Rebirth 08: Equipment God

Chapter 471 Opening the door is about environmental protection.

People who raise catfish.
Zhai Da roughly understood what the other party meant.

As he pondered, his fingers tapped lightly on the table.

"But raising catfish isn't an easy job either, because some people don't like catfish."

"They like silver cod, salmon, and tuna."

Although the research institute is currently facing some criticism, it is only from a very small group of people, and it coincides with the popularity of the "circular headquarters".

Overall, its reputation is still very strong.

The automotive industry is a lucrative market, but it's teeming with problems.

Looking back on my past life, every company involved in the automotive industry was caught in a media storm. The media, car reviewers, and used car dealers—you might think it was all about emotions, but for them, it was all about business.

Then, car companies would start their own alliances, making it arguably the most murky business in the industry.

Wan Gang smiled wryly, "There's nothing we can do about it. Over the years, the market, interests, and public opinion have become quite entrenched. Sigh."

That sigh represents so much.

It is a deep understanding of the industry and the market, a helplessness in the face of various obstacles, and also a kind of exhaustion.

Since 2000, he has worked tirelessly for innovation in the automotive industry for ten years. He knows better than anyone how many troubles he has encountered during that time.

The big shot said leisurely, "Let me tell you a story."

Zhai Da nodded: "Please go ahead."

"Imagine I am a large joint venture car company. After decades of reform and opening up, we have become a large and well-established enterprise with numerous assets and mature factories. If we suddenly ask them to research the field of new energy, the first problem is: we have no R&D capabilities."

"Their long-term R&D focus has been on 'localization.' When the parent company develops a model, they simply copy it and then manufacture the complete vehicle through the supply chain. The word 'R&D' is extremely distant for those companies. They may have good technology, but they have little R&D capability."

Sun Ting's eyes widened. Such a big company has no R&D capabilities?

Hmm, that makes sense. I haven't seen it be any better than the overseas version in terms of a single part or material.
"Even if they are determined to start R&D from scratch, internal opposition will soon come wave after wave. The simplest example is the 'gearbox,' a core component of a car. If it is changed to a new energy direction, relevant departments, subsidiaries, and suppliers will oppose it with a do-or-die determination, because they will die anyway if they do not oppose it, so they might as well make a scene."

"Is it over? No! Even if they pass this hurdle, the procurement system will still give them a 'failure' feedback. The procurement departments of large car companies already have fixed interest chains and suppliers they've cultivated for over a decade with whom they have an unspoken understanding. Now, if they want to procure new components such as batteries, it's like they need to build connections from scratch, and it might even expose past problems. So in the end, they will also object. Through complex reports, they will give an upward conclusion of 'cost too high' or 'technical inadequacy'."

"Even if they persist at this point, foreign capital will intervene and not want any substantial progress in research and development, because they themselves have lost their ability to innovate and are unwilling to give up their years of accumulation. As long as new technologies do not emerge, the market will remain under their control."

"Therefore, no matter how much the country expects of these joint ventures, they all end up failing quietly. Moreover, they are actually opposed to technological innovation, and even use their industry influence to spread rumors and confuse the public."

Zhai Da suddenly said, "Actually, this situation is not uncommon, and it also exists in the electronics industry. We usually call it 'comprador'."

The only truth about rejecting technology.

The problem is that their profit-making methods are not based on technology.

Their technology doesn't come from themselves either.

Not every company has to accept innovation. Those that don't will simply die. Of the private companies attending this meeting today, how many will still be as vibrant and successful as they are today in a decade or two?

But if it's part of state-owned resources, that's a different story.

Perhaps within the system of joint venture car companies, the spiritual world has already wandered away.

Wan Gang waved his hand: "'Comprador' is no longer a valid term, and the situation is more complicated now."

Having probably been sitting for a whole day, this bigwig couldn't sit still any longer. He stood up, walked to the conference room window, drew back the curtains, and looked out at the Ministry of Industry and Information Technology's compound.

"Mr. Zhai, this is the trouble I've been facing for the past few years."

"Our system is unique, and concentrating resources to tackle difficult tasks should be our strength. However, the automotive industry, especially the civilian vehicle sector, is really hard to stir up. I often think about how much force it would take to get these mainstream automakers moving."

The big shot turned his head, his gaze sharp.

"Later I realized that it's hard to make them realize they're wrong, but if they know they're about to die, they'll change faster than anyone else!"

Zhai Da remained silent.
Is this what it feels like to be in a high position with great determination?
The person in front of me is genuinely interested in getting things done, and he's truly capable of doing so.

"People often ask me, 'Old Wan, don't those joint venture car companies pay taxes, create jobs, and produce cars? Why do they have to make such a fuss?'" "Then I would ask, why do joint venture car companies dare to outwardly comply but inwardly defy the national plan for industrial upgrading and seizing the high ground in industry? Does the state, which holds half the power, have the final say, or does the other half?"

The automotive industry is a very unique one; its added value is actually far less than that of semiconductors.

In a mature semiconductor industry, the added value can reach 70% per million units of output, while in the automotive industry it is only around 25%.

On the other hand, for every 100 million units of output, the semiconductor industry can only create 0.2 jobs, while the automotive industry creates 1.2, a difference of six times.

For sectors extending throughout the automotive lifecycle, such as parts, repair, detailing, and finance, an additional 4-5 positions will be needed.

Furthermore, the output value of the automotive industry is three times that of the semiconductor industry.

No country can afford to neglect the automotive industry; it is the most mature and core sector in human industrial history.

Occupying this high ground means the livelihoods of tens of millions of industrial workers, an improvement in the overall quality of social operation, and the ability to profit globally.

In fact, ever since he obtained the [Mechanical Core], the option of building cars has been on Zhai Da's to-do list.

As each technology is dissected, the journey seems to be getting closer, but given the complexity of the automotive industry, we haven't even completed half the journey.

Just as Wan Gang said, technology only accounts for 40%.

Even the worst product is worthless if someone buys it.

Zhai Da has his own plans, and Wan Bu's plans are different but compatible.

"You might hope for a catfish to stir up trouble, but the catfish itself might be attacked by the masses, including fish farmers. To be honest, the research institute has no shortage of directions for development or profitable areas. Simply raising catfish is not a good investment with a proportional return."

Even if there are subsidies and support?

Zhai Da nodded: "Yes, even with subsidies and support."

"Moreover, even research institutes find it difficult to produce mature products in a short period of time, considering safety, compatibility, and quality. It probably takes two or three generations to find the right path before delivering immature products to consumers. I do not agree with this approach."

The lack of support from the market and public opinion will not be an exception for research institutes. This point in time is earlier than in later generations, and the pressure faced by car manufacturers will only be greater.

He doesn't want his car to be turned into a meme, set on fire as soon as it leaves the factory, or even worse, be reported nationwide via text message after a minor accident.

If public opinion cannot be effectively controlled, it will only end up becoming a huge mess.

Although he is not afraid of "forging ahead", why should I walk on razor blades? It's not like I can't make money.

A hint of helplessness flashed in Wan Gang's eyes.
However, private enterprises prioritize profit above all else, which is undeniable.

Until Zhai Da said:

"But what if we change our approach and throw the catfish out?"

Wan Gang was taken aback: "Throw them out? Where to?"

"Go overseas where environmental protection has become increasingly obsessive, and people are loudly proclaiming 'the earth is dying.'"

Stop introducing catfish; just throw them outside.

Flowers blooming outside the wall will attract those inside who will crane their necks to smell them.

This period coincided with the rise of "abstract environmentalism" in the West. Every now and then, there were protest groups shaking snowballs on the streets, all politicians were portraying themselves as environmental advocates, and all countries were claiming that "environmental protection is their top priority."

It's much harder to turn back now than it was a decade or more later when they found themselves losing and resorting to cheating; it's also much more difficult to get carried away.

Acceleration is far more difficult to control than deceleration.

Zhai Da revealed a sinister smile.

"Aren't they environmentalists?"

"Why don't you open the door when environmental protection officials come?"

(End of this chapter)