Standing at the center of the storm, besides pigs, there are also various rumors.For the current technology circle, automobile circle, digital circle and even the successful academic circle, Lei Jun and Xiaomi are standing there, which is a strong traffic outlet, followed by all kinds of gossip.For example, after the success of the Xiaomi SU7 series in the first battle, the rumors of Xiaomi acquiring Evergrande Automobile became more and more popular again.
Acquire Evergrande Automobile? this is a rumor
This stemmed from an announcement by Evergrande Automobile on the evening of the 26th, stating that potential buyers were interested in purchasing 3.145 billion shares of Evergrande Automobile, which accounted for approximately 29% of its issued shares. According to the agreement, potential buyers will retain the option to exercise the remaining 29.05% shares of Evergrande Auto within a certain period after the agreement takes effect.
In other words, the shares of Evergrande Automobile originally held by Evergrande Group are likely to be taken over by the buyer, thereby gaining complete control over Evergrande Automobile. This also means that if the deal is completed, Evergrande Automobile will change its surname and Xu Jiayin will completely lose control of Evergrande Automobile. You know, Xu Jiayin once regarded Evergrande Automobile as his trump card, and even in the most difficult times, he gritted his teeth and refused to sell any shares.
Although the announcement did not disclose the identity of the buyer, the market speculates that it is a new energy vehicle company, and the most likely one is Xiaomi.Affected by this, Evergrande Automobile's stock price rose by 86.84% after the announcement.
It is not difficult to see from this that Evergrande Automobile’s relevant parties intentionally use vague expressions in an attempt to obtain greater benefits by riding on Xiaomi’s traffic.
After several days of fermentation of this rumor, Xiaomi, which is sensitive and good at refuting rumors, clarified in simple and direct terms on the afternoon of the 30th: Xiaomi Motors has never had any plans or actions to acquire or control Evergrande Automobile. This move temporarily calmed down more associations about Xiaomi and Evergrande Automobile, eased market concerns and stabilized stock prices.
But why are the outside world willing to associate the two together? On the surface, it can be attributed to: the smart car industry is reshuffled, Xiaomi has initially entered the poker table with fierce momentum, and Evergrande Automobile will basically be out of the game if there is no miraculous successor. But Xu Jiayin has been laying it out for many years, and Evergrande Automobile still has value points that can make Lei Jun excited. Moreover, Lei Jun has become a god. Isn't it too much to give Evergrande a hand?
Taking it apart, on the one hand, Evergrande Motors, under the guidance of Xu Jiayin's strategy of "buy, buy, join, join, circle, big, big, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good, good" guidance.If Evergrande Automobile wants to turn around, these assets accumulated in the early stage are the biggest capital.
On the other hand, Lei Jun is facing a "sweet trouble" when building cars, namely production capacity issues. Although Xiaomi SU7 has completed an industry record of more than 10,000 units delivered in 43 days, Lu Weibing, partner and president of Xiaomi Group, revealed that the main challenge Xiaomi Motors currently faces is delivery capacity. Some media checked the Xiaomi Auto APP and found that the delivery cycle of Xiaomi SU7Pro after locking the order is 29 to 32 weeks. The delivery cycles after locking orders for the Xiaomi SU7 standard version and Max high-end version are 29 to 32 weeks and 33 to 36 weeks respectively. At present, in order to achieve the goal of "delivery upon launch, and volume increase upon delivery", Xiaomi is accelerating the expansion of production capacity and ensuring delivery.
From these two dimensions, Lei Jun has sufficient reasons to take over Xu Jiayin. By acquiring Evergrande Automobile, he can quickly utilize the existing idle production capacity to more efficiently complete the delivery of user-ordered cars.Public information shows that Evergrande Automobile’s Tianjin factory has ceased production operations since the beginning of this year.
But in Tang Chen's view, the apparent connection is highly confusing, or the interpretation is intentionally conveyed. It is possible for Xiaomi to acquire Evergrande Automobile, but it is completely unnecessary.
In fact, there were rumors of Xiaomi acquiring Evergrande Automobile as early as 2021. At that time, some media said that China Evergrande was negotiating with Xiaomi Group to sell 65% of Evergrande Automobile’s shares. During that time, Evergrande experienced financial problems for half a year and was in urgent need of finding funds to tide over the difficulties. Xiaomi, on the other hand, is immersed in training and has gone through 1,000 days of training after Lei Jun made a high-profile announcement to "fight for Xiaomi cars."Picking the ready-made fruit is undoubtedly a shortcut.But later, both Xiaomi and Evergrande said they had preliminary exchanges with each other, but did not advance in-depth negotiations.
Lei Jun is not a god, he wants to tell new stories
Today, this so-called "marriage" has been denied again. The reason is not that Evergrande Automobile's legacy assets are not attractive to Xiaomi, but that under Xiaomi Automobile's ecological story of "people and cars," Lei Jun does not have to deal with this mess with negative assets.The 2023 results show that Evergrande Automobile’s total assets are 34.851 billion yuan and total liabilities are 72.543 billion yuan. Other data show that Evergrande Automobile has accumulated losses of more than 110 billion yuan in the five years of car manufacturing, and only 129 million yuan was left on the books at the end of last year. Lei Jun once said that Xiaomi plans to invest US$10 billion in car manufacturing in ten years. It can be seen from the book figures alone that what Xiaomi has taken over is a huge debt, which is a heavy burden.
The deeper reason is that Xiaomi Auto is following a path of independent research and development. Buying is a course deviation to some extent.Taking the field of intelligent driving as an example, Xiaomi insists on self-research of the entire technology stack and adopts an advanced architecture that includes leading algorithms such as road large models, super-resolution occupancy networks and zoom BEV to achieve the first mass production of end-to-end large model technology in China. Another example is the large die-casting technology that Lei Jun has been proud of for many times. Xiaomi officially claims that it is the pearl of new technology applications in the automotive industry. At the same time, Xiaomi officials also stated that Xiaomi is also the only domestic automobile manufacturer that has both the mass production of self-developed die-casting alloy materials and the self-developed large die-casting equipment cluster system.
This car-building route is of great significance to Xiaomi, and may even affect the successful expression of Lei Jun’s high-end story. As Tang Chen analyzed in the article "Lei Jun's high-endization may be achieved in Xiaomi cars", Xiaomi's high-end road has entered its fifth year, and the smart car business has brought new imagination space to Xiaomi's high-endization.
On the one hand, the smart car business brings high-end user groups to Xiaomi. Lei Jun once demonstrated at an investor meeting that among Xiaomi SU7 series car buyers, female buyers account for 28%, and it is expected that female car owners will account for 40%-50%; in addition, BBA users account for 29%, and Apple users account for 52.5%.
This structural user reshuffle has an important radiating effect on the high-end development of Xiaomi’s other products. Lu Weibing believes that the success of SU7 has helped Xiaomi’s Chejia ecology form a formal closed loop, and will also have a profound impact on other existing businesses. "First, it brings users out of the circle. With the success of Xiaomi SU7, it is of great significance for Xiaomi Auto to bring about changes in the user structure. The effect of breaking out of the circle is very obvious, gradually covering the entire population from a narrow group of people."
On the other hand, the smart car business is opening up room for growth in Xiaomi’s valuation. According to Barron's statistics, Xiaomi's stock price rose 38.43% in 60 days, and the year-to-date increase reached 17.31%. The automotive business has become the main driving force for Xiaomi's stock price: at the beginning of the official announcement of SU7 on March 12, Xiaomi's stock price soared 11.34%; after listing on the evening of March 28, Xiaomi's stock price rose 8.97% on the next trading day (April 2). At present, JP Morgan Chase, Huatai Securities, Shanghai Pudong International and other institutions have included the automobile business into Xiaomi's valuation considerations, giving the company a target price of between HK$23 and HK$25.
In other words, under Xiaomi's established car-making route, the acquisition of Evergrande Automobile is a very uneconomical deal, and it will not gain much in the implementation of its high-end strategy.Even though Lei Jun has been regarded as a god, he is not a god after all. To paraphrase one of his own famous sayings, when he encouraged Xiaomi to take over Evergrande Automobile, "this guy is definitely here to cause trouble."
For Xiaomi, what should be more important is that under the flood of traffic, those potential reefs and shoals, if not careful, will cause a fatal blow to the just-started Xiaomi car.
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