An interview with Li Xiang: The original definition of the car is wrong and the traditional car will be completely subverted.

In the second half of 2017, the electric cars in China are surging. The various blockbusters are constantly being thrown into this murky market and are dizzying. There is no doubt that for all start-up companies trying to rush gold on this vast super track, the moment of decisive battle is coming. Is there any need to conceal it?

Silenced the quietness of the car and home in which strategy had been silenced for nearly 26 months, and began to release “sudden material” continuously. The latest heavy news was that it completed A round of financing of up to 2.4 billion yuan, with the latest valuation being 65. 100 million yuan.

At the same time, Li Xiang, the founder of the car and his family's distinctive personality and widely-known reputation, began to launch a heavy blow. He was in the hidden R&D center on the edge of the East Fifth Ring in Beijing, and accepted the “Construction Review” for a long time. The exclusive interviews unreservedly showed the ambitions and road maps of cars and homes to subvert the traditional automotive industry and redefine the travel industry.

In this dialogue, Li Xiang’s personality as a post-80 personality was thoroughly demonstrated. When answering questions of various kinds, he was frank and direct, straightforward, and confident. Li tried to criticize the problems of traditional transportation, traditional business models, “pseudo-electric vehicles” and the complexity of the so-called auto industry. In this regard, I was not surprised at all. As a person who used to be an entrepreneurial icon in the 1980s, Li Xiang never missed the topic. However, the most exciting thing about cars and homes is not Li Zheng’s controversy but its business model itself is a kind of subversive innovation.

As China's prestigious product manager, Li Xiang is using his core professional capabilities to redefine what is called a car? What is travel? And how to define a company - cars and homes.

What I must remind is that don't be frustrated because of Lee's attitude and sharp expression. He is wasting such a rare and fresh spiritual meal and paying attention to his core logic. Just as the mobile phone industry is not subverted by technology but by product, the automotive industry is ushering in an outstanding product manager capable of doing original thinking. Regardless of the outcome of his venture, his thinking and hard work will surely be this. The wealth of the industry.

Frankly speaking, the car reviewer is also excited. This is a rare good interview subject. His dedication is an in-depth and complete reflection on this industry. I will do my best to interpret the business models, strategies, products and operations of cars and homes from the perspective of observers. At the same time, I will select the essence from the interview records of tens of thousands of words and expound the car from the perspective of Li Xiang himself. And home strategy.

Traditional car business model will be completely subverted

Li Xiang thinks that the entire business model of the auto industry will undergo radical changes in the future.

He gave a set of data to reveal the source of subversion. After the car is electrified, the maintenance cost will be reduced by 80% and the energy cost will be reduced by 80%. After the L2 level ADAS capability is achieved, the vicious traffic accident can be reduced by 50-70%. Because of the insurance, the insurance premium can be reduced to 1/3 of the original price due to the reduction of the accident rate.

Regarding the business model of car enterprises, Li wanted to admire Tesla and believe that his business model was not flawed. Now he is not perceived because the scale has not yet risen. He admits that there is no difference between Tesla and Tesla’s business model.

Car and Home, like Tesla, are all user-centered and serve the user's entire life cycle, including direct sales, self-financed financial services, self-insurance, self-maintenance services, and shared travel services in the future. Lee’s plans for cars and homes are to be a smart car company by 2020 and will become a shared travel company by 2025.

Traditional car companies and after-sales service departments will have profitable KPIs. Therefore, the higher the price of accessories and working hours is, the higher the profit will be. The more accidents the vehicle owner has, the more profitable the car companies are. Emerging electric vehicle start-ups sell their finances and insurance in their own hands, so Tesla's accessories are very low priced, plus a little money on the basis of the cost price. Because the user repairs the car, it is Tesla's insurance premium. The higher the price of the accessories, the higher the car price is not the profit, but the higher expenditure.

He said Zhongguancun Damaichang had died, not because of JD. It was because of Apple and Xiaomi because they didn't need you. The implication is that the future of traditional cars, along with car aftermarket services, will be impacted by new models until they are subverted.

Weird car and home valuation of 6.5 billion yuan

In the eyes of most people, the strategy of cars and homes looks very strange:

1. The first car SEV is a completely new category. About 2.5 meters long and 1 meter wide, the cruising range is less than 100 kilometers. From the spy photos of online exposure, the body is very thin, an alternative. Most people will ask at first glance, what is this? Will you sell it? Actually what else should we do? We should not be afraid of being drowned when we rent and share the travel market.

2, but also to do a home large-scale SUV, 6-7 seats. The strangest thing is that this SUV is an extended-range electric vehicle. Re-inserting an internal combustion engine into the vehicle body as a range extender increases the cost on the one hand and increases the difficulty of research and development as well as the difficulty of the layout of the original pure electric version. Moreover, because the extended range does not hesitate to get the price of Beijing's electric vehicle license. What is this to do?

More interestingly, as the industry’s first Internet manufacturer to announce the construction of a manufacturing plant, after completing the construction of the first factory in Changzhou and starting the construction of the second factory. Li Xiang suddenly appeared in Shenyang and announced a strategic cooperation with Brilliance. Both parties will cooperate in the development of intelligent electric vehicles, supply chain and manufacturing. Completely confused about what to do.

However, this strategically and operationally seemingly weird company, with financing and interest-free loans, can use 5 billion yuan of funds. What is the logic behind this?

The definition of traditional car market and car is wrong

The traditional auto companies' regional market is often priced, plus types such as SUVs, MPVs, and cars. Auto companies increase market coverage by continuing to develop new products.

This traditional way of market segmentation has obvious problems. It does not know who the user is, and the user's usage scenarios and specific needs. It makes R&D personnel think that cars should be like that, and it is natural to create SUVs from SUVs. It is simply unacceptable to make a car an SEV. However, product managers who truly have the ability to define products must build products based on the needs of users and users.

A few days ago chatting with a boss of a traditional car, he asked me a question, in the development of vehicles, how to choose a variety of configurations, competing products and some are we must have? This is a long-term puzzle for the development of car enterprise products.

The traditional "dogma" for the configuration is "I have no people, I have excellent people." This is a typical standard thinking, imitating thinking. However, it is not known whether users need it or not, and at the same time they have to pay extra for this.

At that time, I asked him why he couldn't think about problems from the perspective of user needs to push forward R&D. He said that it was too difficult to convince the boss. Then, the traditional car dealers watched Tesla with all the keys of the meter and the center gauge, and messed up in the wind.

Lee's logic in planning products is obviously different from that of traditional car companies. As a prestigious product manager in China, his measurement standards will definitely be the user's usage scenarios. He believes that China, even if it is a private travel worldwide, can be subdivided into The three scenes are 0-30km, 0-100km and 0-500km.

New car species

In many people's eyes, the SEVs for cars and homes are shit. However, most of the time, interpreting a core work that has been successfully completed and one of the best product managers in China as a shit is either ignorance or superficiality.

There is no doubt that SEV may be the most glorious crown in Li’s career and his most ambitious product. It may also be the original thinking that was brought to the global automotive industry by the Chinese for the first time. Among the entire automotive category, Lee's SEV is undoubtedly a new species.

If SEV can succeed, its impact and significance will even surpass Tesla's Model 3, because from the beginning of SEV, the automotive industry product manager will be freed from the original, old-fashioned definition of the car's mindset. The way to rethink human travel, continuously innovates this industry and benefits people. Let us look at its logic.

Li Xiang thinks that 0-30km travel is the most common way of commuting in people's daily lives and it occupies 80% of people's daily travel frequency. In this largest and most commonly used market segment, there is not yet a tailor-made automotive product for it, making short-distance commuting convenient, comfortable, and economical.

Cars and homes will travel 0-30 kilometers, subdivided into two typical application scenarios:

1. After people get out of the community, they can choose to travel in addition to subways and buses. There are also Mobike, taxis, and taxis. At this time, SEVs tailored for no-point-time-rents will be added to the competition. Its use cost per kilometer will be half of the taxi. Li would like to say that if the car can drive 50-60km a day, the daily income will reach 100 yuan, and the cost will be recovered in one year.

The operating model corresponding to this scenario is lease when there is no pile time.

2. The second or third car at home meets the daily needs of intensive use. For example, a young mother sends her children to school in the morning, maybe 5km, then goes to the supermarket to buy food, needs to open 2km, and finally opens Going home is three trips. Pick up children at night, send children to cram schools, go home, and travel three times. A medium-to-large SUV is simply not suitable for meeting the above-mentioned demand. The reasons include peak traffic jams, frequent search for large parking spaces and basically no parking spaces. Energy consumption is not environmentally friendly.

The solution for this scenario is a retail or long-term lease.

The SEV for cars and homes is tailor-made for the above two travel scenarios. Its body is particularly narrow, it looks very thin, even a little uncoordinated. The advantage is that its width is the same as Jingdong delivery motorcycles. When traffic jams, it can travel through the traffic flow of the two trains, free from traffic jams. There is limitless possibility when looking for a parking space. You can use your finger to control a button on the back of the car and you can put the car into the gap between the two cars in the parking space, including other possible corners. Don't worry about people coming out.

The SEV is small and the mileage is short. The advantage is that the battery pack is very small and the result is low cost. Secondly, the charging can be done with the home charging socket. Even if it is slow charging, it can be filled for 5 hours. The feeling of fast charging is "second charge". The electricity consumption of 100 kilometers is about 6 degrees, and the use cost is extremely low.

Not afraid of dropping pixel-level copy

With regard to the sales and operation of SEVs, Car and Home will first rent out when no points are set in Paris. Users will search for cars through the APP. After use, they can park on any parking space in Paris Avenue. If there is no parking space, they can park at the car. Between the two cars, because these on-street parking spaces belong to the municipality, cars and homes are settled with the government in the form of annual subscriptions; the charging problem will be quickly replaced by the operator and the battery will be replaced once a day. This model is equivalent to the car version of Mobike. The start-up of Paris-based time-share leasing operations will be ahead of China’s listing offering.

The SEV will be launched in China and will be launched in early 2018. It will be mainly retail-based in the early stage and may also provide long-term rental mode in the sales model. It will also consider that part of the park, the headquarters base took the lead in attempting to lease without a lease.

In the future, through the cooperation with local governments, such as the local settlement of manufacturing factories, the company will compete for more license resources and parking resources, and start a no-point-time leasing business. Li Xiang said that Car and Home do not exclude the establishment of a joint venture with other time-sharing leasing companies to jointly operate SEV's non-plot leasing projects.

In this scenario, Li wants to think when he or she is asked whether he or she is worried about the SEVs that drove out to copy car and home SEVs to follow up quickly. If automotive products cannot be customized for the above scenarios, they cannot improve efficiency and are not competitive.

The key to the travel market is tailor-made products. Whether the product itself is actually suitable for travel scenarios determines the operational efficiency. No matter whether it is an entire vehicle company or a third-party operator, it needs such a core product.

Even if it is a pixel-level copy, because of the laws of R&D and manufacturing of automotive products, from research and development to building a factory, if you are a god, it will take 24 months. If you are a human, it will take 36 months. In the shared travel market, 24 months is enough to end the fight.

From this point, it is better to cooperate with cars and homes.

The SEV for cars and homes, because it is a completely new species, will surely encounter many problems in operations. Hopefully, we have become a global G2. We have a strong sense of confidence and goodwill. We are open-minded and caring for innovation so that China can become an innovative homeland and enable the Chinese people to continue to contribute to the world. It is also hoped that some executives with farsightedness and a spirit of reform will be able to work with the car and the family to make a contribution to the changes in the era of human travel.

In order to extend the distance, do not have electric vehicle licenses

Many traditional car companies are not afraid to break their heads in order to obtain a license for Beijing electric cars. However, Li Xiang and Car and Home have shown completely different perspectives and dimensions here. They do not give up the value of the users due to short-term and immediate interests, change the definition of automotive products, do the right thing, and stick to it.

Li Xiang thinks that the use scenario of another private car trip is 0-500km. This is the private car. He believes that in the event of private car purchase, if the mileage is less than 500km, it is unacceptable. This is the core reason why it is expanding its range of electric vehicles.

Li wanted to ask the “Construction Review” to ask the user to choose a 300km car, an unlimited mileage car, a car that did not consider the charging problem, and a car that did not have any difference in daily experience. Users will choose unlimited mileage. When the car critics argued that in addition to experience, users will also consider the price factor. Li wanted to laugh very happily and said that the price increase was very small.

When he was questioned about installing a range extender that would affect the layout of pure electric vehicles and reduce the efficiency of research and development, Li wanted to disagree with this view. He believes that if you want to add 650km of mileage through the power battery, you need to install 700-800 kilograms of batteries, the car will be 3 tons, while a range-extender engine, only 100 kilograms.

In addition, when the power battery for domestic large- and medium-size SUVs is 35kwh (degrees), pure electricity can run 150km, ensuring that 97-98% of the daily use mileage is driven by electricity, usually go out to play, and go home long-distance holidays without mileage. Anxiety; more convenient charging, any 3.5kw home charger, can be fully charged in one night.

If the price of the range extender is controllable, the "Construction Review" tends to recognize this idea. Li wanted to think that Beijing’s electric vehicle license, though valuable, amounted to only tens of thousands. His target market was an upgraded consumer market for stock cars. Taking Beijing as an example, the annual scale even reached 670,000 vehicles (which should include sales. immigrant).

There is no doubt that home-to-large-scale SUVs are a Red Sea market. Lee wants to think that their competitive advantage is reflected in three places:

1, the value will be very high, is a group of really doing in the design team of large and medium-sized SUV, he almost completely digging the team of Infiniti.

2. Li thinks that it is impolite to say that the intelligent level of the car and home SUV will be the first in the world. He believes that Tesla's biggest mistake and the only mistake is the adoption of Linux on the car operating system. There is almost no ecological application on this system. For example, Tesla's map is difficult to use. No one has developed a map on Linux. Doing O2O on the map is not feasible at all, and it is impossible to pay directly in the car. In a forum last time, Lai Chi Venture Capital, Li wanted to be asked about who was the competition between the car and the family, only mentioning Weilai Automobile and Xiaopeng Automobile.

3. He thinks there is no mileage anxiety in the extended range mode and is also a killer for victory.

This home-sized medium and large SUV will be available in 2019.

The third car of the car and home will cover the use scene with a travel distance of 0-100km. Li thinks that the use of this scene is mainly express trains and special cars.

The express train runs 300 kilometers every day. If the monthly fuel cost of an electric vehicle can be saved by 4,500 yuan, it has an irresistible temptation for drivers. However, this model will be introduced when battery technology is more mature.

B round of financing closed at the end of the year to reserve $ 1 billion in cash

In terms of funding arrangements, Li wanted to tell the "Construction Review" that the total amount of financing for the equity financing of Che He Home was 2.755 billion yuan. According to its investors' announcement, the latest valuation of Che He Home has reached 6.5 billion yuan.

Car and Home have already started financing in Round B. It is expected that the financing will be completed by the end of this year and the valuation will not fall below 10 billion. Lee's goal is to hold $1 billion in cash in his hand. The money will be used to make them profitable.

The original media reported that the car and home 4 billion industrial fund plan, Lee would like to disclose has been suspended.

Li Xiang thinks that car and home can achieve large-scale profits in 2020. In this regard, the “Construction Review” believes that the sales and operations of SEVs are the key to achieving the above goals, and they have great challenges in the work of GR and PR in cars and homes. Because as a new product form, how to incorporate it into the existing management system? The core challenge is the differentiation of road rights and the management of product safety standards. This is also the core reason why cars and homes have to put the SEV in France as a demonstration operation.

Li Xiang believes that for the sharing of travel companies, the layout of B-side production capacity is critical. He said that if the "small blue bike" if the previous production capacity is enough, there is a chance to defeat theo and Mobike. It can be expected that cars and homes will cooperate with existing car companies in more cities. Once the sharing mode of SEV runs, it will quickly increase its volume and will not give competitors follow-up opportunities.

The enterprise is the product sweeping

In terms of operations, Li wants to focus on the implementation of HR and corporate culture in order to enhance the company's execution and operational efficiency. He said he spent 60-70% of his time on the above matters.

Li Xiang admitted to the "Construction Review" that when the car and the family were established less than one year later, there were many phenomena in the company such as mountains and schools. Although this is commonplace in traditional car companies and any other startup companies, there is no doubt that this is a problem that must be resolved and difficult to solve.

For all automotive start-ups, the composition of the company's employees is very complicated. Take the car and the home as an example. Their employees are from large companies such as Mercedes-Benz, BMW, Infiniti, Beiqi, Brilliance, Geely, Ali, Auto House, Nestle, Changan, Lenovo, Apple, and Xiaomi. There is a conflict of corporate culture between traditional car companies, and there is also the disagreement between traditional car companies and employees of Internet companies.

Li Xiang’s solution is through a methodology that they have become a “four-step method” to help employees solve problems, build trust, grow quickly, acquire happiness, and finally unify their common vision and values. He told the "Construction Review" that the car and the family may be the lowest-rate companies in all auto companies. Their R & D department only left one person in the first half of the year. The reason was that because the daughter-in-law had children, she had to return home. Almost all employees are willing to recommend their former colleagues and friends around to work in cars and homes.

The working atmosphere of the car and home has a strong founder's color, and the “Construction Review” recognizes Li’s efforts to achieve the above results. Having common values ​​and a good corporate culture is the foundation for improving execution and efficiency.

In view of the fact that the number of characters has been severely out of control, in this article, the "Construction Review" can only select a very small part of the dialogue recorded here, more content will be presented in the next article, will include Li Xiang thinks deeply about the industry development trend, market environment, and forward-looking technology.

"Construction Review": What is the beginning of the car and home business?

Li Xiang: My biggest start-up was that the current traffic environment is not what I want.

I actually observed it very early, including in 2013 when Toyota demonstrated products such as i-road, but over time they had no incentive to introduce such products.

There are too many possibilities for transportation. Why are so many auto makers in the country indifferent to such a correct thing? Instead, do so many bad products, plug the battery into traditional cars. This is a fundamental reason why I later became a car. The other one thinks that the turning point of the current car-making opportunity has arrived.

Not everything is done, but the possibility to create a trip, not what fire does? Instead stand in 2015 to see what happens in 2020 and what will happen in 2025?

What we see in 2020 is quite clear. In 2025, the big trend is clear. Products and services to be done at each stage.

"Construction Review": How will the environment change in 2020? How will the environment change by 2025?

Li Xiang: By 2020, the 2 million vehicles proposed by the Chinese government can be turned into reality.

It is just how the 2 million vehicles are distributed. We can make a better judgment. In the entire distribution, I think it is 50:50. There are 50 real consumer upgrades, and about 50 percent of the 50 are plug-in hybrids.

"Construction Review": What do you mean by consumption upgrade?

Li Xiang: Everyone is willing to buy about 200,000 yuan or more. It's a bit like a cell phone. It started off with six or seven thousand yuan. Later, the price gradually dropped, but expensive still exists. The plug-in hybrid first requires the car to be large and can be arranged. It is first to help upgrade traditional fuel vehicle consumption.

Some of the consumption upgrades, mainly pure electric, are more like the second big toy in the family. For products like Tesla, there are about three or four layers of market share.

The other 50% is very practical.

What is 60% of this 50% is very practical? It is a short-distance vehicle for the second car in a pure home. The second and third means of transport at home are actually very suitable for mini vehicles. It does not need to run at high speed. It will take about 150-200km a day.

It's just that the car that is being done is too good, and it can do better. On the other hand, about 30-40% is probably in the form of a car or a car. Probably A-class or B-class, all electric. This is the layout of an electric passenger car that I can see.

In addition to this 2 million, there may be a larger market, which may be 4 million, that is, low-speed electric vehicles. Between the two or three thousand yuan battery car, the six or seven thousand yuan motorbike and the sixty-seven thousand yuan electric car and the fuel truck, there is still a lack of transportation.

This is why, in the past few years, low-speed electric vehicles in Shandong and Henan have not been subsidized, and they have been “fighted hard”, and there are still 1 million vehicles each year.

There are no high-end and low-end products here, and the products we make are all quality.

Let me formulate the original intention of the product and business model. In addition to the time points just mentioned, there are two important standards, one is the demand for important travel scenarios, and the other is battery technology.

Why did I start doing it from 2015? Since the battery's specific energy exceeds 200 watt-hours/kg, why 2020 will be a node, because at that time the specific energy will be 300 watt-hour/kg (monomer). But we can't wait, I need to prepare the corresponding product.

The entire trip, apart from the subway and public transportation, is closely related to people around us. I see three important intervals. The easiest to see and understand is 0-500km. Upgraded from medium-sized and large-sized SUVs from past function vehicles and A-class vehicles.

The medium and large SUVs are a very good price range for me. For foreign brands, the prices are high. The domestic brands do not get involved. I can do new energy and intelligence, at the same time in terms of taxes and battery costs. The percentage will not be as low as the following levels.

But battery technology has not yet reached that level. I think that a real family SUV with driving mileage below 500km is unacceptable to me, so we have adopted a way to extend the distance and allow users to obtain unlimited driving mileage. Our range is not the same as others. My tandem is also supported. You can also think of it as a plug-in hybrid. According to the choice of qualification, it is based on whether it is overselling or PHEV.

In terms of car design, we are designing an extended range in the form of an electric vehicle instead of a car. My battery is also clothed in the chassis, clothed with a complete battery, with 35kwh. Therefore, it is ensured that the daily pure electricity can travel 150-200 km steadily, and the urban area is fully adequate.

If you want to ensure that the holidays go out and play, you have to have a long way to go back to your home without any influence. The current problem is still charging the pile.

For example, to go out to play, BYD has an e6 club, to go to Qinhuangdao, at night, can not be set. Although there are charging piles at high speed, it is found that each pile is lined with several cars. The charging time of each car is 40 minutes. Then I think our life is ruined.

Didn't you not have a Beijing electric car number plate? I said that this is too narrow. There are only tens of thousands of electric vehicle number plates in Beijing. However, there are 7.8 million consumption upgrades per year in Beijing because there are 6 million passenger cars in Beijing. This consumption upgrade is The most terrible. Instead of what I just said, a big toy, a second car, and a third car at home, bought a Tesla.

I must do a real, all-powerful product and consider all the user's concerns. Although my R&D will be harder for electric cars.

"Construction car review": will increase the efficiency of the process will be lower?

Li Xiang: What is efficiency?

"Construction car review": For example, layout efficiency, you have to add a range extender.

Li Xiang: I think that efficiency may still be good. Why do I do this? Because I am the owner of the Tesla P90D. However, our basic common sense knows that the biggest problem of electric vehicles is running high speed. When I go to 120km/h, the energy consumption per 100km of Model S is 30Kwh. It means that Tesla runs at a high speed and has an Autopilot with a range of less than 300km. This is the fourth car, the fifth car is unacceptable.

What should I do? Do I continue to install batteries in the car? To load 3 tons of important vehicles, all are back batteries. On the one hand, the battery is more expensive. On the other hand, charging is also a problem. If the battery is only 35kwh, casually 16A, easy enough to fill, the line does not need to make any changes, without any mileage anxiety. I can also guarantee that you are in pure electric mode in 97-98% of miles. As long as your home can have a plug, or 16A charging pile.

"Construction Review": How much is 16w multiplied by 220V?

Li Xiang: About 3.5kw.

"Construction car review": about 5 hours, wrong, it is 10 hours.

Li thought: Because you will not run away the battery, so you can basically be full of one night. Enough, easy.

"Construction Review": The disappearance of the fuel vehicle was not banned by the government, but was replaced by an electric vehicle. From what is your point of view, when might a fuel vehicle be less competitive than an electric vehicle?

Li Xiang: We divided the car into three types: fuel vehicles, electric vehicles and smart electric vehicles.

"Construction Review": It is divided into intelligent fuel vehicles and smart electric vehicles

Li Xiang: I think the fuel truck cannot be truly intelligent because its structure is determined. To judge whether a car can be intelligent, there is a standard to see if it can achieve OTA. There is no way for the fuel truck to do it. Only part of it can be OTA.

When discussing this issue, it still depends on the battery. Because the cost of motors, controllers, and reducers is cheaper than an automatic transmission, it also saves engines and mailboxes.

The battery is a chemical and the change is not so fast. The reason why Tesla mass-produced 21700 batteries, or because "811" formula (the ratio of positive nickel-cobalt-manganese content in the ternary battery) is in place, which means that there is basically no room for increase in ternary lithium, from 300wh/kg, At most, it rises to 335wh/kg. This is where the benefits come. It means that everyone will really start mass production. The cost will go straight down.

In addition to electric vehicles, in addition to battery and cost, there is another factor that is charging.

I think that by 2025, the optimistic point, pure electric plus plug-in hybrid, can account for 30% of the market share of new car sales, pessimistically at 20%.