WM Motor Technology Co., Ltd., one of the new Chinese electric vehicle startups, broke ground for its Smart Industrial Park inside the Oujiangkou District in Wenzhou, Zhejiang Province on November 23.
With a Phase-I investment of ¥6.7 billion ($971 million), the industrial park featuring smart manufacturing, smart logistics, flexible parts matching and autonomous driving testing is expected to start production in 2018, and produce up to 200,000 vehicles a year after reaching full production capacity.
So far, only five carmakers have attained EV production licenses including BAIC BJEV, Changjiang EV, CH-Auto Technology, Chery and Min’an Auto. WM Motor is one of many other newcomers looking to gain that coveted license and the construction of the industrial park is key to tapping into government support.
Building affordable connected EVs for the masses
Founded in 2015, WM Motor is an emerging EV company and mobility solution provider in China. WM was named after the German word “Weltmeister,” which means world champion. While other Chinese EV startups including Singulato (formerly known as Zhiche Auto), LeEco, NextEV and Future Mobility are led by ‘disrupters’ from the IT industry, Shen is a “defector’ from the automotive industry. To learn WM Motor you have to know Freeman Shen, its founder, chairman and CEO. His vision for the company is to build a mainstream smart vehicle that customers are willing to buy even without subsidies.
Shen, who has a master’s degree in structural engineering from UCLA, once held executive positions at various European and U.S. automotive companies for 22 years before starting WM Motor. He attended Harvard Business School’s Advanced Management Program while working for Geely and spent more than a decade working at auto parts maker BorgWarner Inc. and Italian automaker Fiat. Before WM Motor, Shen’s industry achievements were well known. In 2010, while as vice president of Geely Holding Group, he led a team that helped the private carmaker to successfully acquire Volvo Cars. Following the acquisition and restructuring and under his leadership as senior vice president of Volvo Cars and chairman of Volvo Cars China, Volvo Cars started to take root in the Chinese market and managed to build a sound dealer network as well as local supply chain within five years, making China Volvo’s largest and most profitable global market. As such, he has enjoyed a great reputation in the industry and is hailed as a pioneer for the globalization of the Chinese auto industry.
In an interview with CNBC six years ago, Shen revealed his vision for the global auto market, as well as his initial car building dream. After leaving Geely in 2014, Shen and his former coworkers worked on a domestic smart car technology firm. Before long, he set up WM Motor in Shanghai and started a new journey to build a world champion-level mainstream smart connected vehicles of great quality, high reliability and premium user experience, as well as creating a new smart mobility solutions based on complete vehicles.
WM Motor announced on August 17 that it had raised $1 billion in an initial fundraising round, from Chinese investors, the founding team and mostly Shen himself – nearly all his saving, rather from tech giants such as Alibaba and Tencent or venture capital. WM Motor is under control wholly by the founding team with Shen as the largest shareholder.
“We received a lot of offers and went with long-term investors – evergreen funds and the likes. They are not ready to come from behind the scene yet,” said Shen in a media interview. While declining to say where the seed money came from, Shen confirmed his plans to go straight for this mass market rather than follow NextEV in first building a high profile electric super car.
“Building a fancy car to impress people is actually fairly easy as long as you’re willing to spend the money, the most challenging part is mass production – coming up with a car everybody can buy, with high quality but at a significantly lower cost,” said Shen. “We don’t want to make toy-like luxury cars for the minority. We will target the mass market.”
A team with profound industry experience
Nowadays WM Motor has a core team of over 600 staff with offices in Shanghai, Germany, Beijing and Chengdu. Besides the new plant in the pipeline in Wenzhou, WM Motor has a tech center in Germany, with a $15 million monthly payroll, according to an insider’s information.
While most EV startups are rooted from technology companies, WM Motor distinguished itself with a team that has profound experience in the auto industry. In a recent interview with Forbes, Shen talked proudly of his core founding team of eight. To name a few: co-founder and CFO Napoleon Du, former financial controller at Philips’ Suzhou unit; CTO Di Shuo, former technical director of Google; COO Xu Huanxin who led Volvo’s new energy program; vice president Lu Bin in charge of sales and product planning and former vice president of Chinese automaker Chery’s sales arm. Other members specialize in areas such as manufacturing and supply chain management. That’s a team where investors would place their bet.
“All eight partners speak English. We’ve all worked with domestic private-sector companies or startups, where you need to survive lack of resources and imperfect management, and with international companies as well, which is a great place to get trained,” says Shen. “Plus, the eight of us all worked with one another at some point, and so did the first 100 employees of our company. We have similar work style and share similar values.”
Five additional industry veterans sit on the company’s global board to provide strategic guidance, including a retired Volkswagen executive and a close friend of Shen who helped coin the name WM.
Adoption of “128 Strategy” for product and “Industry 4.0” for production
In the New Possibilities for Smart Mobility forum held on September 21 in Shanghai, Shen revealed his “128 Strategy” for WM Motor future product plan, which is to focus on one key architecture, two vehicle platforms STD and PL and eight high-quality mainstream smart vehicles. “In the next 3-5 years, the accelerated speed for automotive development will be increasingly picking up. The technology singularity for automotive value chain will appear, and it will be a key period when the car will be redefined.” Shen said. “With the impact of new technology, the car – a traditional hardware product – has gone through significant changes.
“My years with Volvo and Fiat made me realize that building a Fiat 500 of reasonable price, stable supply and reliable quality is far more difficult than handcrafting a Ferrari. Yet, our dream is not to make a luxury toy for the rich, but a mainstream product that changes the way you move and experience. At the front end, we will allow users to define for themselves the greatest content possible of products and needs; at the back end, we will satisfy front end users’ desired needs via truly Industry 4.0 methods.”
Design concept of WM Motor
On October 16, Sam Sun, WM Motor’s design director, attended the UI/UX Conference China 2016 held in Shanghai. Sun graduated from Durham University and holds a M.S. degree in Design from Coventry University in the UK and is specialized in Automotive Design through his impeccable working experience at Bentley, Roewe, Volkswagen and Borgward. As the only design expert from the auto industry at the conference, Sun delivered a keynote speech entitled as “the Function and Application of Interaction Design in Intelligent Vehicle Design.” He then shared the smart mobility services in the era of experience, mentioning that based on the core value of experience, WM Motor is committed to smart mobility services and the focus of vehicle design of WM Motor will transfer from the traditional mechanical performance to the user and driving behavior. To this end, a lot of user research has been conducted with an in-depth understanding of the user’s perception of experience evaluation, and the importance of the improvement of “11” indicators of human machine interaction system has been highly recognized. The experience design of WM Motor is divided into three levels, namely small interaction, large interaction and general interaction, allowing users to truly enjoy the freedom of travel and planning all possible details of user interaction while not limited to the vehicle screen. Taking the experience as the core, WM Motor will upgrade the intelligent autonomous driving to smart autonomous driving, building a smart car that understands user needs.
“We see ourselves as a service company.”
“I don’t think traditional car companies are doing well selling cars, especially with their customer experience. With smart, connected cars, I believe I can change that,” said Shen “We’re not a traditional car company. We see ourselves as a service company.”
Shen sees WM Motor as a service provider instead of simply a carmaker. “For traditional manufacturers, the part of their job ends when a car is sold, but it’s the contrary for us,” he says. “The vehicle is a link to new opportunities,” Shen said to Forbes. Eyeing the peer-to-peer car sharing market, Shen’s already planned to start transportation services in 2017.
What Shen considers most so far is how to influence and change the way people move in the future through smart cars. WM is on its way to building a basic hardware platform to achieve smart vehicle network coverage through innovative value chain solutions including sales, operation, finance, service, and information strategy. And it has already partnered up with major players in each related sector: Siemens supplies smart factory software systems; Bosch provides manufacturing equipment as well as vehicle components; Tencent will help with cloud processing; Huawei will bring smart city platforms. One startup, Beijing’s Horizon Robotics, will also join the club with its autopilot program.
WM Motor plans to launch its first smart connected vehicle in 2018 and next two by 2020, and roll out four more models including sedan, station wagon and SUV, one each year through 2025. Shen says WM Motor aims to sell more than 100,000 cars a year within 3-4 years after launch. They will target the Chinese market first and then the U.S. market further down the line. “By 2019 we’ll likely launch something that’ll shock you to your very core,” said Shen.
No doubt WM Motor will face challenges. Can it succeed? You don’t want to bet against industry insider Shen, who’s nurtured Volvo to a strong comeback.
Timeline of WM Motor’s major development milestones
December 2015: WM Motor established with R&D team based in Germany
May 2016: Completes series-A financing
July 2016: Signs agreement with Wenzhou government to build industrial park; establishes “WM-Alliance” fans platform so that users can participate in creating their own vehicles
August 2016: Corporate Logo 2.0 launched; Signs strategic cooperation agreements with Huawei, NavInfo, Siemens and Bosch
September 21, 2016: Freeman Shen makes first public appearance and announces “128 Strategy”
November 23, 2016: Breaks ground for Smart Industrial Park in Wenzhou, Zhejiang Province with annual output capacity of 200,000 smart EVs
December 2016: Close to 600 people work in Shanghai, Beijing, Chengdu, Wenzhou and Germany