Tech Giants Steal the Show at the Beijing Auto Show

The 2024 Beijing International Automotive Exhibition, also known as the Beijing Auto Show, has made a grand return after a four-year hiatus. The event, held at the China International Exhibition Center in Shunyi District, attracted an impressive crowd on the first media day, April 25th, with attendance rivaling that of the Universal Studios Beijing, located 40 kilometers away.

Despite the smaller total exhibition area of 230,000 square meters compared to the 2023 Shanghai Auto Show, the Beijing Auto Show boasts a similar scale, with over 1,500 exhibitors, including renowned domestic and international automobile and parts manufacturers. Notably, this year’s event has seen a more significant presence of foreign faces compared to the previous year’s Shanghai Auto Show.

However, the true stars of the show were not the vehicles themselves, but rather two tech giants from outside the automotive industry: Zhou Hongyi, the founder, chairman, and CEO of 360, and Lei Jun, the founder, chairman, and CEO of Xiaomi Group. Wherever these two middle-aged men in red and green went, they were surrounded by layers of eager attendees, much to the surprise of foreign visitors.

The overwhelming attention given to these tech giants has left some industry veterans, who have worked in the automotive sector for over a decade, feeling perplexed. They never imagined that the spotlight of a car show would be stolen by two tech moguls, leading some to lament that this year’s Beijing Auto Show has lost its original flavor, with exhibitors seemingly competing for popularity and traffic rather than showcasing their vehicles.

Zhou Hongyi, who participated in the show to promote domestic new energy vehicles, even climbed atop a Dongfeng Mengshi 917, jokingly referring to himself as the oldest car model at the event. However, it was clear that the audience was more interested in him than the cars. Although Zhou Hongyi did not spend much time at the booth of Nezha Auto, a company he has invested in, he made sure to visit the booths of other high-profile domestic car manufacturers and battery suppliers like CATL.

Meanwhile, Lei Jun, who entered the automotive industry with Xiaomi Auto, spent the morning busy with the Xiaomi SU7 launch event before changing into a green top to visit competitors’ booths in the afternoon. Both Zhou Hongyi and Lei Jun attracted massive crowds wherever they went, causing congestion and prompting some to question whether the focus of the auto show had shifted from vehicles to popularity and traffic.

The immense popularity of Lei Jun and the Xiaomi SU7 led to the Xiaomi Auto booth being cordoned off to manage the crowd. The laser radar supplier for Xiaomi Auto, Hesai Technology, cleverly displayed a Xiaomi SU7 at their booth, garnering additional attention. The overwhelming traffic also translated into impressive order numbers, with Lei Jun revealing that the Xiaomi SU7 had received 75,723 orders and delivered 5,781 units within 28 days of its official launch, setting a new record for the delivery volume of a new brand’s first model in its first month.

While some automakers admit to feeling pressure from Xiaomi Auto’s success, many also recognize the commendable aspects of the company. Industry insiders acknowledge that automakers can learn from Xiaomi Auto’s ability to break into the automotive industry from the outside, bringing in external traffic and effectively communicating the advantages of their products to users.

As the new energy vehicle market becomes increasingly competitive, traditional automakers are not backing down. Yin Tongyue, the chairman of Chery Holding Group, delivered two press conferences on April 25th, one in Chinese and one in English, demonstrating the determination of industry veterans to keep up with the changing landscape.

The Beijing Auto Show has also highlighted the growing importance of AI large models in the automotive industry. Automakers and suppliers alike are showcasing their AI large model applications, with companies like Xiaomi, Jikr, BAIC, Nezha Auto, and SenseTime presenting their latest developments in this field.

While the competition among Chinese automakers is fierce, it is a testament to the progress and growth of the domestic automotive industry. The rise of new energy vehicles and the increasing market share of Chinese brands have put pressure on joint venture and luxury brands to adapt and innovate. Many foreign automakers are now embracing Chinese technology, local supply chains, and talent, recognizing the importance of the Chinese market in the era of new energy and intelligent vehicles.

As the automotive industry continues to evolve, it is clear that the future will involve a mix of new energy and traditional fuel vehicles. Joint venture brands that fail to adapt and change risk being relegated to niche markets, emphasizing only individualized and small-scale models. The Beijing Auto Show serves as a reminder that the automotive landscape is rapidly changing, and those who fail to keep up risk being left behind.

The Beijing Auto Show also highlighted the increasing importance of exports for Chinese automakers. According to data from the China Passenger Car Association (CPCA), from January to March 2024, the cumulative export volume of passenger cars reached 956,000 units, a year-on-year increase of 34.8%. Among them, the cumulative export of new energy passenger cars was about 300,000 units, a year-on-year increase of around 33%.

Brands with significant export volumes, such as Great Wall Motors, BYD, and SAIC’s MG, had a notable presence of foreign attendees at their press conferences, including suppliers, partners, dealers, and user representatives. Chery Automobile even invited over 3,000 foreign guests from more than 80 countries to attend the Beijing Auto Show and chartered two high-speed trains to take them to visit the company’s factory in Wuhu, Anhui Province.

The strong rise of Chinese brands has put considerable pressure on joint venture and luxury brands. A Korean industry insider attending the show told “The Boundary” that they are most interested in the recent “traffic stars” Xiaomi Auto and BYD, admitting that Korean automakers currently face difficulties in competing with Chinese new energy vehicle brands in China. To stage a comeback against the headwinds, they “must launch products that are both high-quality and affordable, with outstanding performance indicators and attractive prices.”

Although previously criticized for their slow transition to new energy vehicles, many joint venture and luxury brands have shown a clear determination to “counterattack” in the new energy sector at this year’s Beijing Auto Show.

For example, Changan Mazda’s booth only featured the newly launched pure electric sedan EZ-6. Honda and Nissan’s booths were also filled with new energy vehicles. Buick, Chevrolet, and Cadillac showcased their new energy models, such as the GL8 plug-in hybrid, Trailblazer PLUS, and Lyriq, in the spotlight.

Kia’s most prominent display was the previously launched pure electric SUV EV5, while the newly debuted fuel-powered SUV Seltos took a backseat. Even Volkswagen, the “joint venture champion,” brought the all-new Magotan and Tiguan L Pro, two heavyweight fuel-powered models, but the spotlight was solely on the ID.CODE, a new energy concept car designed specifically for the Chinese market.

Volvo’s booth was dominated by the Chinese debut of the pure electric SUV EX30, supported by the EM90 and EX90, with hardly any trace of fuel-powered models. BMW also continued its tradition of only displaying new energy models on the media day, with the only exception being the all-new JCW COUNTRYMAN from its MINI brand. Porsche’s booth only featured the pure electric Macan and the new Taycan 4, while Audi, in a desperate move, showcased new energy models led by the debut of the Q6L e-tron.

Behind the numerous new models lies a rational understanding by foreign brands of the true situation in the Chinese market, as they become more open to embracing Chinese technology, local supply chains, and talent in the era of new energy and intelligent vehicles.

Honda, for example, put forward the slogan “Made in China, Fully Embrace China’s New Technology” at the auto show, announcing collaborations with Chinese companies such as Huawei, CATL, iFLYTEK, and Hangsheng, with more emphasis on vehicle development by the Chinese team. Mazda’s EZ-6 follows a similar approach, with the Chinese partner gaining more say in the joint venture.

However, some brands are still in a state of “temporarily lying flat” when it comes to new energy vehicles. Ford, for example, has focused its efforts on the Mustang in the near future. Jaguar Land Rover, despite having a few new energy models, mostly showcased traditional fuel-powered vehicles on the media day.

To be frank, while new energy vehicles are developing rapidly in China, fuel-powered vehicles and new energy vehicles will likely coexist for the foreseeable future. If joint venture brands stubbornly focus on fuel-powered vehicles without attempting to change, their future survival space in China may be limited to emphasizing individualized and niche models.

In conclusion, the 2024 Beijing Auto Show has showcased the rapid evolution of the Chinese automotive industry, with new energy vehicles taking center stage and Chinese brands gaining significant market share both domestically and internationally. The event has also highlighted the increasing importance of AI large models and the need for traditional automakers to adapt and innovate in the face of fierce competition from tech giants and new entrants.

As the automotive landscape continues to shift, it is clear that the future will belong to those who can successfully navigate the challenges and opportunities presented by the era of new energy and intelligent vehicles. The Beijing Auto Show serves as a reminder that the industry is at a critical juncture, and those who fail to keep pace risk being left behind in the race towards a more sustainable and technologically advanced future.