Episode 124 - 25K Downloads for CEM, Li Bin Wants an Open US market, Lei's Trip so far to Beijing

The pod begins with the announcement that China EVs & More (CEM) had gotten it's 25K download - Congratulations to us!

Tu moves the discussion over to the rumors about Audi kicking the tires on an SAIC EV platform in order to try and catch up with Tesla and the other China EV Inc. and a broader discussion about how Audi got here. 

Tu points back to when he said every automaker is going through a 'Make vs. Buy' decision on every strategic (large) software / hardware move they make due to the lack of a tech culture at their companies but in a broader sense, in Europe in general. The discussion also focuses on the lack of speed at each of the European Legacy automakers and how that contributes to their inability to catch up.

Tu pushes the conversation over to Li Bin being quoted in an FT article that the US should open their market to companies like NIO rather than put up protectionist measures that make US entry more difficult. 

Lei then takes a moment to discuss what he's been up to while he's been in Beijing including a visit to Baidu Apollo, trying out the WeRide autonomous vehicle. and trying out the ADAS system on the Avatr 11. 

The podcast closes out with charging in China and how that experience differs from the US. 

Transcript

CEM #124 Transcript
Recorded 7/14/23

Tu Le:
Hi everyone and welcome to China EVs & More where my co-host Lei Xing and I go over the week's most important and interesting news coming out of the China EV, AV and mobility sectors. What Lei and I discuss today is based on our opinions and should not be taken as investment advice. For those that are new to the show, welcome. And to our loyal listeners, welcome back. We ask that you please help us get the word out to other enthusiasts and tune in again next week.

My name is Tu Le. I am the managing director at Sino Auto Insights, a global management consultancy that helps organizations bring innovative and tech-focused products and services to the transportation and mobility sectors. I write a free weekly newsletter that we pull many of our discussion topics from. You can sign up for it at sinoautoinsights.com, which I encourage you all to do. A very busy beaver Lei this week. Can you please introduce yourself?

Lei Xing:
Yes sir, and busy probably would be an understatement. This is your co-host Lei Xing, former chief editor of China Auto Review. This is episode number #124. Before we start, just to mention that we’ve, earlier this week, we've got our 25,000th download for the pod. We now…

Tu Le:
That's ridiculous. That’s ridiculous. 

Lei Xing:
So last August we got our 10,000th, so less than a year, we got our 15,000th. So.

Tu Le:
Our listeners have been accelerating, so we've doubled our listeners in the last probably 6 or 7 months. So.

Lei Xing:
Yeah, so, great accomplishment, pat on the back and continue to do this.

Tu Le:
That's perseverance, right?

Lei Xing:
Yeah. So a lot of things to discuss this week. You want to get Audi out of the way, because I think it's one of the most talked about here in China and in the western press on what they're trying to do.

Tu Le:
Sure, man. I, this is one of those things where under the surface, there's a lot of fires and uncertainty and scare and fear. In Europe and the United States, Audi seems to be doing okay, right? But in China, I just tweeted, the bottom is starting to fall out for Audi in China. And you're referring to what I believe is them kicking the tires on the IM Motors’ EV platform. And what I mean by kicking the tires, they are looking at acquiring a platform rather than developing one in house in order to push forward with pulling in production and development and launch of new vehicles. So what are you hearing on the China side, besides they're considering it.

Lei Xing:
Well, there's not been confirmation or outright denial from both sides. So SAIC came out with the statement simply saying that there's nothing to disclose. 

Tu Le:
A non-denial denial, no, a denial, non-denial denial, yeah.

Lei Xing:
I think Audi also came out with some kind of statement in China, really not confirming or denying anything. So I mean, Reuters had the latest report, and either way you look at this, I think this is, something is about to go down, and to me, I think from a bigger picture of what has happened to Audi. I think Audi has lost that Vorsprung dirch Technik brand identity, I don't know over the last how many years. If you look at the competition on the EV, on the BEV side, you see the numbers. They're well behind the BBs not only in China, but globally, not only ICEs, but BEVs. I think this is an unprecedented and a desperate measure to right the ship, but this is not the first time that this type of thing has happened in China. BYD is already helping Toyota with the bZ3. It's kind of a similar, kind of a foreign established legacy brand depending on China EV Inc. So it's both surprising, but not really surprising, given the kind of the market environment.

Tu Le:
A couple of things that I'd like to add, as a premium German brand, a premium proud German brand, this must be a very tough pill to swallow, because Germans love to tout what I feel is a now hollowed-out engineering prowess due to diesel gate. But you talk to any German, they're going to lean into how well engineered their products are across the board, whether they're Hankel knives, whether they're Chinese EV or electric vehicles. But to your point, and I want to give people a bit of a history here, because I landed in China in 2009. I saw tons of Audis, but they were driven by government folks and military folks. And so that's my reality of Audi in China. And so the e-trons were a terrible representation of EVs for Audi, because I always thought that Audi exteriors were a little bit plain, and they were kind of that Russian Doll. They all kind of looked alike, A4, A6, A8. But the interiors were the best in the business. And now they've kind of lost the plot on everything on the exterior and interior, because, I don't know if they underestimated it, I don't know if they were over confident, but everything's starting to fall apart because, a reminder to everyone, just a couple of weeks ago, they got rid of Duesmann, the Audi CEO, and Blume had an opportunity to bring an outsider, but nope, he brought in a lieutenant that was loyal to him. So I don't know how much that's going to help Audi in the long run, but I’ve also said Lei, you've heard me say this in past podcast, every single legacy automaker right now for any strategic product decision, mostly on the software side, this is a huge huge huge make or buy decision, but every single automaker on the legacy side is going through a make or buy decision about either what's the core competency in the future for them in the EV era, and what can they buy for now and build as they're using someone else's technology? So it doesn't surprise me, but it's an entire EV platform, number one, and number two, maybe you can shed some light on this, Lei. Is this a licensing deal? Or do they buy the rights outright? And IM motors, SAIC cannot use the platform? This is what I’m not clear about.

Lei Xing:
I figure it would be in a licensing deal. I don't think it's an outright buy, basically utilizing the platform. It's not like SAIC Motor is not going to be able to use this platform. I can't see that happening, so.

Tu Le:
So Audi would build it themselves or they would buy finished good, finished platforms?

Lei Xing:
It'll be the same as let's say, Volkswagen and Ford. What was that model unveiled, Explorer EV based on the MEB. So it would be same set up. The other thing about this Audi and SAIC IM is as soon as Audi decided to add a partner in SAIC, and this happened, what back in 2016, 2017 when they had that huge…

Tu Le:
I want to say 17.

Lei Xing:
Yeah, fight with the dealer body. So this is another balancing act that Audi will have to, ever since that happened, I think teaming up with SAIC, it has kind of irked the FAW partnership. And now you have this balancing act in play. And since then, it's been downhill, I think, for Audi. And this is another case that FAW is going to have to swallow as well that Audi is using SAIC’s platform.

Tu Le:
A quick recap for our audience. Volkswagen Group has been rumored or Volkswagen brand that specifically has been rumored to be kicking the tires on Huawei operating system for EVs. And now Audi is kicking the tires on an entire EV platform from SAIC and it's currently being used on the IM Motors, L7 premium sedan. So it's already out in the market and it's a proven platform, at least from a production standpoint. So the mechanics of the transaction, it shouldn't be that difficult once the decision is made to go forward. If it doesn't go forward, we're looking at 2026 for Audi to have a vehicle on a new platform. So that is a lifetime away in China years, a lifetime away.

Lei Xing:
Yeah. And this really the other significance is how times have changed. So in the 80s and 90s, when the foreign companies entered China, they set up these joint ventures. And the term being used then was “market for technology” well used term in the industry. Now it's being reversed “market for technology” in a completely different way, whereas the foreign companies are depending on Chinese companies. So that's the other.

Tu Le:
So let's pull out 50,000 feet and talk about the broader implications here. Because Audi, the German companies just can't keep up with the speed of the China market. 

Lei Xing:
No.

Tu Le:
That's why they continue to struggle. And it seems like they're just making hasty decision after hasty decision that's not leading to anywhere. And along the way, they're losing 6 months, they're losing 9 months, they're losing 2 years for CARIAD. And completely, they're not evolving a concept or ideas, they are completely revamping strategies. They go from 3 months in, 6 months in, 9 months in, to day one, when they do these things. So it's a cultural thing. They're going to continue to struggle until they can really understand the pace at which things and decisions need to be made in order to have successful product. I don't know if the current management, even if Blume has only been in for months, the rest of the team is the same, right?

Lei Xing:
This is really not an Audi thing. This is the entire foreign legacy thing. So the past week, we've heard a couple of things. So Cadillac dropping big time prices on the LYRIQ. Just yesterday, GAC-Mitsubishi put out a statement saying basically they are closing shop. This is the common situation or predicament that these foreign legacies are confronting in China, that the good times are over, basically. And they don't know how to really catch up, right? Even…

Tu Le:
They're not able to.

Lei Xing:
Even with launching whatever EVs, they're not able to compete. So I don't really know what's a good tactic or strategy for these companies going forward.

Tu Le:
Well, what's going to end up happening is those companies that effectively leave the China market, they're going to lean heavily, more heavily into their incumbent markets. Look for Mitsubishi to double down in the U.S. market because guess what, if they decide to double down in Europe, they're competing against the same people and the same companies that they did in China, where they lost out to. And I believe that not every brand that, not every Chinese brand that has exported to Europe will be successful, but the ones that are, will be able to compete with the incumbent European brands in Europe, I'm talking to BYDs, maybe the G6, Xpeng starting with the G6. And perhaps NIO, if they can reconcile their product portfolio. There's going to be a number of brands that fail when they enter Europe. We can point to AIWAYS really struggling for a number of years now as a prime example of that, but there will be successes. And so if they leave markets like Ford, that means that Europe and the United States really become even more important for them. So look to these companies that fail in China to double down in the U.S.

Lei Xing:
The other thing kind of related to this. I think this is on the flip side of things, Model Y production at Giga Shanghai just got their one millionth production milestone, one single model at one plant, 2.5 years. At the same time, we're seeing these bankruptcies happening among some of the China's smart EV startups. When you look at this, put these two things together, there was that chart of all the Chinese smart EV startup brand logos.

Tu Le:
With the Xs on them?

Lei Xing:
 Yeah with many Xs on them, right? You look at these together, and you're saying, at the end of the day, ok, right, this is a race. And then at the end of the day it’s going to be scale, it’s going to be cost, it’s going to be efficiency, it’s going to be profitability.

Tu Le:
It's going to be perseverance.

Lei Xing:
And so there's still a lot of question marks for these smart tv startups, although they are leading in a way, they are at the front so far. So that's the interesting comparison.

Tu Le:
And I'd argue that the only two clear winners are BYD and Tesla.

Lei Xing:
Yeah they are head and shoulders (above everyone else), so.

Tu Le:
And we had alluded to this in a prior podcast, everyone else is effectively fighting for scraps. Because to your point, we're talking tens of thousands versus single thousands for everybody else.

Lei Xing:
So going into the July EV sales, in the CPCA announcement, I think they had like 18 or so, companies that did 10,000 or more in June and those 18 accounted for over, I would say 80, I think it was 82 or 83% of the new energy passenger vehicle sales. And then there's a bunch of others fighting for the remaining 17, 16%.

Tu Le:
16% dude. Before we get to your amazingly busy week, let's talk about Li Bin and his comments in the FT article today about U.S. protectionism. What are your thoughts?

Lei Xing:
He's got a point, but I think it's a little bit different from an attracting investment and being open. I think we have different stances geopolitically with the IRA right? But he's got a point, but you know…

Tu Le:
And he used Tesla and the red carpet being rolled out for them in Shanghai as a point, counterpoint to how the U.S. has reacted to China EV Inc. and China Battery Inc. wanting to enter the U.S. market. I think, let me tell you what I think. I think he's just throwing up a trial balloon. I think he's softening, trying to soften the U.S. government a bit, because although we know that NIO has said they will enter the United States by 2025. We also know that they've been hiring people in San Jose on the commercial side, on the passenger vehicle side before. The San Jose office was mostly technical people, okay. We know that Ganesh Iyer has switched his title to basically the head of the U.S. from a technical title. But I’ve spoken with some NIO folks who hold pretty decent positions. Most of them want NIO to focus more on the China market and getting a foothold in Europe, because I will tell you Lei, they're barely, their heads are barely above water right now. And if they were to enter the China or the U.S. market, it would be tough. Their management team would be stretched, really really thin. And this at a time where EV adoption in the United States is still less than 10, 12%. And Tesla dominating with 60% of the market. Now, he could come early or NIO could come early and try to be have first mover advantage. But with all the complications of the multitude of European markets that they've already entered and trying to right the ship in China, or at least trying to consistently create that extremely positive trajectory, extremely positive trajectory in China during a very challenging time. I think they should really, really focus on that. The last thing I’ll say Lei is that we know Li Bin to be fairly outspoken. I think he took the hit for all the other Chinese EV makers, CEOs and said what they're all thinking. Now, he ignored the fact that for the last 35 years, with the exception of the last few, there's a requirement for a joint venture if you're a foreign automaker, okay? And then the second thing is they are, so NIO can go, NIOlcan enter the U.S. market, right? They're not banned from doing that, but and so Facebook, Google, they're not banned from entering the China market, but they'll be severely restricted, okay. So if I was a journalist, I would have asked, I would have pushed back, but they didn’t. And so, yeah, he can talk about the EV sector. But if we're going to talk more broadly, then he should have to answer some of those questions about China's protectionist measures of the last 30, 40 years, right? So let's call it what it is. The IRA is is a protectionist law, full stop. And so to me, just fair is fair, right? That's all I’m saying. 

Lei Xing:
And it's not like, NIO, I think from a building brand point of view, NIO has been doing extremely well in Europe, but it's not like they're, they are still at that stage of doing that and not at the stage where volumes are big.

Tu Le:
It translates to sales.

Lei Xing:
Right? It has not. And the U.S. is even harder, but not that there's no demand. I think there's a lot of demand, there's a lot of retail investors and interest in NIO. And both, I think, BYD and NIO, they have their vehicles in the U.S., right? So I mean it's, yeah, it's a matter of time.

Tu Le:
And NIO is perplexing to me, because I think you and I believe that the vehicles are nice. They're not perfect by any stretch of the imagination, but they should be selling more than they do in China. That's how I feel. So it's perplexing because I think you and I are hit rates on our predictions. And what we say is pretty high. I think it's like much higher than anyone else. I know. Yeah. It actually upsets me that I'm not predicting NIO that well. But, you and I also said that simplifying the portfolio should help, they did cut prices, which, although a temporary measure should help, you had talked about building brand with NIO. I think it's important to note they've built a major established brand in China. It's not about building a brand, it's about converting now, right? My fear is that they have this positive view from European consumers. They are not able to convert them into buyer. So that's the current track record. Why would it be different in Europe? It shouldn't be, but perhaps they can be more savvy with their positioning and their marketing and their branding. But if I was an investor and I had a large position in NIO, I’d be more focused, or I’d want them to be more focused on the China market.

Lei Xing:
Yeah, most distracted smart EV startup or China EV Inc. right now.

Tu Le:
And yeah, and let's pivot. What did you do this week Lei?

Lei Xing:
So last week after we got off, I went to, I was originally supposed to pick up a Xpeng G6, but I think their end they had to reschedule some of the vehicles because it's in hot demand, right? So I’m going to do that probably at the end of this month. So instead.

Tu Le:
Didn't you tell them who you are? Didn’t you tell them who you are? Didn't you just say I'm Lei Xing dude, what are you doing? You need to reschedule somebody else. 

Lei Xing:
Yeah well, Xpeng, the contact with Xpeng, they know me, but they have the people on the ground dealing with actually delivering or dropping off the vehicle.

Tu Le:
No, I'm just messing with you.

Lei Xing:
Yeah, no no, I know, I know. So I ended up it was interesting because last time I came back, I told former co-worker who works at AVATR, when I'm back in the summer get me a vehicle for me to drive. I picked up an AVATR 11. Now this is, the one I have is the top trim. So it's the super long range dual motor trim and basically it's got the CATL NCM 116 kWh I believe so big battery with about 700 km.

Tu Le:
Huge battery, that’s a huge battery.

Lei Xing:
Yeah 700 km of range. And I’ve never, so I mean we talk about China EVs, right, all this time. And for the specific vehicle, never really looked into the specs or how the vehicle feels. So it's really blind for me just to go and pick up. The thing I really want to say is part of the reason why these foreign legacy’s EVs are not doing well is when you get into the vehicle and how intuitive things are. I think the Chinese EV brands are doing that very well. So for me, just get in and know where to push or on the screens and the steering wheel buttons.

Tu Le:
It just feels natural.

Lei Xing:
Yeah it feels natural. I think there is a lot of copycatting with what Tesla has done. The scrolls on the steering wheels. The UIs on the, behind the steering wheel and on the big screen. I think they all look the same. I think this is the homogeneity we talked about, not only in terms of the design, but I'll talk about ZEEKR X as well. I mean these vehicles when you get in the center console, how the, not the buttons, but the icons displayed on the bottom, they all look very much the same.

Tu Le:
They do.

Lei Xing:
But things just work. I mean whether it's playing with the screens, the response rate. I've been driving this thing quite a lot. I would say, probably I’ve driven more than 500 km on this thing. Mostly city driving, on the ring roads, a little bit on the expressway when I went to Yizhuang for the robotaxi. So I actually drove this right after I picked it up last Friday around noontime. You had to also like Xpeng, first watch a video and then do a test. So you have to answer some questions after watching the video before you can actually drive the vehicle. So I have my own phone number and registered with the vehicle in order to use it and drive it. It took some time to do it, but it was done. I drove to Yizhuang. And then it was, checking out the Baidu Apollo Park, that was amazing experience to see all the different generations, mostly, I think the 4th and 5th  generation robotaxis inside that, you call it the depot, right? Where they calibrate and dispatch these robotaxis.

Tu Le:
For those that aren't familiar with robotaxis. There is a huge, effectively barn or garage within this, it's almost like a hangar. It's not as large as an airplane hangar, but it can fit dozens of cars in it. And within the hangar, there is a large garage. And in that garage, that's where each and every robotaxi re-calibrate its sensors every day before it goes out. And it's really cool experience, because when I first went to the depot, I think they told me each car took up to a couple of hours to re-calibrate. Then the next time I went there, there was just a bunch of QR codes on the walls, and it takes less than 2 or 3 minutes. So we're talking that type of technological advancement and moving forward within months. And this is not specific to Baidu. It's just that Baidu offers the most robust tour of their depot of anyone that I've seen anyways or I've been a part of. So.

Lei Xing:
So when you drive into the depot, on the right, there's a calibration station and on the left this set of parking spaces. And I must say there were probably close to 100 robotaxis and sitting there.

Tu Le:
You could call Yizhuang Baidu’s home turf.

Lei Xing:
It's a robotaxi city basically, because there's that special.

Tu Le:
But specifically for Baidu, right? Pony also, but it's a Baidu stronghold.

Lei Xing:
And then when directly in front of you, there's 5 or 6 generations of robotaxi on display. And then to the right, there's this kind of the central command where they can see, I couldn't take pictures, but there's this huge screen where there's, you can see live data of all the robotaxis running around. And then there's also a place, I don't know whether you saw it last time.

Tu Le:
It's like a command center.

Lei Xing:
Yeah there's four or six, kind of like a video game stations where there's…

Tu Le:
Gaming console. 

Lei Xing:
Yeah where there's people sitting there and watching actually. What do you call this? This is the kind the backup drivers?

Tu Le:
Backup emergency.

Lei Xing:
They're watching these robotaxi not only in Beijing, but let's say in other parts of China where Baidu is running, live monitoring and supervising in case something happens they can take over. So that was interesting and then…

Tu Le:
Anywhere in China, they can take over, so it's not just Beijing for Beijing, they can take over anywhere.

Lei Xing:
So the robotxi, the fully driverless robotaxi I rode on is the 5th generation using ARCFOX. So it's the one priced at RMB480,000. I think this was announced or unveiled 2 years ago, I would say.

Tu Le:
Let's also comment on the generation side by side with each other, and how much the sensors in the LiDAR shrink from gen 1 to gen 2, to gen 3, gen 4, gen 5?

Lei Xing:
From a streamline perspective, it’s a lot simpler, right? So basically, we did a loop leaving right out of the front of the depot and back and took about 40 minutes or so. Even the Baidu employees who sat, there was three of us sat in the back. They even saw some new stuff that they've never seen. Let's say, some of the traffic light recognition and countdown stuff on the screen in the back. It was, I mean pretty smooth, I would say there was two interesting corner cases that we confronted. One is there's this truck backed out of the gate. It's blocking the lane. So there's another truck parked on the other lane, so the other opposite lane. And the robotaxi tried to veer and go around the first truck and incoming, there's a vehicle coming. So the robotaxi immediately, it kind of reached to the left and then it saw the vehicle and it kind of veered back to this side of the road. Once that incoming vehicle passed, it kind of slowly reached out and then there's no vehicles and they went right around the truck. So I thought that was interesting corner case where the robotaxi handled pretty good. And then the other one is basically similar situation with the incoming truck and slow bus in front of us, similar situation where the robotaxi actually kind of tried to pass the bus, but slowed down because the incoming trunk. Other than that, I know you said…

Tu Le:
SO there is no people throwing pylons on top of the hood? 

Lei Xing:
No. 

Tu Le:
Did you hear about that? 

Lei Xing:
No, I didn't.

Tu Le:
Does. So people in San Francisco are throwing pylons on top of the Cruise robotaxis. And they just stop, but anyways, I'm sorry.

Lei Xing:
You had said one of the episodes that you felt Baidu was better than Cruise if I recall, relatively better. So my feel is that I would rate it as a tie. I didn't feel Baidu was clearly or significantly better than Cruise, because when we compare these two kind of operating environments, Cruise only operates at night, but it's in the city. Whereas…

Tu Le:
Well they operate during the day, they operate during the day.

Lei Xing:
Now they probably do, right? And whereas Baidu operates during the day only, but they're in this Yizhuang area, which it's not typical of Beijing city driving conditions. So it's hard to compare Apples and Apples. But I would say the Baidu robotaxi is relatively conservative in terms of the speed that is going. It was going at certain points much faster than Cruise, which was, I think in the entire time, we rode last November was under like 30 mph. But in Beijing, basically robotaxi goes to the max speed limit wherever they are.

Tu Le:
or the flow of traffic.

Lei Xing:
Flow of traffic. But in certain situations, I think I was telling the other Baidu people that see this situation when you make a turn, it seemed a lot more conservative than would a human driving. So that's my thought. But I mean in terms of the number of miles or the kilometers driven, there's what a few hundred Baidu robotaxis running since…

Tu Le:
In a number of cities. Four, five, six cities.

Lei Xing:
Mostly, I mean since the pandemic, I would say, because this region of Yizhuang, the Beijing Highly Automated Driving District, only started in, I think, September 2020 and then get this. So immediately afterward, I tried out the WeRide driverless robotaxi.

Tu Le: 
In Yizhuang as well or…

Lei Xing:
In Yizhuang. I think I might be one of the first to ever try it because they just got the license right in Beijing. And immediately I can tell the difference between, let's say, a big established company as Baidu versus a startup, the WeRide is much more aggressive in certain driving conditions, making a turn, accelerating, it’s much much more aggressive.

Tu Le:
Pony is much more aggressive than Baidu as well.

Lei Xing:
Yeah I figure these smart AV startups, they have different, what, planning, decision, control algorithms than Baidu, but Baidu has more data…

Tu Le:
But we should also note Lei that WeRide is a Guangzhou-based company, so maybe their algo is customized for Guangzhou and then they re-customize it for Beijing, but that driving habits in Guangzhou are different than Beijing. So WeRide being new to Beijing is probably leaning heavily towards its Guangzhou dataset to use for driving in Beijing until they build out the Beijing data set, right? So the aggressiveness might be the algo, but it might be the data as well or something.  So I don't know. I'm guessing we should try to get another AV person on besides or maybe get Maxwell back. Although now I think he's pretty well PR trained. Maybe he won't be as open with his answering questions. 

Lei Xing:
This is something I learned new this time. There's three separate license or permits that these robotaxis are using in Yizhuang. So there's the “shi,” which means testing. There is the “ying” which means operation. There's the, so “shi” “ying” and then sorry, there's the “ce” which means testing. There is the “shi” I think it's trial operation and the “ying” is actually the ones open to the public and actually they can pay, but these are only for ones with the safety driver. Now on Friday last week happened to be the day when BJHAD announced that they will soon start operating fully driverless robotaxis paid. Basically let’s say Baidu, you use their app and you can hire or hail a fully driverless robotaxi and paid, from the general public.

Tu Le:
So like Cruise, effectively, in San Francisco.

Lei Xing:
So that was, coincidentally happened on the same day. And right afterwards they had this festival at one of the malls. They showed all these different robotaxis from different platforms. And also the driverless robots, the delivery vehicles. Kind of from JD and Meituan. Yeah. So that was a great day of experiences.

Tu Le:
Effectively every single time I go to china, I'm going to ride these taxis to see how they've improved. And next time I go to San Francisco, I'm going to try it because you do see and feel it. I know for sure that so I rode WeRide early days in Guangzhou, so I would love to see how it's improved. I was really impressed. But that was really also one of my first autonomous vehicle experiences. So now that we are both wily veterans of the robotaxi game. We're not as many rides in as Taylor and the Snowball Capital team, but I would put us up against any western analysts or anyone that's ridden these western robotaxis, because in Shanghai or in my last trip, I rode four robotaxis, right? So and, I do want to say between my first Baidu trip and my second Baidu trip, or my last Baidu trip, improved significantly. We're talking less than a year or a year at the most between two trips. It's worth trying out every month, every few months to see how the ride’s different, better, maybe worse. Maybe I just think that it's worth going every single time to check them out.

Lei Xing:
So it's safe to say we, you and I we are probably one of the, two of the few that have ridden in both robotaxis in the U.S. and China.

Tu Le:
Although there are research firms that are still rating Chinese autonomous vehicles, yet I've not known any of them to be in China. 

Lei Xing:
Yeah I think it was great to see and compare finally, and two in the same afternoon, I think I was on cloud nine that afternoon, because not many people get to do it and you do it once, but twice in the same location with two different companies.

Tu Le:
How far away was WeRide’s depot?

Lei Xing:
No, we met at the mall where this festival was going on. So this WeRide vehicle is using the GAC AION S, it was just parked there and I went there and hopped on and experienced it.

Tu Le:
It makes a lot of sense to using GAC because guess what GAC is in Guangzhou.

Lei Xing:
And also well I mean GAC and then Nissan, they're one of the investors in WeRide.

Tu Le:
So it's important to note that also these, although they've been to your point just now, they've been invested in by automakers. If it was up to DeepRoute, they'd be agnostic on that. They would be working with any automaker and work with them not only to build out their products, but to integrate it into the design. So that it looks like more like a normal vehicle. So WeRide they have vested interest. Nissan is a bit player, a bit player in China.

Lei Xing:
No, and that same day I’ve had, back to the AVATR 11, I also want to talk about a little bit of the assisted driving functions.

Tu Le:
Let's do this Lei, it is 9:54 on the eastern, on the east coast. I know there's, let's open it up.

Lei Xing:
Sure.

Tu Le:
You can keep talking for a few minutes. And then if there's any questions, I know Jay or Alfred’s in here currently they have any questions, raise your hands, happy to bring you up and listen to what you have to say. So, go ahead.

Lei Xing:
No, I just want to say also not only on the same afternoon, I test rode on different, two different driverless, fully driverless robotaxis, but also during that day I tested out some assisted driving functions on the AVATR 11, so this vehicle has the ADS, the Huawei 2.0, and just for those that are not familiar, AVATR is Chang’an, CATL and Huawei jointly developed brand and there's a lot of Huawei technology in it. So this Huawei ADS 1.22 is the current version, and they had just pushed out 2.0. It's not on this, but there's this NCA which is the Navigation-based Cruise Assist. Then there's this LCC which is Lane Centering Control. So that day I was driving around in different conditions. There was a huge rain on 5th ring road. The LCC works quite nicely on the ring roads during stop and go traffic. I was kind of amazed by what, how really helping your feet, right? Your, to rest kind of, but still holding the wheel and focus on the front. And this system also for the NCA when you get onto the, let's say, the expressway going down to Yizhuang, they will notify you that this section of expressway, this is based on high definition mapping, the NCA is available. And these things, I think they are qualifiers now, they're not differentiators. That's again going back to the earlier topic on these foreign legacies is because they don't have these on their vehicles. These are the things that are really right now cutthroat. Li Auto’s NOA, NIO just pushed out the NOP+, these basic advanced assistant driving capabilities was extremely advanced I think specifically on this AVATR 11, I haven't tested all others, but it just works.

Tu Le:
I think it's important to remember that, that's also why Volkswagen Group is kicking the tires on Huawei, so.

Lei Xing:
And the UI, UX, I mean it's smooth, it’s, you know where to go to figure things out.

Tu Le:
But Lei, talk about homogeneity, is multiple brands are using Huawei operating system. Oh my god, it's going to be the same system and the only real difference is going to be the electric motors and the battery pack effectively.

Lei Xing:
And I also think because of the number of sensors and even LiDARs on this vehicle and on many other models, the screen behind the steering wheel I think there's a bit of information overload because it will show these pedestrians and trucks and buses and cars right next to you, it's ridiculous. How much information is being shown because of these sensors?

Tu Le:
I think it's just one of those things where eventually you'll find the right balance of what to show and what not to show, but the pendulum is definitely swinging towards over information or information overload. So as, because we have to remember Huawei is a new player in this space. They didn't do really anything in the automotive space, not at this level anyways, in the past. So they're still learning too, right? Their UX designers are still trying to figure things out and sort things out. So they see what Tesla is doing. I'm sure they do competitive analysis and see what all these other people are doing. And like it would be great to put that into the screen. It would be great to do that, pull the data from this sensor and that sensor, create an image, and then throw it on the head up display or whatever.

Lei Xing:
And this AVATR 11, the NCA or the LCC they don't have automatic lane change. They have the stalk nitiated lane change. And it works as close to as me, let's say, or any “laosiji” advanced drivers doing a lane change, it’s pretty amazing to, I mean it just feels natural. And I'm sure many others that I haven't driven, and I'll try the G6 later on, will have similar experiences. And this is a brand that's only been in the market for less than 2 years. So.

Tu Le:
But it has some experienced backers. So I think that's important because I don't see, I see AVATR being one of the ones that stick around, so.

Lei Xing:
Their sales numbers are not yet great. I mean the thousands, but Chang’an has many other brands as we talked about last episode.

Tu Le:
And it’s weird right? Because up until, the only reason I would know Chang’an is because of Ford. And you don't actually see that many Chang’ans on the roads in Beijing. Let me say that.

Lei Xing:
Yeah, you mean Ford?

Tu Le:
No, the Chang’an brands, right? The actual Chang’an brands.

Lei Xing:
Chang an, yeah, relatively no. Yeah.

Tu Le:
For them to go so aggressively in the EV space. I think it's refreshing. It probably pisses Ford off, but.

Lei Xing:
So basically the comparison, I would say, for every 1,000 Teslas or BYDs I see, I see a Mach-E or LYRIQ. That's how popular and the BATs are in Beijing and many other cities perhaps.

Tu Le:
And we have to remind people this is before JIDU, Xiaomi, two technology brands are even on the roads yet. So I think it's great. Now the timing is just coincidental, but it's great that JIDU and Xiaomi are avoiding this price war for as long as they can. So, man, that's all I had, really.

Lei Xing:
So the other thing is I want to talk about the ZEEKR X and the Denza N7, because I went to check out the largest ZEEKR Center in Beijing the other day. And then yesterday I took my kid, they wanted to go to this secret room or escape room or something. So there's a Denza N7 store. I won't go into details, but right now, after seeing these two separate vehicles, I have a little bit of concern because the ZEEKR X is completely not the brand, or the vibe that the 001 and the 009 excludes. 

Tu Le:
For sure.

Lei Xing:
Right? It's and it seems to be specifically tailored to female drivers. There's a lot of features or functions that on this X that we tested. I think it's a You 5-seater version. It just doesn't feel I mean when you see the 009 and when you see the 001 that the majestic, what do you call it, the vibes? It just feels different. Same for the N7, it’s completely different from the D9. So I would just say let the sales speak for themselves, but I am a little bit of concerned that this in terms of brand positioning, I don't know whether that'll work out. Now. Both of us have great expectations for the X but somehow just doesn't match the brand positioning, for some reason.

Tu Le:
Does not at all. And the pricing doesn't either. 

Lei Xing:
And X right? The RMB200,000 range I mean there is the G6, and actually the Denza  people in the showroom, they actually yeah, I asked them about, I put my consumer hat on. I was like I might be also looking at the G6 and the G6 is great. And then they said something that was funny. They said G6 is now kind of the savior vehicle for Xpeng, but at BYD we don't have that problem, at Denza, we don't have that problem.

Tu Le:
Oh man…So…

Lei Xing:
I tweeted the L5, right? The Hongqi L5, some dude stepped off the L5 and just went into the Denza showroom for some reason. I don't know what's going on there.

Tu Le:
He was driving or he was being driven.

Lei Xing:
He was being driven, stepped off and there's this kind of commotion. All the employees went out to greet. I don't know who this guy was. But so these are…

Tu Le:
VIP for sure. 

Lei Xing:
No no, just talking again, talking, seeing, experiencing.

Tu Le:
That Hongqi is freaking awesome looking, by the way. Love that.

Lei Xing:
It just makes you understand better why the foreign companies they are now falling behind, the speed of change, the speed of market launches. So that's why I said after 20 years and 3.5 years, 2.5 years doing this, I’ve never had an experience owning, let's say, owning or driving a Chinese brand EV for a significant time. Now I have and I think I'm now more qualified to speak about China EVs.

Tu Le:
Do you just plug it in underground parking.

Lei Xing:
Thee charging. That's another thing, just everything just works, whether it's CAMS, whether it's CAMS, whether it’s shell, Maybe I’ll try a NIO charger next time.

Tu Le:
And the payment system is…

Lei Xing:
Yeah just scan, just WeChat. 

Tu Le:
That's it. So our stuff is way too clunky.

Lei Xing:
There's just one standard in China, there's not a CCS, there's not a NACS, you're not going to see this Tesla, Ford, GM moving to Tesla thing happen in China because everything is standard.

Tu Le:
We can look at that in the rearview mirror in the United States. So that is one hurdle that needed to be kind of jumped over before.

Lei Xing:
So now I am in Beijing, grain of salt, where things are pretty, charging infrastructure is as well established. And that's why you see these policies coming out, trying to push this infrastructure even in rural areas. It is probably going to be a lot different in rural areas, but in Beijing there is no range anxiety whatsoever if you own an EV and driving mostly in Beijing.

Tu Le:
What's funny Lei, is that people ask me about that, right? People ask me about charging infrastructure, not one time when I spoke to anyone who owned an EV in China, did they say I have some challenges with charging? I have range anxiety, no one. It just doesn't exist, at least in Beijing and Shanghai and the places that I visited, right? Because I don't know what the right formula is from the standpoint of how many chargers per electric vehicles on the road. But in China tends to overdo things, right? With build out of new technology. And so maybe there's too many charges. But I’ve just never, and people ask me, are they afraid where they charge? And I’m like what, I've never really thought that deeply about it because no one's ever complained to it, complained about it to me. So.

Lei Xing:
So the CAMS that the Volkswagen joint venture charging brand, the station I went to was, not early in the morning, but 9:30 in the morning. There's nobody there. So I could request a charger  kind of 30 minutes in advance. Get there, lower the lock and park, charge and get out right. And the charging speed, they are rated 120 kW, and you get about 115-119.

Tu Le:
So that's fast. So it's real.

Lei Xing:
So also because I was the only one charging there. So that might had some reason.

Tu Le:
Yeah so it's two things, right? So the top charging speed is achieved, but also over a long period of time right? Because it might get to the top charging speed, but it doesn't stay there very long. And so that's one of the challenges with charging because it tells you what the peak is. But most charging infrastructure and to your point, especially if there's more than one vehicle being charged and never reaches that peak.

Lei Xing:
And at the Shell charging station, there was probably I don't know, 60, 70 spaces, half was filled and I charged it to 90%. So from 80 to about 90%, it was much lower. Because I think that's pretty common for EV charging. It slows down.

Tu Le:
So that's when it slows down. That's when it throttles down.

Lei Xing:
It's like 70-80 kW.

Tu Le:
Because I think it's transferring most of its juice to cars that are less power.

Lei Xing:
I had the benefit of having a bigger battery and longer range in the vehicle, so also that helps.

Tu Le:
You were electricity hog basically. So that because I was told the average battery size in China is about 55 kWh. That's what I was told. So you're twice as large as the average.

Lei Xing:
And NIO is coming out finally, with 150-kWh battery later this year. So.

Tu Le:
Yeah man, that's all I had.

Lei Xing:
That's all I had as well, just really appreciative and loving the ownership. And it's every experience related with having an EV.

Tu Le:
I am glad you are, have you, when do you need to give this back.

Lei Xing:
Back to the U.S.?

Tu Le:
No back to AVATR?

Lei Xing:
No I can give it back until before I leave.

Tu Le:
Your homework Lei is testing the connected features.

Lei Xing:
Yeah.

Tu Le:
Either via the iPhone or you can tell your AVATR contact to activate some of the connected features. So you can try them out.

Lei Xing:
The Bluetooth and connecting the phones were pretty seamless. All straightforward.

Tu Le:
Let's start getting into a deeper dive. What else can it do? You know, like I'm sure you can watch iQiyi, you can do all these other things, right?

Lei Xing:
There's movies on the right, the passenger side and there's this also screen that you can watch iQiyi and stuff like that. The only thing I have to worry about is parking is actually I wouldn't say expensive, but it piles up. But I'm getting this car for free. So what the heck.

Tu Le:
That situation I had with Li Auto when they allowed me to borrow the Li ONE, I borrowed it for like 3 or 4 days, but it was like 150 kuai a day to park it. And I was like, I’d love to keep it and I wasn't planning on any long trips. So I couldn't take it in a real advantage. So after about 4 days, I gave it back. So anyways, hey, everyone, again, thanks for joining. Good morning, good afternoon, and good evening. We will try to get back to a normal cadence in the next few weeks so that we aren't yoyoing around with different times every week.

Lei Xing:
It's mostly Thursdays and Fridays probably.

Tu Le:
Hey, man, have a good weekend. I'll talk to you on WeChat, sir.

Lei Xing:
 You too man. And I’ll talk to you guys next week.

Tu Le:
That brings us to the end of this week show. Lei and I thank you for tuning in. My name is Tu Le and you can find me on twitter @sinoautoinsight. You can find Lei on twitter @leixing77. If you wouldn't mind rating and or reviewing us on Apple Podcast, Spotify or wherever you grab your podcast from, we'd appreciate that as well. Even better if you enjoy this show, please tell your friends about it. Please join this again next week as we track down all the latest news on China EVs & More.