Twenty years ago, Wang unveiled a new plan for his conglomerate BYD to acquire a failed state-owned car manufacturer.
He implemented this plan with the intention: To separate the gas-guzzling internal combustion engine from the car and replace it with a battery. For BYD shareholders, the strategy “seems enticingly ambitious,” according to one analyst.
Six years later, Wang made a revolution when Warren Buffett invested $232 million in BYD. And this week, Wang’s vision – and Buffet’s bet – was vindicated as BYD usurped Tesla’s crown as the most popular battery-powered carmaker.
Semi-annual sales figures show that BYD – which stands for “build your dreams” – has sold more cars than Tesla. About half of the vehicles BYD is selling are hybrids, which China considers “new energy vehicles,” along with battery- and hydrogen-powered models.
The dethroning of Elon Musk means that Wang also achieves what General Motors, Ford and Volkswagen have all failed to do.
“Even Musk underestimated him,” said Tu Le, chief executive officer of Beijing-based consulting firm Sino Auto Insights. “But certainly his ambition is on par with his colleagues or competitors.”
BYD’s success has put the Shenzhen-based company, still little known outside of China, on the front lines of the battle for survival among automakers as more and more vehicles enter the world. electrified and automated.
Wang, who last year ranked as the 22nd richest person in China with a fortune of more than $25 billion, is at the center of increasingly stiff competition between China, the US and Europe for access. resources, control of supply chains and ownership of consumer data that will shape the future of the car industry.
This 56-year-old man was originally from a family that was not rich. He is the youngest of eight children in a family in Wuwei, in the eastern province of Anhui.
After graduating from university, he won a place at a non-ferrous metal research institute in Beijing, first for research, then teaching. In then Beijing, an idea began to spread: China’s fledgling battery manufacturers could – and should – compete with Japan.
Frustrated by the lack of dynamism in state affairs, in the mid-1990s, Wang moved to Shenzhen, southern China, just as it was transforming from a sleepy fishing village into a global manufacturing hub. bridge. Mass migration from rural areas has provided the city’s factories with the cheap labor they need to compete with rivals in Japan and South Korea.
In the two decades that followed BYD was, in some ways, stuck on a rut between East Asian corporations that succeeded in surpassing Japanese and American products and sought to replicate the underlying technologies. Like many Chinese manufacturers, the group has denied many allegations of intellectual property theft.
However, Wang and his top associates told a group of academic researchers in 2018 that in the early years BYD made batteries and other components for Siemens, Nokia and Motorola, they were imparts an important lesson in manufacturing. It seems that small, innocuous problems in small components, when multiplied among a large number of vendors, have a cumulative effect: The phone doesn’t work.
Thus, BYD set out a process of mastering the technology from their finished batteries all the way to the lithium and nickel mines.
Today, BYD’s vertical integration – which controls the supply chain from minerals to computer chips used in vehicles – is considered world-class by industry executives and analysts.
Rival automakers have for years been frustrated by logistical bottlenecks and shortages of key components. BYD, meanwhile, has been making its own automotive chips and selling its own batteries to rivals, including Tesla.
“Our assessment is that Wang has a favorable relationship with the Chinese government due to their strong investment in the industry,” said Alex Payette, chief executive officer of Cercius Group, a focused consulting firm. , especially in the high-tech sector”.
Wang’s importance partly stems from BYD’s position as China’s second-largest EV battery maker after CATL. It’s also one of the lowest-cost manufacturers for both EV and battery cars, according to research from Bernstein.
As a leader, Wang has been praised by employees for his austerity and relative work ethic. In addition, he is also known to reward loyal employees generously with stock options. BYD has even created a number of billionaires on its top leadership team, who have been with Wang since he founded the group in 1995 at the age of 29.
“Wang said there was no such thing as work-life balance for the generation of business leaders in his day,” recalls one auto industry executive who met him several times. “He works all the time.”
However, Wang has also demonstrated his supremacy – a trait common among the heads of family business empires across Asia. He was simply referred to internally as: “Mr. Chairman”.
“Our company has only one voice and cannot have another,” he once told a Chinese business magazine.
At this point, despite having sold more cars than Musk, many analysts believe that Wang still has many challenges, especially as China’s automakers launch an aggressive push to open the door. expand foreign markets.
BYD sales are mainly low-cost models for the Chinese domestic market. However, experts highly appreciate Wang’s ability. Michael Dunne, a former GM executive and China industry expert, said: “He’s a quiet, humble genius that you don’t recognize when you pass by on the street. That would be a mistake.” .
Source: Financial Times
Source: Vietnam Insider