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Since the birth of the electronic TV in 1927, the global sales crown at every stage has been a leader in new technologies. From CRT to rear projection, from plasma to LED, Sony, Panasonic, and Samsung have taken turns dominating the global TV market.

The TV industry has always been dominated by technology, following the law of technological innovation, technological maturity, and a natural decline in product prices from high to low.

Until Xiaomi TV appeared and bombarded the market with low prices, the market law was once broken. The market trend changed rapidly, and the idea of technological breakthrough was replaced by competition for low prices. Domestic brands were dragged into the quagmire of price wars, which also artificially increased the difficulty for future high-end.

Xiaomi’s entry into the TV industry is not just a product, but a model.

In October 2013, the first Xiaomi TV went on sale, and only 18,000 units were sold until the end of the year. The total sales volume of the domestic color TV market was about 47 million units that year, and the market share of Xiaomi TV was only about 0.03%.

At that time, China’s per capita disposable income was only 18,311 yuan, and the price was still the top consideration for most domestic consumers to buy TVs. In China, rising stars such as Hisense, TCL, and Skyworth have left behind the slightly outdated Changhong technology. Although Japanese and Korean high-end brands have no match in the global market share, they are difficult to maintain the forefront in the Chinese market.

In the hearts of many consumers, Japanese and Korean TV brands are truly high-end. Sony and Samsung entered the industry early, with global leadership in patents and technologies and strong brand power. They have also gained higher premiums from it.

At that time, the technology of domestic brands was still growing, and foreign brands were "high and low", leaving a huge gap in the market.

With the launch of Xiaomi TV 2, Xiaomi TV sales exceeded 300,000 in 2014, entering people’s attention at a growth rate of 16 times. Xiaomi Internet + cost-effective play is suddenly enlightened.

Based on deep customization, MIUI TV transforms not only rice noodles, but the entire traditional TV client base, as well as the "Internet surfing" family.

Ambitious Xiaomi, a TV industry recruit with neither technical expertise nor strong brand appeal, has chosen its usual low-priced approach without suspense.

The first generation of Xiaomi TV has a 47-inch 8.4mm narrow frame, selling for only 2999 yuan. At the press conference, the Xiaomi-style slogan reappeared: "The first TV for young people"; perhaps it was consumers who waited and saw the new brand, which led to the first generation of Xiaomi TV’s listing being cold, while the second generation of Xiaomi TV pushed the price of the 40-inch ultra-narrow frame smart TV to 1999 yuan. This time, Lei Jun quickly made many friends.

In 2013, Internet TVs accounted for less than 1% of the domestic market. In an era when the Internet was developing rapidly and the smart TV industry had a market gap, Xiaomi TV used the Internet model to slash product prices.

The Internet ecosystem can become the main channel for Xiaomi’s TV profits, and the demand for hardware profits can be minimized, which almost replicates the way its mobile phones play and is also the model that Xiaomi is accustomed to.

Opponents have difficulty building an Internet ecosystem that can rival Xiaomi in a short period of time, and there is a relative lack of profit points other than hardware. The reason why first-tier domestic brands such as Hisense and TCL were able to successfully bring Changhong down lies in the great progress of exclusive technology until it surpasses. Xiaomi does not use technology to crush the market, but uses extremely low prices to drag opponents into unfamiliar battlefields.

The price is the appearance, and the support point is the Internet ecology. With Xiaomi TV becoming the domestic sales champion in 2019, the Xiaomi model has become the object of imitation in the industry, and the product price has become the focus of attention in the industry.

This has also indirectly led to an increasing number of peers prioritizing technological research and development over lowering product prices.

A team of domestic traditional TV brands began to make up for their shortcomings, each building a TV OS ecosystem based on it, increasing their profit points, and finally further reducing their hardware prices.

The price war is intensifying, consumers and brands are fixated on product prices, but fewer and fewer people pay for technology, craftsmanship and quality, and TV products are gradually "fast food".

At the same time, due to factors such as the relatively high cost of hardware due to brand identity and configuration of cutting-edge technologies, and the lack of profit points other than hardware in the Chinese market, foreign big-name TVs are gradually marginalized in the domestic low-end market.

According to Aowei Cloud Network data, only two foreign brands, Philips and Sony, ranked 8th and 10th among the top ten domestic TV sales in 2019, with sales of only a few million units, about one-tenth of Xiaomi’s.

Xiaomi TV has not only dragged domestic competitors into a price war, but also allowed foreign brands to further tilt their focus towards the high-end market in China.

With the traditional domestic TV brand Internet ecology, online channel construction and other shortcomings made up, no one has an absolute advantage in this price war, and some "micro-exercises" have begun to prevail. Real and fake 4K, old architecture towing new machines and other mixed industry chaos are frequent.

To some extent, this is a manifestation of manufacturers’ cost compression to the extreme.

In Q3 2022, Xiaomi’s internet service revenue was only 7.10 billion yuan, only about 10% of total revenue, and hovered between 7 billion yuan and 7.30 billion yuan for the sixth consecutive quarter, apparently not helped by hardware growth.

Internet revenue, as a fulcrum for Xiaomi TV to maintain low prices, may not be as strong as expected.

Once imitating the Xiaomi model, no one has succeeded in turning the Internet ecosystem into a revenue driver, while technology research and development has regained attention.

Consumption is under pressure, and brands that once pursued cost-effectiveness have seen an upward demand. The tide of high-end products has swept in, and low-end products have gradually become a painless spray.

Millet-style inner roll once triggered domestic peers to "actively go down", and the price melee undoubtedly solidified the "taste" of some users, and the brand was difficult to get out of trouble for a while.

Nowadays, brands that are proficient in going down have to consider how to go up.

Going high-end also means entering the home court of foreign brands.

Before 2016, Samsung also actively deployed low-end products in the Chinese market. However, as the price war intensified, domestic brand prices further declined, and online channels were already weak. Coupled with the lack of ecosystem in the Tizen system, Samsung TVs gradually fell short of their capabilities and completely withdrew from the price war stage. Since then, they have ranked last in the Chinese market for a long time.

The price war has squeezed Samsung and Sony out of the low-end market, and also stimulated them to completely move towards high-end. The industrial chain behind them also forms a virtuous circle around high-end.

The high premium of high-end products brings higher profits to the industrial chain. Theoretically, the investment in R & D can also be higher than the industry average to create cutting-edge technologies and consolidate high-end positioning. This is the logic of the industrial chain of high-end brands.

The Xiaomi model is completely different. By reducing the price of hardware to the extreme, the profit of the industrial chain is also reduced, which indirectly suppresses the technological progress of the industrial chain.

The cost-effective model is inherently unsustainable, prompting brands to rise; consumption is under pressure, the market is shrinking overall, and it has become more urgent for brands to raise demand.

Omdia data shows that global TV sales in the first three quarters of 2022 were 143 million units, down 4.4% year-on-year. TrendForce released data late last year, expecting global TV shipments to 202 million units last year, down 3.9% from 2021 and the lowest in nearly a decade.

The overall shrinkage of the TV industry has become a foregone conclusion, and domestic brands with an absolute share advantage in the domestic market have not shown a similar one-sided strong performance in the global market.

In the first three quarters of 2022, Xiaomi TV ranked fifth in the world with a 6.5% market share, and Samsung led the global TV sales list with an absolute advantage of over 20% market share.

Obviously, the "three-star model" is better.

The novelty brought to users by TV intelligence has long been gone, and Internet expansion has become a regular standard. As mentioned earlier, Xiaomi, which got up early, and the domestic brands that followed suit, failed to change the situation of low Internet revenue, but instead suffered brand damage in the price war.

Another drawback of the Xiaomi model is the potential for quality control after extreme price compression.

In May 2022, Xiaomi TV was exposed that the screen automatically fell off, and it was launched twice in three days, which once attracted widespread attention. In recent years, problems such as black screen and main board have also been complained by many Xiaomi TV users, and there is even a joke on the Internet: If it is over-insured, it will be bad.

Brands that have participated in the price melee have also frequently encountered similar quality control problems, but some brands can improve the problem to a certain extent by relying on their own production lines. In the fully OEM model, the quality control initiative is divided into two, and the extreme price compression will undoubtedly make things worse.

The frequent occurrence of quality control problems is extremely unfavorable for the brand to rise, and it relies heavily on the integration of third-party resources, and only "micro-innovation" to maintain fast-paced product iteration is not very helpful for technological development.

Comparing the data of the past four years, it is not difficult to find that although the market as a whole continues to shrink, the top ten rankings of global market share have hardly changed. In other words, relying on cost-effective tactics to kill the four parties in China, it is difficult to "eat all the sky in one move" in the global market.

Xiaomi TVs, which have often won sales in the domestic market in recent years, have been suppressed by TCL and Hisense in the global market. In the first three quarters of last year, TCL ranked third with a share of 11.7%, and Hisense ranked fourth with a share of 10.1%, continuing to lead Xiaomi.

The exclusive technological breakthrough has become a stepping stone to the high-end market of Hisense and TCL.

TCL has made technological breakthroughs in quantum dots, Mini LED, etc. to develop new display technologies; Hisense is also a major promoter of Mini LED, and it is a leader in the field of laser TV, accounting for 49.5% of the global laser TV market share in the first half of last year.

In terms of price, the flagship product of Hisense Laser TV is close to 100,000 yuan, the flagship of 8999 yuan flat-screen TV is "only" 85 inches, while the price of Xiaomi’s 86-inch flagship ES Pro is 7999 yuan, and Redmi’s 86-inch EA Pro is 5999 yuan.

The launch of Redmi has not allowed Xiaomi’s own brand to rise confidently, but has instead made Xiaomi’s TV product line slightly bloated and confused.

Redmi A, X, and MAX series are relatively easy to remember, while Xiaomi’s own brand TV models include Transparent, Master, Quantum Dot, Mural, Digital, EA, and ES series. This "machine sea tactic" reveals the chaotic product thinking of Xiaomi TV.

Users are easily confused when purchasing, and even if they recommend it to others, they are prone to misremember the model. It can be said that their ability to distinguish and remember is being tested.

The product line confusion is just a symptom of the Xiaomi model. At most, Xiaomi is not well-prepared to rise, which has limited impact on its high-end.

However, Xiaomi users’ perception of the brand’s value and the "Xiaomi model" that has long relied heavily on the supply chain have led to a relatively lack of exclusive technology, which may drag down the high-end process of Xiaomi TV for a long time.

The aftershocks of the price war have affected the high-end TV industry, which is not special. Manufacturers with comprehensive capabilities have always been the protagonists.

Compared with the "Xiaomi model", the "Samsung model" easily wins because of its advantages in technology, brand, global channels, and long-term important role in the upstream supply chain.

Similarly, domestic leading brands such as Hisense and TCL also place great emphasis on comprehensive development. The difference is that the price war has directly stimulated the traditional domestic brands to make up for the shortcomings of the Internet ecosystem. Their low-end product lines already have a strong cost-effective foundation, while brands with exclusive technical routes are undoubtedly more prominent.

The high and low ends are strong enough, and in the context of consumption pressure, it is undoubtedly a two-handed preparation. The "Hisense, TCL model" seems to be more sustainable.

As products move towards high-end, brand temperament also needs to keep up. Although controversial advertising slogans catch the eye, they run counter to high-end, which is not conducive to growth. In the past four years, global TV sales have been solidified, and domestic brands may need to put more thought into improving their overall strength.

Just like the way it came, it relies on step-by-step technological accumulation rather than loud slogans.

Text |Connecting trip　Zhou xiongfei

Edit | Midnight

Volvo has once again embarked on the road of IPO.

Recently, Volvo announced in its official website that it plans to raise 25 billion Swedish kronor (about 18.4 billion yuan) in an IPO on the Nasdaq Stockholm Stock Exchange. It is expected to complete the listing and start trading this year.

Volvo announced the impact of IPO, from Volvo official website.

This is not the first time Volvo has rushed to the market.

As early as 2016, Volvo began to make an impact on IPO, which was recognized by three Swedish investment institutions, but it did not go public smoothly in the end. At that time, the industry speculated that its parent company Geely did not want to let go; Two years later, Volvo sought IPO listing again, but it was once again opposed by Geely because the valuation given by the relevant investment institutions was too low.

Now, Volvo, which has experienced the previous two unsuccessful IPOs, still hasn’t given up listing and started to attack the IPO again, and behind this insistence, it is actually considered for its own development.

Since Volvo was acquired by Geely in August 2010, with the blessing of the latter channel, it has achieved an increase in sales volume and profitability, but compared with the luxury brands of the same level in BBA, Volvo’s domestic development does not have much advantage.

This disadvantage has been further amplified with the rapid development of the new energy automobile industry, because in the industry’s view, although Volvo has made some moves in the new energy automobile business, it is difficult to occupy a seat on such a highly competitive track as a whole.

For Geely, life is also not easy.

Geely, as one of China’s independent automobile brands, started early after smelling the development trend of new energy vehicles, and chose a multi-brand parallel development style. However, due to factors such as internal friction among brands and insufficient brand power, the new energy vehicle business has been tepid.

Affected by this, Geely Automobile began to fall into the unfavorable situation of high debts. Geely also tried to alleviate this dilemma by merging Volvo and listing in science and technology innovation board independently, but all ended in failure. As a last resort, Geely had to pin its hopes on Volvo’s listing.

After the acquisition ten years ago, Geely and Volvo supported each other, and now both of them are in a development dilemma, which can be described as the "ten-year itch" stage. So, will Volvo succeed in this sprint listing? After listing, can it become an antidote to its development?

1, the twists and turns of the IPO road

Volvo’s IPO, in fact, has long been rumored.

On May 13th this year, Geely Holding Group and Volvo Group successively announced that Volvo’s board of directors decided to start evaluating the possibility of Volvo’s IPO.

A month later, Hanken samuelson, CEO of Volvo, once again said that Volvo’s listing process is progressing smoothly, and an IPO may be held at the end of this year. According to the plan, Volvo will be listed on the Nasdaq Stockholm Stock Exchange.

In addition to the announcement of IPO, some substantive actions are also being carried out at the same time.

In late July, Volvo signed an agreement with its parent company Geely Holding Group to acquire all the shares of Geely Holding in its joint venture in China.

It is understood that Volvo and Geely have two joint ventures in China, namely, Daqing Volvo Automobile Manufacturing Co., Ltd. and Shanghai Volvo Automobile R&D Co., Ltd., both of which are held by Geely Holding and Volvo respectively.

Information on equity penetration of Daqing Volvo and Shanghai Volvo, screenshot from Tianyanchang.

According to the agreement, Volvo will fully integrate its manufacturing, R&D and sales business in China after the acquisition. After the complete acquisition, Volvo’s equity will increase, and its share of net profit will also increase.

In the industry’s view, this move is for Volvo to make itself more attractive for investment, so as to pave the way for its subsequent IPO. After all, Volvo’s previous IPO road can be described as twists and turns.

As early as 2016, Volvo conducted a market evaluation of IPO and was recognized by Swedish investment. Through three Swedish institutional investors, it issued convertible preferred shares and obtained 5 billion Swedish kronor (with a contract of 3.73 billion RMB).

Then the Financial Times reported that Volvo planned to raise $500 million from investors in China to prepare for its future listing. At that time, samuelson, CEO of Volvo, did not explicitly deny these news, and said that IPO was an option, but regarding the listing plan, it would be decided by Geely Holding, the parent company.

Just as everyone was waiting for news of Volvo’s further listing, there was no substantive news. At that time, for the reason why Volvo’s IPO came to an abrupt end, the industry speculated that it was because the parent company Geely refused to let go, because it was the sixth year of Geely’s acquisition of Volvo, and Volvo was also an important endorsement of Geely.

Volvo, which experienced its first failure, did not give up its IPO.

In August 2018, according to the Financial Times, Volvo has hired Citigroup, Goldman Sachs and Morgan Stanley to do listing counseling for it, and the valuation was set at 16-30 billion US dollars that year, and it is planned to set Stockholm as the preferred place for IPO, and then it will consider a second listing in Hong Kong.

In terms of fundraising, according to relevant media reports, Volvo was prepared to raise about 4.5 billion US dollars with 15% shares.

However, at that time, the relevant investment institutions only made a valuation of $12-18 billion for Volvo, which was far from the target valuation expected by Geely, the parent company, so Volvo’s listing plan was put on hold again.

In February last year, Geely Automobile announced that it was planning to restructure its business with Volvo. According to the plan, Volvo’s assets after the reorganization will be included in Geely Automobile’s Hong Kong listed company, and it will consider listing in Stockholm in the future.

Volvo and Geely pre-merger part of the announcement, screenshot from the announcement.

This means that Volvo will be packaged and listed together with Geely Automobile, but just four months later, the variables appear again. At that time, Geely Automobile announced that it planned to go public in science and technology innovation board with the approval of the company’s board of directors.

With the "solo flight" of Geely Automobile, its merger negotiation with Volvo has also undergone some changes. In February of this year, Geely Automobile announced that it had reached the "best" plan for the merger and reorganization with Volvo.

According to the new plan, the two parties will carry out a series of business mergers and cooperation on the basis of maintaining their existing independent company structures, including the merger of powertrain business and related technical cooperation such as electrification, intelligent network connection and automatic driving.

As a result, Volvo has become a single party, and its listing plan has once again run aground.

Unexpectedly, a few months later, Volvo embarked on the IPO road for the fourth time. Different from previous times, Volvo attaches great importance to IPO this time. "Today’s announcement that Volvo intends to list on Nasdaq in Stockholm is an important milestone for the company." Hanken samuelson, CEO of Volvo, told the media.

Hanken samuelson also said, "This IPO marks a new chapter for Volvo, and we invite Swedish and international investors to participate in our future growth and value creation. The IPO will help to strengthen our brand and accelerate our transformation strategy-to achieve full electrification, create a user-direct mode and achieve a higher level of security. "

Geely also expressed support for Volvo’s IPO again. "The global automobile industry is undergoing unprecedented changes, and we are determined to support the transformation and development of Volvo, a legendary Swedish brand." Li Shufu, chairman of Geely Group, said this.

Behind Volvo’s demanding transformation and Geely’s strong support, it is actually the dilemma that both sides have highlighted.

2. Volvo and Geely’s "Ten-year itch"

The value and strength of Geely and Volvo today are in sharp contrast with those of ten years ago.

At that time, Geely Automobile was still a small player in the domestic market. According to public data, its near profit in 2009 was only 1.182 billion yuan. In contrast, the net profit of Geely Automobile in 2020 was 5.534 billion yuan, almost four times that of 2009.

Volvo lived a more miserable life at that time. According to the data of Volvo’s public financial report, its pre-tax loss was as high as $1.5 billion in 2008, and it still owed its parent company Ford $3.5 billion, which once became a "burden" in Ford’s product system.

Although it has fallen into a downturn, Volvo is an old car company after all, and its market value at that time remained at around 13.6 billion yuan. Geely’s market value at that time was only over 3 billion yuan.

Under such a big gap, Geely made a seemingly crazy decision to acquire 100% shares of Volvo and related assets for $1.8 billion. As a result, at that time, the media called this seemingly gambling acquisition "snake swallowing elephant".

Tuyuan Geely Automobile official website

Facts have proved that Li Shufu won the gambling with "small and broad". After Geely acquired Volvo, it took the latter’s technology and experience into the bag, and embarked on the "fast lane" of development.

In 2013, Geely and Volvo established a joint research and development center (CEVT) in Gothenburg, Sweden, and Geely started the pace of overseas expansion. After that, Geely successfully hatched Geely Borui based on KC platform extended from Volvo GMC platform, which is the first model that Geely introduced Volvo safety technology concept.

Since its listing in April 2015, Borui has reached the sales volume of more than 2,000 vehicles in the following month, and in January of the following year, the sales volume of this car continued to rise to the sales volume of more than 6,000 vehicles, making it one of the better models of domestic medium-sized cars at that time.

With such success, Geely also began to have the idea of high-end layout.

In 2017, Geely once again set up a technology joint venture company with Volvo, and jointly developed the CMA architecture of the first mid-level car basic module architecture. Based on this framework, a brand-new car brand "Linke" came into being.

Lingke was positioned as a high-end fuel vehicle at the beginning of its birth. With the subsequent launch of Lingke 01 and Lingke 03, its sales volume has been good, and the cumulative sales volume has exceeded 500,000. So that this brand has become a "sharp weapon" for Geely to impact high-end.

"Volvo’s technology has allowed Geely to build a car into the door." Li Shufu once sighed like this.

As the acquired party, Volvo, with the blessing of Geely, has also made significant growth and explored the domestic market soon.

In 2013, Volvo successively built Chengdu factory, Daqing factory and Zhangjiakou engine factory in China. The landing of these factories gave Volvo an opportunity to explore the local market in China.

The following year, the basic research and development of a new SPA platform (extensible vehicle platform architecture) jointly invested by Volvo and Geely was completed. This platform has greatly revitalized Volvo, and Volvo S90 and XC60 developed based on this platform have been well received by the market.

Volvo S90, source of Volvo Guanwei

In this way, since Geely acquired Volvo in 2010, thanks to the convenience that Geely Automobile brought to Volvo in terms of channels and production capacity, Volvo’s sales in China and around the world have also increased year after year.

In 2017, Volvo’s global sales reached 571,600 vehicles, and its operating profit reached a record of 14.1 billion Swedish kronor, up 27.7% year-on-year. Compared with the operating profit of 2.34 billion Swedish kronor when it was acquired in 2010, it has increased more than six times.

While Borui, Link and other fuel vehicles are successful, Geely’s ambition in the field of new energy vehicles is also growing.

Since 2015, Geely has released the "Blue Geely Plan" in a high-profile manner. After taking the lead in the transformation to electrification, it has successively launched three new energy brands, namely Emgrand, Geometry and Maple Leaf, in the following years. However, due to the fact that the models released later belong to the "oil to electricity" change, they all performed poorly after the launch.

After that, Geely did not give up the new energy field, and found Volvo to jointly develop the new energy brand "Polar Star" and launch polar star 1 and polar star 2 models. Although it was expected for a while, it was too similar to the geometric brand in positioning, and the pricing was too high, so it did not form competitiveness in the market.

Because of this, Geely’s entire new energy vehicle business is silent in the domestic new energy market and has fallen into a dilemma.

According to the data of the Federation, in the Top 10 ranking of domestic new energy vehicle sales in 2020, none of Geely’s models were on the list. In contrast, Chery Automobile, both traditional car companies, and BYD’s new energy vehicles were on the list.

On the other hand, Volvo has been helping Geely to launch new energy brands and models, but its own new energy business has not been done. The XC40 RECHARGE, the first pure electric vehicle, was not officially listed at the Guangzhou Auto Show until November 2020, which was visibly slow.

For Geely, although it has been exploring in the field of new energy vehicles, it has not made any achievements in high-end aspects. Until March of this year, Geely Automobile announced that it had jointly launched the "Extreme Krypton" brand positioned in high-end new energy with Geely Holding Group.

Figure source pole krypton official micro

However, just after the release of the brand, the release and opening of its first model, Krypton 001, it was complained and defended by many consumers, which was a bad start. Connected travel has elaborated on this situation in the article "Being extremely defended, unable to support Geely’s high-end dream of new energy".

It is precisely because of the decline of the new energy vehicle business that the profit performance of Geely Automobile is also affected. In 2020, Geely Automobile achieved revenue of 92.374 billion yuan, down 5.46% year-on-year; The net profit was 5.534 billion yuan, down 32.43% year-on-year. In the first half of this year, although the net profit has turned positive year-on-year, the growth rate is only 3.67%.

In addition to poor profitability, Geely is also facing the dilemma of debt. According to Wind data, the total debt of Geely Automobile in 2020 was 46.6 billion yuan, and by the first half of this year, the total debt had reached 43.2 billion yuan. It is foreseeable that its debt may exceed that of last year by the end of this year.

Looking at it now, although Geely acquired Volvo ten years ago, the two sides experienced the same support and common development for a long time, but because of the unsatisfactory development in the field of new energy vehicles, Geely and Volvo have both fallen into their own difficulties, which can be described as entering the "ten-year itch".

Under this situation, Geely, which rushed to science and technology innovation board without any results, and Volvo, which suffered from twists and turns in listing, pinned their hopes on this IPO of Volvo.

3. Can Volvo rush to IPO again become an antidote for both parties?

To discuss this issue, there is actually a prerequisite-Volvo can successfully go public this time.

Based on the previous twists and turns of Volvo’s listing experience, especially one of its failures was terminated because the parent company was dissatisfied with the valuation of Volvo given by the market, the industry is skeptical about whether Volvo can successfully go public.

"The valuation figure has always been a sensitive tipping point for the stakeholders of this transaction." L.M.Feng, a financial scholar at the University of Illinois, said this in an interview with Interface News.

Volvo did not disclose the valuation of the listing after the official announcement of the listing plan, but according to the estimated value given by foreign media, Volvo’s valuation is about 20 billion to 25 billion US dollars, which is about one-third of the market value of European luxury car manufacturers Daimler and BMW Group.

However, it may be difficult for Geely to be satisfied with this valuation. The Financial Times once quoted people familiar with the matter as saying that according to Li Shufu’s idea, only when Volvo’s valuation exceeds $30 billion, or even reaches $40 billion, will it support its IPO.

From this point of view, whether Volvo can successfully go public this time is still unknown.

However, it should be noted that even if Volvo can successfully go public this time, it will be difficult for it or its parent company Geely to get out of the predicament.

First look at Volvo itself. According to its previously released performance data for the first half of 2021, its operating income in the first half of the year reached 141.1 billion Swedish kronor (about 103.482 billion yuan), up 26.3% compared with the same period in 2020; Earnings before interest and tax was SEK 13.24 billion (about RMB 9.878 billion), compared with a loss of SEK 989 million in the same period last year.

Although revenue and profits have achieved a good picture of both growth, it does not mean that Volvo does not need funds. After all, Volvo, which is a few steps behind in the new energy vehicle business, has made a relatively radical plan.

According to Volvo’s plan, it is expected to realize full electrification in 2025, in which the proportion of pure electric vehicles will reach 50%. In 2030, it will become a pure electric luxury car enterprise, catching up with mainstream luxury car brands such as Audi, BMW and Mercedes-Benz in terms of profit margin.

At the same time, Volvo will adjust its existing sales model and promote the online direct sales model today, when the direct sales model has become widely used by new energy vehicle companies. "Promoting the direct sales model will also enable the company to achieve sustained growth in sales, revenue and profitability." Hanken samuelson once said this.

"For Volvo, RMB 18.4 billion may not be enough, because its new energy vehicle business is still in its infancy in a strict sense, and the sales volume of XC40 RECHARGE is not good after listing. Volvo needs to make great efforts in research and development, technology and channels to achieve its own goals, and these aspects all need money." Sun Hao, head of R&D of a domestic head-end new energy vehicle company, told wired travel.

Volvo XC40 RECHARGE, from Volvo Guanwei

Volvo wants to achieve its goals. Apart from capital, competition in the industry is an aspect that it should carefully examine.

The first thing to face is the BBA, which is also a luxury brand and has also shouted their own electrification goals. According to previous foreign media reports, according to BMW’s plan, in 2023, BMW plans to expand new energy vehicle products to 25 models, half of which are pure electric vehicles; In 2025, it is planned to invest more than 30 billion euros in research and development such as hydrogen fuel cell technology.

Mercedes-Benz also put forward its own goal, and plans to launch 10 pure electric vehicles in 2022, and expects to increase the sales of pure electric vehicles to 15% to 25% of the total sales in 2025. By 2030, it is planned that electric vehicles (including pure electric and plug-in hybrid vehicles) will account for 50% of the sales of new passenger cars.

In addition to BMW and Mercedes-Benz, Audi is not far behind. According to its plan, the total investment in the next five years will be about 35 billion euros (US$ 42.35 billion), half of which will be used for investment in automobile projects and innovative automobile technologies. Specifically, about 10 billion euros ($12.1 billion) will be used for electric vehicles, and 5 billion euros ($6.05 billion) will be used for hybrid power.

It can be seen that the plan proposed by BBA is similar to Volvo’s goal, and they are all ready to accelerate electrification by 2025, which means that Volvo will be hard and hard with BBA after that. With Xiaomi, Jidu, Zhiji and other big manufacturers entering the market to build cars, Volvo is bound to encounter their challenges in the future.

"Volvo’s financing can improve Volvo’s own capital situation to a certain extent to support the development of investment, but to better solve the challenges such as product competition, shareholders need to make more other efforts to obtain more capital resources, so as not to fall behind in the new global competition." Zhang Junyi, managing partner of Oliver Wyman Consulting, said this to connected travel.

Compared with Volvo, its parent company Geely is in urgent need of financing to improve its debt situation.

In November last year, the Standard & Poor’s Index downgraded the long-term issuer credit ratings of Zhejiang Geely Holding and Geely Automobile and the issuance rating of senior unsecured bills to "BBB-", and removed all ratings from the watch list, and the rating outlook remained "negative".

In its latest report in June this year, Standard & Poor’s insisted on its previous view, and said that Zhejiang Geely Holding will continue to face leverage pressure in the next 12-24 months due to high capital expenditure, potential economic fluctuations and the uncertainty of its subsidiary Geely Automobile landing in science and technology innovation board.

In order to solve this dilemma, Geely has done a lot of Plan B while supporting Volvo’s independent listing, including promoting the listing of its electric vehicle brands Polar Star and Extreme Krypton.

At the end of September this year, Polestar, an electric car brand owned by Volvo, officially announced the news of IPO. Like FF, Polestar will land in the US stock market by backdoor, and its market valuation will reach 20 billion US dollars.

At the end of August earlier, Krypton Automobile, which was jointly invested by Geely Automobile and Geely Holding, announced the completion of the $500 million Pre-A round of financing. "After extremely financing, it will be listed on the A-share market or science and technology innovation board in the future, and it will get better results." Some Geely insiders told the interface news.

Extreme krypton financing information, screenshot from Tianyan check.

According to another media report, Geely Holding is also considering an IPO for Lotus or its electric vehicle business as early as 2022. If it goes public, the valuation of the whole business may exceed 15 billion US dollars.

Geely needs to clarify the development route and positioning of its multi-brand business if it wants to truly get out of trouble, because the internal friction between brands has hindered the development of various brands. Wired Insight made its debut in Geely Automobile science and technology innovation board. Can it become "China Volkswagen"? In many reports, such as "",the internal friction of Geely brand has been elaborated in detail.

"In the field of new energy vehicles, Geely has tried various directions and its technical route is comprehensive. However, this comprehensive and rapid iterative method is more suitable for Internet enterprises. If traditional enterprises cannot achieve commercialization in a short period of time after using this method, the overall waste of internal resources will be more obvious. " Wang Xianbin of the Geshi Automobile Research Institute said this about connected travel.

In Zhang Junyi’s view, with Geely promoting the listing of Volvo, Polar Star, Polar Krypton and other brands, it may be possible for Geely to further clarify the problems of its business development and provide favorable help for better transformation and development into a technology and user company.

Now, even if Volvo can successfully go public this time, it may not be able to solve its own and Geely’s respective difficulties on its own. Although Volvo and Geely have been closely linked after more than ten years, how to spend the "ten-year itch" is still the biggest problem that both sides need to consider.

(At the request of the interviewee, Sun Hao is a pseudonym in this article. )

At the beginning of this year, I went to Times Town in Songjiang to test drive the BYD Tang 100 bought by my friend, and later wrote a blog titled "After such a long time, I finally tested the BYD Tang 100". A few days ago, he told me that a new generation of 2018 BYD Tang DM (hybrid version) prototype cars have arrived at various 4S stores. He has been to see it several times and feels very excited. He suggested that I also go and see it. I contacted the BYD direct store near the company (it is said to be the only one in Shanghai), and the clerk replied that although there is no test drive yet, there is a prototype car in the store that can be electrified and ignited. Welcome to see it at any time. So, taking advantage of the relatively empty work this afternoon, I immediately rushed to take a look in the heavy rain.

This is a red BYD 2018 brand new generation Tang DM (hereinafter referred to as’ brand new generation Tang DM’). My first impression is that the color is very bright, and the whole car feels a little "shorter" than the Tang 100 I have experienced before? In fact, the parameters are compared: the length, width and height of this new Tang DM are 4870*1950*1725, while the old one is 4815*1875*1725, so the two are actually the same height. The visual change of "becoming shorter" is actually caused by the new car becoming longer and wider. By the way, among the new energy vehicles I have been paying attention to recently, Weilai ES8(5022*1962*1753mm) is the largest, followed by Tang DM, while Baiteng M-Byte(4850*1940*1650) is the third and Roewe Marvel X(4678*1919*1616) is the third. In addition, Tesla’s Model X is 5037 * 2070 * 1684-so it is longer, wider and flatter than other new cars. …

Before, my family leader was not very satisfied with the shape of my friend’s old Tang 100, and felt that it was too much like Lexus, but she had a good evaluation of the shape of this new generation Tang DM. Personally, I don’t really care about the "dragon face" design or the suspended roof or the currently popular penetrating taillights, as long as the new car looks smooth and doesn’t look too similar to other brands (it’s really not easy for domestic cars to do this). Obviously, the new generation of Tang DM is completely acceptable to us in terms of modeling. On the internet, everyone basically has a positive evaluation of the shape of this new car. Well, it is really necessary to get rid of the "Build Your Dreams”logo on the rear of the car that looks like a" secondary two "!

Because it is a hybrid version, the left rear side of the new generation Tang DM body is the fuel filler and the opposite position is the national standard charging socket. At present, the new generation of Tang DM can still get the Shanghai card for free in Shanghai, but it takes about a month to apply for the green card, such as reviewing the charging position and doing personal credit information. Considering that the subsidy for new energy vehicles in Shanghai may change next year, I also asked about the pure electric drive of Tang EV. However, the clerk said that it is not clear about Tang EV except that it will be launched at the end of the year. He also said that if you only drive in the urban area, or if the radius of activities does not exceed 150 kilometers, it is actually more worry-free to choose the pure electric version-but the car price may be higher.

At present, this brand-new generation of Tang DM in the store is the second top model with a price of 279,900 yuan. The clerk pointed to its 22-inch feet and told me that this car should have only 20-inch wheels as standard, but if it is decided before September, it can be upgraded to this 22-inch wheel and Brembo professional brakes for free. In fact, the upgraded configuration is basically consistent with the flagship (329,900 yuan) whose 0-100 acceleration is only 4.3 seconds, which is quite cost-effective! However, because I am still in the wait-and-see stage for the new car, I still want to wait for Tang EV, although this offer is not small.

The previous Tang 100 car interiors always gave me a little "local" flavor, but this has been obviously improved in the new generation of Tang DM. In the words of my friend in Songjiang, it is "the overall texture has reached a higher level". Although I think there is still a gap between the details (such as material collocation, curve and straight line application) and my XTS, at least it is not easy to pick out the thorns at once: at least the soft parts are soft and the hard parts are hard, and even the red stitching on the leather is true! Moreover, because the central control part uses a large flat plate to solve everything, the "sense of technology" in the carriage is much higher than before. I noticed that there is no seat memory on the door at present, but the clerk immediately told me that because this is a test car, the officially sold sub-top version has three sets of memory linkage (seat, steering wheel and exterior rearview mirror). Well, this function is very important for my family where two people drive alternately.

The steering wheel is good in workmanship and feel, and the big "Tang" logo is more pleasing to the eye than BYD. After sitting in the front seat and adjusting the seat to a lower position, there is still a punch on my head, so the head space is still relatively rich. However, this should also be related to the fact that the sunshade of the panoramic sunroof of this car is a thin sunshade fabric similar to Mercedes-Benz GLC, rather than a whole sunshade.

As early as the first generation of Tang was listed, many media praised BYD for being willing to pile up all kinds of "high-tech" equipment in the car, but on this new car, there are all functions such as keyless entry/one-button start, ambient light, 360-degree panoramic view, ACC adaptive cruise, lane assist, full LCD instrument panel, seat ventilation/heating, internal and external driving recorder and so on. However, to my regret, the HUD head-up display that has been used on XTS has not appeared in any version of the new generation of Tang DM-this is a special configuration that doesn’t matter if it is used, but once it is used, it can never be returned.

The DiLink intelligent networking system of this car is also a big selling point. Of course, in my opinion, it is a large Android tablet (12.8 inches and 14.6 inches) that can be rotated electrically (by operating on the screen or pressing keys on the steering wheel). Two days ago, some media compared it with three mainstream in-vehicle intelligent systems, Zebra and GKUI, and the evaluation was that the other two were not as open and playable as DiLink. In fact, since DiLink is really an Android tablet, theoretically you can install all kinds of third-party apps on it and do whatever you want while driving (co-pilot operation). The operation fluency and response speed (including voice control) of this tablet have indeed improved greatly compared with the previous generation of central control, but to be honest, it has not achieved the experience like iPad.

Many third-party apps have been installed on this new generation of Tang DM that I have experienced (only three or four kinds of music are played), and it feels smooth to open, apply and switch various operations. But the problem is that many apps are displayed vertically by default, so when the screen was originally displayed horizontally, as soon as you click an app (such as Baidu map), it will automatically rotate the screen to an upright position-sometimes you have to press the button again to turn it back. I hope that in the future, the DiLink system will enable all kinds of apps to start on the horizontal screen by default through OTA, otherwise it is inconvenient and unsafe to control the big screen while driving.

Of course, I also listened to the car audio system of the new generation of Tang DM. It is said that the new generation of Tang DM, which is equipped with top and sub-top, adopts a 12-speaker system (no brand name), but to be honest, it sounds far from my XTS. The low frequency is full of sense, but the middle frequency is tight and the high frequency is not very transparent. Perhaps this kind of sound is enough for users who like to "move and hit" when driving, but for me, I may still try to modify it.

This brand-new Tang DM in the store can be electrified and ignited, but it can’t be driven out for a test drive. From the appearance point of view, the new generation of Tang DM is similar to Tang 100 in the layout of gear buttons and has the same function. After pressing the start button, the car driven by pure electricity is silent and completely unaware that the car has started; After the HEV mode is enabled, the engine intervenes, and the noise inside the car is not obvious at this time. According to the clerk, on the one hand, this is because the front window of the new car uses double glass, and there is also a newly designed sound insulation cotton under the engine cover, so the noise introduced into the compartment will be much reduced; On the other hand, the whole power system has also undergone major changes, so the noise of the gasoline engine itself has also decreased. Of course, if you want to enjoy pure quiet driving all the time, it is more suitable to choose EV version.

Finally, there are a few things I want to say:

First of all, I personally don’t need this 7-seat version of the new generation of Tang DM: there are two people at home, plus occasionally taking my colleagues out, five seats are enough. Even if I bought seven seats, I guess I have put the last two positions flat all the year round to increase the luggage storage space. In addition, I heard that 7-seater cars are slightly more troublesome than 5-seater cars in terms of annual inspection, travel tax, etc., so although it is not difficult to get in and out of the third row of this car, I still think it is more accounting to buy the 5-seater version;

Secondly, in my eyes, the new generation of Tang DM has beautiful shape, large space, rich technology configuration, 4.5s acceleration, pure electric drive of 100 kilometers, and mixed fuel consumption of 7-8 words … these are the advantages that make me feel excited; The BYD brand, no HUD, and the need for audio transformation are not intolerable shortcomings. As for the sub-top with less than 300,000 yuan, the pricing of the Shanghai brand is even more "conscience". However, Tang DM actually has a "shortcoming" that I can’t make up my mind: it doesn’t have automatic driving assistance like Tesla or Weilai.

Ok, I admit that L4/L5 is unrealistic for the current domestic traffic situation, but can the L2-level autopilot that can make Li Xiang, a "car and home", endure many shortcomings of Tesla Model X and remain infatuated with it? Besides enabling ACC adaptive cruise and lane keeping at high speed, can I also enjoy the worry-free functions such as automatic lane change overtaking and automatic car following on urban expressways? Yes, even if BYD really has this function, it is not enough for me to trust it like Tesla AP2.0 (in fact, my hand has to be held all the time), but since it is a masterpiece of domestic new energy vehicles, can BYD take a step closer in this respect?

Now it seems unrealistic to expect a new generation of Tang DM to realize this function, so is it possible to surprise me in this respect on the Tang EV to be released at the end of the year?