Bouncing Ideas on East Lake: The Future of Automobile - Global Intelligence under Multiple Challenges

November 1, 2013

Official summary of the Global Automotive Forum 2013 held in Wuhan, China
Click here to read the original notes posted at www.ga-forum.org

On the afternoon of October 18, 2013 (The Fourth) Global Automobile Forum was successfully closed on the International Conference Center of East Lake, Wuhan, after a busy two-day agenda.

In this Global Automobile Forum, a wonderful dialogue and discussion were developed closely around the theme of "future development road of automobile - objectives • strategy • mode".

This year, China's automobile industry has seen 60 years of development, and China's auto production and sales are expected to exceed 20 million, continuously ranking the as the largest auto market in the world. It will provide a unique strategic opportunity for China's auto industry.

However, the global auto industry encounters many challenges, such as the environment, fuel consumption, energy, safety and traffic management, etc. Consequently, the issue of whether a feasible and innovative solution can be proposed and put into place has become a key factor related to the development of auto industry and the survival of auto enterprises. Therefore, the cooperation among policy makers, significant industry organizations, auto manufacturers, suppliers, vendors and all related parties is becoming more and more important.

As the world's largest automobile market in terms of production and sales, the future development of the Chinese auto industry has attracted the attention of international auto industry. Wang Ruixiang, the president of China Machinery Industry Federation, also expressed in his speech that the realization of dream of strong auto country was depending on the abundant resources and global automotive industry, as well as the sincere cooperation among international auto enterprises.

At the opening ceremony, Wang Xia, the executive chairman of Organizing Committee of Global Automobile Forum and the president of China Council for the Promotion of International Trade Auto Industry Branch said in his speech: "As the world's most populous country with the largest demand for new cars and fastest growing auto industry, the great challenges and deep-seated problems faced by China as its auto industry becomes the  development engine of global auto industry should also attract the global attention, because the solving of these issues involves not only the development of China's auto industry but also the development of global auto industry."

The development of the auto industry is based on the wisdom of China and world. This is also the original intention that brought auto industry elites from the whole world to this forum in Wuhan.

Chi Shiyan, the president of Honda Motor Co., Ltd., also held high expectations for the development of China's auto industry. He believed that in the face of challenges from energy and environmental concerns, it was important that China should lead the direction of the global auto industry. While such a right direction and pace could better benefit the world, and what was important was not just the increase of sales but the quality, safety and environmental protection issues, so as to better achieve a greater global competitiveness and support the global market whilst being more accepting of Chinese automotive products.

But in fact, there are many problems to be solved if China intends to lead the development direction of global automobile industry. Wang Ruixiang, the president of China Machinery Industry Federation, noted that compared to developed countries in the world, China stills lagged behind in the independent innovation, core components and brand building; "To build a truly strong auto country, we still have a long way to go." Wang Rui xiang said.

Bill Russo, (formerly) from Booz & Company and (presently) the founder and president of Synergistics Company also pointed out that now China's auto market was still very fragmented and the self-owned brand competition was fierce. Therefore, China's auto industry was in a divide-and-rule pattern, without any cohesion, and the local competition in the internal market was very intense. The level of competition needed to be improved.

Then, as the world's largest auto market and producing country, can China lead the development direction of global auto industry in the future?

Zhu Fushou, the general manager of Dongfeng Automobile Co., Ltd. also proposed that: facing the strategic opportunities, China must solve three contradictions to achieve the sustainable and healthy development of auto industry, i.e. the contradiction of competition and long-term confrontation between joint-venture brand and self-owned brands in the China's market; the contradiction between firm determination of China's enterprises entering international market and international trade barriers; the contradiction between rigid demand for auto and energy, transportation and environmental protection.

Zeng Qinghong, the general manager of GAC Group advised that: firstly, to accelerate the promotion of independent innovation capability, especially the breakthrough of key parts and core technologies; secondly, to speed up the integration and restructuring; thirdly, to quicken the economic restructuring, especially the industrial layout adjustment. And the four leaps include: the transformation & upgrading from manufacturing to creation, the leap from production base to industrial base, the leap from asset management to capital management, and the leap from business products to brands.

Wang Xigao, the chairman of JMC Group, held that to improve the independent R&D capabilities of China's self-owned brand automobile enterprises, it should gradually realize the maturity of technology research and development, and finally achieve the purpose of independent innovation by absorption, imitation and improvement when introducing the foreign advanced production technology. In this step, the improvement was the key. Anyone can not blindly imitate the foreign technology, but find a suitable road meeting the actual needs of China's market and international market during the learning process.

Guo Qian, Chairman and CEO of Qoros expressed that the automobile development of China has gone through several stages: firstly, the grasp of some key technologies or a car body or a gearbox; secondly, the grasp of system integration; thirdly, product platformization and modularization and fourthly, the establishment of brand features. In this respect, Qoros has created a kind of automobile with high starting point, which has become a new model of Qoros.

As the representative of commercial vehicle enterprises, Yuan Hongming, Deputy Party Secretary and General Manager of Shaanxi Automobile Group Co., Ltd. thought that autonomous vehicle enterprises should make breakthrough by focusing on post-market, accelerate the promotion of new energy and intelligent technology, pay attention to the mutual development of automobile and parts. Chinese enterprises should also unite closely to reduce internal consumption.

Alan Mulally, President and CEO of Ford Motor Company gave a sustainable technology roadmap: improvement of traditional internal combustion engines and materials, including diesel and gasoline, improvement of aerodynamics and electronic equipment, etc., integration of system and interconnectivity of technologies; automobiles will become a mobile equipment in the future to be connected to internet by people; development from hybrid power to full electric vehicle." Cooperation is required during the whole process. Governments and enterprises in the global world should work together so as to bring the proven technologies to consumers", Alan Mulally said.

Prof · Dr · Jochem Heizmann, President and CEO of Volkswagen (China) thought that the future development of auto industry relies on three key factors: production with energy conservation, high-efficiency mobility and intelligent system. He believed that to achieve these goals, the auto industry of China should be cooperative, including cooperation with suppliers, have a clear and stable legal framework and environment and establish a stable relation with core participants and large number of partners. At the same time, a strong team-work spirit should be built among employees.

In terms of the international cooperation of Chinese automobile enterprises, Geely has come to the forefront by acquiring Volvo and some other international companies. Li Shufu, Chairman of Volvo Car Corporation, founder and chairman of Geely Holding Group expressed that the localization projects of Geely-Volvo in Chengdu and Daqing have been approved this August. This is also an event with far-reaching significance in the development of Chinese auto industry. Currently, Geely has determined to build China to the second home market of Volvo to promote the revival process of Volvo in the global world.

In the two-day meeting, 2013 (Fourth) Global Automobile Forum arranged 16 open sections and launched a range of wonderful discussions on issues of strategic opportunities, multination development, future automobile, post-market, financial innovation, new energy strategy, automobile consumption and international talents, etc.

As what is hoped by Wang Xia, the Executive Chairman of the organizing committee of Global Automobile Forum, the automobile dream of China is an important part of world automobile dream. The mutual dream of global automobile people is: to make the society better with automobiles. This forum which integrated global wisdoms to offer advices and suggestions to the development of auto industry is to guide another new development of auto industry with the creative, constructive and proactive thoughts of everyone.

This session of forum is hosted by Auto industry Committee of China Council for the Promotion of International Trade and Wuhan People's Government, cosponsored by CCTV and firstly held in "City with Auto industry Dream and Solid Foundations"--Wuhan. It attracted more than 900 professionals from 20 countries of the world, including over 200 foreign guests or overseas personnel. The nature of the "Global" Forum is further intensified.

This forum totally organized 16 open sections, 1 closed-door meeting, 6 press conferences, 2 off-field activities and 1 concert held in the same period. 82 authoritative speakers participated in the sectional discussion. USA Michigan and Georgia States specially sent governments and business delegation to participate in the forum.

This forum surpasses the previous three Global Automobile Forums in the scale of meeting, coverage of participants, degree of internationalization and diversity of forum activities, especially in the height, depth and range of issues under discussion, and reaches a new realm and new height in global professional meetings. What is particularly worth mentioning is that this forum broke through the scope of multilateral exchanges, increased bilateral exchange activities, held a number of talks between enterprises, press conferences and communications between enterprises and medias, meetings between government leaders and corporate executives and so on, which makes the platform role of Global Forum more prominent.