In the past four years, most of Midea's auto parts energy has been used to "break through the first customer". After more than half a year of testing tens of thousands of new energy vehicles, the reliability of the product has been verified. Recently, Chen Jintao, general manager of Midea Welling Auto Parts Company, revealed that Midea's new energy vehicle business has officially arrived at the inflection point of take-off, and this year will break into the supply chain of half of the world's mainstream new energy vehicle customers, and sales will usher in a big outbreak.
Chen Jintao said that Midea Welling Auto Parts put forward the "333 strategy" internally, focusing on core components in the past 3 years, focusing on integrated components in the next 3 years, and then committing to becoming a system-level solution supplier for new energy vehicles in the next 3 years.
With the change of energy supply model, in addition to automobiles, including construction machinery, shipbuilding and other industries will also undergo subversive changes, which will be a huge track. Therefore, Midea should also unswervingly invest in the research and development of new technologies to lay the foundation for greater growth in the future and achieve new strategic growth. In the future, Midea Welling Auto Parts will continue to expand business boundaries, increase product categories, and use new technologies and new strategies to drive "new growth".
The new energy vehicle business has become one of the core strategies of midea group. On January 12, 2022, Fang Hongbo, chairman and president of Midea Group, delivered a keynote speech on "Firm Growth, Broad Sky and High Sky" to all employees, in which Fang Hongbo clearly stated that "the industrial layout of new energy vehicles is a very important strategic direction for the future of Midea." Fang Hongbo explained that science and technology to promote change is still the main theme of this era, from product leadership to technological leading strategic upgrading, Midea has tasted the sweetness. The core of Midea's business ideas in the next few years is to promote new growth with new strategies, and to continuously upgrade stocks and create increments through cognitive upgrading and thinking breakthroughs.
"333 Strategy" is committed to providing new energy vehicle system-level solutions
In 2018, Midea Group established Midea Welling Automotive Parts. "Midea first extended its product tentacles to the field of automotive components earlier." Chen Jintao introduced that in 2016, Midea began to develop electric compressors for vehicles, and Midea is also the first manufacturer in the world to introduce rotor compressors to the automotive field.
"Products from R&D design to production line layout, to product mass production, after market validation, this requires a process. Since May 18 last year, the three major product lines have verified the reliability of the product after more than half a year of on-board testing. In 2022 we have reached a relatively mature stage. Customers in the automotive industry are all project-based, and as customers (new models) begin to mass-produce, Midea's auto parts have also begun to be listed in large quantities. Chen Jintao said.
"It is extremely difficult for a product to be applied, to find a car company that has never done business with us and has high requirements for suppliers, and our focus in the past was here." Chen Jintao said that there is now a certain customer accumulation, and the product reserves have been made, and the inflection point of take-off has officially arrived.
It is understood that 5 products of Midea's existing three major product lines have basically been tested on the car, and the production capacity of each product is about hundreds of thousands of units. "This year, there will be new lines in the three product lines of thermal management, electric drive and intelligent driving. After the new line is invested, the production capacity will be doubled again. ”
Chen Jintao also revealed that midea's auto parts are divided into three steps, and in the next 3 years, the company's energy will be mainly focused on components. "This year we're actually focused on components, and soon the thermal management component products will be available." In the next three years, Midea's new energy vehicle business will focus on the layout of system-level solutions.
Midea's core technology expands the field of "sea, land and air"
In Chen Jintao's view, China has passed the stage where it can completely rely on marketing to pull the market, and the technical power of products is the core of enterprise growth.
According to public information, Midea's auto parts have landed in five major R&D centers around the world, among which the product technology direction of Anhui Hefei R&D Center and Guangdong Shunde R&D Center is motor, electronic control and compressor; the product technology direction of Shanghai and Sheffield R&D Center in The United Kingdom is motor and electronic control; and the R&D center in Osaka, Japan is compressor. In the next 10 years, Midea's auto parts will also invest 1 billion US dollars in research and development of leading technologies.
It is understood that Midea's previous industry-first CO2 rotor electric compressor broke through the "card neck" technology, and the level reached the industry's leading position. The traditional scroll compressor uses CO2 refrigerant on the short board, the United States through layers of technical research, to overcome the problem of high noise of rotor compressor, so that it has high efficiency, low noise, light weight and other technical characteristics, can meet the two needs of efficient refrigeration and low temperature heating, to solve the extremely cold working conditions of the industry pain points of fast endurance decay.
Another major pain point in the automotive industry is the problem of fast charging and heat dissipation. After the battery pack charging speed is increased, the heat generated will be very large, and how to quickly take the battery heat away becomes a problem. Chen Jintao said that Midea proposed a thermal management optimization plan for this industry pain point. "Midea's 800V fast-charging compressor is also the first in China to achieve on the car." It is expected that it will be able to produce mass production from June to July this year. Chen Jintao said.
Chen Jintao stressed, "In the field of auto parts, who can grasp the opportunity, who can come up with products that really solve the pain points of users, and who can really help customers to solve the problem of reliability, then who will have a competitive advantage." He mentioned that the track of new energy vehicles is large enough, new technologies and new products continue to emerge, and only by unswervingly investing in the research and development of new technologies can the continuous growth of Midea's auto parts have a foundation. Next, Midea's auto parts will follow the "development generation, reserve generation, research generation", and make technical investment around the three major sectors of electric drive, thermal management and intelligent driving.
In the future, Midea's auto parts will continue to expand its product track, such as construction machinery, shipbuilding and other fields. "Whether it's floating on water or flying in the air, we're planning, and we're already working on a number of customer projects."
The thermal management sector "takes the lead" and strives to sell more than 10 billion yuan in 5 years
According to the data, by 2025, the market size of electric drive, thermal management and intelligent driving in China will exceed 100 billion yuan, and the global market size will exceed 300 billion yuan. Midea Welling Auto Parts aims to achieve a revenue scale of 10 billion yuan in the next 5 years. Inside, the "thermal management" section will "take the lead". In Chen Jintao's view, the core component of "thermal management" is the largest track in the company's three major product lines.
At present, the concentration of the thermal management industry of traditional automobiles has been very high, and foreign-funded enterprises Denso, Mahler, Valeo, and Hanang have collectively occupied 55% of the market share, and the giant pattern has become a reality. However, the thermal management of new energy vehicles and the thermal management of traditional vehicles are two different concepts. Compared with fuel vehicles, the thermal management system of new energy vehicles is more complex and more demanding. In addition, the threshold of thermal management technology for new energy vehicles has been raised, and the value of thermal management system bicycles has also increased exponentially compared with fuel vehicles.
Chen Jintao believes that it is precisely because of the fundamental changes in the thermal management technology of new energy vehicles that Midea has the opportunity to participate in it and reverse the competitive landscape of the industry. In his view, the thermal management market for new energy vehicles has just started, and there is still a broad market space to be tapped.
A research report by Guangzheng Hang Seng in June 2020 also pointed out that the competitive pattern of thermal management of new energy vehicles has not been determined, and domestic investors have the opportunity to seize market opportunities.
"The deployment pace of thermal management systems and overseas manufacturers has actually been slow, and we have grabbed a lot of their share, especially the parts." Chen Jintao said.
Chen Jintao believes that in the existing three major product lines, Midea also has a lot of work to do. "In the future, we will also find ways to increase products. For the same customer, we originally sold 3 products, and may sell 10 in the future. Customers want us to do the same, and we are willing to create more value for our customers. ”
"We first rely on existing products to open the situation, dozens of car companies around the world, if our existing products can be entered, it means that we have a very good customer base." In the previous time, we occupied the market through product and technical advantages, and the second step was to increase the output value of each car by adding more new products. Chen Jintao said that due to the high stickiness of car companies' customers, after entering the customer supply chain, the growth of sales can be exponential.