“I’d saved up most of the money for a Jiyue, but now it’s gone.”

This morning, Brother Bao, who was “almost but not quite a confirmed Jiyue owner,” frantically messaged me.

An avid car enthusiast who boasts, “I’ve test-driven every new force brand you can name,” Brother Bao eventually became a fan of the Zeekr 001 after multiple rounds of scrutiny. He proudly claimed, “Whether a young man is successful or not depends on whether he drives a Zeekr 001.” However, due to financial constraints, Brother Bao had to settle for the Jiyue 07, which shares the same platform as the Zeekr 001.

Just as Brother Bao had saved up most of the money for the Jiyue 07, disaster struck.

On December 11, Jiyue Automobile CEO Xia Yiping held an internal meeting with all employees, announcing adjustments to address the company’s difficulties. That evening, rumors spread online that multiple Jiyue stores had closed. Today, news of Jiyue Automobile’s dissolution began to spread online.

Suddenly, various incidents of Jiyue employees fighting for their rights emerged. Reports of “Jiyue employees blocking Xia Yiping at the company,” “Jiyue owners feeling the sky is falling,” “Jiyue salespeople crying in live streams,” and even “Jiyue salespeople writing vengeful messages in live streams” surfaced.

These events are both surreal and sympathetic, eliciting empathy for the struggling employees, the Jiyue owners who have taken delivery of their cars, and the two relatively decent car models.

From the recent rumors of Nezha’s bankruptcy to today’s news of Jiyue’s dissolution, both indicate that the new forces at the table are facing increasingly difficult situations. Fortunately, Nezha’s founder stepped forward and secured state-owned capital to save the day, whereas Jiyue, which seems to have been neglected by both its parent companies, seems doomed.

In fact, from various signs, Jiyue’s downfall seemed predictable.

Baidu’s Risky Gambit

In essence, Jiyue Automobile is Baidu’s risky gambit for a slice of the autonomous driving pie.

Upon reflection, Baidu’s layout in autonomous driving may have been heavily influenced by Google.

Firstly, new energy vehicles represent the future of transportation, with autonomous driving as its core technology. Mastering autonomous driving technology indirectly equates to owning a stable automotive business.

Secondly, Google secretly developed its driverless car project as early as 2009.

Lastly, Google is an internet giant.

That’s enough.

As an internet giant, Baidu naturally wouldn’t miss out on the field of new energy vehicles. In fact, companies from various industries have ventured into new energy vehicles in recent years. You can see smartphone manufacturers, home appliance retailers, real estate developers, liquor producers, and security providers all getting into car manufacturing...

Is it strange for Baidu to get into car manufacturing? Not at all. In fact, it follows a complete business logic, similar to Huawei’s approach.

Let’s first see how Huawei approaches car manufacturing.

Clearly, Huawei doesn’t manufacture cars; it only helps automakers build good cars. Huawei positions itself as a supplier, further aiming to grasp the core hardware and software ecosystem of automobiles, creating an “Android platform” for the automotive industry.

Baidu follows a similar path. Besides autonomous driving, Baidu also has ERNIE Bot, maps, AI business, CarLife+, etc. All these businesses can be commercially implemented in the automotive field, demonstrating a closed-loop business logic for Baidu.

I’ve discussed Baidu’s journey into car manufacturing in my article “From Apollo to Jiyue: How Many Gambits Did Baidu Make for This Slice of the Pie?” If interested, you can read it at the end of this article. Here, I’ll briefly outline Baidu’s history in car manufacturing.

In 2013, Baidu established the Beijing Institute of Deep Learning, laying the groundwork for its autonomous driving business, aiming to draw automakers into its automotive business ecosystem through autonomous driving technology.

Unfortunately, at that time, consumers were not yet receptive to intelligent driving, and automakers were reluctant to share their driving data, which is commercially sensitive. As a result, many automakers only offered verbal support without engaging in substantial cooperation with Baidu.

Seeing this, Baidu decided to launch its own brand to showcase its autonomous driving capabilities, hoping to attract automakers to cooperate with them.

Thus, in 2021, Geely Auto and Baidu jointly established Jidu Auto, with Baidu holding a 55% stake and Geely holding a 45% stake, marking the beginning of Baidu’s car manufacturing story.

Up to this point, everything seemed to be progressing well. However, unexpectedly, Jidu encountered difficulties in obtaining manufacturing qualifications, which have been a significant hurdle for the industry in recent years, affecting companies like NIO, XPeng, Li Auto, and NiuChuang New Energy.

The problem was once again thrown back to Baidu. However, with car manufacturing already underway, on August 15, 2023, Jidu Auto was renamed Jiyue Automobile, with Geely increasing its stake to 65% and Baidu holding 35%. Xia Yiping, the former CEO of Jidu Auto, became the CEO of Jiyue Automobile, officially launching Baidu’s autonomous driving initiative.

It is evident that Jiyue Automobile is Baidu’s risky gambit for the slice of the autonomous driving pie.

“Futuristic” Ruined Jiyue

From the above analysis, it’s clear that Baidu has made efforts, investing both money and time. However, its path to commercializing autonomous driving has been fraught with challenges. By establishing Jiyue Automobile, Baidu seemed to be playing its last card, hoping Jiyue would dominate the industry.

Did Jiyue Automobile dominate the industry?

In fact, Jiyue Automobile had the potential for success. Geely provided the SEA architecture, which is also used by Zeekr, Lotus, Volvo, and smart, demonstrating proven product capabilities. Meanwhile, CATL supplied its batteries, enhancing Jiyue’s performance.

Standing before you is Jiyue Automobile, boasting a combination of Baidu’s intelligent driving technology, Geely’s SEA architecture, and CATL’s power batteries. This is a powerful alliance of product capabilities, and its price is lower than the popular Zeekr 001 at the time. It seemed logical that it would sell well.

However, in terms of sales, Jiyue has only sold over 10,000 vehicles since its inception, which is even less than the monthly sales of many new force brands. If Jiyue were a person, with Geely’s body frame, CATL’s heart, and Baidu’s mind, shouldn’t its sales have soared?

However, automobiles encompass much more. In these other aspects, Jiyue has performed disastrously.

Firstly, Jiyue’s positioning as a “car robot” is bizarre in the current automotive market. Even Brother Bao, who claims to have test-driven all new force brands, was perplexed by this label, saying, “If it weren’t for the cars in the showroom, I’d think they were selling electric robots.”

Actually, Jiyue’s approach is straightforward: “futuristic.”

In the era of new energy vehicles, AI technology is being applied to automobiles, and various intelligent functions are being introduced. The future of automobiles is clearly intelligent vehicles or smart robots on four wheels.

However, we’re not there yet, and consumers’ perceptions haven’t caught up. Changing the slogan to this not only confuses consumers but also fails to effectively promote the brand. Even if Jiyue had adopted a slogan like “Redefining Intelligent Vehicles,” as seen in recent MMO mobile game advertisements, it would have been more effective.

Next is product design, which is even more “futuristic.” No door handles, button-activated lights, screen-based gear shifting, half steering wheels... These features precisely hit various consumer pet peeves.

Jiyue’s executives were aware of this issue. In a previous interview, Jiyue Automobile CEO Xia Yiping teared up while discussing sales, acknowledging the many anti-human designs in the car. He said, “Difficult but correct things are often anti-human. It’s these so-called anti-human designs that drive social progress.”

I understand Jiyue’s rationale. In intelligent vehicles, there might not even be door handles or steering wheels. But that’s for the future. Currently, these designs only create anti-human effects.

As the saying goes, “Being half a step ahead of the industry makes you a pioneer; being ten steps ahead makes you a martyr.” If Jiyue had addressed consumer complaints about no door handles, screen-based gear shifting, and button-activated lights early on, its sales might not have been so dismal. Of course, this is hindsight, but I believe it’s possible, considering the car’s solid foundation.

In fact, there are many excellent designs in Jiyue vehicles. Take the Jiyue 07, for example, which features a fastback and hatchback design, with the A-pillar moved back by 65mm at a cost of 300 million yuan. This significantly enhances the vehicle’s aesthetics, demonstrating excellent design that is not anti-human. However, Jiyue is aware of other anti-human designs but chooses not to change them. Isn’t that frustrating?

Ultimately, this results in a situation where consumers may purchase Jiyue for its SEA architecture (cheaper than the Zeekr 001), CATL batteries (an industry leader), or Baidu’s intelligent driving technology (top-tier). However, they won’t buy Jiyue for its problematic designs.

Even for Brother Bao, who was saving up to buy a Jiyue, it took a lot of convincing to accept these anti-human designs.

Finally, there’s Jiyue’s intelligent driving feature. Jiyue’s ASD Apollo Advanced Driver Assistance System is paid, initially costing nearly 50,000 yuan but later reduced to less than 20,000 yuan for a limited-time buyout. After the launch of the Jiyue 07, the price dropped to 4,999 yuan.

It’s worth noting that many automakers now offer high-level intelligent driving features for free, often through different configurations like base model, long-range model, all-wheel-drive model, and intelligent driving model, allowing consumers to choose based on their needs.

However, Jiyue takes a different approach, similar to Tesla’s, offering a one-time buyout or monthly subscription. While the pricing remains competitive, this model inadvertently gives consumers the impression that “others offer it for free, so why should you charge?” Given that Jiyue promotes intelligent driving as its main selling point, this pricing model is unlikely to be well-received by consumers.

Jiyue’s vague and futuristic positioning, anti-human designs, and misleading intelligent driving feature promotions have collectively contributed to sluggish sales.

It is evident that it was “futuristic” thinking that ruined Jiyue.

Epilogue

Upon hearing the news, Brother Bao kept saying to me, “It’s really a shame about Jiyue.”

Although Jiyue’s sales have only reached over 10,000 vehicles, sales have shown signs of improvement in recent months. When Jiyue employees surrounded Xia Yiping, some employees echoed the same sentiment.

‘SEA architecture + Baidu intelligent driving + CATL batteries’ should have yielded better results. However, ambiguous product positioning, anti-human designs, and confusing intelligent driving pricing became the ‘three mountains’ impeding Jiyue’s sales. Whoever made these decisions within the Jiyue team was truly a ‘genius child.’

The problem is that these issues could have been addressed. Positioning could have been changed, designs could have been modified, and pricing models could have been adjusted. Despite the overwhelming feedback, Jiyue chose to continue hitting the wall.

So, writing up to this point, Brother Bao and I have come to terms with Jiyue’s decline.

Like in the movie “Lost in Hong Kong,” where Shen Teng’s character Wang Duoyu insists he didn’t play match-fixing, and the coach responds, “None of that matters now. Whether you did or didn’t, you deserve the result.”

The same applies to Jiyue. At this point, nothing matters anymore. By setting these ‘three mountains’ and refusing to change, Jiyue deserved the result it faces today.