Li Shufu: Geely car turn around

From farmers to build cars, price snipers, to the contrarian overseas acquisitions, profit growth, Geely Motor Chairman Li Shufu, as he would like to let Geely car "lost its head."　　In this case, the controversial car "madman" is quite complacent, and even blushes that this is to be written into the history of China's automotive industry, a classic. In fact, Geely's "U-turn" also does have some of the characteristics of classic cases: such as self-denial, desperate.　　In Mr Li's own words, this is even a "doom and epigenetic" adventure for Geely. In 2007, before the Geely car "U-turn", "cheap" is the killer of Geely, by this, Geely Automobile has achieved its market position.　　But soon, Mr. Li found that the "cheap", the Geely car's rich road, has gradually become a dead-end. "The more the price is cheaper, the beginning of more than 50,000, then more than 40,000, 30,000, more than 20,000, do not sell more than 10,000, or even money?" Mr. Li said he had a lot to say about his report to Premier Wen Jiabao in 2005 as a private car brand representative. Mr. Li was proud to say that even the 20,000-dollar sedan could be produced by Geely.　　But Premier Wen shook his head and said, "the development of China's automotive industry, the key lies in High-precision machine tools, high-precision high level of the engine, high-precision high level transmission, this is the way out." "Although he didn't criticize me, I knew he didn't support my idea as soon as I heard it."　　Mr. Li said the market also sounded a wake-up call to him over the next two years. In order to guarantee the advantage of cheap, Geely has to put the price of parts is very low, and even the suppliers are breathless, so that the product quality is getting worse and worse service. 2005 years later, Li Shufu found Geely car slowly do not make money, steel, spare parts and prices rose again, that is, the car does not raise prices, low-cost car profits increasingly diluted. Geely is gradually falling into the "death cycle" of "cheap, inferior, cheaper and worse".　　Do not change, according to this trend, "Geely's brand will die, enterprises will die." As a result, Mr Li made the determination to make Geely "turn around", with a clear direction: "First of all, we must abandon the competitive strategy of winning prices and playing the price wars, and turn to technical warfare, service warfare and brand warfare." "This is a complete" self-denial "for Geely, which has always been a price winner.　　Mr Li's first encounter was a strong rebound from within Geely. "Geely will not be a price war, technical warfare, service war which is so good to fight?" There is no confidence inside, feel that Geely is finished, not cheap, how do we sell cars?　　They all feel they can't do it, "Mr. Li recalls, with no one inside supporting his strategic transition plan, a widespread concern that Geely is on a slim risk. He had to go out on his own, find the management 1.1 points of work, communicate ideas, find dealers to communicate ideas, to sell them their "vision", the process of hard outsiders。 Even, May 18, 2007, Geely issued to the outside world mark its "Ningbo Declaration" of the transformation of Geely, Li Shufu himself wrote.　　Li even broke the auspicious "retreat": the original equipment, molds are all thrown away, even the plant has been pushed flat.　　"I was going to burn my bridges and launch new products on a clean basis," Mr. Li said, after he bought a full range of modern equipment, Swedish robots, Japanese molds, South Korea's welding lines, and so on. However, the negative effects of transformation ensued, in May 2007, the "Ningbo Declaration" just released, Geely announced that the car price increase of 20%-30%, followed by a sharp decline in sales, the month's sales even slipped to five thousand or six thousand, and the peak before the transition is more than 30,000 vehicles. "At that time, Geely is really dying, now think of it also scared."　　"Mr. Li said.　　Adjust for a new image in order to reverse Geely's cheap, low-grade brand impression, Mr. Li began to adjust the brand arrangement, began the Geely "multi-brand strategy" to the Geely brand and models to comb and positioning. The specific approach is to put Geely as a group brand, and then the car brand into three different image of the trademark design.　　"To this end, we also spent a lot of money in the global collection of trademark design, and then set the Emperor Hao, the global Eagle and Shanghai," Mr. Li said, the three brands do not exist level of problem, it is facing three different consumer groups. Fortunately, this series of combination boxing quickly harvested the market effect, October 2007 Geely Sales began to rebound, the early transformation of the initial sales slump caused by the panic also gradually dispersed within Geely.　　In 2008, Geely slashed the share of old products, and by the end of 2008, the "new three" completely replaced the "kind". Mr. Li says the main focus now is to think about strategy and management anytime, anywhere.　　He revealed that recently he is pondering a new thing called "Meta-Power Engineering", which is one of Geely's research and practice of Toyota from parts supply, manufacturing to marketing services, "the whole industry chain lean production". November 12, Geely will hold an internal meeting in Ningbo. Auto parts suppliers will be involved, and the subject of the study is how to "cross" these with Geely's existing parts supply system and, in his own words, study how to "intermarriage" and produce a high-quality "half-breed". In Mr Li's view, Geely's current component supply system has the advantage of low cost and hard work, while the world's big parts companies have the advantage of technology and quality control. Once the "hybrid" succeeds, Li said, it will become a "classic case" from Toyota and beyond.