Zhang Baolin talks about Changan's own brand

For the media, smooth Changan may not be a "sexy" reporting target. After last year's Shanghai Auto Show, the Automotive Industry and Economics Network had discussed an issue in the interior of the Great Wall Chang'an that there must be a battle (see the special topic: Technical Chang'an and the Great Wall of Experts). At that time, the Great Wall was just like the Sun Yat-Sen, and Changan was still in the aftermath of Geely. , but we agree that the uptrend of this company has been unstoppable. One year later, Changan quietly completed the transcendence, but we still find it difficult to write a war-like thrill.

A Coca-Cola executive once said that if Coca-Cola would go bankrupt someday, as long as it still owns the Coca-Cola brand, it would take a few years to make a comeback.

When your brand exists in everyone's mind, when your product becomes part of people's life habits, you have the secret to be fearless about the future.

Unfortunately, this is only the secret of Coca-Cola. For most companies, this kind of success can't be duplicated; for Chinese auto brands, this is an even more distant dream.

Even today, Changan Automobile has become a benchmarking company in its own brand, and Zhang Baolin, President of Changan Automobile, is still admitting that the brand is still the ceiling of Changan Automobile's development. It will take a long time to grow even harder to break through this ceiling. List specific timetables. In the 2025 plan of Changan Automobile, it is clearly stated that the technology is first-rate, the quality is first class, and the brand is first-rate. However, it is the level of the brand first-class. In Zhang Baolin's view, there may be more uncertainty than the former two.

However, Chang’an’s ambition cannot be underestimated. After many years of rapid growth, the joint venture and independent business of Changan Automobile has fully produced the results. This year, the sales of its own brand will be won with no suspense. In Chang'an's product planning, the brand's road to victory will continue. After standing at the level of 100,000 yuan, there will be a series of new products that will hit the 200,000 range in succession. In Zhang Baolin's words, "In 10 years, it must be cheaper than it (Toyota). In the future, we (surely, of course, have confidence) will do better than it. (It takes us to work hard.)

This long-established enterprise in the border seems to have been on the edge of the automotive landscape. Even though it is now on the front line of its own brand, its identity is still blurred for many people. When it comes to large-scale central enterprises, people first think of FAW Dongfeng SAIC. When it comes to self-owned brands, people think of the Great Wall Gili Cheri. Although cars were prototyped as early as 1957, most people are still accustomed to categorizing Chang'an as a latecomer.

China's own brand, in the automotive industry are also latecomers. Latecomers cannot have a Coca-Cola-style secret, and even there is no secret at all. Such a conclusion may disappoint many people who expect answers.

There was no tale of stunned commandments, nor was there a savage decision to turn the tide. Maybe there are indeed many difficult times behind the scenes, but in today's Zhang Baolin's view, there is no difficulty worth emphasizing. It seems to him that difficulties are just a must-have experience, but far from a moment of fate.

Zhang Baolin's calmness revealed in the interview is just like Chang'an's character. The development of Chang’an has always been on a stable path. Because it knows its own route clearly, this company does not frequently repeat and turmoil, but has always insisted on what they think they should do. The result of these things to do is what Changan achieved today.

For the media, smooth Changan may not be a "sexy" reporting target. After last year's Shanghai Auto Show, the Automotive Industry and Economics Network had discussed an issue in the interior of the Great Wall Chang'an that there must be a battle (see the special topic: Technical Chang'an and the Great Wall of Experts). At that time, the Great Wall was just like the Sun Yat-Sen, and Changan was still in the aftermath of Geely. , but we agree that the uptrend of this company has been unstoppable. One year later, Changan quietly completed the transcendence, but we still find it difficult to write a war-like thrill.

As we learn more about Chang'an, we are increasingly discovering the unique traits of the company. Its success today should be inspiring for all independent brands, but unfortunately, it is difficult to be easily copied.

Under the influence of this trait, we also gave up looking for gorgeous to praise performance. With a simple vocabulary to outline Chang'an, perhaps better match his style.

We have chosen three keywords: "Industrial thinking technology is based on the trend."

Industrial Thinking: Step up to thousands of miles

Doing business can be speculative, but it cannot have speculative psychology.

The success of a car can save an enterprise, but only a stable system can ensure the long-term stability of the enterprise. The establishment of a stable system has never been a one-time event.

However, the urgency of latecomers often makes them subconsciously find shortcuts to copy. In these years, China’s own brands, including Chery, Geely, and BYD, have dominated the sales charts, reflecting the fierce market competition to some extent, and reflecting that our own brands have not yet established a robust growth system.

This year, this top name is likely to change hands again and fall to Chang'an.

From January to August, the cumulative sales of 500,000 cars by Changan Automobile increased by 47% year-on-year, 39 percentage points higher than the industry, and led the second Great Wall 55,000 vehicles.

Chang'an's beautiful growth figures have injected some positive energy into the so-called "eleven consecutive" independent brands. However, Zhang Baolin himself is looking at these figures. “The market figures we see today may have been decided five years ago.” In the speech at the TEDA Forum, Zhang Baolin also gave enough respect to other independent brands. “They may just be experiencing strategic adjustments.”

The market has always been defeated by the king, but the value of the company does not change due to market fluctuations. No company has changed overnight, and no company has deteriorated overnight. Unlike other peers, Chang’an has won the sales of its own brand by relying on continuous and steady growth. Zhang Baolin emphasized that Chang’an has only been “following the laws of the automobile industry”.

Following the laws of the automotive industry, this is Chang'an's industrial thinking.

The essence of industrial thinking lies in accumulation and control. Through practical accumulation, growth is achieved, and you achieve control through your own control.

Through more than a decade of accumulation, Changan has already possessed the enviable R&D team and R&D capabilities of the industry. The R&D centers in five countries and seven regions, with more than 7,000 R&D personnel, possess first-rate modeling and design capabilities, and are fully independent of intellectual property rights, and Changan has begun to take shape.

Time is a sufficient condition for accumulation, and input is a necessary condition for accumulation. Can't afford to wait, unable to vote is an important reason to keep many companies out of accumulation. With Chang'an's profitability, these investments in time and money are also no small burden. For this purpose, Chang’an deliberately set up a red line, R&D investment is not less than 5% of sales revenue, which means that even if tightening the belt, the investment in R&D cannot stop and can only increase every year. The 5% R&D sales ratio is also on the upper-middle level in terms of global car prices, while most of the self-owned brands stayed at about 2% over the same period.

This 5% red line has given Changan space. It can firmly follow the path of development, and the high price of development and time and money has constrained Chang’an to treat each product cautiously, otherwise it will bring A huge waste. This is a positive cycle constraint, and low-cost R&D will inevitably bring about the situation of “multiple children arguing,” thereby weakening the competitiveness of each product and eventually leading to a deterioration in user experience and word of mouth.

In order to ensure the effectiveness of the accumulation, control becomes a must. Chang'an's control is reflected in different aspects.

Almost all independent brands have chosen to work with Italian design studios. Only Changan, after cooperating at the beginning, chose to set up a modeling center directly in Turin, Italy. Facts have proved that this choice is right. Chang'an Automobile's reputation among consumers today is beautifully ranked first.

It is hard to imagine that the shape of every new car in Chang'an Automobile needs to be determined by the board chairman Xu Liuping himself. Of course, this is not the power given by the board to Xu Liuping, but the Changan team's trust in Xu Liuping's aesthetics. Zhang Baolin said with a smile: "He is very critical of the aesthetic, but also can wear 1000 suits out of 10,000 children, and my clothes are all my wife bought."

Who will ultimately decide that this is not the key to the problem. The key point is that the outsourcing cooperation model simply cannot meet the requirements of discerning leaders, nor can it guarantee the accuracy of process communication, and it is difficult to rapidly coordinate with the repeated changes in the middle. Just like Apple's mobile phones, production can be done by Foxconn, but the design must come from Apple's core team.

Without absolute control over the design and design side, one of the core competitive advantages of today's Changan Automobile will cease to exist.

This year, Changan also announced CA-PDS and CA-TVS. This is still a model of control that has been explored in two long-term practices to ensure the effectiveness of R&D investment and the effectiveness of supplier management. According to Zhang Baolin, the two systems have actually been operating internally for a long time and their effectiveness has been fully tested in practice.

"There are more than 30,000 parts and components of the car, and if it cannot be controlled effectively, the user's experience cannot be guaranteed at all", but even so, the trouble caused by the quality of the supplier continues. "(We have a very strict system for upstream suppliers), but frankly speaking this system is also our weakest, and it is also the most difficult thing for cars."

However, consumers ultimately pay for the “Changan” brand, so even if it is difficult, this is the problem that Chang’an must solve. "One of our management measures is to send people to control. I call STA, sit down to manage, and the second is informationization. Your production line will start. I will automatically track it here... The car is a very systematic one. In an industry, if you only grab a certain point, you will certainly fail and you will certainly fail."

Let Zhang Baolin feel proud that Changan has done "(Changan Ford's production of Fox) than the United States, doing better than Europe, this product is a European design, the global synchronization to the market, when I last came to the United States Ford , Ford's vice president of global tube manufacturing received us to visit. He told me that you look at Fox's index. Now that Chang'an Ford's index is the best, it is (worldwide) first place."

Only today, Internet thinking is popular, and light companies are widely sought after. More and more companies have lost their accumulated patience and lost control of their interest.

However, the automobile industry does have its own laws. The most complicated civilian machine in human history to date consists of more than 30,000 parts and components. Unlike other industries, this industry is naturally dependent on the industry chain. Therefore, its evolutionary route is different from that of general consumer goods. As more and more consumer goods industries consider more control rights to be handed over, the auto industry should still consider how to effectively accumulate more technology and how to control their growing borders.

This is the industry, even if it is the subversive Tesla, today has accumulated through long-term trial and error, and today Tesla is also actively seeking to acquire factories, joint production of batteries, spare no effort to promote the construction of charging piles, Even the channels have chosen their own control. Internet thinking gives it a dream, and industrial thinking can really make him to the other side of the dream.

Technology-based: not an empty phrase

5% of the hard input from the resources determines that Chang'an's technology-based approach is not empty talk.

Chang An's ability to solidify and persevere in this investment will largely depend on the company's genes. When we asked Zhang Baolin to describe Chang'an's genes with simple words, he gave us a simple four-character "technological innovation."

The genetic formation of a company may come from its leaders. It may come from its history, or it may have both.

Technicians have a lofty position in this company and it is a tradition all the time. This military enterprise, which dates back to 1862 and originated in the Westernization Movement, has had to go crazy and learn from the mission of a technologically advanced country at the beginning of its establishment. This tradition has been preserved even after several twists and turns. For a long time after liberation, Chang’an’s workers all lived in an office building. Chang’an’s technicians lived in two-story buildings. This tradition of respecting technology passed through many similar signalized details and affected generations. The Chang'an people were gradually solidified through inheritance and formed the foundation of Chang'an.

Zhang Baolin, born from the third generation of Chang'an, is a witness of this culture and at the same time a faithful executor of this idea. Respect for technology has become a prerequisite in the context of Chang'an, not a choice that needs to be demonstrated.

Therefore, when Zhang Baolin started cooperation with Suzuki to build a sedan, he was facing Japan’s distrust of the Chinese technical team. Even when a screw was not allowed to be implemented by Chang’an, Zhang Baolin’s grievances could be imagined. . If there is no technical complex, the market will not be able to automatically exchange technology. Sometimes, on the contrary, the success of the market will inhibit the impulse to obtain technology. The acquisition of technology must be rooted in its own pursuit, rather than natural after being rich.

In Chang'an, the technical frustration on the joint venture project has strengthened their sense of urgency for acquiring technology. Since then, Chang An has taken a different path from other large state-owned auto groups.

Some roads don't go. You never know how hard he is. Similarly, if you don't go, you may overestimate its difficulty.

Chang'an research and development of global resources, the use of five countries and seven places, won the National Innovation Award of the Ministry of Science and Technology. During the reply, some experts asked a question that most people would like to ask: Changan runs this R&D institution abroad, ah, in the end what is the benefit?

Zhang Baolin answered two things: "Rapid, low cost." It's not hard to understand that the R&D institutions they own have greatly shortened the response time. At the same time, these individuals are at the leading edge of automotive technology, and it is much faster to capture these latest trends than to bring these people back to China. However, the low cost may exceed the imagination of many people. Zhang Baolin described that the actual cost of local recruitment in the place where talents gather is much lower than the introduction of talents into China, and it is easy to attract talents by paying the local matching costs. If you want to bring these people into the country, you will pay several times the cost.

It is the consensus of the entire industry to establish R&D institutions in the places where it is most likely to attract talents. Even the German Mercedes-Benz F1 team from Germany has its R&D headquarters in the United Kingdom, where racing culture is strong, not Stuttgart.

But both of these benefits have preconditions. If it is not a company with a technological complex or a soil of engineer culture, the hidden costs of such cross-border technology management will become very high, and in the end it will probably make these institutions useless.

For this reason, Zhang Baolin often flies to Italy, flies to England to chat with engineers one by one, and sometimes even brings two bottles of white wine to him and the engineers drink two. It is no accident that these seemingly Chinese ways have encouraged foreign technologists. Face-to-face chat with the president feels respect, because their works are highly sought after in the market, and the management and motivation of technical personnel is actually very simple, no matter how large the cultural differences.

Follow the trend: do the right thing

After attending the closed-door meeting of the TEDA Forum, Zhang Baolin did not attend the dinner party of the organizer, but took time to see the local mini vehicle dealer in Tianjin. In Zhang Baolin’s view, although 90% of Chang’an’s R&D resources are placed on sedans, mini-vehicles are still the markets Changan does not want to give up.

"This market currently has 3 million vehicles. In the long term, there will be 4 million market spaces."

“Last year was the turning point of the micro-vehicle business. This year we will also exert force on the micro-vehicle.” After the sedan business has been solidified, Zhang Baolin wants the micro-vehicle, a product that once brought Chang'an to Changan's honor, to continue its upward trend.

Perhaps this kind of one way can not be less, so that we will have the impression that the company is not focused enough. However, if we look at Chang'an's development path, we will find that each step, Chang'an is taking advantage of the situation.

From the first mini-vehicle in the 1980s to the Changan Suzuki sedan joint venture in 1993, it was followed by the Changan self-owned brand. Every step goes firmly. Behind this resoluteness is the grasp and obedience of the general trend.

In the 1980s, the military transferred people. Like most military-industrial enterprises, Chang’an also chose automobiles as the direction of transformation. It turns out that mini-vehicles were the most suitable route at that time. Since then, Chang’an has always been the “mini-car king,” and many mini-vehicle companies that have been transformed during the same period have either already been under Chang’an’s income or have already withdrawn from the stage.

The Changan Suzuki joint venture project, which was established in 1993, has laid a good foundation for Chang'an's entry into the car market and has also thoroughly inspired Chang'an's technological route. After this, Changan began a series of joint ventures and cooperation. Ten years later, China’s per capita GDP exceeded 1,000 US dollars, cars began to enter the family on a large scale, and the Chinese automobile industry ushered in a golden age.

In 2006, after years of joint venture experience and technology accumulation, Changan announced the launch of its own branded products. In November, Changan's first self-owned brand car, Benben, went public. For 8 years, Changan’s own brand began to climb.

The terrible thing about this company is that it can always look for the general trend, and then resolutely invest and implement it solidly until it reaches success. Today, Zhang Baolin again raised the micro-vehicle and apparently passed a signal. Changan is still optimistic about the general trend of mini-vehicles.

Then Changan may have to enter the battlefield where it is least good: the brand. This point has reached a consensus within Chang’an.

“Now we have already felt that our own cars are not enough for our marketing power. We say that the competitiveness of a company is equal to the technical force multiplied by the product power, multiplied by the brand power, multiplied by the marketing power, and has always multiplied. Equal to zero, you are all equal to zero."

Brand breakthrough has become the most important thing for this company, and this will become the biggest challenge for Changan. How can a company with "technological innovation" as a gene play a beautiful turnaround in areas where it is not good for itself, and perhaps after that, we will have more thrilling stories to tell.

Perhaps a similar 5% red line is needed. Perhaps this is not just a question of money. It still depends on the company’s pursuit.

We still expect Changan to contribute to the Chinese auto industry in the future.

But perhaps there is no secret, which is Chang'an's biggest secret.

Zhang Baolin's Interview with Quotations

About cars and mini cars

Zhang Baolin: If Changan only makes micro-cars, the car will only let several joint ventures do it. We think this is an incomplete auto company. So at that time it was decided to adopt a development strategy based on sedan. So 10 years ago and 8 years ago, especially after Xu Liuping was in charge of Chang'an, since 2006, we have mobilized a lot of resources to make cars. In the Chang'an headquarters, 23,000 employees, of whom nearly 7,000 are R&D personnel, and about 90% of these R&D personnel are sedans, that is to say, in the past few years, all resources have been allocated to cars.

2 Zhang Baolin: The car is in the climbing stage. The car hopes to achieve sales of about 550,000 vehicles this year. We have made great progress with ourselves, and the gross profit rate of bicycles has greatly increased. However, due to the large investment in the car, we also We did not make full profit to remove costs. Because of the large amount of investment, the cash flow of the current period is far more positive. Therefore, I hope that in the next two years or so, the car will achieve complete profitability and be profitable.

3 Zhang Baolin: The mini vehicle section may undergo some changes in its morphology. Now we call it collectively a commercial vehicle, or a special commercial vehicle, or a crossover vehicle. In this market, we think that we can reach a scale of about 4 million by 2020, and now it is about 3 million. I think 4 million in 2020 is entirely possible. Therefore, the scale of 4 million is still a market worth studying.

About Changan's low-key style

4 Zhang Baolin: Chang’an is a military industrial enterprise. This kind of corporate nature determines the low-key style of its external propaganda. Even if the work is excellent, the special nature of military products makes it not very important for external propaganda. After we were doing cars, especially cars, we felt the importance of the brand.

5 In fact, we are also aware of the importance of publicity, but we suffer from limited funds, so we must first seriously product, earnestly strive to do the product to do fine, and then increase our brand awareness. For example, this year CCTV's "Colorful Chinese" program, I personally think that is a relatively successful case in the sponsored activities of Changan in recent years. Previously, we had done some similar activities and spent some money on them. The effect was not good, so we are adjusting.

About technology research and development and corporate DNA

6 Zhang Baolin: First of all, Chang’an attaches importance to innovation in technology and technology. This is one of the characteristics of our company. No matter what it was in the past when it was engaged in military products, from the era of the Qing Dynasty to the era of the Republic of China, and even after the founding of the People’s Republic of China, all generations knew that technology was The importance of business development. In fact, the emphasis on technology is the soul of this company.

7 Zhang Baolin: Close to 2000, Changan established the Automotive Engineering Institute. This was a relatively large investment in technology at the time. Since 2000, we have continued to invest in this area. Chang'an people have attached great importance to technology, and certainly not technically, and they always attach importance to technology. This is the gene of Chang'an. The heritage of the military industry, we talk about the core technology can not be copied to buy, although at that time the Chinese auto companies said that the market for technology, but Changan has not been included in the country's major auto companies, lack of support, It's all about playing it yourself. However, the more stumbling, our predecessors pay more attention to the mastery of technology, so step by step.

8 Zhang Baolin: If Chang'an's genes are summarized in only one word, I think it should be called innovation, or technological innovation. This is the first DNA in Changan's DNA. Historically, leaders have attached great importance to technology.

In 2003 and 2004, Changan began to get involved in hybrid power, and the research on hybrid power was very hard. On the one hand, hybrid research must avoid people’s technical barriers and intellectual property rights. On the other hand, we must also cultivate our own abilities. Therefore, through nearly 10 years of hard work, Chang’an’s hybrid power should be said to be comparative. Our integrated vehicle integration technology, power technology, battery integration, and electronic control integration are all independent, and we have completely owned Changan's independent intellectual property rights. All of these have already been achieved.

9 Zhang Baolin: Continuing investment in these years, tightening his belts and investing in research and development, and no matter how hard he can develop, there is indeed a consensus in Chang’an. Even if you cut costs, you must support R&D. The other is the use of global resources, five countries and seven places, I think this is a very unique practice of Chang'an.

10 Research and development is only a matter of time. We must be able to do a good job. If we can only do something well, the Chinese people are not stupid. Coupled with national institutional policy support, the future will surely usher in a development. I have been very optimistic about this person. Despite the difficulties, I have always been optimistic.

About product competitiveness

11 The first is appearance, the second is quality, the third is cost-effective and competitive, this must be to follow the flow, and now it is absolutely impossible for Chinese brands to sell 200,000, and ordinary people will not buy it.

12 When the contradiction between the quality and the progress of listing is irreconcilable, it is right to resolutely grasp the quality, so as to avoid trouble after listing.

About long-term development

13 Zhang Baolin: For a company to achieve long-term development, the first must have the ability to continue to develop. I think that if we have this ability, we must have the necessary investment. The auto industry still depends on investment, and it takes a lot of investment to have great development. . There are many areas of R&D for cars, and we have to fill in everything one by one. If we do not fill up, one or two things may be successful, but in the long term it will not work.

About vision planning

14 Zhang Baolin: First of all, from the perspective of a big vision, we have just recently been planning for the next 10 years. When we mention that in 2025, Chang’an strives to become a world class. The world is now a fluid: First, technology is first-rate. At that time, Changan must master some advanced technologies. The second is quality first-rate. The third is the first-class brand, and strive to become a world-class brand.

About marketing

15 Zhang Baolin: Our own car, our marketing power is not enough, we say that the competitiveness of the enterprise is equal to the product strength multiplied by the technical force, multiplied by the brand power, multiplied by the marketing power, etc., has been multiplied, but if you can not do what, Your final result may all be equal to zero. This tells us the importance of the entire management system, systematization, and variety.

If the previous R&D investment reaches 2 billion, but behind the marketing side, you don't have the ability to match it. For example, after 20 billion investment, it will be able to form a production capacity of 500,000 a year, but the marketing system will not reach 500,000 sales. The ability to finish is equivalent to wasting all the previous inputs. Therefore, we are now very concerned about the coordination of various systems.

About independent brands go out

16 Zhang Baolin: Will China's cars go to the world? I think it will definitely go to the world. China exported 1 million last year, and China has 20 million. When the future world market size will reach 90 million or even 100 million, I think this export ratio will gradually increase each year.

17 Zhang Baolin: I hope that several features of Chang'an products: stylish, reliable, and cost-effective, can become the product elements that will be formed in the beginning of China's automobile to the world. We don't mention safety and quality right now, because quality and safety are the most basic elements. If you don’t have quality, you can’t be safe if you don’t have quality in the international market. On this unanimous premise, I feel like fashion. Elements can become an important manifestation of competitiveness.

About Mobile Internet

18 Zhang Baolin: Mobile Internet Big Data will change a lot of things in automotive companies, such as automotive technology and product configuration, and the integration of mobile Internet big data on intelligence, this is definitely a direction for us in the future. We also set up appropriate institutions in research institutes to track this issue in our research institutes.