Dialogue with GAC Aion's Gu Huinan: discussing going overseas, technology, and i

In 2024, one of the key words in the automotive industry is undoubtedly "intense competition." The market competition is becoming increasingly fierce, and technological innovations are emerging one after another. Since the beginning of this year, both emerging car manufacturers and established traditional car companies have expressed high attention and thought to the fierce competition in the current automotive market.

From the perspective of customer needs, the improvement of living standards and the transformation of consumption concepts have led to continuous changes in consumers' demand for cars. They not only pay attention to the quality and performance of cars but also pay more attention to personalized, comfortable, and intelligent aspects of cars. Therefore, car companies need to closely monitor changes in consumer demand, continuously innovate and improve products to meet the diversified needs of consumers.

From the perspective of market competition, as consumers' requirements for car quality and performance continue to increase, major car companies have increased their R&D investment and introduced new products, striving to stand out in the fierce market competition. Especially with the rapid development of intelligent and electric technologies, the automotive industry is undergoing a profound technological transformation. From autonomous driving to the Internet of Vehicles, from battery technology to charging facilities, each technological breakthrough brings new possibilities for the development of the automotive industry. In this process, car companies need to keep up with the latest technological developments and apply them to actual products to enhance product competitiveness and user experience.

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The automotive industry is facing unprecedented challenges. The "intense competition" in the automotive industry is the result of the combined effects of market competition, technological innovation, and changes in consumer demand. Recently, Guo Huinan, the general manager of GAC Aion, specifically talked about his thoughts on the above issues in an interview, and also talked about the development of GAC Aion's high-end brand "Hao Bo."

01

"Building a high-end brand" requires at least 15 years

In September 2022, the Hao Bo brand was officially released. As a brand under GAC Aion, which is positioned as a high-end luxury brand, how can it occupy a place in the extremely competitive market?

Guo Huinan said in the interview, "Building a high-end luxury brand is a protracted war." Taking Tesla as an example, Tesla has been established for more than twenty years, but its brand has only become well-known to the public in recent years. The high-end of a brand is not "selling cars at a higher price." Cars are durable, and car manufacturing should first focus on performance and quality, and then on reliability and durability. "Quality is the belief of GAC Aion, and there is safety only with quality." Guo Huinan said that whether a brand can be labeled as "high-end luxury" needs to withstand at least 15 years of testing.

A characteristic of a high-end brand is that it has strong bargaining power. Building such ability requires "demonstrating brand value in details such as R&D, manufacturing, sales, service, supply chain, organizational system, culture, and international comprehensiveness." Returning to the Hao Bo brand, first, GAC Aion has the manufacturing capability of the three electric systems. Second, Hao Bo has made high investment in both the design of the car body appearance and the internal entertainment system. Guo Huinan specifically mentioned, "I myself am an audiophile, and Hao Bo uses the best sound system."In addition to having top-notch products, attention to detail reflects value, and high-end brands must also go global. GAC Aion not only took its products abroad but also exported GAC Aion's "technological culture" overseas. To build a system for going overseas, it is also necessary to cultivate international development talents. Gu Huinan introduced that GAC Aion has cooperated with the Royal Institute of Technology in Thailand. By writing textbooks and other means, it cultivates international high-skilled talents in Thailand. Gu Huinan said that being able to continue to export Chinese technology is a very glorious thing, and this is the brand value that GAC Aion recognizes. Chinese car brands should face this challenge, with products, technology, and culture going overseas.

Gu Huinan said that for GAC Aion, now is a good time for brand high-endization. At present, many traditional luxury cars are experiencing a decline in brand premium ability in the new energy field, while the brand premium ability of new energy car brands is continuously improving. At this time, GAC Aion has laid a solid foundation as a brand, which has also promoted the rise of the Haobo brand.

02

The first echelon of intelligent driving, launching Robotaxi next year

In the interview, Gu Huinan repeatedly emphasized that "Haobo's label is high-end, technology, and art."

As the most concerned technology topic in the current automotive industry, intelligent driving has become a hot topic. In early June, the Ministry of Industry and Information Technology approved nine car companies to test L3-level autonomous driving, and GAC Aion's Haobo GT was included in the approved list, which is the "first echelon of intelligent driving."

For L3-level autonomous driving, an important aspect is the system's redundancy capability to ensure user safety. Currently, GAC Aion's intelligent driving technology can already be applied on some highways and is exploring urban street technology. Gu Huinan said that GAC Aion will strive to open all major cities' streets this year to achieve advanced functions such as turning at corners.

As one of the first car companies in China to enter the field of unmanned driving research, GAC Aion has a unique AEP 3.0 pure electric exclusive platform, which integrates an electric vehicle platform, an open-line control platform, electronic control steering, and redundant braking. It is an industry-recognized vehicle platform with a high degree of interface openness and platform stability and safety. In terms of intelligent driving technology, GAC Aion has laid out multiple sensor fusion technology, pure visual algorithm technology, and high-precision map technology. Among them, the pure visual algorithm technology has won the "pure visual list" global first in the international nuScenes autonomous driving test competition for many times, and it also won the "motion trajectory prediction list" global first in the Argoverse 2 motion prediction challenge. In November 2023, GAC Aion took the lead in obtaining the first batch of L3 test licenses. The multi-sensor fusion technology independently developed by GAC Aion is expected to be applied to the first batch of mass-produced L3-level autonomous driving models this year.

Gu Huinan said that GAC not only wants to be leading in China but also wants to "represent China and go overseas." In order to better enter the global market, Haobo has proposed the concept of "no map global pass." According to Gu Huinan, a pain point of Chinese car exports is the limitation of maps. With the global no-map technology, as long as users can see maps on their mobile phones, Haobo can travel globally.

Regarding the plan for the large-scale application of intelligent driving, Gu Huinan said that they will launch L4-level unmanned driving taxis with Didi in 2025. Gu Huinan said that taxis are one of the most valuable scenarios for unmanned driving applications. L4-level autonomous driving can reduce the operating costs of taxis, and GAC Aion is also confident that it will be ahead in the related technologies of unmanned driving through cooperation with Didi.In addition to autonomous driving, Gu Huinan also introduced the research progress of GAC Aion in solid-state batteries. The industry believes that solid-state batteries can not only reduce volume but also improve stability. Gu Huinan stated that GAC Aion aims to overcome the relevant challenges by 2026. He also mentioned that what GAC Aion wants to do is not a "conceptual" solid-state battery, but a fully solid-state one. He believes that the process of fully solid-state is disruptive, but it is also challenging.

03

China's automobile market enters the "Warring States Period"

With the development of the industry, the technological barriers of the automobile industry are also increasing. Gu Huinan said that China's new energy automobile market has been cultivated for more than ten years and has been maintaining rapid growth. Although the entire automobile market has mentioned less about environmental protection and dual carbon in recent years, it will still return to dual carbon, environmental protection, and so on in the next few years. Now it is in the "Warring States Period", with new energy technology taking multiple routes, fast charging, battery swapping, and energy replenishment forms becoming more diverse, and ICV is also a multi-route melee.

Automotive companies are facing not only the "volume" of technology but also the "volume" of prices. At the 2024 China Automobile Chongqing Forum, several chairmen of automobile companies expressed that the automobile industry is now highly involutionary. Involving products, prices, and even traffic. Talking about the involution of the automobile market, Gu Huinan said that GAC Aion wants to fight is not a "price war" but a "value war".

Traditional car companies admit that the new forces of car manufacturing are "closer" to users, and can provide full "emotional value" in user experience. This is also why more and more traditional car companies are starting to reach more users through various new media to enhance brand strength.

In order to better promote the brand, Gu Huinan also released some videos to "speak" for GAC Aion. Gu Huinan believes that in such an involutionary automobile market, it is necessary to participate in the necessary price war, but it is also necessary to have differentiation. "When you meet on a narrow road, you have to walk sideways", the competition in the automobile market does not necessarily have to be "mutually destructive". Friction is inevitable, but doing a good job in differentiation is more likely to win.

In the current international environment, car companies want to think about not only surviving but also living well. So how to do a good job in differentiation? In essence, the core is still to develop the core competitiveness of the product and do "real" things.

The "volume" of China's cars is not only in the domestic market, but in fact, Chinese cars have also "rolled out to sea". According to data from the General Administration of Customs, in 2023, China exported a total of 5.22 million cars, a year-on-year increase of 57.4%, surpassing Japan's 4.42 million, and has become the world's largest car exporter. In addition to competition in China, GAC Aion also needs to look at the world and participate in global competition. Compared with the involution of the home appliance era, Gu Huinan believes that the export of Chinese cars is better than the export of electronic products and home appliances. Because for the automotive industry, the threshold of technology is improved, as long as the automotive industry adheres to the innovation and leadership of science and technology, insists on high-quality development, there will be opportunities to roll out a world.

In the overseas market, Chinese cars have to face more tests. For Chinese car companies, they first have to compete with local brands. After "moving others' cheese", Chinese car companies also have to face the heavy barriers set by foreign governments.Resolve Reflects Strength, True Skills Determine Heroes

On June 12, 2024, the European Commission announced plans to impose new tariffs of 17.4%, 20%, and 38.1% respectively on BYD, Geely, and SAIC starting from July 4. In addition to these three car manufacturers, the Commission also stated that companies not sampled but cooperating with the investigation would be subject to a unified weighted average tariff rate of 21%; for companies not cooperating with the investigation, the additional tariff rate would be 38.1%. Foreign media indicated that this move is closely related to the pressure faced by European car manufacturers (such as Volkswagen, BMW, Mercedes-Benz, etc.) from Chinese car brands. Previously, the United States had already announced a new 100% tariff on Chinese electric vehicles. In addition to tariffs, the European carbon footprint is also increasing barriers. The next barrier facing new energy vehicles may be the barrier of electrification, followed by the barrier of ICV, and intelligent networking and autonomous driving may also give birth to new barriers.

In response to such a situation, Gu Huinan discussed the coping strategies of GAC Aion. GAC Aion will continue to focus on building six core competencies, "winning future market competition with R&D, product matrix, marketing service innovation, intelligent manufacturing, strong industrial chain, and innovation in system and mechanism."

As Gu Huinan said, "The current situation is a good opportunity for the Chinese automotive industry, but do not rush for success, do not serve capital. The automotive industry should have such resolve."

Although there are difficulties ahead, after the test of the waves, the true heroes can remain on the field.