Huawei Zhijie S7 was caught in a delivery problem, which triggered the dissatisfaction of the scheduled car owners. Many car owners who ordered the lock order after the listing of Zhijie S7 on November 28th told First Electric that their waiting time had exceeded 6 weeks, and the sales staff still could not give the exact delivery date.
On January 15th, Huawei HarmonyOS Zhixing gave a compensation plan. For the users who completed the scheduled payment of Zhijie S7 from November 28th, 2023 to January 15th, 2024, if the delivery time of the vehicle exceeds 6 weeks, they will provide the owners with a daily compensation of up to 10,000 yuan.
The introduction of this compensation scheme is very sudden. Some car owners told First Electric that the sales staff could not provide any compensation the day before, and they only informed the car owners one by one after the compensation plan was announced, but they still could not promise the delivery cycle.
Zhijie is the second intelligent car selection brand launched by Huawei after the cooperation with AITO. The cooperation with Chery Automobile in research and development is a key step to measure whether Huawei’s intelligent car selection model can be replicated and expanded.
However, unlike the previous positive response to the production capacity problem of the new M7, apart from the compensation measures released yesterday, Chery and Huawei have not taken any other public positive measures so far, nor have they spoken out about the production capacity problem.
"There are a lot of ugliness, and I always promise when to deliver it. Every time I arrive, I sayno." A car owner who turned big after the release of Zhijie S7 said, "It’s far ahead."
Delivery has been delayed repeatedly.
As the first coupe model of Huawei’s intelligent car selection mode, at the beginning of the market, Zhijie S7 didn’t sell the first fire, and only two days after the pre-sale, it won more than 10,000 orders. Yu Chengdong said that it was "more powerful than the new M7 in the same period".
Huawei also has high hopes for Zhijie S7. It is equipped with Huawei’s latest HarmonyOS Cockpit 4.0 and Turing Intelligent Chassis for the first time, which is ahead of Wenjie’s new M7 and has a performance benchmark of Tesla Model S, but the price is the same as Model 3, and the final price is between 249,800 and 349,800.
Yu Chengdong said that there was a fierce internal dispute over the pricing of this model, and all four models were sold at a loss. They hope to make up for the loss after the sales increase in the future.
However, the difficulty in delivery led to poor sales of Zhijie S7. By the end of December last year, the order of Zhijie S7 had exceeded 10,000. Due to the delay in delivery, Zhijie S7 only sold 784 vehicles in December last year and only delivered 113 vehicles in the first week of January, which was insufficient. In contrast, the first complete delivery month after the launch of the new M7 in the world has delivered 105.47 million vehicles, and the large order volume has exceeded 100,000 so far.
Several car owners who ordered Zhijie S7 at the end of November told First Electric that HarmonyOS Zhixing promised to deliver the car in mid-December at the earliest, but the delivery date was postponed again and again, and the sales reply to the owner’s inquiry was no longer active. A car owner in Wuhan said that their Zhijie S7 Max tried to choose the option of faster delivery according to the sales suggestion in terms of matching, interior and body color, but it has not been delivered yet. "I don’t know how long it will take now."
A Huawei HarmonyOS Zhixing salesman in Beijing said that none of his Zhijie S7 orders had been delivered so far. In HarmonyOS Zhixing App, the waiting period of Zhijie S7 Pro is the longest, and the car can only be delivered in April this year at the earliest. The delivery cycle of Max and above is 4-6 weeks, but the sales staff can’t guarantee to deliver the car within 6 weeks. They can only appease the customers and get a subsidy of up to 10,000 yuan if the delivery is delayed.
The long wait led to the outbreak of dissatisfaction among the scheduled car owners. Some car owners tried to return their orders, but they were rejected by Huawei HarmonyOS Zhixing. According to the Zhijie Automobile Subscription Agreement in HarmonyOS Zhixing App, the user will hesitate to pay the deposit within 24 hours. After the hesitation expires, the order will be locked and the subscription deposit of 5,000 yuan will not be refunded. A lawyer told First Power that there was no problem with this rule according to the relevant provisions of the Civil Code.
A large number of scheduled owners of Zhijie S7 posted articles on social platforms complaining about delivery problems, and their dissatisfaction extended to the following aspects: the delivery of vehicles was not in a fixed order, the NOA smart driving function in Huawei City was slow to open, and the delivered vehicles had workmanship defects. Even under the compensation scheme of Zhijie S7 in HarmonyOS Zhixing App, many users expressed their dissatisfaction with the repeated delay in delivery in the comment area.
The sales side also suffers from the inability to get to the store by showing cars and test driving. The sales of Huawei HarmonyOS Zhixing Store in Beijing told First Electric that the Zhijie S7 exhibition car and test drive car in the store just arrived at the store two weeks ago, and many customers who came to inquire at the beginning of listing had already transferred to other brands. M9, on the other hand, arrived at the store on the day of the press conference. This is only the case of direct stores. The sales under a dealer system in Beijing said, "The dealer’s store only has a test drive, not a car show."
Sun Shaojun, a car blogger, also said in December that the arrival rate of Zhijie S7 exhibition car and test drive car was only 30%, which led to the failure to transfer. "The delivery time seriously affects the choice of some vehicle configurations."
At present, Zhijie S7 has not yet achieved mass delivery. It is posted on social platforms that most of the owners who have picked up the car are concentrated in the first half of January, and most of them are the first local delivery vehicles. According to the third-party platform, in the first week of 2024, except for Shanghai and Xi ‘an, the terminal sales of other cities in Zhijie S7 were in single digits, and half of the 40 cities with statistics delivered only one.
Why is the capacity insufficient?
Production capacity is the enemy of all new energy car companies. In the past, Tesla has repeatedly fallen into the "production hell". In order to urge the production capacity to increase, Musk also directly worked in the factory and personally supervised the war.
Among the car companies in China, Weilai once affected the sales of new cars because of the difficulty in delivery of ET5. Weilai ET5 was released in December 2021. At the beginning of its listing, it won a large number of orders, which provoked Li Bin to directly say, "This is the model with the highest order volume after the conference in Weilai history."
However, due to problems in the production process, Weilai ET5 was unable to start delivery until the end of September 2022. In the first complete delivery month after listing, ET5 only delivered 1,030 vehicles, which was no longer the fiery scene when it was released.
Huawei is not the first time to face the problem of production capacity. At the beginning of the listing of the new M7 in September last year, due to the surge in orders, the factory’s production capacity was insufficient, which once caused difficulties in delivery.
However, unlike the intellectual S7, the productivity of the intellectual M7 has increased rapidly. The person in charge of the relevant factory of Sailis said that the monthly output of M7 was 5,000 units in September, and it has exceeded 10,000 units in October. Since then, the goal is to produce 20,000-30,000 units per month. "Traditional enterprises generally take 2-3 months (to increase production capacity), and the whole system will mature. We require one month."
Yu Chengdong has also appeared in Celeste Smart Factory for many times to supervise the speed and quality of vehicle production. On October 16th, when the new M7 order exceeded 60,000, Yu Chengdong publicly stated that they had invested more than 1 billion yuan in the whole supply chain, adding more than 20,000 people to ensure high-quality and fast delivery.
At the end of 2023, Huawei also invited some media to visit Celeste Smart Factory. In order to improve the production capacity, the new M7 factory in Wenjie has implemented a two-shift production mode, with a daily production capacity of 750 vehicles, and it is planned to ensure a monthly delivery of 30,000 vehicles in 2024. From October to December, 2023, the delivery volume of the new M7 in Wenjie was 10,547, 15,242 and 20,611 respectively, and the delivery volume increased steadily.
In contrast, Zhijie S7 has not officially announced the delivery volume. Neither Huawei nor Chery has spoken publicly about the production capacity of Zhijie S7.
The manufacturing plant of Zhijie S7 is the Chery Intelligent Networking Super No.2 Factory located in Wuhu, Anhui Province, which was just put into production at the end of 2023. At the beginning of the construction, the local government attached great importance to this, saying that the factory was the "No.1 Project" in Wuhu City with large capital investment and high technical requirements.
A video circulating on the Internet shows that in early December last year, Chery Chaoer Factory realized the first Zhijie S7 off the assembly line, and it still takes some time for the production capacity to climb.
However, Chery Xingyu ES, which is on the same platform as Zhijie S7, has not encountered capacity problems. Xingjiyuan ES is Chery’s independent high-end electric vehicle brand, which was listed one month later than Zhijie S7. Beijing One Star Era Sales Store said that the delivery cycle of Star Era ES can be picked up in 15 days at the earliest, and some models have existing cars in color stores, which can be picked up directly. Searching on social platforms is mostly successful sharing.
Caixin quoted people familiar with the matter as saying in the report that the difficulty in delivering the S7 in Zhijie was mainly due to the supply of spare parts. Unlike Xingjiyuan ES, which adopts Chery’s own technical solutions, Zhijie S7 adopts Huawei solutions for intelligent cockpit, intelligent driving and other parts.
03 Huawei Smart Car Selection Key to Expansion
After the success of the AITO brand cooperated by Huawei and Cyrus, the Zhijie brand cooperated with Chery is a key step for Huawei to expand its smart car selection business.
At the opening of the press conference of Zhijie S7, Yu Chengdong emphasized that Huawei’s smart car selection business has been upgraded to HarmonyOS Zhixing. In addition to the cooperation with Cyrus and Chery, the "Jie" brand models with BAIC and JAC are also on the way. These brands of "Jie" will all be unified under HarmonyOS Zhixing. After the listing of Zhijie S7, it will be listed side by side in Huawei’s Zhixing store in HarmonyOS, and HarmonyOS Zhixing official website will also be distinguished by Wenjie and Zhixing.
Previously, First Electric was exclusively informed that the cooperative brand of Huawei and Beiqi Intelligent Car Selection Mode was determined as "Enjoy the World", and the first model was positioned as a medium and large car, which will be officially released before the Beijing Auto Show in April. In addition, the smart car brand jointly developed by Huawei and Jianghuai is designated as "Aojie", and there are three large-scale cars under research, covering three categories of cars, SUVs and MPVs respectively. The release time of the first car will be advanced to Q4 in 2024.
S7, the first model of Zhijie brand, carries the hope that Huawei’s smart car selection can open the door of cooperation between car companies. If Zhijie brand can succeed again after asking about the world, it may attract more car companies to cooperate with Huawei.
Previously, before Huawei cooperated with Cyrus, it visited domestic head car companies several times to seek cooperation, but few of them succeeded. Sailis was the only car company willing to accept the smart car selection model at that time. Later, the HI model launched by Huawei has successively reached cooperation with BAIC, Changan and Guangzhou Automobile, but at present, only Changan is left.
The "soul theory" of Chen Hong, the chairman of SAIC, was also popular for a while. Chen Hong said that it will not cooperate with enterprises like Huawei, and it is necessary to hold the soul of key technologies such as autonomous driving in its own hands. "SAIC does not want to become a body."
Chen Qiang, co-founder of Auto Media after owning a car, believes that the key to cooperation lies in whether traditional car companies are willing to accept Huawei’s division of labor. "If traditional car companies are willing to do only the assembly, production and mechanical parts that they are good at, they can hand them over to Huawei for autonomous driving and smart cockpits."
Car companies at different stages of development have different demands on Huawei. One of the reasons why Cyrus is more active in cooperating with Huawei is that it does not have intelligent capabilities and "has strong complementarity with Huawei". SAIC and other car companies are larger and have their own autonomous driving research institute. In addition, Huawei itself is relatively strong, and car companies are not necessarily willing to put down their own things to accept Huawei’s plan.
Xingyue ES, which is on the same platform as Zhijie S7, is equipped with Chery’s third-generation NEP intelligent driving. After the listing of Star Era ES, there was a comparison between Chery and gallants. Gao Xinhua, executive deputy general manager of Chery Automobile Co., Ltd. and president of the General Research and Development Institute of Automotive Engineering Technology, used the difference between Mercedes-Benz and BMW to describe the era of the stars and the intellectual world, emphasizing that the two will face different people and will not compete.
One detail is that in the promotion of social platforms, Chery Automobile’s official account did not participate in the promotion of Zhijie brand, which is in stark contrast to Celeste’s promotion of social platforms. Up to now, the avatars of various social platforms of Zhijie brand are still two Chinese characters with black characters on a white background.
Judging from the depth of cooperation with Huawei, Chery and Cyrus play different roles.
Among the brands in the world, Celeste is not only responsible for the manufacturing process, but also has a team responsible for the sales and after-sales of the models in the world. In July last year, Cyrus and Huawei jointly established the "AITO Joint Working Group on Marketing and Service" to be responsible for the marketing, sales, delivery and channels of the industry. The sales of the above-mentioned Beijing HarmonyOS Zhixing store told First Electric that Chery is not responsible for the channel and after-sales of Zhijie brand, but Huawei is responsible for it.
Huawei hopes to attract more car companies to participate in its "circle of friends", but the continuous delivery problem of Zhijie S7 casts a shadow over this vision. How to meet the demands and cooperation of different car companies will be the key to test whether Huawei’s smart car selection can replicate the success of the industry.
