The Entry Of Technology Giants Will Inevitably Bring Pressure On Traditional Automobile Enterprises And Even New Forces

At 4:42 p.m. on December 25, 2020, in Beijing on the eve of the cold wave, the temperature is close to zero. At the west gate of block B of Baidu building, which is located in Shangdi 10th Street, Haidian, Beijing, few passers-by are in a hurry, but there are also "Baidu employees" who insist on outdoor work: in a short period of two minutes, three different types of Apollo automatic driving vehicles slowly pass by.

On the south side of the west gate of the building, there is a traffic light. A Lincoln MKZ, a red flag EV automatic driving car and an Apollon minibus carrying four or five "passengers" circle around the silver gray metal building 232 meters long from north to South and 65 meters wide from east to west. The words "autopilot" in dark blue at the rear of the car indicate their mission.

"It's been testing for more than two years." A Baidu employee told the 21st century economic reporter. As early as January 2018, a self driving experience station was built at the gate of Baidu building to accept the application experience of internal employees.

Two years later, the test car is still diligent, but the industry is changing. While the vehicles were travelling, a piece of news had been fermenting for more than a week. On December 15th, it was reported that Baidu was considering producing its own electric cars. Almost at the same time, another technology company, apple, also announced the trend of car building: on December 21, it was reported that Apple would release its apple car as soon as September 2021.

Just three weeks later, some rumors quickly turned into reality: on January 11, baidu officially announced the establishment of a smart car company to enter the automotive industry as a vehicle manufacturer facing the passenger car market. The details of Apple's car building plan are gradually becoming clear. It is reported that Apple will sign an auto driving car cooperation agreement with Hyundai in March this year, and both sides or joint ventures will build cars.

"In 2020, new energy vehicles, especially intelligent electric vehicles, begin to enter the explosive period. Smart cars are growing rapidly at present, and there is a huge space for future growth.". Recently, in an interview with 21st century economic reporter, Li Zhenyu, head of Baidu intelligent driving business group, expressed his optimism on the market. He also stressed that, regardless of fuel vehicles or new energy vehicles, intelligent technology has become the decisive point of standard configuration and even future bayonet.

And this has become the driving force and ambition of technology companies.

The entry of technology giants will inevitably bring pressure on traditional automobile enterprises and even new forces. Visual China

Turning the road

In June 2013, at the annual meeting of Apple's global software developers, Apple announced its entry into the automotive field and launched the "IOS in the car" plan.

In July of the same year, baidu established the deep learning research institute, mainly engaged in forward-looking technology research, and Baidu unmanned driving research and development project was launched almost at the same time.

At the beginning of 2021, two science and technology companies that began to aim at the automobile industry almost at the same time also thought of making cars at the same time: Baidu joined hands with Geely to set up a smart car company, holding absolute control, trying to enter the whole industrial chain of intelligent car design, R & D, production, sales and service; Apple was exposed to have made stock requirements with several auto parts manufacturers and even media It said its first apple car will be released in September and the prototype has been tested in California. Judging from the news, Apple's car making is a foregone conclusion.

However, this is not a consistent idea of the two companies.

In November 2018, Li Yanhong, founder and chairman of Baidu company, said frankly, "Baidu will not make its own cars", "we only do the research and development of automatic driving technology that we are best at, and open it up to all enterprises that are interested in, have ideas and have the ability to do it together."

At that time, the release of more than a year's Apollo plan, both inside and outside Baidu. This open source platform of automatic driving software can help users quickly build a complete automatic driving system of their own by combining vehicles and hardware systems. It is even regarded as the "Android system" of the future automobile industry by some people in the industry.

However, in the past for a long time, Apollo and Baidu intelligent driving business have been regarded as Baidu's "negative assets". On the one hand, it has been criticized by the industry that the depth and breadth of cooperation with OEM manufacturers is less than expected. On the other hand, the real problem is that its profit model has not yet run through.

According to the 21st century economic report, most of Baidu's domestic self driving vehicles, except some of which are sold to local governments such as Changsha, are owned by Baidu. Add research and development and other costs, baidu intelligent driving has been in a state of burning money.

It is not difficult to understand why there are rumors in the industry in recent years that Baidu will split its intelligent driving business and seek external financing. Although Baidu said several times that rumors are not true, but the financial pressure is really hanging on top of Baidu's smart driving business.

Apple's car building plan has also experienced twists and turns. In 2013, Apple launched the "IOS in the car" plan to prepare for car manufacturing. Its partners include Ferrari, Volvo and other car companies. This is the first time in Apple's history to apply its own software to other hardware.

In 2014, Apple was first reported to be "suspected of making cars", and its "Titan plan" was first exposed. The so-called "Titan plan" is to build an unmanned intelligent car and completely subvert the current industry. In 2015, it was reported that Apple recruited talents on a large scale, and the scale of R & D personnel once exceeded 5000.

However, since then, "Titan project" gradually ran aground. In 2016, apple claimed in a letter to the U.S. Department of transportation that it would not build a complete autonomous car like Tesla, but would focus on the development of autonomous driving software technology. Since then, despite sporadic reports of apple "poaching" Tesla executives and other news, but Apple's self driving car did not spread new trends again, until recently.

"The cross-border car building of technology companies represented by Baidu, on the one hand, helps to achieve the intelligent driving industry chain card, on the other hand, it helps to find a more operational way to realize cash on the basis of existing technology accumulation." An investment organization personage to the 21st century economic report reporter analysis said.

Great opportunity

For technology companies, making cars means facing consumers directly, which is undoubtedly a huge opportunity.

In fact, Tesla, which started from scratch in 2003, has grown into a super giant with a market value of more than $800 billion after 17 years of development. By comparison, as of December 31, 2020, the market value of Toyota and Volkswagen, which are the world's leading auto market value, are about 215.4 billion US dollars and 107.4 billion US dollars respectively, while the market value of Daimler, general motors and BMW Group is only tens of billion US dollars.

In terms of sales data, Tesla also performed well. From the global market point of view, Tesla's sales volume is close to 500000 in 2020, which plays an important role in the field of luxury cars. The sales volume of model 3 also exceeds that of BBA's fuel vehicle series of the same level.

At the same time, the future of intelligent automobile industry is more promising. According to the planning document of the Ministry of industry and information technology for the next 15 years, the sales volume of new energy vehicles in 2025 will account for 20% of the total automobile sales in that year. According to the calculation of 20-30 million units per year, the scale is about 4 million to 5 million units.

In this process, the technical capabilities of intelligent cockpit and automatic driving will become the standard configuration of electric intelligent vehicles, and even become the decisive points. "In the next three to five years, if we don't have a very good intelligent cabin, we predict that such new cars will probably not be sold." Li Zhenyu asserted to the 21st century economic reporter.

Li Zhenyu further pointed out that the "battle" of intelligent electric vehicles will be carried out two times in a cycle of three and a half years. "By 2023 and 2024, the first round of PK will start, and some people will be out in this round. Some enterprises with strong brand ability may survive this cycle, but if they have not improved their intelligent ability in 2027, it will be more dangerous. "

At present, Baidu, apple and other enterprises enter the bureau to build cars, which means that they will further participate in the automobile manufacturing industry chain, and it will be easier to build their own intelligent cars, rather than just stay at the level of solving the needs put forward by automobile enterprises.

According to the reporter of 21st century economic report, Baidu's cooperation with other car companies is at most involved in the second half of new car research and development, involving intelligent cockpit and automatic driving, but not in the macro definition of products. However, after the establishment of the smart car company, Baidu will enter the whole industry chain of smart car design, R & D, manufacturing, sales and service.

"In the era of automobile intelligence, the threshold of car building has been significantly reduced, which is also the reason why new forces such as Weilai and idealism can stand out," an auto industry commentator told the 21st century economic reporter. "At the same time, the importance of chips and software has greatly increased. Tesla has become the world's largest automobile company in terms of chip research and software development and application Force is inseparable. Under the background of increasingly prominent importance of software, it is indeed a historic opportunity for science and technology enterprises to enter the automobile manufacturing industry chain. "

At the same time, technology companies have their own unique value. Compared with Tesla, Weilai, ideal and other new forces, Baidu's differences in car making are reflected in its software strength and intelligent technology ability.

To some extent, the last batch of new forces of car building have laid a good hardware foundation for intelligent electric vehicles, but how to internalize the data generated on hardware into the automatic driving ability of vehicles is the core competitiveness of Baidu technology companies.

"For example, the industry claims that Tesla has several billion kilometers of test data, but this has not completely transformed into its automatic driving ability," said an industry person close to Baidu. "Baidu's ability to accumulate for many years is an overall data pipeline, and this" alchemy "ability is very important."

For apple, in addition to the R & D capabilities accumulated in the field of autonomous driving, its advantages also lie in its own operating system. According to the data report released by above Avalon, Apple's total iPhone activation reached 1 billion in the autumn of 2020 due to the continued hot sales of the iPhone 12 series. "If some of these users are transferred to Apple cars, it will also be a considerable sales volume." These commentators pointed out.

There are still challenges

Although car building is full of great opportunities, there is no doubt that it is also an area that requires a lot of capital investment and has a long return period.

"In the 18 years since its establishment, Tesla has been losing money most of the time, burning more than 30 billion yuan in total." The above commentators said. Coincidentally, Weilai auto has burned down more than 20 billion yuan, and is still losing money. There are also more cross-border people who are trying to build cars. After spending a lot of money, they have to give up making cars. "So it's really not easy for technology companies to invest a lot of money into unknown industries unless they have a clear assurance."

However, for apple, the current financial strength is relatively strong. By the end of January 14, Apple had a market value of $2.17 trillion, compared with Tesla's market value of more than $800 billion.

"From the financial level, technology companies are relatively strong, and they are also relatively deficient in the new forces of car making." The commentator pointed out that "the entry of technology companies will inevitably bring pressure on traditional automobile enterprises and even new forces."

In contrast, Baidu's current market value of $84.93 billion is far less than Tesla. Although it is far better than Xiaopeng automobile (38.66 billion dollars) and ideal automobile (31.15 billion dollars), it is still inferior to Weilai automobile (95.12 billion dollars). Therefore, in the view of some investors, capital pressure may also become a risk on Baidu's future car making road.

"If Internet companies make cars, it is indeed a way to realize the realization of automatic driving technology, but the profit margin may plummet," an investment institution told the 21st century economic news reporter, "but if it only provides software AI system, it is difficult to see the profit point." In his view, this is also difficult to evaluate the future of Baidu car building contradictions.

However, the capital market as a whole still recognizes the logic of Baidu's car making. Baidu shares rose 13.83% to $185.5 on the morning of December 16, 2020, just after the news of car building. Since then, its share price has gone up all the way. After the news of cooperation with Geely on January 8, Baidu's share price soared 15.57% to $240.25, a new high since August 2018, and its market value also soared to $81.94 billion. In the latest trading day on January 14, Baidu's share price hit $258.73.

"At present, the automobile industry is in the stage of rapid development, and it is a good opportunity for technology companies to enter the board. If we set our sights high, their participation will certainly promote the development of the industry. It is of positive significance from the industry level, but it also means that a new round of industry reshuffle is coming soon." These commentators pointed out.