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IAA Mobility 2021 Spotlights ABB, Get to Know Geely Boss Li Shufu, A Midsize NIO - SAI Newsletter 35



The IAA Mobility 2021 is going on this week in Munich so it’s a chance for the German and European mobility companies to show off their wares. For those unfamiliar with the IAA Mobility show, it’s just the Frankfurt Motor show – rebranded. The Frankfurt show was canceled last year due to Covid but seems to be back with a vengeance in 2021. This rebrand is meant to allow the show to cover the entire ‘mobility’ space and not just cars.

These shows might make some of the managers at these car companies feel better, allow them to pat themselves on the back for all of the hard work that they’ve done, and talk about how they plan to ‘change the world’ or do things differently moving forward but the proof is in the pudding.

I will qualify this forthcoming sentence by saying that Twitter is pretty US-centric and there are a TON of Tesla STANs on the platform but the products that have been intro’d this week by ABB generally haven’t been well received. And the stinging critiques are mostly coming from their fellow countrymen! It could also be the frustration lingering from the rail strike that left people scrambling to get to Munich though.

These events year in and year out have the same people presenting. In the same uniforms - a button-down shirt (most of the time a white shirt) with a suit jacket (without the tie to show that they’re progressive) and a pair of wingtips, captoes, or monkstraps. The uniform is different in the US but the formula is the same.

Below is a brief list of some of the product announcements from the event. Merc especially coming out of the gates strong with a few introductions. I may have to agree with the Twitterverse for most of these cars though, of what I’ve seen so far nothing moves the needle that much for me either.

Some of the more notable announcements from the show:

- Merc went crazy with its product introductions. It launched the EQE sedan (think electric E-Class) or baby EQS. It unveils the EQG concept aka electric G Wagon. Finally it also unveiled an AMG version of its EQS flagship sedan. Think of the EQS sedan with more of ‘everything’ and you wouldn’t be that far off. Finally, Merc unveiled an all-electric Maybach SUV – the Maybach EQS SUV concept. These names aren’t that clever, in fact, I’d call them downright lazy. But I digress.

- An ID.Buzz robotaxi was unveiled at the VW event the evening before IAA Mobility launched. It'll be tested on Munich roads by Argo AI before finally launching a service in 2025. For those not familiar with Argo, they are an AV startup based out of Pittsburgh and Silicon Valley who Ford Motor and VW Group both have a substantial investment. They’ve both basically hitched their robotaxi wagon to Argo which isn’t a bad thing, they’re a strong team.

- Smart Concept #1 SUV. It’s much more of a crossover than an SUV. Smart, which is 50/50 owned by Daimler and Geely likely plans on producing a variant of this concept in the near future at the Xian factory. This concept also shares the same SEA platform that is being used on the Zeekr 001. It isn’t likely the suicide doors make it into production though. Styling-wise, it seems in-offensive.

- Great Wall bringing two EVs to Europe. The WEY Coffee 01 Hybrid and the Ora Cat EV. They’ll be launched in not yet announced countries in the EU starting in 2022. Pricing was also not announced but the current Chinese EV trickle into European markets is going to become a gush come 2022.

- The Porsche Mission R concept race car. Electric and badass.

I was a guest this week on a recently launched UK-based podcast this week called ‘Ride: The Mobility podcast’ hosted by Jonny Combe and Martin Kahl. I was joined by two entrepreneurs, Sampo Hietanen from Finland who’s the founder of a Finnish mobility startup called MaaS Global, an online mobility integration platform, and Pedro Somma from Brazil who is the founder/CEO of Quicko, another transportation integrator.

We had a good discussion about the mobility challenges in each of our respective homes and what we’re doing and seeing to make them better for everyone. Once the pod gets posted, I’ll link it to the newsletter.

In this week’s EVs & More, Lei and I will spend a bit of time on the IAA Mobility conference and some of the recent news about NIO and XPeng. As per the last 4 episodes, we’ll be using the Twitter Spaces platform and will be on this week on Thursday – 8:30pm EST. Please do join us.

For those who can’t join in real-time but are interested in listening to this week’s or past episodes of China EVs & More, you can find them by scanning the below QR code:

TESLA NEWS - A $25K Tesla with no steering wheel? I call bullsh*t! This is the worst-kept Tesla secret, of course, they’re going down-market even further than the Model 3. It’ll likely be designed in Shanghai, or at least partly in China since this is their largest and most important market in the world. Just for clarification though, are they saying it won’t come with a steering wheel full stop? Because that’s silly. Or it won’t come standard with a steering wheel or that the steering wheel can be stowed away? In the first scenario, I see huge aftermarket potential and with the second, I think of concepts that have already explored designs with hideaway steering wheels. IN THE NEWS - Genesis is better late than never. Here are some announcements the Hyundai-owned luxury brand made this week. First, Genesis plans to go completely electric with their vehicle lineup starting in 2025. On top of that, Genesis committed to being zero emissions by 2030. Both very BOLD statements. They hosted an event recently to launch 8 new EVs and with aims to sell 400K of them by 2030. What may be even bolder is that they plan on achieving that number through the sale of BEVs & hydrogen fuel-cells vehicle sales. That 400K seems to be a pretty ambitious number but when set side by side next to some others’ including VW, Great Wall, and NIO, it seems to be much more achievable. Genesis will count on China to be a big part of sales if they’re to come anywhere near that goal. China hasn’t been a market that Genesis has played in so the key question here is will they be able to wrestle away sales from ABB, NIO, Tesla, and other domestic premium automakers? Because that’s the only way they hit that number. As an American who’s seen how Hyundai went from 0 to a major player in the US market in short order, I do think it’s something that is possible. The jury is still out on their first attempt, the electric GV60 crossover but they should be able to learn from mistakes and engineer them out of future products. - Those interested in learning more about the automotive personalities that are shaping the future of transportation, not just in China but globally should take the time to read this piece about Li Shufu. The founder and Chairman of Geely Holding has as good of an entrepreneurial spirit as anyone in the west. For those that aren’t familiar with Geely, they are one of three Chinese legacy OEMs that aren’t state-owned with the other two being Great Wall & BYD. Geely has been VERY ambitious recently and it’s tough sometimes to keep up with all of the announcements about investments, partnerships, product and brand launches. As the article also states, they have less of a foot in the traditional ICE space as their other legacy contemporaries but more importantly, they have a CEO that seems to be more impatient who wants to see progress sooner than later, and is open to experimentation and failure. Because let’s face it, quite of few of his bets that won’t pan out. I do see Geely as a player in future mobility space. I just don’t know how large or international that will be yet. - Steve Jobs famously said during a 1997 WWDC Q&A that focusing is about saying ‘No’ to things. It looks like James Dyson took that to heart and decided to scrap his plans to produce an electric car when the price and cost didn’t make sense. This is even after a $700M investment. He decided to say No. That takes discipline and I’d say is pretty admirable. Although I would’ve loved to have seen his team’s effort. I would’ve loved to have been a part of that team even more… - Rivian wants to come in and eat Ford Motor & GM’s lunch with its R1T & R1S EV truck & SUV. Based on initial reviews, it looks like it may very well be able to. If GM or Ford gets shut out of the premium electric truck or SUV category because they were 18-24 months too late it is GAME OVER for them. That’s not likely to happen but they can’t feel good about the type of havoc and disruption that the Rivian products are going to do to the once predictable, and very profitable US market. Rivian has had a long time to get this right so expect the R1T & R1S to bring the heat. You can also expect that there will continue to be growing pains with Rivian which should slow their expansion and growth leaving GM & Ford with an opportunity to shorten that lead that Rivian has launched their product now. Unfortunately, they both saw this coming. They could’ve just flown across the pond to know that serious competition was right around the corner. - A midsize (ET5) NIO unveiled at this year’s NIO Day is likely to happen. Between the ET7 & ET5, ABB better watch out or between the Tesla Model 3 & S and these new NIO vehicles, they all may be fighting for premium market scraps in the China market. I am serious too. TRENDING ON SOCIAL MEDIA - 10 Classic cars we want back with electric powertrains. I agree with #s 2, 3, 6, 7, 8, 9 &10. I NEED that 4th generation Lincoln Continental. - Watch & learn how a Porsche 911 gets built. LEGEND. For those who’ve never visited an automobile factory, this one will be a lot different than what you’ll see at a Volkswagen, Ford or Toyota factory where annual output can reach 500K units/year vs. Zuffenhausen where annual production is probably <70K/annum. I visited the Zuffenhausen factory & museum back in my grad school days so it’s amazing to see the progress in some areas and the lack of it in others when manufacturing a 911. Back when I went, they sold beer in vending machines and you could smoke on the factory floor. I believe they’re not selling beer in vending machines anymore but I don’t know whether you can still smoke or not. - WM Motor’s Founder Freeman Shen gives his first TED talk. It’s about cars on the road, less of them. Which is notable. Worth your 5 minutes or so to watch. - China Evergrande bonds are rated worse than junk. At least that’s how the market is treating them. This spells bad news for their NEV unit. We’ve already known that they’re trying to unload a big stake to repay some old debts but with no takers, potential investors must’ve seen under that kimono and not like it. - XPeng’s breakout product – an autonomous pony? This could be its way of searing its brand into the mind of children ala Apple with their elementary school computer libraries or Disney with the constant bombardment of IP with every fairy tale told or children’s movie watched. Please see Steve Jobs's statement about Focus. JUST THE NUMBERS - $588M – That’s how much Cao Cao Mobility, a ride-hailing platform that competes with Didi in the China ride-hailing/sharing space, mainly in tier 2-4 cities. Cao Cao was launched by Geely and is one of Li Shufu’s new business entries into the services sector. The 6-year-old app has been aggressively trying to gain share by discounting rides while trying to poach Didi drivers from their platform. This funding will go a long way in helping them get bigger although other competitors have also now raised their spending so this could be another race to the bottom as Didi watches from the sidelines. Most people I know are still primarily Didi customers even though wait times have increased as available vehicles have decreased since the investigation launched. The battle could ultimately be zero-sum and not harm Didi that much since most players aren’t strong in the tier 1 cities, where Didi dominates. - 53%. That’s the % of global NEV sales that came from China in July. That’s a MONSTER number. For 2019 ICE sales, China’s share of the global market was ~28% so they are punching above their normally substantial weight already. Their annual market share of NEVs isn’t too shabby either at 48% through July. When should we start to see the US eat into some of that share? Likely not for another year or two. - $13.5B. Toyota plans to invest that amount by 2030 and take on a leadership role in the space and reduce the costs of batteries by at least 30%. I would NEVER bet Toyota out of the game even if they had to be coaxed to play it. - $128M. That’s how much VanMoof, an electric bicycle startup based out of Holland has raised in its Series C round. What’s notable about this aside from that BONKERS amount raised is that Hillhouse Capital, one of China’s premiere PE shops led the round. - $85M. An autonomous trucking startup that differentiates itself from its contemporaries because it focuses its services on loads with fixed short-haul routes making things a bit more predictable. Also, the CEO happens to be a fellow CMU grad so we are definitely rooting for their success! —— This weekly newsletter is a collection of articles we feel best reflect the happenings of the week or important trends that have effects on the automotive and mobility sectors here and in the US, we also provide a point of view that we hope educates and sparks debate.


The Sino Auto Insights

Sino Auto Insights is a Beijing, China-based market research and advisory firm that specializes in assisting companies analyze, strategize, and develop products and services that will shape the future of mobility and transportation. Members of our team have experience working in Detroit, Silicon Valley as well as here in China across multiple sectors and functions as entrepreneurs as well as working at larger companies like Apple, Google, Amazon, GM and FCA, and many others.

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