PromZ Vak 3 · 2024

By Fred Sengers:

Chinese Brands - Aldo Spanjaars

Chinese brands in the Netherlands part 7

Xiaomi is the Fastest Kid in the Class

In just over ten years, the Chinese company Xiaomi has grown into one of the world's largest smartphone manufacturers. And this year, the Chinese company surprised everyone by developing and launching an electric car within five months. How does this Chinese company manage to operate so quickly?

What do Google, Apple, and Xiaomi have in common? All three tech companies announced their plans to develop their own car. But while Google and Apple threw in the towel after a few years, the Chinese phone maker Xiaomi surprised everyone this year with the introduction of the SU-7. Not just a concept model to demonstrate new features, but a car currently being produced in large numbers. And it was developed in just five months!

A smartphone maker producing cars might sound odd. However, there are two trends that explain it. The first is the growing need for connectivity. Our car has become a mobile living room (or mobile office if you prefer), and we want not only to make calls - hands-free, of course - but also to play our favorite playlist from Spotify and use voice recognition technology to text or search for a nice lunch spot with both hands on the wheel. If we happen to get into an accident, an emergency call is automatically sent with the correct location. It's no wonder that car manufacturers are increasingly working closely with smartphone makers to make all this possible.

The second trend is the increasing importance of electronics in modern cars. The first thing a mechanic does when you bring your car to the garage, even before opening the hood, is to connect a computer. If a car has electronic problems, you might as well forget about getting that good old combustion engine to start again. The transition to electric vehicles (EVs) has accelerated this development. Previously, the engine was the centerpiece around which a car was built. Making a combustion engine that performs well, is reliable, and is also efficient and clean is a skill in itself. But an electric motor, on the other hand, is very simple, you don't even need a gearbox anymore.

One could argue that it is now simpler for a smartphone maker to build a car than for a car manufacturer to design a smartphone. You don't need to reinvent the wheel like Elon Musk and do everything yourself. Xiaomi lets its cars be built by BAIC, the Beijing Automotive Industry Corporation. However, it remains an achievement that Xiaomi developed and launched a new car in just under half a year.

And that is no coincidence, says Aldo Spaanjaars. He worked for 26 years in China for both Western and Chinese companies, including Adidas, Siemens, Fosun, and Anta. Based on his years of experience, he describes in his book "Dragon Tactics" how Chinese companies operate differently than their Western competitors and achieve success as a result. "Western entrepreneurs are less opportunistic, less willing to take risks, and are inclined to look more at how others do it. Chinese entrepreneurs, on the other hand, believe that you can succeed against all odds," says Spaanjaars. "This is precisely the reason why so many joint ventures between Chinese and Western companies have failed. They operate in the same reality, but the way they respond to it is totally different. The Chinese have a great word for this: tongchuangyimeng. It means: sleeping in the same bed but with different dreams."

In his book, he identifies five dragon tactics, all with catchy names: Wolf Culture, Change or Die, The Emperor Decides, Happy Families, and Everything Begins with Data. The first two are particularly applicable to Xiaomi, says Spaanjaars: "A wolf doesn't wander around aimlessly but is constantly looking for opportunities." So it’s not surprising that a mobile phone maker decides to build a car, Spaanjaars wants to say. A Western company seeks efficiency, looks for economies of scale, and finds them, for example, by concentrating on its core business. In Asia, on the other hand, you see many conglomerates that have grown orga-