Author｜Wang Bin

Cover｜Jiyue

The rumor of BYD acquiring NIO has just subsided, and another automaker is now deeply entangled in rumors. Recently, social media platforms have been buzzing with rumors that Jiyue Automobile is laying off 40% of its staff and that its CEO and management are fleeing the country.

Jiyue Automobile issued a statement yesterday, stating that it has noticed the false information circulating online regarding its management and operations. Jiyue emphasized that the company's operations are proceeding as usual and that all relevant information is released through official channels. Regarding the rumors, they have retained evidence, reported them to the competent authorities, and have taken necessary legal action against the rumormongers.

Jiyue Automobile's rumor debunking statement

It is noteworthy that Jiyue did not mention the word "layoff" in its statement, only emphasizing that the company's operations are proceeding as usual. This does not rule out the possibility of layoffs. Objectively speaking, layoffs have become the norm in most highly competitive industries today, and the reduction in staff numbers at several large Chinese internet companies is no longer considered newsworthy.

However, the relevant discourse has escalated from discussing the company's operations to malicious attacks on management, such as rumors about the CEO and management fleeing the country. These rumors clearly aim to foster the perception that "Jiyue is about to close down," which will inevitably undermine public confidence in the Jiyue brand and directly affect sales.

For Jiyue Automobile, which has just emerged from a difficult period over the past year, such rumors are particularly damaging. At the beginning of the year, the company's monthly sales were only in the hundreds, but by the second half of the year, it had stabilized at around 3,000 units per month, indicating a positive trend.

While layoffs at Jiyue Automobile may indeed exist, one should not overthink it. Backed by giants like Baidu and Geely, Jiyue is not yet at its wit's end, especially considering that sales have been growing steadily over the past year.

Beyond debunking rumors, what Jiyue needs to consider now is how to effectively translate its leadership in pure vision intelligent driving and vehicle intelligence into actual sales amid the accelerating elimination game in the automotive industry. After all, sales are the most powerful counterargument to rumors.

01 | Overview of Jiyue's Fundamentals in 2024

The health of a company's operations can be glimpsed from its external actions alone.

Over the past year, Jiyue Automobile has been one of the most enthusiastic automakers in enhancing its external communication. Amid the trend of automaker CEOs entering live streaming studios and personally participating in short video production, Xia Yiping has been one of the most diligent.

Unlike other automaker CEOs who often use live streams to experience intelligent driving and answer user questions, Xia Yiping goes all in. Beyond simply bringing new cars to test tracks for collision and rollover tests, after the launch of the Jiyue 07, he conducted an 18-hour endurance live stream test and a 24-hour intelligent driving live stream over 2,000 kilometers. Both in terms of duration and mileage, these were the longest automaker CEO live streams in the industry, earning him the reputation of being a "workaholic" in the field.

It's not just the CEO engaging in marketing; almost the entire Jiyue team is involved. In a previous interview with the media, Xia Yiping stated that almost all frontline store salespeople in the company have started using short videos. They now have at least 300 blue V-verified short video accounts, forming a complete new media matrix to continuously promote the Jiyue brand. "We are essentially a small advertising company ourselves."

Even during the weekend when rumors of the management fleeing surfaced, Xia Yiping was in Shanghai conducting a live delivery stream of a new Jiyue model and delivering a TED Talk at the TED conference.

Xia Yiping's speech at the TED conference

At the company level, Jiyue has also been continuously accelerating its infrastructure construction. In November alone, 23 new stores were added. By the end of November, Jiyue had nearly 140 stores and integrated centers nationwide, covering 40 cities. For a new force automaker that only launched its first mass-produced model in the second half of last year, this pace is relatively fast.

At the Guangzhou Auto Show earlier this month, in addition to unveiling the new Passion version of the Jiyue 07, they also showcased the supercar model Jiyue ROBO X. This is the world's first AI intelligent driving supercar and the first model to combine AI, autonomous driving, and supercar elements.

Jiyue ROBO X at the Guangzhou Auto Show

New Jiyue companies are also being established continuously. On November 28, news emerged that Yangquan Jidu was established, positioned in the technology promotion and application services industry, with business mainly focusing on downstream automotive manufacturing, including vehicle and parts sales, charging facility operations, and internet data services. In addition to Yangquan, Jidu has also established companies with the same positioning in Foshan, Dongguan, Chongqing, Qingdao, Xiamen, and other locations, actively creating a regional ecosystem.

Whether it's from Jiyue CEO Xia Yiping's statements over the past month or Jiyue's external layout, it is difficult to say that the automaker has encountered operational issues. The rumors circulating over the weekend about the management fleeing and the inability to pay social security next month are highly unlikely.

Jiyue's delivery volume over the past 6 months

Over the past year, Jiyue's monthly sales have increased from around a hundred units to around 3,000 units, and the product capabilities of the Jiyue 01 and 07 have been recognized in the market during the sales ramp-up phase.

In the past, NIO, XPeng, and Li Auto have also gone through a difficult sales ramp-up phase. In September 2021, XPeng achieved monthly sales of over 10,000 units, but earlier this year, it hovered around the 10,000-unit mark for four months before the launch of the MONA M03 and P7+ models in the second half of the year, which helped it surpass the 20,000 and 30,000 unit sales milestones.

Although Jiyue is a younger brand compared to them, it can be speculated that its shareholders, Baidu and Geely, are well aware of the harshness of the market. The urgent issue for Xia Yiping to address is still how to sell more cars. In Xia Yiping's words, he has been focusing on marketing since the beginning of this year to enhance Jiyue's brand influence.

Now, Jiyue has gained a certain level of popularity, making up for the shortcomings of its brand power at this stage. The next step is to consider how to further increase sales and better promote the 01 and 07 models in the market.

02 | Logically, What Should Jiyue's Next Steps Be?

As 2024 draws to a close, more and more automaker executives are stating publicly that the elimination game in the Chinese automotive industry is intensifying, and the next two years will be crucial for the Chinese auto market.

Automakers are competing to launch more models to capture existing users. Next year, according to the current plans of several new force automakers, there will only be more models entering the market, making it an unprecedented year for new product launches in this sector.

The chill has spread to every player in the industry. At the end of the year, China's largest new energy automaker, BYD, was reported to be requiring suppliers to reduce costs by 10%. The global automotive market is also under heavy pressure. In early November alone, multiple multinational automakers, including Stellantis, Nissan, and Audi, announced layoffs, with media outlets headlining their articles as "Chilling Winds."

Amid the wave of cost reduction and efficiency enhancement that has swept the global automotive market, Jiyue Automobile, with its smaller size and shorter history, needs to stockpile resources in advance and prepare for the more intense market competition next year with a lighter load.

Layoffs may be the most direct option. Earlier this year, even Ideal Auto, which had already set a new sales record for domestic new force brands, was rumored to be laying off employees after the failure of its MEGA model, affecting departments such as intelligent driving, sales, and recruitment.

Jiyue's existing product lineup is quite competitive. The 01, launched in October last year, was the first mass-produced model equipped with the Qualcomm 8295 chip and underwent a facelift in the second half of the year. The 07, launched in September this year, has started to gain traction in sales over the past few months. Both models are at the forefront of the market in terms of competitiveness and have no issues fighting with the current rhythm.

Jiyue 07

A more reasonable layoff strategy would be to streamline related aspects of unannounced new models, such as production and manufacturing, and engineering quality departments. According to some previous social media leaks, some employees in Jiyue's vehicle team may have left, which could be true. Moreover, these recent controversies were initiated by these employees.

In short, for Jiyue, playing the cards it already has is more important than blind expansion. Some new force automakers, such as NIO and XPeng, have chosen to expand further and launch more models into the market before more intense competition arrives, but this does not suit Jiyue. Not to mention that many new forces have failed due to factory expansions, which is not an issue for Jiyue, backed by Geely Intelligence.

Jiyue may be one of the latest new force automakers to be established, officially founded in March 2021, alongside Xiaomi. However, in just over three years, Jiyue has launched two models, even faster than Xiaomi. But the Jiyue brand was launched very late. Due to qualification issues, the Jiyue brand was only established in September 2023, and Jiyue had to launch its first model, the Jiyue 01, in October, starting both the brand and product from scratch, which was a marketing nightmare for Jiyue.

Jiyue 01

It is precisely this adversity that has made Jiyue more flexible and agile in iteration. In the first half of the year, after realizing the shortcomings in marketing, they quickly adjusted within a month, with the CEO leading the entire team online, resulting in 300 blue V-verified accounts and over 100 million online exposures. Xia Yiping said, "Our advantage is our ability to quickly test, validate, and iterate. If something doesn't work, we try something else. It's all about stamina and time."

It was precisely through such rapid iteration that Jiyue managed to increase sales of a model launched last year from a hundred units per month to over 2,000 units per month in the first half of the year, despite the absence of new models. This achievement is remarkable considering the fiercer competition in the automotive market this year.

This is the best moment for Jiyue in a year. To some extent, it is a good thing for Jiyue to make some optimizations and adjustments now to ensure accelerated progress. In the current environment, management must strictly control costs to ensure normal operations, which is the utmost responsibility to the company.

They did not choose to lay off employees during the difficult period at the beginning of the year when monthly sales were only in the hundreds but instead conducted internal adjustments when sales were improving. This is not necessarily a passive choice but more like a reorganization of the company's internal operations by management after achieving periodic goals, aiming to improve internal operational efficiency, reduce unnecessary expenses, and prepare for next year's elimination game.

Jiyue's management has not publicly responded to the rumors of fleeing on social media platforms—they may not need to. Xu Jiye, Jiyue's public relations director, stated in a social media post that amid the weekend's chaos, CEO Xia Yiping participated in a TED Talk in Shanghai and attended the delivery ceremony for the first 100 cars, which could be seen as an indirect rebuttal to the rumors of fleeing.

He quoted a poem by Su Shi, "Do not heed the rustling leaves and pattering rain; why not sing and stroll on leisurely? A bamboo staff and straw sandals are lighter than a horse; who fears the misty rain for life?"

©? All rights reserved by Shangshan. No reproduction without authorization.