XCBR Media focuses on the evolution of the automotive industry chain
Author: Zhou Changxian
After more than twenty years of fighting in the automotive technology industry, the name Li Peng was not well known in the automotive media circle until the last three years when he stepped forward and became popular.
In 2019, Li Peng founded Xian Dou Intelligent, an intelligent travel technology company. In 2020, he became the digital executive director of Great Wall Motors and the founder of Smart Salon, a high-end brand of Great Wall Motors. In 2021, he founded a new smart electric vehicle company called Youpao Technology. Prior to this, he was also involved in channel management and worked in several automotive technology companies.
Li Peng is not secretive about each stage of his work experience.
He said, “Autoliv (the world’s largest supplier of automotive safety systems) has brought me a lot of things, such as product knowledge, understanding of development systems, operation and management of global companies, and respect for life.”
Later, he joined the mainland group to realize his industrial vision of “hope that cars will become automatic driving robots”.
However, in 2013-2014, the “New Four Modernizations” direction of the automotive industry was just beginning to sprout and everything was immature. At that time, Li Peng believed that the first step was to change the interaction between people and cars, so that cars became walking iPhones. Therefore, he was responsible for intelligent interconnection and ITS (Intelligent Transportation Systems) at Continental and worked for a period of time in Horizon Robotics, a company that develops edge AI chips.
Of course, his experience at Great Wall Motors cannot be avoided.
On December 9, 2020, Li Peng issued a challenge to new forces in a speech: “the tide is coming, and we must go in.” Three weeks later, he announced that he would be responsible for the SL project, the high-end brand of Great Wall Motors, which later became Smart Salon.
However, shortly after that, Li Peng disappeared from the public view. When he reappeared a few months later, it was as the founder of Youpao Technology.
In this interview, he did not talk about the real reason for leaving Smart Salon, but expressed his gratitude and blessings to Great Wall Motors.
“Thanks to Chairman Wei Jianjun for his recognition, he gave me an opportunity to enter the auto factory from the supply chain. I founded Xian Dou for Great Wall Motors and established a Digital Center for Great Wall’s digital transformation.”
Now, Li Peng has set off again, embarking on his first real entrepreneurial journey.
The Business Logic of Youpao
From traditional industries to foreign Tier 1 first lines, and then to innovative fields such as the Internet and artificial intelligence, Li Peng’s resume can be seen as a process of fighting monsters and leveling up.Also, based on these rich experiences, he has a deep insight and forward-looking judgment of the automotive industry, and has created the perfect commercial model for UcarTech.
“The changes in the automotive industry are actually driven by two underlying factors: the technological attributes of cars and the consumer goods attributes of cars.” Li Peng calls this “dual-wheel drive.”
He believes that cars were not technological products before, but rather mechatronic products with integrated mechanics and electronics. When the technological attributes came, it meant that the cost of software became increasingly expensive. Therefore, when cars are driven by software costs instead of hardware costs, hardware standardization solutions begin to have substantial advantages.
UcarTech discovered this opportunity and joined the new wave of car-making in a brand-new way.
As the founder and CEO, Li Peng believes that the era of “Intelligent Automobile 2.0” is where automobiles are defined by their scenarios. Therefore, he believes that the core value of UcarTech is to upgrade the traditional “whole-vehicle integrated development” to “upper and lower separate development,” redefine the top-level logic, technical form, and supply chain of automobile development, and empower more scene owners to create their own cars.
The so-called scene owners can be divided into four categories in specific terms.
The first category is the AI scene owners. For example, a company at L4 level of autonomous driving needs to solve the redundancy and functional safety of the entire lower body, enabling the algorithm to run on a strong body.
The second category is value proposition owners. They have their own specific value proposition for a certain group of users. Compared with traditional automotive brands, the appeal of their value is more profound. However, it is difficult for them to produce cars with such a small capacity. By manufacturing cars on the Ucar super platform, the quality and styling differences of the products allow them to reconcile with users’ value propositions.
The third category is the commercial scene owners. These customers originally had a commercial brand that needed to be solidified in a certain city’s commercial space. The commercial space is not moving, but the population is. As people flow, the form of their solidification inside commercial real estate should change. For example, services need to be distributed to the capillaries of the whole society, and many intelligent scene terminals are needed to enable services to reach users better.
The fourth category is the car OEMs. At the beginning of the business, Li Peng thought that car factories were not potential users, but in the past four months, he found that both international car factories and domestic traditional ones had very positive responses to new car-making forces, and they had projects under discussion.It is interesting that Youpao Technology has proposed the “New Four Transformations” for intelligent cars – hardware standardization, software platformization, service ecologization, and experience personalization. Through this model, Youpao Technology empowers various carmakers, autonomous driving companies, travel platforms, life service platforms, commercial operation spaces and other scene owners to create intelligent electric cars, providing them with definitions, designs, development, and production of car models based on the UP super chassis.
The AutocarMax believes that Youpao Technology has two innovations in terms of business models.
Firstly, it has opened up a new research and development model and value chain system for the automotive industry. The traditional vehicle development process is centered on the body and focused on the powertrain platform. This mechanical thinking is changed by Youpao Technology’s innovative approach of developing the upper and lower body of the car for carmakers to produce better quality, more consistent, more reliable and globally standardized technological base at a certain cost.
Secondly, it lowers the threshold for intelligent electric cars in terms of quantity scale. Li Peng’s prediction is that Youpao’s customers can own their own intelligent electric car with 100 million US dollars within a year. He believes that changing the entry threshold of an industry, and changing it by an order of magnitude, will bring the most profound changes to the industry.
However, Li Peng said that the business model adopted by Youpao is not entirely new, but focuses on some of the relevant businesses of some large companies. In fact, similar solutions have already appeared in the markets of the United States, the United Kingdom, and Israel. For example, Rivian, a US electric vehicle manufacturer, has related businesses and has attracted 10.5 billion US dollars in financing. It recently secretly submitted an IPO application and was valued at 80 billion US dollars.
As of August, Youpao Technology has independently developed the first domestic mass-produced full-line control chassis and the world’s first CTC battery system jointly developed with Jiewei Power, and achieved technical landing. Li Peng also revealed that Sichuan Kaiyi Automobile, the contracted plant partner, was the first batch of joint development partners and OEM factories.
At the same time, Youpao Technology has signed strategic cooperation with Jingxi Heavy Industry and Horizon, and will conduct in-depth cooperation in the related fields of smart cars, edge artificial intelligence chips, and other related areas. It is worth mentioning that Jingxi Heavy Industry (BWI) was formerly Delphi’s global suspension, braking, and steering business.
According to the plan, Youpao Technology will officially release the first generation of mass-produced super chassis in December this year, and enter the mass production stage in 2023.# Li Peng’s Introduction
Li Peng introduced that on the same chassis, the first generation of YOUCAR’s super chassis can support the development of different types of vehicles such as sedans, pickups, MPVs, SUVs, and vans. However, the first generation product cannot support the load capacity of vehicles above 3.2 tons, which will be addressed in the next platform.
In essence, the super chassis is not just a chassis; it has more architecture than a regular chassis. For example, it has its own full-stack self-developed electronic and electrical architecture, on which smart cabins and intelligent driving are pre-installed as apps in collaboration with partners.
How do new entrants view this?
It is well known that the current new car market has entered a stage of vigorous development, and the second wave has arrived. Tech giants are diving into the market, with Baidu teaming up with Geely to establish Jidu Auto; Xiaomi investing $10 billion over ten years, and Lei Jun “stake[ing] his entire life’s accumulation of achievements and reputation to fight for Xiaomi cars.” OPPO, Skyworth, and others have also released signals of car production.
At the same time, capital markets’ enthusiasm for smart electric vehicles continues to rise. In the past few years, the financing rhythm of leading new carmakers such as “WmAuto,” has evolved from annual unit rounds to quarterly unit rounds.
However, not all new entrants have entered the first echelon, nor have all investors boarded the punctual bus.
When interviewed, some media asked Li Peng whether it is too late to enter the market now.
Li Peng believes that “when we choose to start a business at this time, we must think that it is the right time, not too late. This is very certain.”
First, the overall judgement is that the intelligent electric vehicle industry will remain an incremental market until 2030. Consumers have not formed their own fixed evaluation system, and the supply chain providers will not form their complete fixed competitive structure.
“That is why Apple and Xiaomi are entering the automotive industry at this time. In fact, their cars will be launched around 2023 or 2024,” he believes that today, the entire market is the decision-maker, and consumers never think that the intelligent electric vehicle market has been saturated. “The market penetration rate has increased from 5% last year to 10% this year, and the next few years will be a certain, flourishing market.”
Second, the entire industry has just passed the first bubble period and is entering a period of comprehensive takeoff and launch.“`markdown
“Starting from the second half of 2019, there have been industry players exiting one after another. The fact that there are those who exit does not necessarily mean that the industry is going downhill. On the contrary, those who have survived the ordeal might be the ones who are truly willing to produce good cars, polish their products, take responsibility for consumers, rather than those who focus on financing, writing PPTs, and explaining concepts. According to Li Peng, today is the perfect time for the car industry, when the dust has settled, and the final opportunity has arrived.
Thirdly, YOUPU Technology’s business model does not conflict with anyone’s. “We are not creating a new brand, nor are we operating ToC to seize consumers’ awareness. In fact, we hope that those who have actual scenarios can customize, personalize, and create revolutionary products with lower costs and superb user experience, while having access to our users at a relatively low cost.”
At present, YOUPU has only started for four months, and both the product and the business model have not been validated by the market. In other words, YOUPU is still in the stage of less than 10 pages PPT. Can it be recognized by the capital market?
“YOUPU Technology’s “2 rounds in 4 months” financing, has attracted top dollar funds, AI chips, self-driving, and other top players, which might be the best answer to this question.
YOUPU Technology was founded in April this year, and completed its angel round just a few weeks later, with angel investors including Dr. Yu Kai, founder of Horizon Robotics, Wang Lipu, President of Fuxing Automotive Technology Group, Dr. Gu Junli, self-driving expert, etc. On August 31, YOUPU Technology completed Pre-A round financing, led by Ventech China with CCV Partners and ZhenFund following closely. It is reported that a new round of financing is also underway, with industrial capital entering.
Wang Huadong, a partner at Ventech China, said: “YOUPU Technology’s super chassis under development can shorten the new car development cycle to within 12 months and lower the funding threshold to within USD 100 million, which greatly empowers new car companies to focus on creating higher value-added brands, user services, and data loops, constituting a hardware standardization revolution for new energy vehicles.”
At the same time, he also affirmed the core team of YOUPU Technology. “The core team comes from a diverse background including traditional OEMs, Tier 1 companies, and intelligent driving, and we believe that the diversified background can help the company to create valuable products and take a certain position in the electric car market.”
As mentioned above, not all investors have boarded the train on time, and Zhou Wei, the founding partner of CCV Ventures, is one of them.
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Zhou Wei used to be the managing partner of KPCB China. He admitted that KPCB missed Tesla in the US and invested in Tesla’s competitor Fisker. As a result, Tesla succeeded and Fisker did not.
In China, whether it is KPCB or CCV, established in 2017, “We have missed the three largest electric car companies in the market (NIO, XPeng, and Li Auto).” Zhou Wei regrets this, so he attaches great importance to new opportunities.
“As an investor, it is a very rare and happy thing to come across a project that excites people. YouPai is such a project.” Zhou Wei said, “In the first meeting, I was impressed by Li Peng and his team’s rich experience, strategic thinking, and original intention within half an hour, and I made an investment decision immediately.”
Li Peng told Zhou Wei that YouPai Technology aims to become the MTK (MediaTek) of the intelligent automobile sector. Zhou Wei believes that this concept is very advanced and leading, just like the era of smartphones and feature phones.
“He proposes a completely different way of thinking for the intelligent automobile era, which can create a universal and configurable chassis for new energy vehicles that can serve the entire market.” Zhou Wei said, “Because we are also very familiar with MTK, we approve of this idea very much.”
He believes that YouPai, as an ideologically forward-looking intelligent automobile technology platform, has a business model with great imagination that provides a universal and flexible platform for future participation in the Chinese smart mobility market, which is revolutionary.
During the video interview, Zhou Wei said a thought-provoking statement, “President Li’s strategic thinking is surely advancing by leaps and bounds.” It seems to be both commendatory and cautionary.
Perhaps unintentionally said, but intentionally heard.
“I am very sure that what you just said is our underlying logic that remains unchanged,” Li Peng responded very seriously. “After getting capital and industry recognition from entering the market, I have more respect for the intelligent automobile sector. The primary task now is to concentrate on developing the first-generation product.”
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.