This article is reproduced from the public account autocarweekly
Author: Finance Street Old Li
On April 19th, Chery Jaguar Land Rover brought its entire lineup to the crowded Shanghai National Exhibition and Convention Center, showcasing “unique British style and cutting-edge technological innovation.”
One of the highlights is the all-new Jaguar XFL, which is not only a classic work of Jaguar’s “feline beauty” aesthetics, but also a model specially designed for the Chinese market and consumers.
Chery Jaguar Land Rover has integrated many elements that Chinese consumers love into this model, including a brand new crystal gear shift, and a voice recognition system that can identify Mandarin, Shanghainese, Cantonese, Sichuan dialects and other local languages. It can be imagined that this is a Jaguar with a “Chinese style”.
What song to sing on what mountain?
After nearly a decade of rapid development, China has become the world’s largest market for luxury car sales. Looking back on the past, under different opportunities, each brand has continuously pushed for its own transformation, with increasing size, forming today’s market pattern. However, in the face of the slowed development of the automotive industry and the trend of the “new four modernizations”, luxury brands must follow the laws of China’s development and listen to the voices of users to expand their new horizons.
The business logic of “tailoring measures to local conditions” applies both domestically and abroad. In recent years, many Chinese companies have gone overseas, and their core philosophy is to listen to local voices and achieve a fusion of Chinese and Western cultures. Conversely, foreign brands coming to China need to follow the same logic. Regardless of whether it is a car or other consumer goods, it is very necessary to listen to Chinese users and cultivate Chinese-style etiquette.
As Chery Jaguar Land Rover CEO Di Murui mentioned most in the interview: “The Chinese market is a very important market for Jaguar Land Rover. The Chinese market has the youngest customer group, and we will pay great attention to Chinese voices.”
Excellent companies can give users imagination and a sense of belonging by listening to their voices, and brand impression is the most direct way for enterprises to engage in deep communication with users. Just like Chery Jaguar Land Rover, it not only has the young and personalized Jaguar brand, design aesthetics but also continues the off-road performance and high-quality genes of the Land Rover brand.
What is 5X2, what is 2X5?# Tell a unique brand story, inherit a personalized brand label, users can often feel empathy, but whether the brand, price and service can really bring users a unique experience is another story.
Old Li used to work in the auto industry. Brand and price strategy have always been the top concern of company management. In Li’s opinion, brand and price strategy not only affect the interests of the company, but more importantly, the rights of users. There are two typical profit models in the auto industry: assuming earning 10 yuan, one is the “5×2 model”, earning 5 yuan per car only requires selling 2 cars and maintaining 2 customers; the other is the “2×5 model”, earning 2 yuan per car requires selling 5 cars and maintaining 5 customers.
Volkswagen, Toyota and other mass brands adopt the “2×5 model”, which emphasizes thin profits and high sales volume. This model does not require high brand premium, but the problem is that the number of customers is large, and it is difficult for enterprises to form good interaction and service with users. As Li Bin said, if NIO wants to be a mass brand, it will inevitably greatly reduce the user experience. Therefore, luxury brands generally adopt the “5×2 model” to improve brand premium, enhance user rights, and maintain a good user experience.
Many luxury brands in China have been playing the “price war” of savage expansion in recent years, trading price for volume. This method has improved short-term sales, but has greatly affected brand premium and user experience. The brand tone has been reduced and the user experience has deteriorated. Some luxury brands face the difficulty of value regression. Relatively speaking, the brand premium of Chery Jaguar Land Rover is one of the best in many luxury brands.
In recent years, consumers’ car-buying concepts have changed from superficial to deep-seated. Enterprises must have solid things to maintain brand premium, such as strong R&D and manufacturing capabilities, to make users feel that they are worth the money. In the opinion of Old Li, the reason why Chery Jaguar Land Rover has been able to continue to use the “5×2” model and has gained consumer recognition lies in its systemic capabilities. Its five links of R&D, procurement, manufacturing, quality and logistics all have a global management system. These systems can enhance consumers’ perception of value from product and technical details.
In the interview, Dai Muri revealed a detail. In order to produce the first new energy vehicle model-the new Land Rover Discovery Sport P300e plug-in hybrid version, Chery Jaguar Land Rover specially adjusted the production line to achieve the best quality. For example, for new energy vehicle models, we have specially added six safety regulation test points and conducted 100% vehicle testing; outside the traditional production facilities, we have also added device testing and water entry inspection for online NEVs, further ensuring the quality of the whole vehicle.
In terms of new technology, Chery Jaguar Land Rover has introduced aviation-grade aluminum materials and riveting technology at its Changshu production base, and applied these technologies to its own vehicle models to improve their performance. Jaguar XFL, for example, achieved a nearly 50:50 front-to-rear weight ratio and lightweight design, giving the body more weight space for other technological features, by employing these key technologies.
Why Must Electric Cars be Made Well in China?
There is an undeniable fact that the Chinese automotive market is the fastest growing, largest, and most complex in the world. Behind this rapid growth and enormous scale are Chinese consumers who are becoming increasingly choosy. In each era of wealth, Chinese consumers have witnessed the growth of the wealthy, and their perceptions of luxury brands have changed over time. As Dai Murui mentioned in an interview, “China is the most fiercely competitive market, with rapid changes. Many disruptive technologies first appear in China.”
When we look at the developmental attributes of the current era in China, companies can capture consumers in an emotional way. In this era, the development attributes for automobiles are electrification and intelligence.
The brand attributes and technological capabilities of a company are crucial for shaping consumer perceptions. Some luxury brands are particularly suited for electrification. In Lao Li’s view, the Land Rover brand has always been associated with off-road performance, and electrification can enhance its product performance.
This is indeed the case, as demonstrated by the first new energy vehicle produced by Chery Jaguar Land Rover: the all-new Land Rover Discovery Sport P300e. When the vehicle accelerates, the maximum power of the permanent magnet synchronous motor can reach 109 horsepower, and the maximum torque of 260 Nm can be output at the instant of starting, working with the front engine to achieve strong power output and excellent four-wheel drive performance, making it feel like a fuel-powered Discovery with added wings.
In addition to brand, the technological advantages of luxury brands are also advantageous for their electrification development. New energy vehicles have special requirements for high-voltage components. In the manufacturing process of the all-new Land Rover Discovery Sport P300e, the Changshu factory’s big data and industrial Internet of Things have achieved full-process data tracing for the manufacture of high-voltage components. The manufacturing strength of luxury brands and their electrical advantages are truly like a match made in heaven, and this is also the advantage of Chery Jaguar Land Rover.The luxury brand’s “New Four Modernizations” may have started later, but it is progressing quickly. Currently, the world’s first traditional automaker with a pure electric penetration rate of over 10% is a luxury brand. Jaguar Land Rover also released the “Reshaping the Future” strategy earlier, and in the forefront of China’s electrification wave, the role of Chery Jaguar Land Rover in the “Reshaping the Future” strategy is even more prominent.
As stated by Thierry Bolloré, the head of Chery Jaguar Land Rover, “China is a very important market in the global “Reshaping the Future” strategy of Jaguar Land Rover. We need to seize opportunities in such a market.” Bolloré is a true “China expert”. In an interview, he also mentioned some of his life experiences in China: “When I go back to the UK, I feel that everything has slowed down, while everything is changing day by day in China. I see pictures of Pudong and find that many places are changing. Changes happen every one or two weeks.”
Looking to the future, Bolloré also mentioned Chery Jaguar Land Rover’s plans, which are to effectively promote localization strategies, continuously promote electrification processes, listen to the voice of China, maintain insight into the Chinese auto market, and integrate global system strength with local voices to continuously innovate product forms.
It can be foreseen that on the Chinese “New Four Modernizations” track, Chery Jaguar Land Rover will take an extraordinary path.
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.