Huawei is not omnipotent

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Adhering to the principle of 'ask if it is true before asking why,' we researched the sales data of the various sub-brands under HarmonyOS Intelligent Driving.

In July, AITO's sales remained 'steadily successful,' with a total of 39,552 vehicles sold across its three models.

As for the Zhijie brand, the Zhijie S7, a single model, experienced a sales peak in May (5,021 units) but has since declined, with only 1,541 units sold in July.

Turning to the Xiangjie brand, since the brand's first model, the Xiangjie S9, was only released on August 6, its monthly sales figures are not yet available. However, on August 9, HarmonyOS Intelligent Driving announced that the S9 had received over 4,800 orders within 72 hours, revealing intriguing insights behind the data.

For instance, car companies announcing figures like 'XX hours/days, over XXXX orders' are often inaccurate.

Xiaomi Automobile released data showing over 10,000 orders within 4 minutes and over 20,000 within 7 minutes after the launch of Xiaomi SU7. However, the final retail sales figures for the first two months were 7,058 and 8,646 units, respectively, not aligning with the 'booking data.'

Therefore, based on the '4,800 orders within 72 hours' data from the Xiangjie brand, we can make further speculations.

As the Xiangjie S9 has not yet experienced a sales ramp-up, it's too early to judge its success. However, analyzing the number of bookings, the highly anticipated Xiangjie S9 has not become an overnight sensation.

Now, having established the 'is it true' question, let's delve into 'why.'

First Layer: Why has only AITO succeeded under HarmonyOS Intelligent Driving?

Undeniably, Huawei enjoys immense popularity across various sectors.

Especially in the automotive industry, many consumers hope Huawei will directly enter the market to challenge foreign car brands and replicate its success in smart mobility.

The first brand to enter the market under the HarmonyOS Intelligent Driving system was AITO, a collaboration between Huawei and Seres Group.

AITO's success stems from Huawei's technological prowess and a fortunate coincidence.

Firstly, it's crucial to understand that Huawei does not directly manufacture cars.

In HarmonyOS Intelligent Driving, Huawei's brand collaborations with automakers resemble Wanda's shopping mall projects, where Wanda does not own the malls but provides branding, management, technology, and commercial operations services.

Similarly, Huawei deeply engages in design and technology development with its partners but does not own any automaker's brand.

As Huawei's first automotive brand, AITO capitalized on the misconception that it was Huawei's own car brand, allowing it to quickly capture the market as the face of 'Huawei Cars.' AITO's deep integration with Huawei, coupled with its HarmonyOS smart cockpit and HUAWEI ADS intelligent driving system, gave it a competitive edge. However, AITO's success is hard to replicate.

In today's consumer market, customers associate 'Huawei Cars' solely with AITO.

Therefore, Zhijie and Xiangjie face an inherent disadvantage due to their late entry into the market, failing to establish a psychological advantage.

This issue is prevalent across the automotive industry.

For instance, consumers highly recognize NIO but are less familiar with its subsequent brands like HeChuang and LeDao. Similarly, Volkswagen is widely recognized, but its related brands like Škoda and Jetta are less popular.

Understanding the 'brand perception' angle simplifies the challenges faced by Xiangjie and Zhijie: consumers see only one 'Huawei Car' – AITO. As a result, Xiangjie and Zhijie can only play supporting roles within HarmonyOS Intelligent Driving.

Second Layer: What product-related reasons hinder Zhijie and Xiangjie?

While brand perception is crucial, it's only part of the equation.

Deeper analysis reveals more reasons related to product competitiveness.

Firstly, let's discuss Xiangjie S9's weaknesses.

Positioned to compete with BBA executive sedans (5 Series, A6L, E-Class), Xiangjie S9 aims for the premium market with a price range of 400,000 to 450,000 yuan.

At the launch event, Yu Chengdong unabashedly expressed Xiangjie S9's ambitions: 'the most expensive Huawei-related car to date' and 'keeping Maybach up at night.' These claims hint at a positioning issue.

I believe Xiangjie S9 skips competitors like NIO ET7 and IM Motor L7, directly targeting BBA executive sedans. However, these BBA models dominate due to their balanced product offerings and luxury attributes.

Xiangjie S9, a younger-focused C-segment luxury sedan, emphasizes 'new-age luxury' with frameless doors and Huawei's smart ecosystem. Competing with established BBA models is challenging as their consumers tend to be older and conservative.

Xiangjie S9's advantages in intelligence, performance, and cost-effectiveness may go unnoticed by executive sedan buyers who prioritize traditional luxury and social status symbols.

As for Zhijie S7, its underwhelming sales stem from simpler reasons.

Unlike Seres Group and Beijing Automotive Group, Chery Automobile, a leading domestic brand, has significant influence. Thus, 'Huawei' alone cannot guarantee Zhijie S7's success.

Zhijie S7 shares similar core mechanical features with Xingji Yuan ES, such as 700+ km range, sub-3-second 0-100 km/h acceleration, and a double-wishbone front and multi-link rear suspension. Without significant differentiation beyond Huawei's smart ecosystem, Zhijie S7 struggles to stand out.

Further, targeting the 250,000 to 350,000 yuan segment, Zhijie S7 faces fierce competition from Tesla Model 3, IM Motor L6, ZEEKR 001, Xiaomi SU7, among others. This intense rivalry overshadows Zhijie S7's 'Huawei factor,' making it difficult to carve out a niche.

Even against its sibling Xingji Yuan ES, Zhijie S7 has a 50,000 yuan price disadvantage. In today's cost-conscious environment, many consumers may opt for Xingji Yuan ES to save on Huawei's intelligent driving and ecosystem experience.

Third Layer: Is the yet-to-arrive Zunjie brand still necessary?

Among Huawei's 'Four Worlds,' Zunjie is the only brand not yet systematically discussed.

Announced by Yu Chengdong in late July, Zunjie is Huawei's premium collaboration with JAC Motor, poised to compete with ultra-luxury brands like Rolls-Royce and Maybach. If this trajectory holds, Zunjie's future products may exceed the million-yuan price range.

Zunjie's potential is limited.

Aiming for Rolls-Royce and Maybach levels means accepting lower sales volumes. Rolls-Royce's annual sales are well-known.

Therefore, Zunjie is likely to become a 'benchmark brand' under HarmonyOS Intelligent Driving, showcasing Huawei's capability to rival ultra-luxury cars rather than aiming for high sales or profits, akin to Hongqi's Golden Sunflower model.

However, Zunjie could surprise if it offers exceptional product features at an astonishingly low price, similar to AITO M9, which targets large luxury SUVs like Mercedes-Benz GLS and BMW X7 but at a fraction of their cost. Such a combination of value and quality could secure a market share.

Closing Thoughts:

Today's automotive landscape is incredibly complex.

More and more new energy players are emulating luxury brands, fostering an exaggerated trend in carmaking.

Within HarmonyOS Intelligent Driving's 'Huawei Four Worlds,' we glimpse the diversity of the automotive industry through just three brands.

Some are at ease, some struggle, and some falter. The key takeaway is that Huawei's intelligent technology is impressive, yet cars are more than mobile smart devices. Successful carmaking requires more than passion and leading technology alone.

From mechanical design to supply chain, sales, and marketing systems, every aspect tests automakers' capabilities. While the future of Xiangjie and Zhijie remains uncertain, time will tell. One thing is clear: without precise positioning and unique competitiveness, their paths forward will not be smooth.