China EVs & More

Episode #155 - Lunar New Year Hangover, 电比油滴, US Govt Investigation, HiPhi for Sale

March 05, 2024 Tu Le & Lei Xing
Episode #155 - Lunar New Year Hangover, 电比油滴, US Govt Investigation, HiPhi for Sale
China EVs & More
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China EVs & More
Episode #155 - Lunar New Year Hangover, 电比油滴, US Govt Investigation, HiPhi for Sale
Mar 05, 2024
Tu Le & Lei Xing

Lei begins this podcast with a brief explanation of the effects of the Lunar New Year on passenger vehicle sales traditionally. 

Tu points out BYD's social media campaign about how 'electric is cheaper than gas' after they'd cut prices of their already low priced vehicles, so much so that they are cheaper than ICE vehicles from Volkswagen and some of the other foreign automakers. 

Lei predicts that Li Auto may be the next EV startup that emerges from the pack in 2024 as others continue to struggle with price cuts and vehicles that aren't as popular among Chinese consumers. 

Tu and Lei then spend a few minutes to share their opinions on the US goverment's connected vehicle investigation and let's just say that both seem skeptical. 

The podcast ends with a discussion on potential HiPhi partners or acquirers including a look at Changan who have been rumored to be kicking the tires recently.

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Show Notes Transcript Chapter Markers

Lei begins this podcast with a brief explanation of the effects of the Lunar New Year on passenger vehicle sales traditionally. 

Tu points out BYD's social media campaign about how 'electric is cheaper than gas' after they'd cut prices of their already low priced vehicles, so much so that they are cheaper than ICE vehicles from Volkswagen and some of the other foreign automakers. 

Lei predicts that Li Auto may be the next EV startup that emerges from the pack in 2024 as others continue to struggle with price cuts and vehicles that aren't as popular among Chinese consumers. 

Tu and Lei then spend a few minutes to share their opinions on the US goverment's connected vehicle investigation and let's just say that both seem skeptical. 

The podcast ends with a discussion on potential HiPhi partners or acquirers including a look at Changan who have been rumored to be kicking the tires recently.

Climate Confident
With a new episode every Wed morning, the Climate Confident podcast is weekly podcast...

Listen on: Apple Podcasts   Spotify

CEM #155 Transcript
Recorded 3/1/24 

Tu Le:
Hi everyone and welcome to China EVs & More where my co-host Lei Xing and I will go over the week's most important and interesting news coming out of the global 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 about this podcast to other enthusiasts and of course 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. Lei. Good morning. Can you please introduce yourself? 

Lei Xing:
Good morning. This is Lei Xing, former chief editor of China Auto Review, and this is episode #155. Busy week, to say the least. Bloodbath continues.

Tu Le:
Tesla just cut prices again this morning.

Lei Xing:
HiPhi looking for a lifeline, $LI earnings, MEGA, Volkswapeng, February EV sales, Polestar and IM getting those big investments, too much happening. Where do we start?

Tu Le:
The U.S. government scrutinizing connected vehicles.

Lei Xing:
Existential threat, from the Alliance of American Manufacturing.

Tu Le:
Let's do this the easy way. Let's look at February sales. Did you see any numbers come out yet?

Lei Xing:
Yeah, I tweeted the, whatever was announced as of this moment, everybody went down as expected, right? I tweeted that this was the dip for the Chinese New Year before the leap forward in March. Let's just say some fared worse or some dipped more than others. But I mean it's a slow month. And if you look at the general rule of thumb I tweeted was that March sales should be about roughly January and February combined. That's the general rule of thumb of how the seasonality works.

Tu Le:
And in the upcoming months, we should start to see sales of the Li Auto MEGA come into Li Auto’s overall sales. We should start seeing I think Xiaomi SU7 is going to start shipping in April, right?

Lei Xing:
Yeah right around the Beijing Auto Show time. MEGA starts deliveries on March 11.

Tu Le:
So yeah, it'll be interesting time over the next couple of months. Coming out of the gates, we saw that Tesla cut prices again. They're following on what I think is what BYD did aggressively with their social media post about “dian bi you di” which means electricity is cheaper than gas. And that was a social media post that listed a number of vehicles that they are currently selling cheaper. Now these vehicles, and we are talking at the A, B segment are less than ID. series vehicles are less than also Volkswagen’s ICE entry level vehicles, the names, I stopped talking about ICE vehicles in China, so I forget them now. What are some of the vehicles? Volkswagen Sagitar. 

Lei Xing:
Sagitar, Lavida, A-segment vehicles.

Tu Le:
This goes back to last week when we talked about the Buick Electra E5 is a $23,000 car in China. So scale is kind of the ultimate champion. And I think that BYD is not as focused on the quarterly numbers as some of our other legacy automakers. So they're willing to cut price in order to push their competitors out of the market or at least weakening them substantially. And it looks like Tesla for the last 18 months or 14 months, has also had that same mindset. So.

Lei Xing:
Within a matter of days, BYD rattled off Qin Plus, Dolphin, Song Plus, Song Pro, Han, Tang, what else? I think there's still more coming some of the L versions we talked about. So keeping the pressure on because they're under pressure themselves, right, to keep that lead and to keep that momentum going with pretty much a 4-million target set for 2024.

Tu Le:
So there's that pressure of hitting that target, but also that pressure of keeping those factories running, because there's 4 million units of capacity now.

Lei Xing:
Yeah, and I think that totally, the pricing expectation have just gone down by a lot of the models that are on sale of what you would expect to be a competitive-priced model. Before it's probably RMB120,000, RMB150,000. Now that type of level, you're expecting to be around RMB100,000. 

Tu Le:
Caps at probably RMB120,000, RMB125,000. Lei Jun must be pulling his hair out right now to be launching a brand-new vehicle in this…

Lei Xing:
In the midst.

Tu Le:
In this bloodbath, right? Like you said in a few tweets.

Lei Xing:
We had thought that Lei Jun avoided last year, but boy, what a time to launch a vehicle, right?

Tu Le:
And showing us that speaking of launching vehicles and showing us that BYD can walk and chew gum at the same time. They go over to Geneva and unveil the U9 with LFP batteries, a $233,000 price tag, and specs that match or come close to the Italian-3 premium super car makers’ specifications. So I think the LFP, Steve LeVine, friend of the show, he kind of mentioned that normally super cars or premium vehicles used the NCM, NCA chemistry, but I think BYD is betting on these super cars not really going distance driving. So I think they announced it goes about 250 miles on one charge. So that's breaking a barrier or at least a mental barrier for a lot of people if we think of the two chemistries: Tesla, standard range, LFP, and then long range is normally NCM, most U.S.-manufactured Teslas are using the higher priced chemistry, the NCM. So will we start seeing more premium bands go to LFP? I think we're going to see a ton of efficiencies over the next 3, 4, 5 years in that LFP chemistry. I think there could be others that take on BYD’s lead, or take BYD's lead. But I still think, and this is where I want to hear from you, I still think the U.S. has very unique use cases and big cars that make LFP still pretty challenging unless you're going into the small sedan, small hatchback mass market segments. So.

Lei Xing:
Yeah, and considering that they're going back to hybrids, right? Plug-in hybrids. GM. So BYD and some of the others, I think, I tweeted, NIO, relatively, actually, I was looking at the month on month drops. NIO actually did relatively better it would be better because they went from 10,000 to 8,000. 

Tu Le:
I saw that.

Lei Xing:
Which was, like that wouldn't be a drop at all if we consider the other ones, I mean Xpeng dropped pretty big. 

Tu Le:
To me that's flat. 

Lei Xing:
That's flat. BYD, I mean, GAC AION I think lost a lot of steam.

Tu Le:
We got to start looking at AVATR, AITO, I think those are going to round out pretty well, and.

Lei Xing:
AITO, right now the biggest rivalry, there's two of them. So AITO and Li Auto and Geely and Xiaomi. AITO is still in the lead so far, but there are more products coming out from Li Auto and they are now moving into a new competitive environment because now they're competing on the BEVs. And they've not had the, this is their first shot, right? With the MEGA.

Tu Le:
If you want to look at it from the glass is half full standpoint Li Auto has had the luxury of sitting back watching that market mature in China and then building a strategy around the MEGA. So I think that's an advantage to them, but to your point, it’s their first BEV. So they're going to have manufacturing challenges. They're probably going to have some quality issues. But one thing I did want to note about Li Auto, it's become, or it is Wall Street's darling of the triplets, because their strong margins and strong sales. I'm interested to see how the share price ends out at the end of the year, especially if Xpeng and NIO continue to incrementally increase sales but aren't able to kind of breakthrough that to that next level of sales.

Lei Xing:
You know, from, I tweeted, right? We talk about BYD, Tesla and everybody else. Who among those everybody else can emerge. My bet is on Li Auto right now, based on their earnings, based on their current momentum. They were in the black for the first time right annually, so they became profitable last year. Thy have, they are a RMB100-billion sales, revenue wise company. They have RMB100 billion in the cash hoard that they're planning to sell 100,000 units a month by the end of the year, 800,000 units still the target, their margins are well above 20%. And I think they pride themselves. So we talk about this operational efficiency. You launch the model, you start deliveries. And product planning wise, they also remember they also launched a refreshed L7/8/9 at the same time they launched the MEGA, adding more standard features and driving that home, the message that their focus on family. So if I'm not mistaken, I think Li Auto (Li Xiang) brought his own family onto the stage at the MEGA launch. I think he has four kids.

Tu Le:
You Qian De Ren (This guy is rich).

Lei Xing:
I was reading some articles on the history of developing the MEGA. He basically said, he owned a Mercedes, was it the V-class?

Tu Le:
Is that like the Sprinter vans?

Lei Xing:
Yeah, like and he hated it. And the idea a of a MPV came like 3 years ago, early 2021. And there was like, talked about like he wanted to do an 8-seater. He said no, forget it. I want to do a 7-seater and then trying to make.

Tu Le:
Cha Bu Duo, man, Cha Bu Duo (that’s about the same).

Lei Xing:
Cha Bu Duo. Like the specs, cd of 0.215, 12 minutes (charging) getting back 500-km range, charging on the 5C, averaging 400 kW speed. The second row, it's like a 7 Series at the same time the third row is like a 5 Series, BMW, space wise. But it's a $80,000 car, RMB558,900, like now only one spec, like just one model, one price. There's no upgrades, you only…So it's interesting tactic on Li Auto’s part.

Tu Le:
They did a, I think that Will, maybe you can come up in a little bit Will. Because I think he went down to Sanya, I'm assuming that he went down for the MEGA, he went for the marketing event. So Will, hopefully Will's listening, he's not sleeping, and he can tell us a little bit about it towards the end of show. I think the other thing that's important is like they really kind of simplified their product strategy outside of the MEGA, which is diverging, is still family oriented. The L7/8/9 are basically the same car.

Lei Xing:
And then the L6 coming in April in the RMB200,000-300,000 range should be a leg up. And then following that the BEV, three more BEVs later this year.

Tu Le:
Well let me hammer that home Lei, the 800,000 units. Let's say that's about. If we get to 10 million cars, NEVs in China this year, that's going to be 7%, 8% market share. BYD last year was close to 20 something or 30%. Tesla is at like 12 or 10 or something like that. So we're talking they're going to catapult themselves into top three, top four player in the NEV space. But also it's going to be driven by this, the L6, the volume is going to be driven by the L6.

Lei Xing:
Yeah, that was exactly his prediction in the earnings call that by Q4 in the RMB200,000 and above segment NEVs, three players will account for 70% of the market. And Li Auto wants to be one of them. The other two, you can guess, right? Who they are. Tesla is going to be one of them.

Tu Le:
Well, are we sure about that? I'm joking. They will be. They will be. But it will be a struggle for them. Much more than in ‘23.

Lei Xing:
I think Tesla if they maintain, it’s a win.

Tu Le:
What else? So let's just tackle the elephant in the room, the 800-pound gorilla. What do you think about this connected vehicle investigation, the U.S. government, Biden Administration?

Lei Xing:
Let me read off the first two lines of that document: American automakers and auto workers are the best in the world. Ha Ha Ha. The iconic Big 3 and American auto workers are leading the world in quality and innovation. Ha Ha Ha. I stopped reading after that. I'm not, nothing against American automakers and auto workers, but, you read those statements and having seen, covered, we look at this globally, what are you talking about, right? Then the 4th line says “China's policy could flood our market with its vehicles.” Flood, flood. It’s nothing more than political folly.

Tu Le:
I agree. I think it's protectionism, disguised as national security, not to oversimplify this, but so, investigate, that's fine, whatever. But to, this is so political now that that there maybe, they've listened to us Lei, after so long, they've started really being like man, Tu and Lei know what the hell they're talking about, man. But cause the threat is real. And obviously, it took Elon to say they would demolish. But remember also that the U.S. government, the current administration has been investigating or not investigating, researching this for a very long time from probably from a genuine understanding and caution standpoint, but there's a lot of politics here, a lot of politics, the cars aren't here yet. Then there's that whole for the people that say the people that point to the protectionism of the Chinese market. So be it, yes, the Chinese market required joint ventures, but let's not look at vehicle sales, let's look at profits that the GM’s and the Volkswagens took from the China market. GM booked $2 billion in profits, almost automatically for the better part of 20 years. So there were joint ventures and no one forced GM, no one forced Volkswagen to enter these markets. They knew the requirements. They accepted them. And then with Tesla.

Lei Xing:
Why are we still talking about this? We beat this to death, the whole horse to death, right?

Tu Le:
And I just, I'm trying to be balanced about this and idealistic and..

Lei Xing:
Impartial. That's right.

Tu Le:
It's not only that, but I'm trying to, I'm just trying to give the automakers the benefit of the doubt that they're not in Washington, the U.S. 3, specifically, they're not in Washington saying we're going to get creamed if you don't help us, but it can't be about protectionism. It needs to be all these other reasons. Or you need to give us cover fire and use different reasons as opposed to our cars aren't competitive, our cars aren't feature rich and priced accordingly. So I'm trying to give the automakers the benefit of the doubt. But you and I simply put, see this as protectionism as disguised as national security concerns. 

Lei Xing:
Yeah, and then the other line that says “China imposes restrictions on American autos and other foreign autos operating in China.” Well, what restrictions? Can you be a little bit more specific? Is it the 50% joint venture requirement? Or is it stopping vehicles from sales? Or is it something else, right? Like you read these, it's, doesn't make sense. Maybe Teslas are limited to be used somewhere in China, but has that affected sales? No.

Tu Le:
The other thing that's really important and we will pull Europe into this as well. So let's kind of, you and I try to be fair, right? But if we think about it, they're trying to cover up their failures, European union and the U.S. government. Now I understand administrations change, but China has been investing in minerals, EVs, batteries since 2009. So the U.S. government knew about this, the EU knew about this. They had to have. And then if we look at the automakers, they were too busy counting their money from the China market because think about it, Lei, Tesla has been, Tesla became $1 trillion company in 2017, I think or 2018. So they've known about Tesla. If you didn't know about China EV Inc. and nobody did before 2018, really, except for you and me and a couple other people in this world. And I exaggerate there's more than a couple of people, but not many more. They can't use China EV Inc. The automakers can't, because they saw Tesla coming. So they're just slow, they didn't react. They didn't take it seriously. They got caught flat footed. And now they're trying to use protectionism in order to kind of reassess and rejigger their product portfolio. But even if the Inflation Reduction Act buys at least the U.S. 3, Europe. I've been told that tariffs will increase in Europe, but even if it buys them 2 or 3 years, what are they going to do with it? They're probably going to piss it away. I don't have any confidence that a GM or Ford or a Stellantis can really or Stellantis is a little different, because they invested in LeapMotor, right? So these are the things that I should, as someone who grew up in the Michigan, U.S. auto industry, dude, it's perplexing. It's frustrating.

Lei Xing:
And as someone who had family, relatives work, and you as well, right? Yourself, work at these companies, automakers.

Tu Le:
I honestly, it's just I mean we're supposed to be this capitalistic society, which is a little bit. I don't want to beat a dead horse too much, but I just yeah, man, I, but it's important to note also that if and cause, Jeffrey just posted, but, it's popular on the left and the right to bash China right now. I mean Trump is the one that put the 25% tariff on Chinese vehicles. So I think that it's a common theme that maybe they need to find that boogeyman, both sides agree to that, but we've beaten a dead horse. What do you want to talk about next?

Lei Xing:
No, I just follow up, I think, on the China auto or EV perspective. Luckily, I guess besides the Volvos, the Polestars, Buicks, some of the ones that are made in China, sold in the U.S., they have not arrived yet, right? Luckily. And we saw BYD’s Stella Li, in that was it the Reuters report saying that they're not considering entering the U.S. and that Mexico is simply addressing that market and South America. And I was told that NIO’s goal of 25 countries by 2025, I think it's out of the boilerplate the U.S. market. So luckily, for the Chinese that they haven’t, they're not here yet, there's not an issue of kind of protecting yet.

Tu Le:
But we know at the end of the day, we know that they're probably waiting in the wings, trying to figure out who the next president is going to be, and then update their strategy, their global strategy, or their market entry strategy for North America. I think that's really important. I don't think they're going to see a slowdown. I don't think we're going to see a slowdown. I don't think BYD will make an announcement about Mexico until the end of this year or beginning of next.

Lei Xing:
Yeah, I mean the confirmation is that they are planning to build a plant in Mexico, but exactly when, to be decided. But I think also I would take Stella’s words with a grain of salt that I still expect some of these early movers, China EV Inc. to make a move, depending on…

Tu Le:
But I fully expect it. But the Inflation Reduction Act complicates things, but where there, wherever there is space, they're going to find breathing room, and they're going to find an opportunity to enter. So. And on the other side of that, I kind of plugged into the startup ecosystem. So I know a lot about some of the battery startups, some of the kind of supporting companies that want to make a difference here and it's just getting drowned out. Still at least in Michigan by the Big 3 in how fast they're moving, how they have the skunk works team, building a small EV, small blah blah, right? It's like, dude, come on. I'm a little fired up, man. I kind of was noodling on it to try to find the right words to articulate my thoughts.

Lei Xing:
Yeah, so I will basically summarize it as one, political folly. But at the same time, I think China EV Inc. shouldn't be naive. They can laugh it off, because they are not here yet. Also they shouldn't be naive and look at this, and because this goes back to that trade opinion, that MOFCOM we talked about two episodes ago of being careful and abide by the rules when now you're becoming global.

Tu Le:
But let me also be clear, do I think that there could be some restrictions on certain parts, certain commodities from this investigation that are sourced currently by, or sourced to Chinese suppliers? Yes, I think there could be some restrictions that come out of this investigation. So what does that mean? I don't know yet, but it'll just be interesting next 18 to 24 months, I feel. So what else do we want to talk about, man?

Lei Xing:
So there's the Apple car and this HiPhi looking for possible acquisition.

Tu Le:
Let's talk about HiPhi.

Lei Xing:
I mean you called it, right? Kicking the tires and someone has kicked the tires.

Tu Le:
My first thought about Chang'an is my short stint at Ford and how difficult and challenging managing that relationship with them was. I told HiPhi, in a tweet maybe or in my newsletter, I was like, you know what, they should talk to Ford right away. Chang'an seems very, I get the impression that they are one of the least flexible SOEs in China.

Lei Xing:
Well they are one of the centrally administered SOEs. And they don't, it could be complimentary. So their AVATR is their most premium brand, right? But HiPhi seems to be a little bit higher positioned. And again, you talked about some of the IP that it had. Is it worth it? So I think nothing has been confirmed that, right? There was reports about 51% ownership, but Chang’an said they're still talking. HiPhi said they are still talking, early stages of talks, and it could be other ones kicking the tires as well.

Tu Le:
I think great point you make because I think HiPhi is negotiating in the media and trying to get a market. They're trying to create a market for themselves by saying, man, somebody's interested in us. I think that they're trying to get other.

Lei Xing:
Sly, Ding Lei, you know? The funny thing is, now YT came out saying that they were a disgrace because HiPhi copied the FF 91, supposedly they stole IP or something. That's what YT is.

Tu Le:
The other thing that I would think that if Chang’an does acquire a large stake in HiPhi, they originally 12, 14 months ago had an international strategy. And I think that if Chang’an acquired them, the HiPhi fans outside of China might have to wait a little bit longer and that China would like HiPhi to focus on the China market. So we'll see. And then.

Lei Xing:
This also shows how long it takes and how difficult that when we talk about this consolidation, that these companies they don't just go off, flip a switch and they're dead, it always becomes a saga.

Tu Le:
Are you thinking of Farady Future? Qiantu.

Lei Xing:
I mean, like they're dead, but they always seem to have a last breath.

Tu Le:
It's like Jason from Friday the 13th or like Halloween. The zombie apocalypse. And it's unfortunate because you and I know the Faraday guys pretty well, and they're great guys. They're great people. Just kind of managed a little bit crazy. So Apple car. Surprised?

Lei Xing:
I think a lot of people are surprised because they have been working on it, spent what, $10 billion into this thing. And you know like how these, Lei Jun and He Xiaopeng, Li Xiang, they all came out commenting, oh, this is the right move, they're going into AI, but at the back of their mind they're like sigh of relief. But like so funny, but your newsletter pointed out something which I agree, which is part of the reason. I think, China innovated Apple out of this game, I believe, because when you talk about Apple, every device they launch, they want to disrupt the current, the status quo. And when you try to do that with a car, a car, or an EV, how else can you disrupt? Its autonomy, its connectivity? It's like, what else can you do to disrupt? China has already done it, aside from the capital intensive and being profitable, which Apple prdes on. I mean you worked at Apple. Do you agree?

Tu Le:
I point to what you just said, how China out innovated or innovated them out. I look at that statement. And then I projected on to Xiaomi and Lei Jun, because there are super high expectations about, no one knows, but there are just super high expectations about what potentially that Xiaomi vehicle can do. So I think people are going to be a little bit disappointed. There's still limitations to a lot of that stuff. We know that at least from a policy standpoint, China can only do Level 2+. So even if they think they can get to Level 4, they can't say it. And yeah, I just don't know for Apple. I look at it this way. I talked to some of my friends on the special projects team, quote, unquote. And they didn't tell me they were working on Titan, but I knew they were working on Titan. And they're true believers, man, you work at Apple, 5, 6, 7 years, man, you work a lot of hours. It's super fulfilling, but it's also really, really tough. And I'm talking 2, 3, 4, 5X tougher than a typical automotive job. Like there's intense pressure. It's also one of the reasons they are a top three, top four market cap company in the world. Now, there's a lot about legacy, too. I think Tim just kind of reconciled that he's okay with not having an Apple car as part of his legacy. Because when we talk about Steve, we point to a lot of things that he did as an innovator, but I don't think anyone really associates the adjective innovation with Tim Cook. So.

Lei Xing:
Yeah, I think a lot of people were still expecting the iPhone moment for Apple for cars. I was very much looking forward to iCar. It’s the ultimate device, right? As everybody else says it's smart wheel, bytes on wheels, phone on wheels. Nobody fits that more than Apple.

Tu Le:
I’m going to say this now. I think the door’s closed and it might be locked, but they haven't thrown away that key. I'll say that.

Lei Xing:
So they ditched the car project, I don't think it means that Apple won't be at some time in the future eventually have some kind of a device. I think it's still open.

Tu Le:
Well. I think they're going to double down on CarPlay. And the legacy automakers and the legacy automakers are going to be so hosed.

Lei Xing:
I cannot live without my CarPlay, because I stream WeChat music, I stream Spotify, my daughter loves it.

Tu Le:
For the Hyundai OS, does it work really well?

Lei Xing:
Yeah, it works fine.

Tu Le:
Because my Buick man. Yesterday I drove from Ann Arbor back to my house which is about 50 miles and got a phone call. I had my air pods in, and they kept on going back and forth between speakerphone on my car and then air pods. And I'm like and I don't know what button to press to fix it. It's like holy cow, dude. And I'm driving 70 miles an hour. And I'm like, I can't do this, so I just like, how you can end the call and it's like, yeah. And so whether it's an Apple problem or a GM problem, I look at that as a GM problem.

Lei Xing:
I think another part of it when comparing, let's say the Xiaomis and Apple, Apple has much higher expectations of launching and developing a product. Think about Vision Pro, how long that took versus a Xiaomi, who's basically trying to prove to the world that they can make a car rather than trying to disrupt something, that they can build a car, utilize whatever the resources, manufacturing supply base or talent that they have and they can do this. I think the mentality is a little bit different.

Tu le:
This is where Lei Jun's kind of humble mentality doesn't do him any favors, because to your point, I feel Xiaomi kind of is entering because of FOMO.

Lei Xing:
And Xiaomi stands on the shoulders of giants, had Apple not launched the iPhone. Xiaomi probably wouldn't have gotten into the phone industry because they had nothing, they, Apple had the ecosystem first, right? That the iOS, but Xiaomi had nothing they started out with phones. And then it now expanding into what Apple is trying to do.

Tu Le:
I can't help but think of our conversation with Daniel Kirchert because I think his perspective is really important, because he went and did that. He hired a team, Silicon Valley. He had some software developers in China. And so he had this really international team. He said that he had a Google designer sketch out the interior of the BYTON. So I'm looking forward to finally publishing that in the next couple of weeks and having you all listen, because I still kind of referred to it and think about it.

Lei Xing:
So it's 100 minutes long. We probably have to break it down into two parts.

Tu Le:
Maybe the video stays. I don't know. We'll figure it out.

Lei Xing:
It's a bit long, but good content, I think.

Tu Le:
And so, yeah I agree.

Lei Xing:
I think it's our first MAX guest who's done it, right? You talked about, I think in the newsletter, who, someone who went through this.

Tu Le:
As an automotive executive, because I think what differentiates Daniel from a lot of his German counterparts, ex-colleagues is that he is so curious. He is so open minded. And he is not so opinionated about…

Lei Xing:
At a young age.

Tu Le:
It’s that but also, yeah, he's not as opinionated about the level of expertise that the Germans have. And it’s not offended when somebody says German legacy can't do this or can't do that. I think that differentiates him a lot, makes him, it almost makes it seem like he's a little bit more American maybe, about the curiosity stuff and kind of being able to open mind, cause that struck me, the open mindedness, the curiosity, the want to have people in a position. I guess he's just a great manager because he's put people in positions to succeed, right? Even if he doesn't really understand their technical background. Eeveryone. Thanks for joining. We will talk with you all next week. Good morning, good afternoon, good evening.

Lei Xing:
Talk to you guys. Bye Bye.

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.

(Cont.) Episode #155 - Lunar New Year Hangover, 电比油滴, US Govt Investigation, HiPhi for Sale