Exclusive Dialogue With He Xiaopeng, The New Force Of Car Making

There are so many people and people are busy. The rising corners of the mouth reveal joy. The green Christmas tree and the red gift box add warmth to each other. On December 22, the hall on the first floor of Xiaopeng automobile intelligent industrial park was full of customers who came to pick up their cars and register their licenses.

Taking the elevator to the fourth floor, the spacious office environment, young face and huge slide all explain the Internet gene of this new car manufacturing enterprise.

At 2:00 p.m., the 21st century economic reporter met the leader of Xiaopeng automobile, he Xiaopeng, wearing a light shirt, dark blue jeans and black leather shoes, maintaining the same hairstyle throughout the year.

During the one hour conversation, he Xiaopeng didn't speak out, on the contrary, he was dull and introverted

"Genes are nirvana, not remodeled, so even if we do 10 in the next five years, we won't be able to play cards in the world."

"It's not selling the car as expensive as you can or brand it, or making the car cheap. Selling a lot is just scale. I think the two are related, but not all."

"I believe that Li Bin's logic is the same as mine. It's the worst to die, and it's miserable to grow up."

"I don't think a small win is a win, on the contrary, a big win is a win. On a global scale, the sales of Chinese national brands account for a small proportion, and they are neither successful nor profitable. "

He Xiaopeng is a casual person. He often sends his true feelings on Weibo and his circle of friends. However, he is restrained and stops talking after several interviews. "At present, we can't disclose it yet", "wait until the right time to announce it", "some words will offend people"

"I may be more casual. In a way, starting a business is not for personal money or financial freedom. We hope to do something different to satisfy our feelings, so as to truly affect our future transportation and even our future life. This vision is not the same." During the conversation, he Xiaopeng turned his head to the left from time to time and looked further out the window.

Six years of cross-border entrepreneurship, 2020 is a crucial year for he Xiaopeng. At the end of August, Xiaopeng auto officially landed on the New York Stock Exchange. Since November, its stock price has risen by more than 260% and its market value has exceeded 100 billion yuan, once ranking among the top ten auto companies in the world. The gross profit margin of the third quarter's financial report has turned to positive for the first time. It has more than 30 billion cash flow

Facing the current achievements of Xiaopeng automobile, he Xiaopeng is very sober. "I think that Xiaopeng automobile has barely finished from 0 to 1 at present, and will do well from 1 to 10 in the second five years. At present, Xiaopeng automobile only accounts for three thousandth of the world's automobile sales, and China's largest private automobile manufacturing enterprise only accounts for about 1.25% of the world's automobile sales, which are very small. "

In his opinion, rhythm is very important for a new car manufacturing enterprise at the moment. In the whole interview process, he Xiaopeng mentioned the issue of rhythm three times.

"In the long run, any enterprise must have a very high gross profit in order to make profits, but rhythm is very important. I think it is right for a car making enterprise to continuously improve its gross profit in the future, but it is not necessarily a good thing to have too much net profit in the process of innovation. Companies with profits and companies with a future are two different paths. I hope Xiaopeng will become a company with a future. "Future" represents greater profits in the future. "

Barely finished from 0 to 1

21st century economic report: it has been six years since you started your second business this year. At this time point, do you have a deeper and newer understanding of car building?

He Xiaopeng: the ignorant were fearless before. In fact, it's much more complicated to make a car than you think. But now I have entered this industry. I have to stick to it and make different things. Everyone will encounter some painful things every day, but biting my teeth will pass.

21st century: if the development of Xiaopeng automobile is divided into different stages, do you think that Xiaopeng automobile has achieved initial success?

He Xiaopeng: so far, I think Xiaopeng has barely completed the process of "0-1". In the second five years, we should do a good job in "1-10". At present, China's largest private car manufacturing enterprises account for about 1.25% of the world's auto sales, accounting for a small proportion. In fact, there are many new car brands now, and the traditional main engine plants are also making new intelligent electric vehicle brands.

Back then, there were two reasons why I didn't buy a traditional vehicle factory: first, I couldn't afford it; second, it was difficult to transform. Because genes are nirvana, not remodeled, so even if we do 10 in the next five years, we won't be able to play cards in the world.

21st century: from "1-10", what are the dimensions and standards for Xiaopeng automobile to achieve this goal?

He Xiaopeng: in terms of layout, it basically has a certain breadth and depth. When the income reaches an order of magnitude, it can make profits and has a certain popularity in the society. The company scale may reach tens of thousands of people.

21st century: this year, the national team and private automobile enterprises are aiming at the track of high-end intelligent electric vehicles, such as Dongfeng lantu, BAIC arcfox, SAIC Zhiji, Great Wall Motor SL, etc. In the face of this trend, will Xiaopeng automobile "go up"?

He Xiaopeng: of course. Many of Xiaopeng's actions this year have attracted much attention: we want to do lidar, so do the industry; we are going to launch xpilot3.0, and other auto driving companies are also on the agenda; we have recently opened a super charge in the airport, and recently Benz, BMW and Audi (BBA) are looking for the person in charge of this in the airport; our three (as well as Weilai and ideal) open stores in the supermarket Unified manufacturing enterprises have also opened stores in Shangchao

In 2014, we proposed to make smart cars. Last year, we defined it as intelligent electric vehicles. This year, car companies are transforming in this direction. Li Bin has made the high-end brand, and Xiaopeng has always been positioned to be the middle and high-end, which is one more middle end than Weilai. I believe that Li Bin will gradually do the middle end, and from another angle, we will also do a good job in the high-end. So in this respect, some car companies are going from top to bottom, and some are doing the middle work first, but both sides will consider it.

21st century: Xiaopeng automobile will definitely develop to high-end, so how to define high-end? Is there a quantitative standard, such as the threshold of 300000?

He Xiaopeng: not necessarily. Weilai is selling very well this year. Its real invoice price is about 440000 yuan. I think this is a high-end category. BBA's main configuration model, cheap about 300000, expensive between 500000-1000000 yuan. I think high end is a kind of cognition related to brand and culture, not necessarily price. The average price of Xiaopeng P7 now reaches 300000, but we don't think it belongs to high-end, we still position it as medium and high-end.

21st century: this year, a new mode of cooperation has emerged, that is, technology enterprises are deeply involved in car manufacturing, which is called "the second generation" in the industry. For example, Huawei cooperates with BAIC and Changan, and SAIC establishes a joint venture with ALI. In the new round of new energy intelligent electric vehicle competition, which mode of cooperation do you think is better?

He Xiaopeng: in 2014, I was thinking: will an open or closed cooperation system come out? There are three closed loops involved: product R & D closed loop, customer experience end-to-end closed loop, technology manufacturing gene and organizational culture closed-loop. In my thinking today, if cars change dramatically from 2025 to 2030, one of these three loops is indispensable. Today, other "Chuang er generation" have not developed in these three closed loops, more or less. I insist that the three closed loops must be integrated to form a closed system.

Three new forces of car making make achievements

"21st century": in the first half of the year, you showed a group photo of Li Bin and Li Xiang, and the article "three hard forces are remembering and thinking about changes". Later, idealist and Xiaopeng successively went to the United States to list, and the three gathered in the US stock market. What do you think is the difference between you and Li Bin and Li Xiang? Or what is the difference between Xiaopeng and Weilai and their ideals?

He Xiaopeng: the three of us are totally different. Even though Li Bin and Li Xiang have started their business in automobile media for many years, the differences between them are quite large. Among the three enterprises, Weilai may be the most powerful brand. From the business point of view, the best is ideal. From the perspective of software and intelligence, I think the best is Xiaopeng. All three of us have some good foundation.

Recently, some investors said that I may be more efficient in terms of the ability to set up a team; in terms of financing ability, Li Bin has done the best and I am the second. In fact, everyone has his own characteristics. These characteristics establish different ability models, create different company vision, and the development direction, organization construction, and execution rhythm are also different. I think there is no right or wrong, just different choices.

Fortunately, the three of us are based on the thinking logic of the Internet system and support each other. I think it's important that we don't undermine others, because the market is bigger, not attacked. Our three enterprise teams often connect, chat and share, learn from each other's strengths and achieve each other's success.

21st century: what kind of cooperation space will the three companies have in the future? Will we face the problem of competition? For example, Weilai will announce the products equipped with lidar on NiO day.

He Xiaopeng: Li Bin and I discussed some ideas this year. Ideal was listed one month earlier than us this year. After ideal went public, Xiaopeng immediately had a team to learn and consult. They were happy to share the problems encountered in the listing process and the points to pay attention to.

In fact, Weilai just announced the rhythm and route of lidar, but it is not clear when it will be applied. It may be the car at the end of next year or the model after it. This will be clear only after Weilai publishes it.

In terms of lidar, our scheme is strong visual perception, which emphasizes algorithm and data. The camera is very cheap and does not need powerful lidar. Lidar is very expensive. Lidar is auxiliary to us. At present, all the ground vehicles are guided by human eyes and human driving. The camera can not solve the problem to rely on lidar to solve, such as fog. Therefore, our logic is to make the best technical architecture solutions, not to use the most expensive hardware. Of course, there is no problem with good hardware, because each company has different technology paths.

21st century: the industry often compares Weilai, idealist and Xiaopeng. Xiaopeng's intelligent label is more distinct, and Weilai focuses more on user service. What do you think is the difference between the two in business model?

He Xiaopeng: from the perspective of science and technology enterprises, more and more gross profits come from non hardware, which is nothing more than software or services. This is the development logic of the future business model. Because the hardware has BOM. For example, if the BOM for selling 100 cars is 100 yuan, the BOM for 10000 vehicles may be reduced, but it may also cost 80 yuan, which is impossible to reduce to 0. Software and services will have marginal effect at a certain point. Maybe the marginal effect of software is faster than that of service.

To some extent, Weilai has done more in terms of services, but I'm not sure whether it can make money on services. We are the first to charge for software. At present, more than 25% of P7 users have paid 20000 yuan for xpilot software service fee, which is the only one in China. I believe other companies will explore software in the future, and Xiaopeng will also explore services.

"21st century": in terms of channels, about 70% of Xiaopeng's direct sales and 30% of its franchises have joined. Weilai, ideality and Tesla are all directly operated. Why did Xiaopeng choose this mode at that time? How is the future planned?

He Xiaopeng: I think direct marketing and franchise will exist for a long time in the future, and each has its own advantages. The stronger the brand, the wider the scale, the proportion of franchise will be increased. Because we are three companies without burden, other brands may have certain burden, the core depends on how to control the rhythm and how to grasp the direction.

Sober crossover

"21st century": after listing, the stock price and market value of Xiaopeng have risen, and the market value has exceeded 100 billion. On the concept of new energy stocks, some people think that the long-term good, but some people are more pessimistic. What do you think of the relationship between market value and profitability?

He Xiaopeng: first, the market value is related to the long-term profit, but not to the short-term profit; second, all stock markets are a manifestation of confidence. I think the core of a startup depends on its growth rate, not on the performance of the company's current capabilities. Many car manufacturing enterprises didn't look up to us three years ago, calling us PPT, mass production, sales, etc., but today we are all paying attention to us, because we are actively exploring the middle and high-end.

Some enterprises think that high-end needs to go through a middle and high-end process, so they will first see how we do it. In fact, high-end has high-end challenges, which is a logic of short-term and medium-term. I think our enterprises will have a great development in the future, because we see changes in 6, 12, 18 months, as well as changes in the whole market. Maybe a lot of people think that this year's market change is due to the boost of the stock market. In fact, they don't see the real prospect, so some people believe that some people suspect, some ridicule and some doubt, which is normal.

The 21st century: the first time that Xiaopeng automobile's gross profit in the third quarter turned positive. When do you think Xiaopeng can really achieve profit?

He Xiaopeng: in the long run, any enterprise must have a very high gross profit to make a profit, but the rhythm is very important. I think it's right for a car company to continuously improve its gross profit in the future, but it's not necessarily a good thing for an automobile company to have too much net profit in the process of innovation. Therefore, companies with profits and companies with a future are two different paths. I hope that Xiaopeng will become a company with a future, and "future" represents greater profits in the future.

21st century: what is the logic behind Xiaopeng's P7 sales?

He Xiaopeng: first of all, P7 is a good car. Now many people take our car for disassembly and benchmarking. We are very surprised that the second car can achieve this effect. Secondly, I am very confident in the hardware and software architecture of electronic and electrical automation of Xiaopeng P7. Now, few people are learning from us, which means that they will not launch it until the end of next year or the year after next Peng has led the way.

In other words, we may take the pace every two years, some enterprises may take six or seven years to catch up. So I think most enterprises don't think about this logic. They either sell cars as expensive as they can, or brand them, or sell them cheaply. I think they are related, but not all of them.

21st century: are you satisfied with the marketing of Xiaopeng P7 and its current brand power?

He Xiaopeng: I think the brand power is good, but it is not enough. Next year, when our automatic driving function comes out, I believe it will further promote the whole market. Now there are too many enterprises that claim to have L3 capability in the market. Before, some car companies said that they would release L3 level automatic driving function, but they did not use the report. They just tested in the indoor environment, which is very different from the real need to do well and realize mass production.

21st century: we all know that Weilai was faced with life and death pressure in 2019. In your opinion, has Xiaopeng ever faced such pressure?

He Xiaopeng: for entrepreneurs, there is also the pressure of growth. Long does not mean death. I believe that the logic of Li Bin is the same as mine. It is the most miserable to die, and it is also very miserable to grow up.

China's enterprises should be global enterprises. I started two businesses and countless people told me not to do internationalization, but to do No.1 in China first. This is the biggest problem. Even if we achieve No.1 in China, we may not be successful in internationalization. As a matter of fact, Xiaopeng automobile has considered more in terms of internationalization, but it has gone slowly. Various problems, including team and brand, should be taken into consideration. In the next few years, Xiaopeng automobile will be in the stage of exploration in terms of internationalization.

21st century: do you think Xiao Peng will face the risk of life and death in the next two or three years?

He Xiaopeng: of course, because the times and trends are changing, anyone may not catch the trend. Win in the pattern, lose in the details, we will face challenges and pressure in the whole reform, but the pressure of enterprises with solid foundation is not so fierce, but our pressure is much more rapid.

21st century: you said that in the next 1-2 years, only 2-3 new forces will survive. Do you still think so?

He Xiaopeng: first, I mean, there are only two or three new car manufacturing enterprises that can come out of the world; second, they have to live long enough. I don't think a small win is a win, on the contrary, a big win is a win. Globally, the sales of Chinese national brands account for a small proportion, and neither of them is successful nor profitable.

21st century: what are the traditional car companies in China that you like? Does Xiaopeng have a target to learn from?

He Xiaopeng: I think many domestic enterprises have done well. In terms of quality and manufacturing system, we learn more from Toyota.

In three or four years, Xiao Peng's blueprint will be clearer

"21st century": this year's epidemic situation has an impact on the automotive industry, and the problem of lack of core has caused heated discussion some time ago. How is Xiaopeng arranged in the smart electric vehicle chip? Will the same problems arise in the future?

He Xiaopeng: chips are typically an industry that turns mud into gold, because silicon is not valuable, but it is more expensive in grams than gold. Therefore, in terms of chips, as long as you can attach importance to and layout them, in the long run, there are no production capacity problems, only technical problems, such as other people will not allow to use them; there are also situations that everyone is using suddenly, and the production capacity is too late to release. At present, the main reason is that mobile phone manufacturers occupy the chips of automobile manufacturers, so we should be prepared in advance.

21st century: will Xiaopeng automobile choose self research in chip field in the future?

He Xiaopeng: we are now cooperating with NVIDIA and Qualcomm, because there are many kinds of chips in the car. For example, most G3 can be OTA, of which more than 70 cells need to be upgraded, and P7 cells will be merged into about 20 units. Fewer and fewer chips means that the cost is cheaper, the computing power is stronger, and the management is more and more simple.

In the future, the number of cells will be concentrated between 4-10 through continuous consolidation. But in this system, there will be many changes in the future. Many companies are developing chips, but it is unknown whether these products will exist or whether they will be integrated by other products five years later.

21st century: as the leader of Xiaopeng automobile, what emphasis will be placed on self-study in R & D and integration of software and hardware? What emphasizes cooperation?

He Xiaopeng: there are several logics involved: first, the core strategy can be regarded as a storm eye, and what is in the eye of the storm should be your own; second, the slower the technological innovation is, the more partners you choose, you should choose to cooperate with others; third, the problem of rhythm, for example, apple pays special attention to R & D, because it has Time, money, technology and patience to support.

21st century: as the "initiator" of intelligent electric vehicles, Tesla has developed some standards and its market value has been growing continuously. What do you think of Tesla and musk?

He Xiaopeng: Tesla is a respected enterprise, very technological, but there are also many problems. Every company has its own characteristics. Xiaopeng automobile wants to be an exploration enterprise. I think that among all the automobile manufacturing enterprises in China, the exploration of science and technology of Xiaopeng automobile is very smooth, especially in the depth of intelligent electric vehicles and the thinking of future transportation.

I think we all have their own characteristics, advantages and disadvantages coexist. He (MuSK) pays close attention to us and has a lot of words about us. In the past, Chinese companies were not willing to fight with American companies, but I may be more casual. In a way, we didn't start our business for personal money or financial freedom. We hope to do different things to satisfy our feelings and really affect the future transportation Travel and even future life have different visions.

21st century: so some people interpret this as that Xiaopeng and Tesla are different on automatic driving routes.

He Xiaopeng: it's different. We are going with a laser radar with visual perception fusion, and most automatic driving uses the solution of laser radar fusion. We are the first to do so, and I believe that we can prove that our plan is right in two years.

21st century: as for the development trend of new energy vehicles, Tesla may be a direction for intelligent electric vehicle enterprises. Will Xiaopeng's future development direction be different?

He Xiaopeng: we must have many different places. We will see more and more differences in the next 2-3 years. We are a company that has only been established for six years. Tesla has been established for 17 years, which is nearly three times of ours. I think Xiaopeng's blueprint will be clearer in three or four years.

21st century: Xiaopeng automobile began to overcharge earlier. Is it slowing down now?

He Xiaopeng: No. At present, we have 533 overcharge stations in 66 cities, which is more than the total of overcharge and replacement stations in Weilai, and the construction speed of overcharge stations is relatively fast. The cost of replacing power station in Weilai is high, and our overcharge station will be slightly lower.

21st century: will Xiaopeng auto change its electricity in the future?

He Xiaopeng: everything is possible, but we are focusing on overcharging.