Episode #213 - L2 > L4, What's Next for Renault, In Anticipation of the Xiaomi YU7

In this episode, Tu and Lei discuss the latest developments in the electric vehicle (EV) sector, focusing on Tesla's upcoming robotaxi launch, the competitive landscape in China, and the implications of price wars among EV manufacturers. 

They explore the challenges of transitioning to Level 4 autonomy, Tesla's valuation in comparison to competitors, and the milestones achieved by various EV companies. 

The conversation also touches on Xiaomi's ambitions in the EV market and Renault's leadership changes, providing insights into the future of the automotive industry.

Keywords

EV, Tesla, Robotaxi, Level 4 Autonomy, China, Price War, FSD, Market Dynamics, Xiaomi, Renault

Transcript

Copy Transcript Copied

Tu Le 
Welcome to the EVs and More podcast. The next hour or so, my co-host, Lei Xing and I will go over the 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 and viewers, welcome back. We ask that you smash those subscribe and like buttons so you don't miss anything from us in the future. Lei and I are two of the most knowledgeable people in the world doing this. So help us get the word out about this show to others. 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.
 
 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.substack.com, which of course I encourage you all to do. A volleyball dad, Lei can you please introduce yourself?
 
 Lei Xing 
 Good morning, ‚Åì live from Orlando, Florida, where my daughter is playing a volleyball tournament this week. this is your co-host Lei Xing, former chief editor of China Auto Review. And this is episode number 213. Yeah, ‚Åì lots of sunshine. I'm looking at palm trees outside, lots of volleyball. ‚Åì And it's...
 
 been relatively a slower week than usual, I think. But everything is setting up for the big events coming later this month. And I'm talking about number one, Tesla, Robo taxi on Sunday. And then the next week, I believe it's June 26. This is Xiaomi official Xiaomi
 
 Tu Le 
 Mmm.
 
 Lei Xing 
 YU 7
 
 launch, I guess. Yeah. ‚Åì
 
 Tu Le 
 They pulled it up.
 
 Lei Xing 
 And there's been, I just treated some, there's been some updates on the Tesla robot taxi event. ‚Åì the caveat is based on the pictures that have been shared, ‚Åì on, on, on social media is first of all, there will be a safety monitor sitting on the passenger, right passenger seat. And it'll be geo-fenced.
 
 It's from 6 to midnight. So all of the qualifiers ‚Åì putting this as the so-called robotaxi initial initial ‚Åì early rider access, I guess happening this Sunday. ‚Åì What are you looking forward to, you know, ‚Åì in terms of how they do this? What are you looking to?
 
 Tu Le 
 I'm expecting and I'm hoping for no accidents. Tesla and the Tesla STANs are making this out to be some really enormous technological feat, but we know that it's currently being done in a lot of parts of the world, California. Waymo talked about launching in New York City, and I would say that New York City is probably the closest thing to...
 
 Lei Xing 
 Hahaha
 
 Tu Le 
 Asia streets or major cities. And so that's going to be pretty, pretty significant. Zoox is also looking at building tens of thousands of their robotaxis now. and Wayve is also making waves. The biggest challenge for Tesla, Lei, Uber, who has millions of downloads and subscribers on its platform, has partnered with what WeRide, with
 
 Wayve with Waymo. So all those services now have all those Uber customers, potentially whenever they go to the cities that those services are rolled out in and Tesla, they have their drivers, their Tesla owners, but outside of that, they need to build up that install base in order to build, you know, credibility in order to
 
 build a competing service. And I guess I would ask you, do you think that Uber is their competitor or do you think Waymo is their competitor, Nuro is their competitor? Because at the end of the day, if there's one app where you can use multiple services versus one app where you can use one service, what's better?
 
 Lei Xing 
 Well, we're definitely benchmarking against the Waymo's, the Pony's, the Baidu's, the WeRides for Tesla's robotaxi. The only thing is they're moving from L2 to L4, whereas the other ones are the pure L4s. That's kind of how we compare. So the significance really, the ultimate goal for Tesla is really doing this. I say, know, Toro.
 
 the car rental, right? It's kind of like the Airbnb of car rental. But I think Tesla wants to move a step higher and become kind of the Airbnb of the autonomous ‚Åì vehicle. That means if I own a Tesla, I can put it into this service. I think that's the ultimate aim, right? So that's the big question mark.
 
 In order to get there, we do see the Tesla going the same route as what the L4 Pureplays have done because in China, they go through these permanent process where you have the safety drivers first in the driver's seat and then second in the passenger seat and then third completely they're gone, right? It's purely driverless, which in Baidu's case, it is. They're pure
 
 driverless operation in China right now. And in order to get to that point, there's still a long way to go. I think that's kind of the framework.
 
 Tu Le 
 One, one or a couple other things that I'll bring up, Lei you had mentioned earlier that these Robotaxi companies went straight to level four. So how clunky is it going to be to go from level two to level four? And then, you know, another thing is the older Teslas don't have the TOPs the stack that's necessary.
 
 likely to run a level four system. So without new products, ‚Åì Model 2, a really, really refreshed Model 3, Model Y, and with the current backlash in California and other parts of the United States with the Tesla brand, now we run into different issues.
 
 So the system could be great, but if they can't sell more vehicles with the newer hardware and software capabilities, then that could be a gating item for this future Airbnb of of ‚Åì RoboTaxis, as you'd mentioned.
 
 Lei Xing 
 Yeah.
 
 And it's the same things we've been saying over and over again, right? ‚Åì And if we do benchmark Tesla with the L4 Pureplays, then the next questions we ask are, when are they gonna get rid of the safety monitor? When are they gonna expand the geofence in Austin? When are they gonna expand into other cities? When are they gonna expand into other parts of the world? And, right?
 
 And if that process is longer or shorter compared to what Elon Musk has talked about on the earnings calls, previous earnings calls, right? We benchmark that process ‚Åì against this kind of the proliferation of that service and really become a viable commercial service like Waymo, like, you know, Baidu, like Pony, that probably is going to
 
 be a longer timeframe going forward. But I think the ball is kind of rolling now, ‚Åì In China, right? yeah, the beer is still held. But I think the other interesting question is, do we have another
 
 Tu Le 
 Well, well, it's still not Sunday yet.
 
 Lei Xing 
 competitor in China trying to do the same as what Tesla is doing now going from L2 to L4 and putting the fleets into the robotaxi network. So far no, but it would be interesting if there's another competitor outside of the We Rise ponies ‚Åì that are doing this.
 
 Tu Le 
 But in China, the robot taxi companies are shoehorning level four systems into analog, not analog, but connected vehicles that don't have those capabilities. Like a deep route, you know, was working with Great Wall. So this is where the market is much, much different, much more different, number one. Number two, there are just many more competitors. The intelligent driving.
 
 Lei Xing 
 Yeah.
 
 Tu Le 
 in China from the automakers is very robust. You and I have tried them all effectively. And in addition to that, they are becoming vertically integrated with NIO, XPeng, Li Auto, rolling out silicon to run their own system. So they are really, really creating an advantage that Western OEMs do not have.
 
 Lei Xing 
 Yeah, and also with the extreme ‚Åì competitive landscape in the door to door point to point parking space to parking space, ‚Åì ADAS level two plus plus plus plus. What happens thereafter? Do the NIOs the Li Autos, the XPengs they move over to the Tesla robot taxi space? And that'll be interesting to watch what happens and do they become
 
 Tu Le 
 It has to be the play.
 
 Lei Xing 
 Yeah, did they become competitors
 
 of WeRides, Ponys and ‚Åì Baidus or somehow they're ‚Åì work could be working together? I mean, these the whole questions.
 
 Tu Le 
 And
 
 guess what? That just means the current and now the domestic EV players, the BYDs, the Chinese government, they're all saying it's a brutal price war. So it's not just us saying it. It's the calls are coming from inside the house. And Stella Li said this is unsustainable in her interview with Tom McKenzie. so I...
 
 Lei Xing 
 Mm-hmm.
 
 Tu Le 
 It's a little bit rich coming from Stella and BYD that they're, they are playing like these innocent bystanders, but they created the monster. BYD created that monster along with Tesla. So, so sorry, Tesla ignited the flame. BYD consistently pours gas on that flame. And so for Stella to say,
 
 You know, we bring technology and then competitors undercut us six months later. You know, ‚Åì I love Stella's ambition, you know, BYD plays a decent role. And the last thing I'll say, Lei, is that, so we're going to move from connected clean energy and EV price war to a intelligent driving. ‚Åì
 
 self-owned robotaxi service, potentially price war, in China within five years.
 
 Lei Xing 
 Yeah.
 
 That's a good point. also the other side of this going over to China is what Tesla's FSD in China. I think there's recently been a new development ‚Åì that they could be somehow ‚Åì progressing ahead with offering these type of, know, the L2 plus.
 
 smart driving assist driving features. ‚Åì It's a blank for them currently in the Chinese market. They don't have the same capabilities. So what do they do there? What does China allow? Does not allow to compete? That's kind of it.
 
 Tu Le 
 The one thing that is...
 
 that is helpful for the players in China, and I'm talking domestic and foreign, is that the policies are fairly consistent. And they don't yo-yo like in the United States where the Biden administration was very, very restrictive. Right or wrong, we're not here to talk about right or wrong. We're here about, we're calling balls and strikes. We're the referees, ‚Åì you know, from
 
 a Chinese connected software and then Chinese connected hardware. then the Trump administration comes in and seems much more open to this grand deal. Whereas the technology might be secondary to an economic deal. we don't know, assuming that Trump doesn't try to force his way into a third term, we don't know what the next president's policies towards China, Chinese technology is going to be. And that's kind of the.
 
 the wild card that creates the uncertainty for legacy automakers to make certain commitments.
 
 Lei Xing 
 Yeah, I think that the fanfare here is huge because anytime Tesla puts on a kind of a agenda or announcement or event, there's a lot of fanfare, there's a lot of expectations. And I think in recent few events, what has happened is there's a bit of underwhelming that came out of it. So it'll be interesting to see how this on Sunday would
 
 you know, what the pundits or what the STANs are going to say based on the ones that are going to experience this.
 
 Tu Le 
 Well, I'll tell you that
 
 I've been told that the early users will be friendly to Tesla, first of all. then second of all, it doesn't matter. The robotaxis could stop right in the middle of a demo. The Tesla STANs will be Tesla STANs. And that's not going to change. But if we want to be objective,
 
 then we'll have to wait probably six to nine months when a broader customer base is allowed to download the app and use the service. so.
 
 Lei Xing 
 when you and I can
 
 experience it, right? Then we kind of judge.
 
 Tu Le 
 And there's probably going to be when and if we're able to download that app, the fine print is likely going to say you cannot post videos, blah, blah, blah. There's probably going to be a super restrictive ‚Åì agreement if you want to use the service. That's what I'm anticipating.
 
 Lei Xing 
 Yeah, so for this early rider access, they are allowed to post photos and videos. So ‚Åì I'm sure we'll see tons of those by Sunday. the safety driver being there, the monitor being there and not being there, I think makes a difference. ‚Åì And then I think I've said it before is when it's boring, it's probably doing the best job.
 
 And yeah, but.
 
 Tu Le 
 and
 
 I
 
 should look because I haven't been that curious to be quite frank because
 
 does.
 
 Launching in Austin in a limited geo-fenced area.
 
 justify this $1 trillion or close to $1 trillion valuation.
 
 Lei Xing 
 No,
 
 at least not yet.
 
 Tu Le 
 RIGHT and there needs to be some acknowledgement that
 
 Tesla's overvalued because again, this is not a big deal in the US, let alone China. So if they're not going to be the only and clearly best player in this space, are they 100X more than a WeRide, a Pony, a Waymo?
 
 It doesn't make, well, Waymo I think is probably $20, $30 billion valuation. you know, maybe they're a hundred billion dollars, but again, we're talking almost 10X from a Tesla, right? So, and again, the analysts don't assign any value to the manufacturing and vehicle sales part of Tesla. It's only the autonomous stuff. So how do you square that circle?
 
 Lei Xing 
 right yeah so we have you know again a lot of questions going to this ‚Åì
 
 Tu Le 
 Competition is good. I'm going to be very open-minded about ‚Åì if and when I'm able to use the service. I don't think Nori is able to tell what they have because our friend Nori Shirouzu lives down in Austin. But I do know there are one or two people ‚Åì heading down to Austin.
 
 Lei Xing 
 Yeah, same here. Yeah,
 
 same here. I know some that live there and ask them to kind of follow closely and maybe share some videos or
 
 Tu Le 
 And
 
 the last thing that I'll mention is what's pricing going to be?
 
 Is it going to be cheaper than Waymo? Is it going to be about the same price? because this is Tesla's first time full stop providing this service. so is it going to be, because also remember that Waymo is in Austin via the Uber app. And it's not as ubiquitous as in San Francisco and LA.
 
 Lei Xing 
 So.
 
 Tu Le 
 And it's not direct, so sometimes you might get a Waymo, sometimes you might get a driver in Austin. And so it'll be funny because I'm sure there's going to be pictures of ‚Åì a street in Austin where you see a Waymo and then you see a CyberCab. That'll be pretty funny.
 
 Lei Xing 
 ‚Åì
 
 From a cost perspective, should be lower, right? And at least comparable to the Uvers and the Weimels that we've taken. It's not lower, it should be lower. The ultimate goal should be much lower because you've taken the human audit equation, the driver audit equation. but again, those are the things that as this progress forward that we kind of look at and benchmark.
 
 against.
 
 Tu Le 
 And one thing that I just thought up, Lei, is that because this is going to be a service for everyone, or who can afford it, it's not just going to be this first mover ‚Åì customer that loves cutting edge technology like the early Tesla buyers were. They're likely going to need to be more open kimono about, you know,
 
 the information on accidents, on close calls, on remote control drivers in order for people like us to feel safe to get in these things. Because if they're trying to hide and be very secretive about the data and stuff like that, I don't know if that's going to attract the general public. Because Waymo seems
 
 much more customer friendly that way. And you and I have experienced the app and calling the car. That process was awesome. It was seamless. You got in, hey Tu so.
 
 Lei Xing 
 There are so many components that go into ‚Åì this service, A complete service, not only the performance itself, but other parts of it. ‚Åì So enough about Tesla robot taxi. ‚Åì We said it was a slow week, but I just want to mention some of the milestones that you and I kind of touched upon and I tweeted is. ‚Åì So.
 
 Leap Motor delivered the 800,000 vehicle this past week. Zeekr 500 half a million production. RoboSense delivered the 1 million ADAS lidar, not the RoboTaxi lidar, ADAS lidar. Li Auto just opened up its 2,500th supercharger station in Disney World in Shanghai. Then Leap Motor
 
 Already has their 1500th global store, that being Hong Kong. So quite a few of these ‚Åì milestones that happened the recent week. ‚Åì Interesting that Leap Motors is going to get to 1 million, the second smart EV startup that will get to 1 million units cumulative after LiAuto.
 
 And speaking of Li Auto they just shared some new pictures of the i6 that are launching in September. That kind of looked like a ‚Åì
 
 The closest I would say it was kind of like a Toyota Stream. Is that the MPV name or the Sienna? No, not the Sienna. Sienna or the Venza, the earlier version of the Toyota Venza. Right. It's kind of weird. Not a traditional SUV, not an MPV shape. But coming before that is the i8 obviously next month. Right. So we said,
 
 Tu Le 
 I don't know. See you now.
 
 ‚Åì right, right.
 
 Lei Xing 
 Kind of the calm before the storm the text the robot taxi and then YU7 ‚Åì
 
 Yeah, interesting milestones.
 
 Tu Le 
 So the Li Auto BEVs that are going to be launching very soon, the i6 and ‚Åì i8, I think they almost look like a Mega and a G7 had a baby.
 
 Lei Xing 
 i8 and i6
 
 Mega and the L series.
 
 Tu Le 
 Yeah. so ‚Åì
 
 this reminds me, Lei, because you're talking about all these milestones. I'm reminded of the shared bicycles, the OFOs and the mobikes. And what's that blue, the baby blue one? I forget what it's called. But hello. Yeah. So remember in Beijing,
 
 Lei Xing 
 it's a hollow, hollow bike.
 
 Tu Le 
 when in Shanghai, when they all started, there's dozens of them. You'd go to a tier two city and there's a brand that you'd never seen before. Then you go to another city, there's a brand you'd never seen before. This kind of reminds me of that. And what happened with the e-bikes in this is the. The I'm trying to square this circle because you and I have heard about consolidation since day one. We've talked about that before.
 
 But in the shared bicycle space, that did happen. So now there's a Mobike and an Ofo. You use the Meituan app or the Didi app, and you're good. And they're pretty ubiquitous. So you talk about all these milestones, but I still feel that in 10 years,
 
 Lei Xing 
 I did have, yes.
 
 Tu Le 
 three quarters of these companies, 80 % of these companies, 90 % of these companies that you and I have spoken about at least once, twice, three times. Most of them aren't going to be in these foreign markets. They're barely going to have a presence in China. so I do believe what that professor said, I forget his name, but there was a conference a few months ago and he was like, number is 2 million units, a minimum 2 million units, or you're out of the market.
 
 Lei Xing 
 I think Han Xiaopeng
 
 even said, right, two to three million units, ‚Åì seven players doing that, right? We're still far away from that. and speaking, right, speaking of Xiaomi, they just got land for potentially their third plant. I think about their long-term ambition of trying to be the top five global automaker, which means they need all the capacity that they need. And it's only...
 
 The three plant together probably is only 450,000 capacity initial. That's not nearly enough. So they're kind of under capacity when we talk about this over capacity problem.
 
 Tu Le 
 And with those companies, so there was a, don't know if you saw that there's this Bloomberg article that said ‚Åì Gasgoo know, Gasgoo that research, they said that 2024 utilization for China was 49%. So, and remember that Brand Hyma, the GBA, ‚Åì
 
 Lei Xing 
 Mm-hmm.
 
 Tu Le 
 startup, Paima, they had a factory in South China that was at a utilization rate of 2 % or 1.5%. So that should be concerning extremely to the Chinese government. And you hear about these green fields, like the Xiaomi factory you mentioned, why aren't they just converting ICE
 
 Lei Xing 
 Yeah.
 
 Tu Le 
 capacity to EV capacity. We know why, because the local governments will incentivize to build new factories. And so it doesn't make sense to invest in a brownfield site. the one thing that's really important is that outside of BYD, no one has really announced commitments to manufacture outside of China.
 
 Lei Xing 
 Sure,
 
 Tu Le 
 There are a number of companies that are shipping kits and we know current trends say that the door to export is that that opening is getting smaller and smaller and smaller. Okay. BYD is getting ahead of it by effectively announcing manufacturing and
 
 eight, nine different locations, a combination of kits and a combination of complete manufacturing. That's going to slow them down. so they're march to 10 million. I think you and I believe that they'll get there, but it's not going to be like the last six or seven years of BYD where they went from 700 to 5 million.
 
 Lei Xing 
 Mm-hmm.
 
 Yeah,
 
 that's exactly what I told Sherissa from NPR this morning. We talked about kind of the price war, ‚Åì
 
 Tu Le 
 And so
 
 when you think of these big bold claims from a Xiaomi, because again, they're not even at two products yet, and they want to be a top five player. That means, and always keep in the back of your mind if you're listening and viewing, the China market's by far the number one market. Then you go to United States, then you go.
 
 The United States is about 25 or 20 % of the total global vehicle sales. Take that piece of the pie out. Your path to 10 million is really, really tough.
 
 Lei Xing 
 Hmm. Yeah, that's...
 
 The last frontier until you're in that last frontier. ‚Åì Can you get the 10 minute? Right,
 
 Tu Le 
 So, so...
 
 It's not impossible. It's not impossible.
 
 where do you pick up? I'm saying chunks of volume. I'm saying a million units, a million and a half units, 800,000. Where do you pick up those? There's only a handful of countries that will give you that type of volume. And that means if you're in one of the top 10 countries, so India is the fourth or fifth largest.
 
 And I want to separate regions from countries, EU is a region with 28 countries. And so you have to sell into those individual countries. United States, you can create a national strategy and then launch it locally. Whereas in Europe, you need different languages, you need different culture. So it's much more difficult from that standpoint than entering the United States.
 
 And if India is a four, four and a half million unit market and you want to extract a million units from India, you need to control 25 % of the market. Is Tata and Mahindra going to allow you to do that? There's no freaking way. So that's where the fun part begins for us, think, Lei, because
 
 Lei Xing 
 That's right, it's tough.
 
 Tu Le 
 We understand the products, the brand, positioning in China, how they're going to evolve those. And the other thing that's really important to me that I'm grabbing my popcorn is how that will evolve their brand message. Because XPeng has kind of shifted a little bit because they're providing technology and affordable.
 
 mass market vehicles, but does that play in Europe where technology is not probably a top three or four ‚Åì attribute for vehicle purchase?
 
 Lei Xing 
 Yeah.
 
 And then we've seen NIO kind of recently trying to expand into some of the additional European markets, working with kind of the one player, one dealer partner per country style that they've talked about. And now Firefly is heading over how that will fare. Right. Yeah.
 
 Tu Le 
 One thing that I have a good friend of mine that lives in Sydney and he feeds me ‚Åì information. He said that Zeekr is really struggling. ‚Åì XPeng is really struggling in Australia. ‚Åì so a market that only imports vehicles, they don't mass produce any vehicles and a huge opportunity for a Chinese EV maker to pick up.
 
 looks like chunks of sales volume. You can't make those types of mistakes when you launch into a country like Australia, because you probably aren't going to get a second chance. And so for the folks at Zeekr and at XPeng, hopefully you're listening because this dude knows what he's talking about. You know, I won't hold it against him because he's from Melbourne.
 
 but ‚Åì I have a few good friends that are from Melbourne, but I thought Melbourne was a cool town. I thought Sydney was better, but I digress anyways. ‚Åì but
 
 Lei Xing 
 Yeah.
 
 Tu Le 
 And that the reason I bring that up, Lei is because.
 
 I think you and I with BYD feel like they're this force that will get to where they want to go because of the price, because of the products, and because they're already in so many markets.
 
 Lei Xing 
 Yeah.
 
 Tu Le 
 And with their entry into so many markets, they probably have a set process, rinse and repeat into these markets. Whereas you look at XPeng, they press reset and NIO slowly. so getting to the multiple millions for an XPeng or a NIO,
 
 we have to question whether they can do that.
 
 Lei Xing 
 Yep. Exactly.
 
 ‚Åì Other than that, think the other one ‚Åì that we kind of touched upon a little bit is last Sunday, this major news drop that Luca Da Meo moved over to Kering the luxury group ‚Åì that has Balenciaga, YSL,
 
 Tu Le 
 Hmm.
 
 Gucci. That's the crown jewel.
 
 Lei Xing 
 Gucci, Gucci, yeah. So yeah, I gonna say
 
 move, but I think what I, yeah, it's, I just feel like he's kind of like, you know, my job is done at a Renault Group and I'm looking for a new challenge and somebody else please take my baton and you know, we go from there. And he he turned Renault around during the pandemic. ‚Åì So that's.
 
 Tu Le 
 So there's two reasons Renault
 
 was struggling. The Carlos Ghosn.
 
 Lei Xing 
 Right.
 
 Tu Le 
 debacle
 
 and you can also point to the tragedy with Sergio Marchione dying and almost holding FCA hostage for a few years as they were finalizing the Stellantis deal. So Renault and Stellantis, I feel had similar challenges because their CEOs were
 
 not focused. then Renault got into the whole COVID thing and Luca, he's only been in the position for five years. So kudos to him.
 
 Lei Xing 
 Yeah, I think this smart guy and the China factor is a few things he did in his 10 or one is I don't know. People have noticed. Renault set up a R and D entity in China, even though Renault is not that producing. They're not producing. They're producing some vehicles, they're right. They're kind of they're out. They're out of China, but they have an R and D entity in China.
 
 Tu Le 
 Whoa.
 
 Well, wasn't that a wasn't that due to our friend Weiming Soh?
 
 Lei Xing 
 No, I think it's different from earlier. And then second, what they did with the horse power train joint venture, kind of working with Geely and then also their, I think Geely has taken over their ‚Åì South America entity. I remember that there was an agreement signed last year. Right, so these are the moves that he made. ‚Åì
 
 Tu Le 
 Earlier? Okay.
 
 Lei Xing 
 that even though they're not an active player, no longer active player in China, but China still to him, I think is an important piece of the puzzle. And that's kind of his legacy that he's left behind. And ‚Åì yeah, think the auto industry actually lost ‚Åì quite a ‚Åì star CEO. mean, right? Yeah, we were at the...
 
 Tu Le 
 you brought sizzle too. He's such a smooth, smooth
 
 guy, huh?
 
 Lei Xing 
 Paris Auto Show,
 
 the new Renault 5, these next generation of products, they're online. They're ramping. So that's his kind of the legacy.
 
 Tu Le 
 Five.
 
 And Renault is effectively
 
 the national brand of France. That's how I look at it. And I'd written about this a little bit in the newsletter. And I'm going to counterpoint to your point. I did say that, hey, maybe Luca is kind of done. And he feels like he's accomplished what he wanted to with Renault. The other part of me, the other side of that coin Lei is maybe he sees
 
 the Chinese players entering Europe as kind of the best that they're going to get at this point. And he didn't see anything but more competition and more challenges, especially because he knows what the product portfolio is for the next five years for Renault and Alpine and Dacia. So I almost feel that there's a combination of that.
 
 Lei Xing 
 Yes.
 
 Tu Le 
 Hey, you know, I've done a good job. I'm ready to take on a new challenge, but also I see what the challenges ahead are for Europe and not having any strong sales presence in China is also a huge constraint for him or Renault.
 
 Lei Xing 
 Yeah.
 
 And it's not,
 
 it's going into an industry which is not having an easier time because of China or despite whatever.
 
 Tu Le 
 Kering is,
 
 I think their share price was down 60 or 70%.
 
 Lei Xing 
 So I mean,
 
 if he can turn that around, then he's some kind of CEO, right?
 
 Tu Le 
 Yeah.
 
 And kudos to Printemp who is the son of the founder of Kering for looking outside of the luxury goods space. there was a Reuters article, Nick Carey had written it, friend of the show, Nick Carey, who pointed out two
 
 Lei Xing 
 Yeah.
 
 Tu Le 
 one Renault guy and one Stellantis guy. Two Frenchmen ‚Åì as the likely candidates, but I'm gonna throw out a Dark Horse, man. I'm gonna throw out Weiming Soh as a Dark Horse.
 
 Lei Xing 
 Yeah, he's been
 
 under the radar. He's been low key. ‚Åì
 
 Tu Le 
 And I haven't heard anything about BeyonCa so.
 
 Lei Xing 
 I don't know. I don't have any hope for that.
 
 Tu Le 
 Yeah, me neither. so for those that don't know, Weiming Soh was the highest ranking and board member of Volkswagen Group. And he got passed over for the head of Volkswagen Group China and ended up leaving because Luca Da Meo is also a Volkswagen Group alum. And I think Luca poached him to become the Renault China head. ‚Åì so ‚Åì so he's still currently the Renault China head in
 
 Lei Xing 
 Hmm. Yeah.
 
 Tu Le 
 Three or four years ago, had launched a Renault and GAC backed startup called BeyonCa. We haven't heard anything about it. We actually did some work for BeyonCa back in the day. Yeah.
 
 Lei Xing 
 They're trying to produce in Hong Kong the last iron number
 
 set up a facility which is weird but...
 
 Tu Le 
 It's like it's like it's almost like building in Arizona.
 
 So, ‚Åì do I have anything? Let me take it quickly.
 
 Lei Xing 
 So that's all I have.
 
 I know it's been relatively slow week. ‚Åì
 
 Tu Le 
 So some administrative. I posted part two of the roundtable, SPX. ‚Åì Thank you for watching both of them. He seemed to enjoy the episodes, so we'll try to do more of those, those roundtables. And the priority for me doing those roundtables was really trying to expose
 
 I think we have a pretty good mix of Western and European and Eastern listeners and followers and watchers. And Jill is very diligent. ‚Åì Ethan is also grinding it out. And Ed, obviously, for the FT being in Shanghai, I wanted to highlight people on the ground, and we wanted to highlight. So that's why we invited them, not just because they're
 
 Lei Xing 
 And yeah.
 
 Tu Le 
 super knowledgeable because they're on the ground, they're also super knowledgeable. have a ton of respect for all three of them.
 
 Lei Xing 
 Yeah,
 
 it's just not only in terms of the people on the ground, but the breadth of their perspectives are different, are diversified, are diverse. That's why we have them. Thought provoking, even questions.
 
 Tu Le 
 Yes, ‚Åì
 
 a Chinese woman working for a tech media outlet, an American man who has driven almost every car, and then a Kiwi who's covered multiple industries and is now in Shanghai.
 
 Lei Xing 
 in America, in China.
 
 ‚Åì
 
 for British outlet. I'd
 
 say.
 
 Tu Le 
 So ‚Åì
 
 that's all I have to. Let ‚Åì me check our messages here.
 
 with me so no messages on LinkedIn which is cool
 
 Lei Xing 
 Hi to anyone that has said hi. I think some pop-ups I saw.
 
 Tu Le 
 So
 
 Jeffrey's on as always. ‚Åì And this is what he says about.
 
 LiDAR. Diane is back on. So it's like consistently Diane, Jeffrey, and SBX like to post things, which is awesome. Thank you. ‚Åì Here's Jeffrey again.
 
 Lei Xing 
 Thank you.
 
 to do or not to do is the same. Okay.
 
 Tu Le 
 So Diane says, thought Zeekr would do well. So Diane, I was told that the Zeekr products are not a good market fit and the pricing is not where it needs to be. ‚Åì Diane also says, Renault is working with South Korea also. So Renault killing it, I guess. ‚Åì
 
 She also says the round tables have been good. So first of all, thank you. You know, I know that was almost two hours of your time, SPX and Diane. great that you could watch that stuff. ‚Åì We'll try to get more of that stuff out. ‚Åì But that's all I have, So we're letting class out early. We're giving you back 10 minutes, everyone.
 
 Lei Xing 
 Appreciate the sport. Appreciate the sport.
 
 Next week, yeah. Yeah, next week
 
 we'll have more to talk about because 27 that the robot taxi would have launched. YU7 would have debuted hopefully. ‚Åì
 
 Tu Le 
 So there are pictures
 
 in the production or manufacturing yard of YU7s already built.
 
 Lei Xing 
 Yeah, that's always been the plan. When it's launched, the deliveries start soon after, rather than a prolonged time in between. That's always been the Yeah.
 
 Tu Le 
 Which is key.
 
 Lei Xing 
 So we can start counting the sales starting from July basically. Six months, well yeah, six months.
 
 Tu Le 
 And I think
 
 it's prudent because they want, now that they double their product, things will get more complicated and they're going to need to manage manufacturing the SU7 and the YU7 together and balance out lead times for each of those orders. So anyways, everyone.
 
 Lei Xing 
 You know, one number
 
 I would estimate for the YU7, can they do 100,000 YU7s in the six months remaining of this year? If they do that, that's incredible. That is incredible.
 
 Tu Le 
 Go ahead. Sorry.
 
 Well, that would mean that ‚Åì they're selling about 15,000 units a month for the next six months.
 
 Lei Xing 
 That's all I've heard of.
 
 Tu Le 
 And this, so that means that they would need to be working extremely closely with their suppliers. And this with the dark cloud of suppliers not getting paid for 120 days. so I thought this through a little bit, Lei, and I'll just leave the show with this thought.
 
 It only takes, and it could be a supplier that doesn't have an important part. It just takes one supplier to screw everything up.
 
 Lei Xing 
 Because yeah,
 
 because last year Xiaomi did over 130,000 units in nine months.
 
 So it's not out of the question they can do 100,000 YU7s in seven months, in the six months.
 
 Tu Le 
 So it's not out of the question.
 
 Well,
 
 so, but remember, they probably need to build as many SU7s as they do YU7s. So if you're saying 100,000 units in six months, well, let me ask you this. Let me put it this way. How many total units? SU7 plus YU7.
 
 Lei Xing 
 Well,
 
 they said the target is 350,000. That's still in place. roughly, 100,000 YU7s and 250,000 Su7s. That's kind of my look at it.
 
 Tu Le 
 by the end of 2025.
 
 So the utilization rate at that factory is gonna be over 90 % easily.
 
 Lei Xing 
 Yeah, because it will be produced at the second factory. ‚Åì
 
 Tu Le 
 So when
 
 they say things like that, that means that their tooling was ordered weeks ago or months ago. That means that their purchase orders and their manufacturing planning schedule was already shipped out to the suppliers. And the sourcing people are talking to the suppliers on a weekly basis. How are we looking? How are we looking? How are we looking? Do you have any challenges?
 
 Do you have any issues? And then any quality issues, the sourcing guys and the supplier quality guys are going straight to the supplier factory and trying to straighten all those challenges out so that when products ship, they call it linear supply. It means that there are no kinks ‚Åì because what you don't want to do is start the line.
 
 Stop the line, start the line, stop the line. So I would also guess that they are probably hoarding parts in order to launch production pretty smoothly. So they probably have a lot of parts sitting in Beijing ‚Åì waiting to get installed into the YU7s that are about to get ‚Åì added to the line. So anyways, ‚Åì now we're getting too wonky.
 
 Everyone, good morning, good afternoon, good evening, Lei good luck to your daughter and thank them for spending time in the other room. And so we will.
 
 Lei Xing 
 Thank you. They're having breakfast. So
 
 I will talk to you next week from Phoenix. Even the hotter place.
 
 Tu Le 
 Mmm.
 
 Hopefully,
 
 hopefully, having tried out a Waymo
 
 Lei Xing 
 I would definitely try the airport Waymo. I would definitely try to, you know, hail one. Waymo. So, cause Phoenix airport is not that far from the city center from what you know.
 
 Tu Le 
 Is that a Waymo app or is that an Uber app? Okay, so, amen.
 
 Okay.
 
 so Waymo goes to the airport in Phoenix. Okay. Hmm. All right. Hey, have a good weekend, We'll see everyone.
 
 Lei Xing 
 Yes. Yes. So that'll be interesting if I can. Yeah.
 
 Alright, you too man.
 
 Bye bye.