On the morning of June 6, BYD convened its 2024 Annual General Meeting. During the meeting, Chairman Wang Chuanfu shared insights into BYD's current state and unveiled the company's strategic roadmap. His momentary emotional breakdown during the shareholder Q&A session resonated deeply, sparking discussions thousands of kilometers away at the Chongqing Forum later that day.

This article delves into the following aspects:

• Shareholders' trust and emotional impact
• Peer users' doubts and criticisms
• BYD's 10 million vehicle strategy

Shareholders' Trust and Emotional Impact
Wang Chuanfu's emotional display was primarily triggered by two contrasting questions posed by shareholders. One shareholder read an extensive article highlighting BYD's shortcomings in product marketing and brand premiumization. In response, Chairman Wang acknowledged the company's rapid growth had led to deficiencies in these areas, vowing to improve. "We understand shareholders' frustration. Please send the article to us for thorough review and necessary improvements." Another shareholder shared his journey of buying BYD stocks, selling others to fund his purchase, expressing unwavering trust in BYD and Wang Chuanfu himself.

Upon hearing this, Wang Chuanfu momentarily broke down, saying, "Regardless of the grievances we face, we will act with integrity. We won't drag others down; we'll only strive harder. There may be short-term pressures, but people are watching."

Peer Users' Doubts and Criticisms
Wang Chuanfu's emotional moment and statements ignited widespread discussions among society and executives at the ongoing Chongqing Auto Forum. Ordinary users questioned if his tears were a "publicity stunt," emphasizing the need for more attention to employee welfare, supplier payment terms, and user experience.

Executives at the Chongqing Forum espoused the "contrast theory," with one executive noting the well-known issue of conventional pressure tanks and severe emission non-compliance in the auto industry as a criminal case. Media often disseminates information contradictory to the facts. Current challenges may not solely stem from individual companies but reflect broader industry difficulties: declining OEM gross margins, minuscule industry profits, and waning momentum for various brands. Suppliers struggle with delayed payments and annual price cuts, causing widespread supply chain distress. Auto workers endure endless overtime, embracing the 996 work culture, and being on standby 24/7. Consumers complain about deceit, quality issues, and even safety concerns.

All this is further highlighted against the backdrop of our previous article, "China's Auto Market 2025: Intense Competition, Equal Rights in Intelligent Driving, and the Great Escape of New Energy Vehicles - Interpretation of Morgan Stanley's China Autos Overview." While individuals are responsible for the current chaos, a broader reflection on our rules of the game is perhaps more crucial as everyone seeks solutions.

BYD's 10 Million Vehicle Strategy
At the AGM, Wang Chuanfu stated that BYD aims to propel China's new energy vehicle technology globally, achieve an annual production and sales milestone of 10 million vehicles, and become China's Toyota in the new energy sector. BYD's strategy revolves around four pillars: electrification, intelligence, premiumization, and overseas expansion, aiming to attain the 10 million vehicle sales milestone and become the Toyota of the new energy era.

Electrification - The End of Fuel Vehicles
BYD stands as a significant beneficiary of automotive electrification, experiencing nearly a tenfold increase in the past four years, unprecedented in automotive history. Future competitors remain to be seen, with Xiaomi as a potential contender. However, at this year's shareholder meeting, Wang Chuanfu said, "There are regrets in the first half of electrification, like slower charging speeds compared to refueling and battery performance in low temperatures not matching fuel vehicles. As these technologies advance, consumers will have a better experience, paving the way for a complete phase-out of fuel vehicles."

Therefore, in electrification, BYD will continue innovating in charging technology, akin to "megawatt flash charging," and batteries, focusing on solid-state batteries and extreme temperature performance.

Intelligence - Mass Introduction of New Technologies
Regarding intelligence, BYD's initiative on equal rights in intelligent driving earlier this year, "BYD's Dream of Intelligent Driving: Can 'Smart Cars' Really Become Popular by 2025?", surprised competitors with its fully loaded sensor approach. At this year's AGM, Wang Chuanfu said, "The crux of intelligence lies in ensuring extreme safety. Current intelligent driving is nascent, with vast imagination space for future algorithm development and sensor integration. In the next 3 to 5 years, BYD will launch a series of intelligent driving technologies, addressing pain points at each press conference as engineers work tirelessly."

BYD's intelligence strategy involves equipping vehicles with advanced hardware first, followed by iterative algorithm upgrades. BYD hinted that from 2026 to 2029, it will massively introduce new intelligent technologies, with each press conference announcing new advancements. Stay tuned.

BYD's intelligence strategy is poised for success. China's Deepseek's success isn't due to technological leadership but rather a triumph in Chinese engineering applications. Automotive intelligence represents another AI engineering application scenario, where we excel, especially with a large and rapidly growing young user base.

Brand Premiumization - A Necessary Battle
BYD has faced criticism from competitors for lacking premium appeal. Judging from BYD's past sales, 80% are concentrated in models priced below 200,000 yuan, with premium brands like BYD Atto 3, Denza, and FANGCHENGBEI accounting for less than 5%. For instance, premium brands Denza, FANGCHENGBEI, and BYD Atto 3 recorded cumulative sales of 64,000, 42,000, and 798 units, respectively, in the first five months, falling short of expectations.

At this year's AGM, Wang Chuanfu stated, "Premiumization is BYD's next necessary battle." Denza is pivotal to this strategy. Citing the Denza fishhook test case, Wang emphasized that advanced technology empowers premium brands, converting technology into emotional value. BYD's brand premiumization journey, and that of the entire Pearl River Delta's auto brands, has a long way to go. Brand and product premiumization require individuals who understand users' lifestyles, not just hardworking tools.

Auto Export and Overseas Expansion - A Core Strategy
Wang Chuanfu stated that just as the domestic market entered an explosive growth phase in 2020, the overseas market is gradually doing the same this year. BYD's overseas expansion strategy, akin to its premium strategy, is a core strategy for the next three years.

Our previous article, "BYD's Global Expansion Plan - 800,000 Overseas Sales by 2025, 50% of Sales Overseas by 2030," also shared that BYD has planned overseas production capacity exceeding 1.5 million units and prepared the world's largest roll-on/roll-off shipping vessels. BYD aims to sell over 800,000 vehicles overseas by 2025, with half of its sales coming from overseas by 2030. For auto export and overseas expansion, BYD appears fully prepared, both internally and with macro support.

Conclusion
Wang Chuanfu's emotional moment at the AGM and the contrasting viewpoints at the Chongqing Forum reveal the tumultuous competitive landscape amidst China's rapid automotive development and the struggles of Chinese entrepreneurs. Some view this as a strange, unhealthy phenomenon with no future; others see it as a developmental stage, a vortex we must endure for future generations' benefit. What do you think? >>>>