“Jump in, the water is fi ne!”
Those of you that are diehard fans of CBU/CAR know that these are the words from Don St. Pierre Sr., when he spoke to Wayne Xing, our founding and honorary chief editor, 22 years ago.
St. Pierre Sr. at that time was the president of Beijing-Jeep (now Beijing-Benz), China’s first automobile joint venture founded in 1984. He used the phrase to describe the prospects of the Chinese auto market in the first-ever interview of a senior automotive executive conducted by CBU/CAR. The summary of that interview was featured in the inaugural issue of our weekly e-newsletter CBU-Auto published in April 1995.
Fast forward to today, the same words can still be said about the market thanks to the fact that the car is becoming more connected, autonomous, electrified and shared, which has created all sorts of opportunities for players from outside the industry.
Case in point: Chinese telecom equipment maker ZTE Corp. announced just a few days ago that it will begin producing electric vehicles by the end of this year with an annual output capacity of 30,000 units. The company is doing so via the recent acquisition of bus manufacturer Zhuhai Guangtong Automobile Co. ZTE has already mastered key technologies in wireless charging, connected cars and autonomous driving and will be applying for a license for electric passenger vehicles this year, a manager with the ZTE Smart Auto subsidiary was quoted in the media as saying.
Just a few days earlier, Dong Mingzhu, chairman of Gree Electric Appliance, a leading Chinese home appliance manufacturer based in Zhuhai, teamed up with China’s richest man – Wang Jianlin, chairman of Wanda Group – and several other companies to invest a total of ¥3 billion ($436 million) in Zhuhai Yinlong. Dong’s personal investment in the electric bus and lithium titanate battery manufacturer comes a few weeks after her company’s shareholders voted against a corporate acquisition.
The outsiders, it seems, have kicked the doors to the traditional industry wide open, and we don’t have to mention the Baidus, Alibabas and Tencents from the IT industry as well as China Mobile, China Unicom and Huawei from the telecommunications industry who are actively seeking to become a part of the new automotive ecosystem. There is also no shortage of new “internet carmakers” and other tech startups that have emerged who try to challenge and “disrupt” the incumbents.
While the 2016 version of the investment project catalogue issued by the State Council on December 20 reaffirms the country’s stance that in principle no new manufacturers of traditional fuel-powered vehicles will be approved in the future, we will see quite a few new manufacturers even possibly joint ventures get approved based on the policy on the establishment of new pure electric passenger vehicle manufacturers (e.g. JAC-Volkswagen). The door is wide open, but how you enter gets tougher.
So, as Chinese President Xi Jinping said in his New Year’s message, roll up your sleeves and jump in! The water may be crowded and more difficult to swim in, but it is still fine!
With that, we wish our readers a Happy New Year and look forward to continuing to provide our readers with independent and unique perspectives on the largest automotive and EV market in the world!