Author | Qiu Kaijun
Editor | Qiu Kaijun
What kind of achievement can be considered good enough for a new high-end brand with only six months of delivery?
Zeekr, SAIC’s high-end brand founded nearly two years ago, began delivering its first car, the Zeekr L7, on June 18th this year, with a cumulative delivery of 4,500 vehicles to date.
“As a start-up company, Zeekr certainly hopes to have more sales. However, if we need to weigh between brand and sales, we believe that brand building is more important than short-term sales.” On December 8th, in an online communication meeting of Zeekr Auto, Liu Tao, CEO of Zeekr, made this evaluation of Zeekr’s sales and brand performance.
“Zeekr has taken a small step forward, but it is far from satisfactory.” Liu Tao said. This “small step” is to be recognized by users as a smart electric luxury brand.
Zeekr is SAIC Group’s “Project 1”, with the best resources of the group. What do Liu Tao and his team think about the achievements of sales and brand, and the reasons and logic behind them?
Shortage of supply + insufficient channels
Zeekr Auto is the biggest player among China’s new energy start-up brands.
The controlling shareholder is the leading Chinese automaker – SAIC Group with a 54% stake; China’s largest internet company – Alibaba Group holds 18%; and Zhangjiang Hi-Tech, known as China’s Silicon Valley, owns 18%.
With three-party investment, Zeekr has a registered capital of 10 billion yuan.
Zeekr has a high starting point and a fast pace.
Just one month after its listing – in January 2021, Zeekr released its new mass-produced car, which later became the Zeekr L7.
A year and a half later, Zeekr began delivering its first car.
However, in terms of sales performance, Zeekr is not outstanding. The official information released states that, as of early December, Zeekr has delivered 4,500 Zeekr L7s.Liu Tao explained, “The delivery of IM L7 has been under pressure due to the shortage of components such as AKC four-wheel steering and high-end chips, resulting in our average monthly delivery hovering around 1,000 units.”
In addition, “The speed of IM’s terminal network expansion is still slow. So far, we have 98 (channel) touchpoints, but Weixiaoli has 500-700. We will quickly make up for the shortcomings.”
Emphasizing Control and Establishing the Brand
Still, Liu Tao believes that IM has taken a small step and has already been recognized by users as a luxury electric vehicle brand.
Liu Tao shared the characteristics of the 4,500 seed users of IM.
He introduced, “IM L7 car owners born in the ’80s and ’90s account for 74%, with an average family income of 540,000 yuan after tax and 91% having a college education or above.“
Moreover, interestingly, very few IM L7 car owners purchased their first car from IM, only 16%, with 51% of the purchases being additional purchases and 33% being exchange purchases. Among the buyers who made additional purchases or exchanged their cars, 60% came from luxury brands, and 4% were from ultra-luxury brands.
Being able to win users from luxury brands, even ultra-luxury brands, shows that IM’s product quality is truly extraordinary.
Liu Tao believes that IM has been able to establish preliminary brand awareness because they focus on “extreme driving control,” and “L7 is the ceiling of electric driving control,” which has been well received among IM’s users.
Entering the era of intelligent electric vehicles, Liu Tao believes that Weixiaoli also has many innovations. “But we think that understanding the underlying mechanical qualities of automobiles is still essential. … It seems that only the large screen is the focus of the intelligent car, and driving control seems unimportant. I think this is a mistake.”
IM L7 indeed has powerful performance in terms of product strength, having set multiple racetrack fastest lap records.
In March of this year, at the Shanghai Tianmashan Racetrack, the IM L7 car set a lap time of 1 minute 12.94 seconds, which is comparable to the 911-level lap time.
In October of this year, the new IM L7 model – IM L7 Snake Performance high-performance version set a lap time of 1 minute 42.212 seconds, surpassing the AMG EQS and Porsche Taycan Turbo S, and won the title of “Zhejiang’s fastest production electric car” at the Zhejiang International Racetrack.
In addition, the model has surpassed Porsche Taycan and broke the Guinness World Record for the longest distance drift of an electric car (43.646 km), and has also become the holder of the world record for drifting.
The handling ability of IM L7 does not necessarily need extreme conditions, such as on a racetrack, to be demonstrated.
In September of this year, IM L7 initiated a “Nine-Layer Demon Tower” user challenge activity. Faced with bends in parking lots that even golf carts can’t easily pass through, many users were able to challenge them successfully while driving the IM L7 with ease.
“IM’s participation in external competition is mainly based on identifying differentiation positioning and entering the user’s mind,” said Liu Tao. “The differentiation positioning of L7 is mainly focused on ‘driving and control,’ which is more precise and in line with the brand strategy.” Judging from the L7 users, IM’s brand strategy has achieved the expected results.
Intelligence: Independent Research and Development and Joint Cooperation
“In the intelligent era of automobiles, we definitely cannot rely on only one ‘core advantage.’ In fact, we hope to achieve the extreme in driving and control, safety, intelligence, advanced aesthetic design, and more,” said Liu Tao.
IM Automobile has three original aspirations, electric, smart, and upgrading consumption and aesthetics, “which is also our understanding of the trend of the times.”
“IM is unquestionably the #1 engineering project (of SAIC Group), with very strong internal resource mobilization capabilities. This includes SAIC’s entire supply chain, as well as top software companies such as Zongzuo and Bangma.” Liu Tao said. This naturally includes the ability to intelligently drive.
“We now have a team of nearly a thousand people working on autonomous driving, and IM’s investment is not less than that of its peers. The lateral control and automatic control of IM’s intelligent driving, or NOA based on high-speed and high-precision maps, is definitely not inferior to the industry’s top level.”
He said that in terms of intelligence, SAIC does more and talks less. SAIC established a project team to start doing SOA architecture in 2015 and 2016. Today, from an industry perspective, SOA has become a standard configuration for smart cars, and SAIC’s project has become Zongzuo. Currently, a large part of Zongzuo’s resources are serving the IM project, and SOA has become one of the most core technical foundations of IM Automobile.
“We use deep intelligent development to understand the needs of users in the intelligent era,” Liu Tao said. “Users may not care about showing off autonomous driving technology at all. They care more about how autonomous driving can enhance the driving experience from work to home.” IM has established a large-scale data factory for the purpose of imitating the experience of an experienced driver using driving data automation iteration loops, making the IM AD intelligent driving experience more and more like that of an experienced driver.Except for self-developed intelligent driving, IM also adopts an external cooperation model. “Something that core users perceive must be mastered by ourselves, but IM does not reject cooperation. Chairman Chen Hong’s ‘soul theory’ has been taken out of context.”
Liu Tao introduced that in terms of autonomous driving, IM cooperates with Momenta.
“Momenta’s advantage in perception is very obvious, and its weakness in vehicle control is also very clear. Our engineering capability must be stronger… They have 300 people working in our company, which is equivalent to our team. The overall coordination and product efficiency are very high… If we rely solely on independent research and development, the efficiency will not be so high. We will continue to adhere to this model.”
On December 20th, IM will release its second car, LS7.
“L7 has achieved its preset goals, while LS7 will achieve goals that L7 has not reached,” Liu Tao said. “After the polishing and refining of the software system, the more mature LS7 is more suitable for the medium and large luxury SUV market with more opponents, players, and user traffic.”
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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.