Cars may seem unrelated to Haier, but in fact, Haier has already made a move.

Author/Spotless One

Produced by/Xinzhai Business Review

In recent years, home appliance giants have been cross-border seeking new growth, and Haier is no exception. Recently, Haier suddenly became a trending topic on social media. The reason is that there have been rumors that Haier will acquire Autohome, with Haier acquiring part of the equity of Autohome with a certain amount of funds to achieve its controlling interest, rather than merely acquiring a certain business segment as previously rumored.

Further reports indicate that after the acquisition, it is expected that there will be a 30% layoff at Autohome in January next year. By the end of this year, the relevant Haier team will officially move in, and there will be significant changes in the senior management of Autohome. It is rumored that Autohome is currently looking for a new CEO.

The current exposé article has been deleted, and Haier responded that it would not comment.

One is an established home appliance giant, and the other is one of the three major automotive portals. The "rumor" between the two has left the industry and the public puzzled. Some netizens even said that Autohome has been on the decline for a long time, so what use is it to Haier? After synthesizing all the information, Xinzhai Business Review found that although this matter is surprising, there is a reasonable logic behind it.

1. Haier has long been eyeing the automotive market.

Haier has always been known for its home appliances. In fact, today's Haier is no longer a "pure" home appliance giant. Besides home appliances, Haier has also deployed in the fields of great health and industrial internet, which, together with smart living, form Haier's main business. At the same time, the latter two also shoulder the burden of becoming new growth points for Haier. The logic behind Haier's acquisition of Autohome is hidden in the industrial internet sector.

In simple terms, the industrial internet refers to the use of internet technology and ecosystems to reshape and transform the industrial chains of various vertical industries, thereby forming a new internet ecosystem. The automotive market has huge potential and has naturally become the target of enterprises intending to deploy in the industrial internet, and this is also the deployment logic of BAT.

Specifically for Haier, it has chosen two focal points in the direction of the industrial internet. One is smart homes, with Haier Smart Home as the carrier, and the other is the automotive market. To be precise, Haier's deployment direction is the used car market. According to insiders, what Haier intends to acquire may be the used car business of Autohome.

Autohome's used car business is named ErChe.com, with two main business carriers: one is the ErChe.com within the main Autohome website, and the other is Chepai.com (acquired). Based on these two carriers, ErChe.com can continue to leverage its channel value for both supply and demand ends, and on the other hand, it can provide offline services for used cars. Autohome hopes to be more involved in used car transactions, amplify its own value, and avoid becoming a mere channel again. Autohome's deployment in the used car market happens to meet Haier's needs.

In fact, the connection between Haier and the automotive industry is not as unrelated as the market impression might suggest. At least in 2021, Haier deployed in the automotive market and established the used car platform Katechi. Since then, Haier has gradually deployed in charging technology, smart cockpits, home-car interconnection, and other automotive-related businesses.

In terms of charging, Haier's deployment is also extensive, covering household, public charging, and energy storage scenarios. Notably, Katechi has developed its fast-charging piles, which can achieve a driving range of 200 kilometers after charging for 5 minutes (the official did not specify the vehicle model used for testing), featuring high stability, long lifespan, and low power loss. At the same time, Katechi has also launched a mobile charging solution, utilizing autonomous driving and robots to allow the piles to find users. In the field of home-car interconnection, Haier's approach is to leverage the technology and scenario advantages of smart homes to cooperate with automakers. From the market perspective, Katechi is not among the top-tier players in these fields.

Under such circumstances, if Haier truly acquires the used car business of Autohome, Katechi may have great potential.

Currently, Katechi focuses on self-operated malls on the supply side, with specific channels including online malls, offline superstores, and service networks. Previously, there were geographical restrictions on used car transactions in China, and cross-regional ownership transfers were not supported, limiting demand on both the supply and demand sides. Since 2021, policies have loosened, which has become a focus for many used car platforms, such as Guazi and Uxin, both of which have prioritized their "nationwide purchase" business, as has Katechi, which emphasizes the ability to achieve "nationwide purchase and sale" in its promotions.

Over the past year, Haier has cooperated with 18 local used car dealers through Katechi and currently has 28 offline stores in cities such as Beijing, Shanghai, Zhengzhou, Wuhan, etc. It is expected that by 2025, Haier will have opened 100 stores. In addition, Katechi can also provide personalized customization services for users.

Regarding whether to manufacture cars, both Katechi and Haier hold a negative attitude, indicating that Haier's automotive strategy revolves around providing services for used car transactions. Overall, the story told by Katechi is the same as that of platforms like Guazi, focusing on the industrial internet, which has great value and deserves recognition.

2. By embracing the used car market, can Haier achieve its wishes?

Although Autohome is one of the three major automotive portals, its situation is not good.

In 2019, Autohome's revenue was 8.42 billion yuan, which declined to 7.18 billion yuan in 2023, and its net profit also declined from 3.2 billion yuan to 2.16 billion yuan. In the third quarter of this year, Autohome's revenue continued to decline, falling by 7.9% year-on-year to 1.77 billion yuan, and its net profit decreased from 570 million yuan to 440 million yuan. In 2023, Chepai.com's transaction volume and revenue increased year-on-year, and it continued to remain profitable. It can be seen that the used car business is a highlight in Autohome's performance.

Will Haier, which has acquired quality assets, be able to achieve new growth as desired? The answer that can be drawn now is that the direction is correct, but the process and result are highly uncertain, which is due to the "deep waters" of China's used car market.

On the one hand, the scale of China's used car market is huge, and even if participants only get a small share of it, they can still earn a lot, which is the main reason for Haier's deployment in the used car market. According to data from the China Automobile Dealers Association, in 2023, the cumulative transaction volume of used cars nationwide was 18.4133 million vehicles, an increase of 14.88% year-on-year, with a cumulative transaction amount of 1,179.532 billion yuan. From January to June 2024, the cumulative transaction volume of used cars in China was 9.3829 million vehicles, an increase of 7.01% year-on-year, with a cumulative transaction amount of 625.212 billion yuan.

On the other hand, there are some chronic issues in the used car market, which provide opportunities for participants, including Haier.

On the supply side, China's used car market is highly fragmented. Relevant data shows that there are currently nearly 800,000 used car enterprises in China, and the digitalization level of these enterprises is not high, and efficiency needs to be improved. At the same time, there are used car dealers who deceive users by exploiting information asymmetry, which leads users to first think of "deep waters" when mentioning used car transactions. At the same time, compared with the new car market, the quality and after-sales guarantee of used cars in the used car market are even worse, sometimes even absent. At this time, if an enterprise can help users solve these problems, it will naturally gain their recognition.

Platforms like Guazi are also targeting these chronic issues. For example, by building a vehicle model database and online channels, Autohome helps users reduce information gaps and also provides online channels for businesses, optimizing the transactions of new and used cars from two aspects.

Therefore, Haier's general direction is correct, but the problem lies in the "deep waters" of the used car market. Katechi needs to overcome industry-wide issues and face competition from rivals. More importantly, when choosing new businesses, enterprises generally extend based on existing businesses. For example, Xiaomi's business sequence is from mobile phones to IoT to cars. Both IoT and cars have strong ICT attributes, which are consistent with Xiaomi's experience accumulated in the mobile phone business. In contrast, the correlation between the used car business and Haier's home appliance business is not strong, which poses a hidden danger to the used car business. It remains to be seen whether it can form a synergy with Haier's main business, and the same applies to Haier's great health layout.

Of course, even if it cannot form a synergy with the main business, as long as it develops well, Haier can still obtain financial returns. Moreover, Haier has many cards in its hand. In the industrial internet sector to which Katechi belongs, Haier has at least three other cards, namely, the industrial internet platform COSMOPlat, the digital city business Hainer Cloud, and the logistics business RRS Supply Chain. As long as one of these cards works, Haier will benefit.