02 Endure the suffering, see the light

However, the seemingly accurate and successful layout is not taken for granted in Zhu Xingming’s view. In a previous interview with The Times Weekly, Zhu Xingming mentioned that the information obtained by various ways is enough to support any thinking person in the industry to see the direction. What is the direction, in fact, we all know that the key lies in dare not to do, is to encounter difficulties and pressure when can insist on doing. He believes that endurance on this track determines how far you can go.

Zhu Xingming in the interview specifically mentioned the layout of new energy vehicles. 2018-2019 was the time when Huichuan Technology invested the most in the field of new energy vehicles, and the company “transfused” a large amount of profits to the new energy business. Zhu Xingming said at the time, “Even at the risk of financial indicators becoming worse, we must do this.” We must build the car even if the profit drops to zero. At times like this we have to be bold and not care what the outside world thinks.”

Data show that in 2018-2019, the total revenue of Huichuan Technology increased by less than 30% year-on-year. In 2018, net profit attributable to shareholders of the parent company only increased by 10.08% year-on-year, and even fell by 18.42% year-on-year in 2019, which is also the only decline since 2013. Its gross margin on sales is also declining at a rate of about 4 percentage points per year, to just 37.65 percent in 2019, compared with 45.12 percent in 2017. 2019 was also called the lowest point in the history of Huichuan’s business performance by Zhu Xingming.

CP451-10

CP451-10

CP451-10

Also from 2018, Zhu Xingming insisted on making a New Year speech in the form of live broadcast, and the theme of the speech was Zhu Xingming’s thinking and cognition of Huichuan’s “internal troubles and external difficulties”. At the lowest point in 2019, Zhu Xingming spoke for three and a half hours. With the title of “Embracing the Future from the Beginning of cognition”, the speech introduced 20 cognition of Why thinking based on origin thinking and first principles, and analyzed Huichuan’s talent view, business model, strategy and management.

After the stock price fell 31% in 2018, Huichuan Technology began to fight back in 2019, and the stock price rose 56.53% in that year, and it rose 212% in 2020! Driven by new energy vehicles and other businesses, in 2020, the total revenue of Huichuan Technology increased by 55.76% year-on-year, and the net profit attributable to the shareholders of the parent company increased by 120.62% year-on-year.

03 From Technology to Enterprise Management

In 2022, after experiencing a substantial increase in the penetration rate of new energy vehicles and the impact of the epidemic, the performance growth of Huichuan Technology once again encountered challenges. The annual operating income increased by 28.23%, and the net profit attributable to the shareholders of the parent company only increased by 20.89%, which is the lowest value in the last three years.

At the beginning of this year, Zhu Xingming gave a four-hour speech on the topic of “The Pain of Evolution, the Light of Life” at the annual meeting, and the content was nearly 20,000 words. In his speech, Zhu Xingming analyzed the elements of enterprise success: the era is a thousand level, the strategy is a hundred level, the corporate governance is a ten level, and the management is a bit level. In his eyes, 90 percent of the success of Huichuan technology is luck.