Author: Chris Zheng
“Throughout the (car manufacturing) process, I never ran out of money.”
“We don’t want to define our target audience. I don’t want to define age ranges, we don’t have that idea, and we don’t want to compare ourselves to anyone.”
“Back then (in 2019) I thought it was easy to recruit people, we didn’t encounter any problems.”
“I don’t plan to share supplier information.”
“If he (the user) is a family with three children, we may not be able to meet his requirements.”
“If he (the user) requires a necessary condition of LIDAR, we may not be able to meet his requirements.”
“I also forgot about the user operation issue, to be honest, I can’t answer it.”
“My role is mainly to participate in all aspects of the company, but there are many things I don’t know, so I listen and learn.”
The automotive industry has a (possibly) more honest founder than Li Xiang and Elon Musk: Niu Chuangxin Energy Founder Li Yinan. The above words came from his crazy output during a one-hour group interview.
Before the interview (if you really can’t wait, okay, the interview is at the end), let’s first get to know Niu Chuangxin Energy.
Niu Chuangxin Energy is a very young company. Young enough that even though its official website is already online, you can’t find its URL on almost all search engines (https://www.niutron.com/).
But its founder Li Yinan is a name that has already circulated among many Chinese people after dinner parties without the need for search engines. This is mainly due to his legendary career:
At the age of 15, he entered the youth class of Huazhong University of Science and Technology.
At the age of 23, he joined Huawei and was promoted to chief engineer half a month later.
At the age of 25, he was promoted to Huawei’s vice president, chief engineer, and president of the Central Research Department.
At the age of 30, he founded Harbor Networks, becoming Huawei’s competitor, and was later acquired by Huawei.
At the age of 38, he became Baidu’s CTO.
At the age of 40, he joined China Mobile as CEO of 12580 business.
At the age of 41, he joined Jinshajiang Venture Capital as a partner.
At the age of 45, he founded Niu Electric Technology and served as CEO.
At the age of 48, he resigned as CEO of Niu Electric Technology and joined Meihua Angel Venture Capital as a partner.
It was also in 2018 that Li Yinan set off again and founded today’s protagonist, Niu Chuangxin Energy.
Niu Chuangxin Energy was established in November 2018, later than Wei Lai, Li Xiang, and XPeng’s companies but faster than Jidu and Xiaomi’s, and from a time perspective, it can be regarded as a representative of the 1.5th wave of new car manufacturing.Li Yinan explained that NIUTRON, the English name of Niu Chuang, is a combination of “Neutron,” the English word for the smallest uncharged elementary particle in the universe, and his previous company, NIU. He is personally interested in theoretical physics, and two of his classmates and a junior are currently the youngest academicians of the Chinese Academy of Sciences. This word represents his exploration and dream of the mysteries of the universe.
The corresponding Chinese brand name of NIUTRON is “Ziyuojia,” which may be a bit confusing, but Niu Chuang’s relationship with “Ziyuojia” and NIUTRON is similar to that of a car and a home with the “ideal car.” You can understand it as one being the enterprise name and the other being the brand name.
Let’s start with the product. The first product of Niu Chuang, the Ziyuojia NV, is based on a steel-aluminum hybrid body and is available in two power versions: extended-range and pure electric. The Niu Chuang official website explicitly states that the two versions correspond to the positioning of “freedom of mileage” and “ultimate performance,” respectively.
From today’s actual experience, the wheelbase of the Ziyuojia NV is estimated to be around 2900, and the length of the car is around 4900, with a large five-seat layout and no plans for six/seven seats. The spatial feel is similar to that of the NIO ES6.
The front row is equipped with a 12.3-inch instrument screen and a 15.6-inch vertical screen design. Most of the buttons on the steering wheel have been removed, leaving only the middle roller and left and right interactive designs, which is very similar to Tesla Model 3. The armrest position provides dual wireless charging boards, which can charge two iPhone 13s at the same time. The glove box above the passenger seat does not have an entertainment screen, but is equipped with a narrow display screen, which can adjust and display the air conditioning, etc.
In terms of styling, the most impressive part of the front face is the round headlights on the left and right sides similar to the Jeep Wrangler and the matrix-style off-road searchlight. The closed faux air intake grille below should be compatible with the extended-range version, but in reality, it does not serve any function. The hidden door handle on the side is nothing new, and the D-pillar is equipped with a battery status display light, which dynamically displays the charging process and remaining power during charging, similar to the appearance of mobile phone charging.## NIUTRON NV: Engineering Test Completed
As of now, NIUTRON NV has completed three rounds of engineering testing with an accumulated mileage of over 1 million kilometers, covering winter and summer testing in the first round. The second round of winter testing is currently ongoing. The vehicle is expected to go into small-scale production in March 2022 and the first batch of units will be delivered to customers in September 2022.
On an enterprise level, NIU has completed Series A funding of $500 million USD, with investment from IDG Capital and COATUE etc. Its headquarters is located in Beijing, with its design and R&D center in Shanghai, and its engineering, development, and manufacturing facilities in Changzhou. The size of the team is close to 1,000, primarily composed of R&D personnel. The Changzhou factory covers an area of 770,000 square meters, with an overall design capacity of 180,000 vehicles per year and an initial single-shift capacity of 60,000 vehicles per year.
The images attached below represent NIU’s current product lineup.
This is the basic information shared in NIU’s most recent communication. As of now, we still do not have information regarding the car’s price range or power parameters or any smart-related configurations, but we have high expectations of NIU, thanks to the extensive professional background and experience of CEO Mr. Li Yinan.
Regarding the basic entry barriers of cost and human resources as key elements in new car production, Mr. Li Yinan appears to be very confident, claiming “I believe that I can most likely raise the $3 billion needed to carry out this endeavor” and “We have no issues recruiting people.”
In addition, Mr. Li Yinan has high expectations of the entry barriers to new car production. In terms of timing, he used Honda as an example to refute the argument that there is a “window period” for new car production:
Japan is an automotive powerhouse, and we know that Honda entered the auto industry 30 years later than Toyota and Nissan. I don’t believe that in those 30 years, nobody else in Japan was making (cars). Maybe Honda was the last of the big car manufacturers to make it–was there no one after that? I think during that 30 years, there was most likely quite a few people working on it.
Japan’s situation is different from China’s; the Yangtze River waves push forward the waves behind them. Who will succeed? Who can hop on at just the right moment or on a particular wave? Perhaps hindsight will make it clear. We are in the midst of it, and I believe that many people have their own opinions–time will tell us the correct answer.# A Translation of the Markdown Text
In many issues, Li Yinan’s attitude exudes a confident and direct persuasion, whether it is the “full-stack self-developed” autonomous driving that Tesla initiated and Wei Xiaoli followed, or the cooperation with partners to jointly develop the autonomous driving, which is defined as the main line by Chinese electric carmaker NIO.
However, Li Yinan’s self-confidence is so strong that it is difficult to discern whether he has a completely different understanding or whether he is simply using PR rhetoric given the current state of NIO’s business.
In his view, “the most reliable method that everyone may think of may still not be successful. The core is that there is no absolutely correct and unique road and method. At least 20 companies in China have raised more than 400 million US dollars to do this (autonomous driving).”
But what cannot be avoided is that in 2022, NIO must start with an advanced intelligent driving solution without a lidar and mainly based on vision and millimeter-wave radar to challenge Wei Xiaoli’s lidar + dual Orin platform.
If consumers in 2018 were not particularly interested in autonomous driving, the fact that after 3-4 years of continuous market education, autonomous driving is becoming more and more important is undeniable. In addition, compared to the efficiency of internal self-development of companies, efficient supplier management is another test for NIO.
Of course, the good side is that from the interviews, Li Yinan has a full expectation of the complexity of the automotive industry and NIO’s current problems. The confidence in the title of “I think we can do it” is based on this foundation.
So, will NIO succeed? It is still unclear right now, but undoubtedly, Li Yinan’s arrival and NIO’s arrival will make the Chinese automotive industry more interesting.
The following is an excerpt from an interview with Li Yinan, the founder of NIO, as compiled by Class A Star Channel (with some deletions):
Li: What impression does this car give you? Does it feel like an electric car or a gasoline car? This may be different for different people, but at least from our perspective, from the first day, we have been very clear that we designed this car as an electric car, whether it is platform architecture, appearance, or interior.
As you can see, there are no large air intakes even for range extender, and there are many hidden air intakes, whether it is range extender or pure electric, the appearance is exactly the same. The rear exhaust pipe is completely hidden, and it cannot be seen until about eight meters away. We made a joke internally that our range extender is actually an electric car retrofitted with oil, not an oil car retrofitted with electricity.## Q&A
Q：
2018 年 11 月份到现在，节奏是不是有点慢？有没有再准备下一轮融资？
A：
确实我们 2018 年 11 月份就开始做了，我觉得我们在整个过程中，没有一天偷懒，我也没有一天缺过钱，在整个过程中也没有缺过钱。大家觉得我们做的挺慢的，我也觉得不够快。但是我想好的产品都是打磨出来的，任何一款产品，汽车我觉得说它简单，它的流程非常清晰，你必须按照这些流程来做，但是它的细节特别多，所以说它既有大面的平衡，又有无数的细节，既有涉及到大量的设计师的工作，也涉及到大量的工程工作，也涉及到很多，所以我自己觉得我们的时间压得挺紧的，这是我想说的，也许别人比我们强太多了。
融资方面，我觉得汽车也都是一个高资金门槛的，毫无疑问。我相信这个是之所以别人也问你之前为什么没做汽车，现在想着要做汽车，2014 年的时候我自己判断我融不到 30 亿美金来做这个事情，现在我自己觉得我大概率应该能够融得到这个钱来做这个事情。
Q：
自游家 NV 的定位，包括它的目标人群大概是？对于高层的招募是怎样思考的？
A：
首先我觉得汽车这个行业最大的特点就是不缺对照车型，你做任何一个东西市场上都有很多产品。大家又问你的目标人群是什么样的，我自己觉得我们也不想定义我们的目标人群。我想我们至少探索一下：单身汉能不能买我们这个车，两个人能不能买我们这个车，三口之家四口之家可不可以？我觉得都是可以，我不想去定义我们的人群，我不想定义我们的年龄段，我们也没有这个想法，我们也不想去跟谁比。但最重要的是买了我们的或者是开了我们自游家 NV 这个车能不能感觉到自己的自豪，当然我们不可能保证我们的车没有任何问题，没有车没有问题，它是个工业品，在生产过程中这么复杂的工业品一定会出这样那样的问题，一定会有可能会有各种各样的召回，虽然我们努力把它做好，但是一定会出。但总体来说，我们能不能让我们绝大部分用户就以拥有这个产品，或者是以开这个产品而自豪，这是我们最关注的，我们不在乎跟谁比。
人才的问题，我们启动的时间主要招人的时间、高管招人的时间是在 2019 年的时候，那时候我觉得挺好招人的，我觉得我们没碰到任何问题。
Q：
我们的核心的发展策略？请介绍一下我们这个产品在智能化上的亮点。
A：
无回答Li: The first question stumped me. As I mentioned earlier, our development strategy is mainly focused on bringing joy to our customers and making them proud to own our products. Our starting point is always centered around whether our potential or imagined users can have a better experience. We don’t have any set ideas about any particular direction.
The intelligent cockpit is developed independently, while automatic driving is developed through our own definitions and cooperation with partners.
Q: People are particularly interested in our founding team, so I would like to ask about the current situation of the initial investment by our founding team? The entire supply chain is a challenge, are there any partners in the supply chain that can be revealed?
Li: Our founding team is invested 100% in the project, but I won’t be sharing any information about the financial investment. As for the suppliers, I don’t intend to share any information either.
Q: Did you have any new insights with this start-up compared to before?
Li: Actually, no, I didn’t. Sorry.
Q: How do you view the timing of car manufacturing? You founded both Cowin and Xiaoniu, how do you differentiate them? There are rumors that you are a very intelligent person, have you been tested for IQ?
Li: For the third question, it seems that my IQ is just average, like everyone else.
For the second question, the two companies are completely separate with different brands and different product lines.
For the first question, I would say that we are late to the game, there’s no denying that. But interpreting this situation depends on how you perceive it. Let me give you an example, even though it may not be entirely accurate:
Japan is a powerhouse in the automobile industry. We know that Honda entered the auto industry 30 years after Toyota and Nissan. I don’t believe that no one in the Japanese industry tried to make their own car during those 30 years. Maybe Honda was the last major automaker to emerge, and there were no others after them. I think it is highly probable that during those 30 years, many people tried.
But the situation in Japan is different from that in China. This thing about the river waves pushing each other is about which wave, or at what point, or a specific wave can make it. Perhaps it can only be seen clearly after the fact. We are in the midst of it, and I think that many people have their own opinions, but only time will tell us the answer. We won’t believe that this venture will succeed if a certain investor believes so, or simply because we’ve received funding, or because others won’t fund us. We’ll just try. We’re not the first to explore this field, at least we can explore it and try our best. We’ll do our best and see how it goes.
Q: Will there be other seating arrangements for the NV model?# Li:
This car only has 5 seats. People ask why we don’t make 6 or 7 seats, or a 4-seat version. I think it’s because, with our size, we want to give our customers a sense of ease and comfort. Why would we cram so many seats into a relatively small body size?
If you have three children, then maybe I’m not the right car for you, unless you have multiple cars. If this is your only car, then we may not be able to meet your needs. We also haven’t tried to meet everyone’s demands.
Q: How will we address the competitiveness of intelligent driving? How do we approach user operation?
Li: I think autonomous driving is a revolutionary technology bringing AI to the automotive industry. However, this revolutionary technology will require a considerable amount of time to evolve. The arrival of new technology must be based on the basic prerequisites of improving user experience and absolute safety.
The reason we chose not to equip NV with a LiDAR in the early stage has many considerations. I don’t want to explain them individually, but we do believe it is a good choice for us at this stage. As for our users, if LiDAR is a necessary condition for them, we may not meet their requirements.
As for competitiveness, I think the least important thing is competitiveness. The most crucial thing is what we can bring to our customers.
Regarding the second question, I forgot the question about user operation, and I cannot answer it truthfully.
Ji Xiangpeng: In terms of user operation, we have already established a user operation team. We focus on user content, user points, and excavation teams, including teams that classify users based on their usage. We pay great attention to user operation and new car manufacturing. We also use a direct sales system, and we adopt similar user operation methods.
Q: How do we build our brand? Why did we choose Changzhou? Can you reveal any details about the next round of financing plans?
Li: First of all, building a brand is not a one-off process. We cannot simply promote ourselves strongly and proclaim ourselves as an excellent brand.
I think it is a step-by-step process that requires us to improve our own products while adequately communicating and exchanging ideas with media and teachers. At the same time, the most important thing is our users’ satisfaction with their actual use and experience of our cars. I think it takes a considerable amount of time, and we have no intention of rushing it.
Since we started this project, we’ve been hammering away at it for three years and still haven’t produced a product. To be honest, I’m not in a hurry. Building a brand is harder than building a car, and I think it will take even more time to do it right.## Translation
As for choosing Changzhou, I was already there for two rounds, so naturally, I am familiar with Changzhou. That’s why I chose it. I have certainly chosen and seen many other places, but as for the places I’ve seen, I don’t need to mention them. In the end, we are here.
The third point is financing. We haven’t started the next round of financing yet.
Q: What are the advantages of Ziyoujia compared to other new car brands? Can you reveal a general pricing range?
Li: To be honest, I can’t say for sure what our advantages are, but we just need to do our own thing well. As for the pricing, it hasn’t been determined yet, sorry.
Q: How do you think about corporate culture?
Li: As for corporate culture, I think it should be the same both internally and externally. You can’t have one face for external and another for internal.
The things we insist on are exploration, refinement, and enjoyment, and we hope it’s the same internally. No matter what we do, there are always different possibilities. At least we should think about them, right? Then we do the things seriously. The most important thing is that everyone should be happy whether they are working or not. It’s not what we want if we just come to work every day with grievances to earn money.
Q: What are your market goals for your new brand? Do you have any sales expectations? Is the brand positioning more high-end or cost-effective?
Li: We are definitely high-end, that’s for sure, but not necessarily luxury. We want to give customers a luxurious feeling. But we are not actually luxuries because everyone knows that luxuries require history.
As for the first question, everyone in the industry is studying and paying attention to this issue.
I don’t have an opinion on this because firstly, my car hasn’t come out yet, and I haven’t even taken the stage, so I don’t have the qualifications to say what level it is, whether I can survive or not. I can’t answer these questions, so I don’t have the qualifications.
But overall, the automotive industry is a very large industry, and we can survive in the preconditions of the unique supply chain environment in China. If we imagine that there are only three companies in this market, the supply chain will definitely be monopolized by the three companies. It’s very difficult for the fourth and the fifth company, let alone the sixth company.
There are too many supply chain companies in China, including those from Japan, Germany, Europe, the United States, South Korea, and domestic companies, both state-owned and private, joint-ventures, etc. Only under such a rich supply chain system can companies like ours be established. If we sell 200,000 cars, we will soon achieve a relative scale effect. This is the basic because we can’t do it anywhere else in the world.
Q: What is your view on full-stack self-developed automatic driving?
Output
As for choosing Changzhou, I was already there for two rounds, so naturally, I am familiar with Changzhou. That’s why I chose it. I have certainly chosen and seen many other places, but as for the places I’ve seen, I don’t need to mention them. In the end, we are here.
The third point is financing. We haven’t started the next round of financing yet.
Q: What are the advantages of Ziyoujia compared to other new car brands? Can you reveal a general pricing range?
Li: To be honest, I can’t say for sure what our advantages are, but we just need to do our own thing well. As for the pricing, it hasn’t been determined yet, sorry.
Q: How do you think about corporate culture?
Li: As for corporate culture, I think it should be the same both internally and externally. You can’t have one face for external and another for internal.
The things we insist on are exploration, refinement, and enjoyment, and we hope it’s the same internally. No matter what we do, there are always different possibilities. At least we should think about them, right? Then we do the things seriously. The most important thing is that everyone should be happy whether they are working or not. It’s not what we want if we just come to work every day with grievances to earn money.
Q: What are your market goals for your new brand? Do you have any sales expectations? Is the brand positioning more high-end or cost-effective?
Li: We are definitely high-end, that’s for sure, but not necessarily luxury. We want to give customers a luxurious feeling. But we are not actually luxuries because everyone knows that luxuries require history.
As for the first question, everyone in the industry is studying and paying attention to this issue.
I don’t have an opinion on this because firstly, my car hasn’t come out yet, and I haven’t even taken the stage, so I don’t have the qualifications to say what level it is, whether I can survive or not. I can’t answer these questions, so I don’t have the qualifications.
But overall, the automotive industry is a very large industry, and we can survive in the preconditions of the unique supply chain environment in China. If we imagine that there are only three companies in this market, the supply chain will definitely be monopolized by the three companies. It’s very difficult for the fourth and the fifth company, let alone the sixth company.
There are too many supply chain companies in China, including those from Japan, Germany, Europe, the United States, South Korea, and domestic companies, both state-owned and private, joint-ventures, etc. Only under such a rich supply chain system can companies like ours be established. If we sell 200,000 cars, we will soon achieve a relative scale effect. This is the basic because we can’t do it anywhere else in the world.
Q: What is your view on full-stack self-developed automatic driving?Li: I think it’s like solving a set of high school exam questions. After solving them, there are many ways to reach the conclusion. There isn’t only one way to solve these questions. There may be many methods to solve it or even no other methods work. The most reliable method may also not work. I don’t know.
What I want to say is that there is no absolutely correct and unique path or method. As for your question, I answered indirectly through problem-solving, so I don’t want to make a judgement on whether it is necessary or not.
But what I want to say is in the autonomous driving industry, we see many companies working hard in their own ways. At least 20 companies in China have raised more than 400 million US dollars to develop autonomous driving technology.
Q: About the sales model and sales channels?
Li: Our main sales model is direct selling stores because, initially, when the brand is not yet known to consumers, this is the only way.
Q: How many stores are you planning to expand to next year?
Li: We have a plan for next year, but we haven’t decided yet. However, it is important to have points of contact with the consumer, especially for this high-value, durable consumer product.
Q: From Xpeng Motors to Ziyoujia, is there any experience or team technical expertise or experience in the power battery system that can be transferred to Ziyoujia? Will there be cooperation with Huawei in the future?
Li: There is no relevant experience. The two products are completely different. We will definitely explore cooperation with leading suppliers.
Q: What is your role personally in Ziyoujia? Where is your focus?
Li: My role is to participate in all aspects of the company, but I don’t understand everything. I listen and learn.
Of course, based on my personal work experience, I have been involved in complex system development, hardware and software, brand establishment, understanding of sales channel logic, and to some extent, financing and capital market knowledge.
Q: In terms of product definition and overall vehicle manufacturing, Xpeng Motors has been quite successful. Do you have some insights to share that can be used as reference for Ziyoujia?
Li: My answer may disappoint you, but there isn’t any.
Because the complexity of the automotive industry is not at the same level as that of two-wheeled vehicles. The difference between them is not just one or two levels but three levels. Therefore, although I want to borrow, I cannot borrow.
Q: Have you and Li Xiang had any discussions about the industry in private?
Li: Li Xiang shared a lot with me before I started. He is a good person and speaks his mind.When I formally decided to do this, I stopped communicating. I think this is a basic respect for others. Li Xiang did a great job, and we applaud him with our hearts.
From our perspective, as I just mentioned, we design all our concepts based on electric vehicles, and our range extender system is only based on the electric vehicle platform.
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.