first half of 2023, the revenue of BU business, as the fifth largest sector, is 1 billion yuan, accounting for about 0.3% of its total revenue, and it is the only sector that Huawei is losing money at present. According to Huawei’s annual report, by the end of 2022, the research and development team of Car BU had reached 7,000 people, with a cumulative investment of 3 billion US dollars. According to the previous plan, Huawei BU will achieve profitability in 2025, but it is difficult to achieve this goal at present. This time, Huawei will operate the smart car business independently and introduce car companies as investors, which will reduce the drag of the smart car business on Huawei’s profitability.

Huawei has not changed its mind, and it is further away from Bosch in the era of smart cars.

Previously, some car companies were in conflict with Huawei’s cooperation model and worried about losing their "soul". This time, Huawei will independently market the smart car business and realize equity diversification, which can alleviate the doubts of car companies to some extent. Huawei’s technological leadership in the field of smart cars is clear, but we don’t think that the completely self-developed intelligent technology by car companies is the best option. Since the second half of 2023, Huawei’s deeply empowered models have been increasing, such as Zhijie M7, Aouita 12, Zhijie S7 (in cooperation with Chery) and Wenjie M9 (in cooperation with Cyrus), and Huawei’s presence in the automobile industry has been increasing. The willingness of other car companies to cooperate with Huawei is stronger than before. We expect that more car companies will dispel the concern of "transferring their souls" in the future and choose to embrace Huawei’s smart car technology.

The target company has great development potential, and its revenue scale will reach 100 billion in the long run.

Relying on Huawei’s leading intelligent solutions, the target company has become an industry leader in automotive intelligent systems and component solutions based in China, facing the world and serving the industry. In the short term, the annual sales volume of supporting models of the target company set up by Huawei is expected to reach about 1 million units.

In the long run, if the passenger car market in China reaches 30 million units, the target company accounts for 25%, and the bicycle supporting price is 20,000 yuan, the corresponding annual operating income will reach 150 billion yuan, and if the net profit rate is 15%-20%, the corresponding net profit will be about 22.5 billion-30 billion yuan. The target company has the potential to grow into a domestic head supplier of smart car software and hardware solutions, and has the business potential of 100 billion yuan revenue scale and 10 billion yuan net profit scale.

Chang ‘an has a good foundation for in-depth cooperation with Huawei, and there is great room for further strong alliance.

Aouita is a high-end brand of Huawei, Contemporary Amperex Technology Co., Limited and Huawei. With the combination of avant-garde styling design and Huawei’s leading intelligent technology, the brand influence has gradually expanded. In addition, Changan Automobile has also announced that its brand will cooperate with Huawei in the field of automobile intelligence, especially in the field of smart driving.

We believe that Changan Automobile has made some mistakes in the investment in smart car technology, and we should pay close attention to the definition of vehicle products, provide flexible smart car solutions for consumers, and rapidly enhance the comprehensive competitiveness of Changan Qiyuan, Deep Blue, Aouita and other brands. In addition, Changan Automobile is the first car company to invest in the target company, and it is expected to enjoy the benefits of the future valuation improvement of the target company to the greatest extent.

The feature of Huawei’s smart car selection is that Huawei is deeply involved in product definition and channel sales, and the target company will serve the entire automobile industry.

Huawei is deeply involved in the product definition and channel marketing of smart car selection, and enjoys relevant benefits. The target company established by Huawei this time will face the whole world and serve the whole automobile industry. We believe that the ultimate success of automobile enterprises depends on the improvement of vehicle production and sales scale and brand premium, so the core competitiveness of automobile enterprises such as product definition, channel efficiency and supply chain stability are indispensable. The comprehensive ability of car companies has a great influence on the effectiveness of future cooperation.

Author of this article:Wang Dean, Wang and Hai, source: Ping An Securities, original title: "Huawei and Changan join forces to create" Bosch "in the era of smart cars"

Wang Dean S1060511010006　

Wang jihai　S1060523080