"Two Monks and No Water to Drink."

It's no surprise that Jiyue Automobile is on the brink of 'bankruptcy'.

A Jiyue livestreamer was stunned to hear that the company might cease to exist mid-broadcast. Xia Yiping, CEO of Jiyue, was greeted by a crowd of agitated employees and suppliers upon his arrival at the company premises. Some even seized the office microwave. Jiyue car owners gleefully received their 'limited edition' models... A series of humorous trending topics obscure deeper, more serious issues.

As a collaborative venture between Baidu and Geely, Jiyue Automobile has given the impression of being neglected by both partners in recent years. After introducing the concept of the 'automotive robot,' Baidu has rarely offered public support to Jiyue. Meanwhile, Geely has been preoccupied with nurturing its 'own child,' Zeekr.

Gradually forgotten, Jiyue's sales have plummeted. Even Xia Yiping's tears at the new car launch event failed to elicit much empathy from consumers.

Image source: Screenshot from ecar.xcar.com.cn

Behind Jiyue's downfall lies the power struggle between internet giants and automakers, coupled with the challenge of narrating the electric vehicle story in an increasingly demanding consumer market.

01. 'Livestreamed' Collapse

This year's 'Double 12' may have been the toughest day of Xia Yiping's career.

Following the 'on-the-spot disbandment,' Jiyue was thrown into chaos. On December 12, as soon as Xia Yiping arrived at the company, he was completely surrounded by Jiyue employees and suppliers. Fearing that Xia might flee, some employees even called the police on the spot.

Image source: Weibo

Faced with this chaotic scene, Xia Yiping remained composed. He even hugged an emotional employee on the spot, reassuring them that he was there to resolve issues and would not flee. Regarding the sudden announcement of the 'collapse,' Xia Yiping explained that it had happened unexpectedly and denied rumors of corruption leading to shareholder withdrawal; he also revealed that his social security contributions had not been paid, which drew a round of boos from the crowd.

An employee claiming to be from Jiyue posted a video about employee rights protection on Xiaohongshu around 3 a.m. She stated that after negotiations, the first step was to pay social security and provident fund for November, but other matters remained undecided, and negotiations might continue from the 13th to the 17th.

Image source: Xiaohongshu

In the video, employees blocked the entrance to the conference room, and the slogan on the wall, 'In the history of smart cars in China, the name of every Jiyue person must be included,' seemed particularly ironic.

On December 13, media reported that Jiyue Automobile had agreed to its employees' reasonable demands and formulated a communication plan with the Baidu and Geely working groups. Meanwhile, Xia Yiping emphasized to employees that he was still actively seeking financing, would not flee, and that the company was not shutting down or going bankrupt. Vehicle warranties and software services would not be interrupted.

Image source: Weibo screenshot

According to Sina Tech, an insider from Jiyue revealed that the fuse for the current predicament was the withdrawal of shareholder support, leading to a lack of funds.

Media reported that Jiyue and Baidu had agreed on a 3 billion yuan financing plan earlier this year. According to Tech Planet, by the end of 2023, Jiyue had already reported to Baidu an expected loss of approximately 7 billion yuan for the year, indicating that Baidu was aware of Jiyue's potential losses in advance. By September of this year, the investment terms had entered a detailed confirmation stage. Baidu promised to invest 3 billion yuan in Jiyue but required Jiyue to return the funds to Baidu in the form of purchasing intelligent solutions (intelligent driving, intelligent cockpit, and large models) over the next three years.

Image source: Weibo screenshot

It can be speculated that perhaps both Xia Yiping and Jiyue believed that this funding was a done deal, but Baidu's sudden change of heart caught Jiyue off guard, leading to the current 'flash crash'.

While employees were busy protecting their rights, car owners were also confused.

On social media platforms, a car owner who picked up their car in December last year said they saw some car owners in a group reporting that the weather query function was no longer working. The first thing he did after work was to ask SIMO, 'What's the weather like outside now?' but SIMO did not respond as usual. Another netizen joked on Xiaohongshu that they had just bought a 'limited edition' car.

Image source: Xiaohongshu screenshot

Although everyone's attention is currently focused on the Jiyue incident, Baidu and Geely should address Jiyue car owners' questions: Can the car software be used normally in the future? If not, will the intelligent system be replaced? Will future hardware repairs be handled by Geely's after-sales service? Can those who have placed orders but not yet received their cars cancel them?

02. 1+1<2

Jiyue's 'flash crash' was sudden news for the company but not surprising to industry insiders.

Baidu announced its entry into the automotive industry in 2021, amidst the strongest momentum for electric vehicles, and its partnership with Geely attracted particular attention. However, in the electric vehicle sector, the 'double powerhouse alliance' failed to achieve '1+1>2'.

This echoes the saying, 'Two Monks and No Water to Drink.'

Image source: Canva

"A powerful automaker hopes that its suppliers are competent but not well-known," said Xiao Yu (pseudonym), an automotive professional. "The reason is simple: it's a matter of power struggle."

"In a double powerhouse alliance, who calls the shots?" Xiao Yu believes that, taking Jiyue as an example, Baidu definitely wants to vigorously promote its intelligent driving capabilities. From the half-steering wheel and handleless doors to the automotive robot, it promotes cutting-edge intelligent concepts. However, Geely is not renowned for its intelligence; in Geely's overall electric vehicle transformation, technological platform development and hardware strength are its benchmarks. Consumers may think that one focuses on software and the other on hardware, creating a perfect complement. In reality, one wants to promote software, and the other wants to showcase hardware, leading to issues in marketing strategy.

Moreover, as Baidu could not obtain an automotive manufacturing license, it wanted to step back into the shadows. However, Baidu aimed to follow Huawei's model and become an intelligent supplier for automakers. Therefore, Baidu did not want just Jiyue but the entire 'forest' of intelligent driving.

On the other hand, Geely already had its 'own child,' Zeekr, in the 200,000-yuan price range. Additionally, Jiyue's design and positioning did not align with Geely's overall product positioning, resulting in Jiyue having two powerful 'fathers' but neither willing to embrace this 'son'.

Image source: Canva

If there is a successful case of collaboration between an internet company and an automaker, it is undoubtedly AITO, backed by Huawei and Thalys. Before AITO emerged, many had not heard of Thalys, and even after AITO's appearance, many were still unaware of the automaker. AITO's entire marketing strategy revolved around Huawei's intelligent driving capabilities, with its initial flagship model being a larger SUV, leveraging Huawei's sales advantages to tap into the ToB market and follow the 'electric Hongqi' route.

In fact, Huawei has also collaborated with other more well-known automakers, such as the ARCFOX Alpha S HI version jointly released with BAIC, but the monthly average sales of the ARCFOX Alpha S model over the past year have only been in the hundreds.

Image source: Owner's Guide

In comparison, a powerful company leading the narrative alongside a 'compliant' smaller company has more influence than a combination of two large companies.

Jiyue's 'collapse' inevitably reminds people of another powerful alliance, AVIATAR, which has 'three monks' behind it: Huawei, Changan, and CATL.

Similar 'vague positioning,' similar 'lack of a sense of belonging,' and similar 'low sales' (according to data from Ecocheaps.com in October, the cumulative sales of AVIATAR 11 and AVIATAR 12 in 2024 were 6,839 and 16,070 units, respectively)...

03. How to Tell the Story of Electric Vehicles

It's unclear if Geely anticipated Jiyue's outcome, but it embarked on a strategy of 'internal consolidation' much earlier.

On November 14, around the release of its third-quarter report, Geely Automobile announced the merger of Zeekr and Lynk & Co. Combined with the 'Taizhou Declaration's' focus on 'strategic focus, strategic integration, strategic synergy, strategic prudence, and strategic talent,' the words 'focus' and 'integration' indicate that Geely has realized the need for precise and vertical storytelling in the era of electric vehicles. Behind the brand integration lies the unification of marketing strategies and power struggle.

Perhaps from the beginning, Jiyue didn't tell the right story when selling cars. "Jiyue (Jidu) opened an experience store in Sanlitun, and I went to see the Jiyue 01 as soon as possible. The first thing the salesperson said to me when I walked in was, 'Our car has six ways to open the door.' After hearing that, I felt that something was off," said a car enthusiast.

Image source: Canva

However, it's not just internet companies that struggle to tell the story of electric vehicles; automakers also sometimes don't know how to do it. For example, Geely's 'own child,' Zeekr, caused much controversy in its early years due to covert de-specification and frequent changes to its sales strategy. Some car owners even established rights protection groups to protest.

"Automakers transitioning from fuel vehicles often face this issue. Their success in the fuel vehicle market makes them believe that making electric vehicles is not starting from scratch, and they bring a touch of 'arrogance' from being a big brand. However, the electric vehicle consumer group is younger, and the trend towards intelligent electric vehicles makes buyers more sensitive to information, preferring new things. Such consumers also have more ways to voice their opinions and protect their rights. After several rights protection incidents, automakers realize that the marketing strategy for electric vehicles needs to be more cautious; otherwise, consumers simply won't buy it," said Xiao Yu.

Even XPeng, which once topped the list of new forces, experienced a sharp decline in revenue due to chaotic SKU management. Electric vehicle users are not easy to deceive.

However, there are also successful 'storytelling' cases in the electric vehicle circle. For example, when everyone used seat count, wheelbase, and vehicle length to emphasize vehicle space advantages, Li Xiang described the Lixiang L8 as a 'standard three-bedroom, one-living room' apartment, turning cold numbers into a visual image.

Image source: Canva

Another example is Xiaomi's SU7, which was ridiculed by some for resembling a Ferrari when it was first launched. Xiaomi SU7 invited Ferrari owners to the launch event. As a result, a large number of videos emerged online featuring 'Ferrari owners buying Xiaomi SU7' and 'Ferrari owners putting Xiaomi SU7 stickers on their cars,' effectively turning the 'embarrassing resemblance' into a marketing strength.

However, the current challenge for electric vehicle manufacturers is to maintain a good story over time, not just temporarily.

Nowadays, most consumers will not blindly follow a brand solely because of its brand effect. Companies must produce high-quality, popular, and comprehensive products. In an increasingly competitive electric vehicle market, both marketing and product quality are crucial skills.