Changming Xu, Director of the Information Resource Development Department of the State Information Center shared his experience for being a Xuanyuan Award jury member for three consecutive years.

　　By Yandi Liu

　　Three Major Points about Being a Jury Member

　　Jack Yu: Mr. Xu, you have been a Xuanyuan Jury member for three consecutive years, the results of this year’s award have been announced, what do you think of this year’s award? How do you feel being a jury member during these three years?

　　Changming Xu: I’ll first talk about my feelings towards these three consecutive years. First of all, Xuanyuan award is very valuable and has a special meaning. The meaning itself is special, These criteria are product innovation, contribution to mobility in China and most importantly, contribution to the Chinese automotive industry. Thus, I have a very profound understanding on the special meaning of the award.

　　Secondly, after attending the award jury for three years, I can use two words to describe the evaluation process: fair and professional. Its fairness is shown on its motto: independent from business, authority and relation. It’s easy to say, but me, as a jury member who has participated in the whole process, do feel that we are really doing this according to that motto.

　　As a jury member, at least we do not have any interference from the organizer or the manufactures. It is because of this independence, that this award is more fair than other auto awards. Besides, it is really precious that you as organizer have no vote and cannot have influence during the evaluation process. It’s one hundred percent a reflection of the experts’ opinions.

　　We are just witnesses.

　　Because of its fairness, jury members are really willing to join the award. The second word I mentioned is professional. I think its professionalism is reflected in the following aspects:

1. The members of the jury are very professional. We have experts in areas such as R&D, design, technology, market, components, management, as well as professional testing. The composition of the experts itself determines a multi-angle of the award. Some jury members are evaluating from the consumer’s point of view, some others from a technical point of view, some from R&D, and some from testing. All the variety of opinions challenge each other. The process is very professional; this is my first impression.

2. The nomination process is also very professional. We combined recommendations from both the manufactures themselves and experts. Some companies might be unwilling to take part in the award because they don’t understand it, but if the experts think their vehicles fit our criteria they will recommend their vehicles. Sometimes we also meet embarrassing situations, like when there were certain companies who were unwilling to come and claim the award even though they had won the award. This kind of situation never happens in other auto awards by other auto magazines. It was quite an impression when it happened to us. However, it is also a reflection of our fairness and professionalism.

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3. The evaluation process also shows its professionalism. We have data from experts’ assessment on all the vehicles and the jury takes that as reference while we also drive the vehicles ourselves. The discussion during the jury session is also very comprehensive and profound. Thus, I also think the evaluation process is very fair and professional.

　　▲JiaYanliang who is the designer of China’s most prestigious car Hongqi CA770designed the Award Trophy, and Chinese cutting-edge car designer Wang Chaobuilt the trophy and the medal.

　　My third impression is that the results of the awards can really stand for serious scrutiny and are very forward-looking. Former winners have been GAC Trumpchi GS5 for the first award, SAIC-GM-Wuling Baojun 730 for the second award and Geely GC9 this year. When I looked at these cars together, all of them meet in a certain degree our criteria and all contribute to the Chinese auto industry.

　　For example, GAC Trumpchi GS5 is representative for a high priced SUV suitable for young people, it greatly helped into pushing the SUV market forward. When people see the GS5 selling really well, many other SUV began to develop rapidly. Also because of the development of the SUV, sales for domestic brands increased much faster than the overall growth rate which is approximately 7% while domestic brands reached more than 20% growth, three times faster than the overall average growth rate.

　　I think that rapid growth also has something to do with our award. I’m not saying it’s all based on our contributions, but there is a certain relation between them.

　　SAIC-GM-Wuling Baojun 730, winner of the second award, is also foreseen as a pioneer and it’s also very popular. As for its contribution to the Chinese automotive industry, I think Wuling chose a specific market segment in which the customers are mainly from rural areas or small towns or low-income cities. These customers are owners of minibuses or minivans. Wuling grasped their needs to upgrade their vehicles with a lower price. Baojun 730 is a perfect product that meets this demand and satisfies this market segment. These customers now can spend the same amount of money while enjoying a higher product. This is its contribution to the industry.

　　This year’s Geely GC9 shows a kind of development on a broader scale. Sedan models encouraged Chinese people to have more self-confidence in developing independent car brands. We used to call the car of this level the Level-B automotive. The Level-B automotive is hard to sell regardless of the price. However, this Geely GC9’s sale volume amounts to 5000'6000 vehicles per month with its quite-high price. I think it is a big inspiration to the domestic brands and to the national industry. It is definitely objective that we choose this model as winner of the Xuanyuan Award.

　　These three models which won the Xuanyuan Award during these three years, have all contributed a lot to China’s automotive industry. They are the winners because they meet our evaluation criteria. For three years, I do believe that the Xuanyuan Award has encountered close scrutiny throughout its meaning, process and results. Therefore, I wish that this activity could continue. As for myself, I am willing to continue being a jury member for the fourth and fifth session, together with all of you.

　　Some suggestions

　　Jack Yu: Thank you! Besides the Xuanyuan Award, there are also some other special awards this year. It’s kind of like an Oscar Award. There have been some special awards during the past few years, but only three this year. These are: Award for Design, Award for New Product Experience and Award for Consistent Portfolio Strategy. No award for new energy vehicle even tough last year was the booming year of new energy automotive, this award is surprisingly missing. Of course, to some extent, our awards are not just following the trend, but it is still a pity that we couldn’t chose a car to give this award. What do you think?

　　Changming Xu : From my point of view, the highest award is the Xuanyuan Award. It’s an appropriate name, based on its contribution towards China’s automotive industry. But as an award, it should be like Oscar, whose nomination shall be directional and professional. Every year, this principle should stay the same, and our following steps should stay unchanged. For example, the Design Award is of one profession, so it should continue. Besides, some special awards should be added based on each year’s new situation.

　　Such as the intelligent vehicles and autonomous driving, they are both hot topics. We can add these two concepts into our award. Smart and connected vehicles are also hot topics, and can be added as well. Of course I am not just adding whatever I want to add, it should be something that contributes to China’s automotive industry, or shows the tendency of a trend or something that is not trendy now but will be trendy in the future, all of the above could be added into our awards.

　　Maybe, there should be another award above the other sorts of models. What we are evaluating are the traditional cars, and our awards are called The Annual Contribution Awards of China’s Automotive Industry. If the new energy vehicle is an important strategy direction, and plays a leading role in the automotive industry, it can be leveled higher than other models.

　　▲The jury members test the cars.

　　Yes, there might be new energy automotive everywhere in the future.

　　It takes time.

　　Our national conditions determine that development of new energy vehicles will occur at any cost. What else do you want to say about the Xuanyuan Award?

　　I have some thoughts on its evaluation process. One is that some jury members think the evaluation time is quite tight. It takes about half-an-hour’s drive to get a real feeling of the vehicle, a few hundred meters distance is not enough. But we still need to consider if the experts have the time to do this. This is only my opinion.

　　During our third award, we conducted an assessment at the Xiangyang Proving Ground in the end of 2015, and got a report which was handed to the jury members. This was a third-party evaluation. For the 2017 election, besides the evaluation report from a third-party, it would be better to give more time to the jury members to experience the cars themselves.

　　Furthermore, I’ve always considered we should invite R&D directors to the event one day in advance, giving them the chance to express their ideas to our jury about why their products are superior to the others. It would be more comprehensive.

　　I’m not sure. Maybe it has its advantages and disadvantages. It depends on which side has more influence. If we do this, the award would rely more on the speakers’ presentation skills. If the car is not as good as the speakers said, it would affect the accuracy of our decision making. However, it probably would be different from the test driver’s point of view. Maybe it would be feasible since there are real testing experts among our jury member, it would be worth trying.

　　I am currently discussing with our jury president Truls Thorstensen about adding a Chinese jury member who specializes in design. Our actual design experts are all foreigners. What’s your opinion?

　　I totally agree. Many well-sold models are made and designed in China, and many Chinese engineers are involved. Such as Baojun series, are made and designed by Wuling Group themselves. The Chinese know better about Chinese aesthetics, values and customs. I agree with you.

　　The background is important as well. I realized that the jury session is now not simply a mere voting action but more a process full of persuasion and reasoning.

　　My next suggestion is to add a debate session. The first results were good enough, but an extra debate would make it better. The problem is that we need to find someone who is willing to do so and I am really willing to be the judge as I mentioned just now. There are three reasons for that:

　　firstly, I think the debate itself is meaningful; secondly, the valuable jury session makes Xuanyuan Award more complete; thirdly, it contributes to the development of Chinese automotive industry. There must be some experts who are willing to contribute to the Xuanyuan Award and Chinese automotive industry.

　　▲The donation ceremony of the 2nd Xuanyuan Award winner SAIC-GM-Wuling’sBaojun 730 was held at Beijing Auto Museum on October 12, 2015.

　　I Have Great Faith in Independent Brands

　　Jack Yu: Some people say it’s now a business society that takes money as the first priority. However, all jury members are working for the award voluntarily and for free and I’m really touched by that. Of course, just as you’ve mentioned, some are willing to take the duty.

　　Judges are not wasting their time but expressing their individual values. If the Xuanyuan Award were not good, no one would like to be a jury member any more. I want to express our sincere thanks to Director Xu again.

　　I am proud for what I’ve done for the Xuanyuan Award after these three years. I also hope our jury members take pride on the Xuanyuan Award as well. The birth of the Xuanyuan Award shows the improvement of Chinese automotive industry to some extent. We can see competitiveness is becoming increasingly fierce, and that the automotive industry is developing continuously. There is no need to be pessimistic about the industry at all.

　　Changming Xu: I am confident about the Chinese automotive industry especially the local brands. My confidence comes from several reasons: firstly,

　　China has two characteristics when it comes to auto demands, one is the huge market; the other is the multiple levels of the market. The huge and multiple levels of Chinese market lead to a larger scale per segment. The local brands can sell 6 million cars while the Japanese vehicle yearly sale is less than 6 million cars ranking as the third largest market in the world. The market performance of our local brands shows that there are large demands for local brand cars.

　　In addition, from the supply point of view, there are some manufactures showing advantages in different aspects. Their unique characteristics are presented when we track companies, such as Chery, Great Wall, Wuling, Chang’an, GAC, SAIC, GEELY, BYD etc. It is obvious that these manufacturers are gradually revealing their competitive advantages.

　　Therefore, both supply and demand are very promising. My suggestion regarding this point is that our government and society should help oreate a favorable environment for local brands. Our domestic brands are still developing, and have a long way to go. Our government and societies can do a little more for them.

　　The reason why developed countries can be so advanced in many aspects is that they have many self-owned brands. We can take America, Germany, Japan or Korean as clear examples. Only by focusing on self-owned brands can a country develop into an advanced level. Therefore, it is our duty to pay attention to the automotive industry and local brands in particular.

　　We should emphasize that we are not going to award a vehicle that only sells well but has no contribution to the Chinese automotive industry.

　　You can see that Wuling won the Award for Consistent Portfolio Strategy this year and Xuanyuan Award last year. I don’t know if I should define Wuling as a joint venture brand or as a domestic brand. Nevertheless, I think it is a world-class automotive company with a sales volume of 2 million vehicles.

　　I don’t have a definition but I do regard it as a local band. The key point is where it developed. Wuling is completely developed in China so it should be considered a Chinese brand. If you acquire a foreign company, then it cannot be considered a domestic brand because the origin of its growth was in a foreign land.

　　▲SAIC-GM-Wuling has been a world-class automotive company with a sales volume of 2 million vehicles.

　　I think that could be called a self-owned brand and not a Chinese brand.

　　It is necessary for a nation to have local brands if they want to evolve from a low-income country into a middle-income country and finally into a high-income country.

　　Yes, let’s have a look at GAC Trumpchi GS5, which won the First Xuanyuan Award. GS4 had an excellent market performance last year, and I think it comes from a good foundation of GS5 from the last two years. BAIC Senova X25 also had a good market performance last year. Before X25, BAIC seldom focused on self-owned brands. I think it is your team that nominated the X25. Is that right?

　　Yes. To further develop an automotive company, it needs a star-product. If the products are plain, it is hard to expand a company. It’s good for companies to have star-products or even one star-product which can lead the domestic market. The company has 3 star-products and is really active in the market. Therefore, our advice for local brands is to put their effort on star-products.

　　From this point of view, Geely Automotive shows its huge potential. It already has two star-products and they hope that their SUV can be successful this year. It will be a big step for Geely if it can reach sales numbers of over 10 thousand vehicles with a sale price of over 100 thousand RMB per auto. After achieving this goal, it would be much easier to develop lower-level cars.

　　▲Mercedes-Benz all new C-Class won the 2nd Xuanyuan Award for Redefining Premium.

　　Joint Venture Brands Are Having More and More Opportunities

　　Jack Yu: People may feel confused about the Xuanyuan Award, specially about why the local brands have won the award more often than the joint ventures. The first award winners included Lavida from Shanghai Volkswagen; the second award winner was a new C-Class from Beijing Benz, and this year we have Lannia from Dongfeng Nissan which was specially designed for the Chinese market. If the joint ventures or international brands want to compete for the Xuanyuan Award with local brands, how should they prepare for the competition?

　　Changming Xu : We can refer to a “smiling curve” of value chain to see the contribution to the Chinese automotive industry. The layout of a “smiling curve” is R&D, purchasing, manufacturing and then the upper part is sales and service. Most auto models in joint ventures are concentrated on the manufacturing, sale and service, so they do contribute to these parts. In the past, we regard all of these including new products, new marketing model, and new service system as a contribution to Chinese automotive industry and the biggest defect of joint ventures is R&D.

　　According to our survey, the components purchased by domestic brands are mainly from local companies, that is already a great contribution. Besides, they are now focusing on R&D without imitation from other companies. From this point of view, self-owned brands contribute a lot to the automotive industry chain.

　　If the joint venture brands want to compete for the Xuanyuan Award, they need to make a real contribution to Chinese automotive industry. For example, on the one hand, adopt more Chinese elements or take more Chinese engineers into account; on the other hand, localize a components system.

　　Xuanyuan Award is an Annual Award of Contribution to the Chinese Automotive Industry, so we will not acknowledge an auto which is only made in China without anything special, unless domestic brands cease having competent models, but the truth is that Chinese brands have done well in recent years.

　　Thus the joint ventures that have won the award are all strong in R&D.

　　If they have strong R&D, they might win the award.

　　In the second Xuanyuan Award, C-Class from Beijing Benz set a good example to the Chinese market from product definition to market acuteness.

　　At least, I think it indeed took Chinese factors into consideration. The Chinese market is so big that sales in China take up to 30% of the global sales for many foreign investors. Taking Chinese factors into account is an old-fashioned way, as vehicles nowadays are designed for Chinese market firstly and then for other markets. For manufacturers, the Chinese market is two to three times larger than their domestic market.

　　Following this logic, the winning possibility for joint-ventures will get higher if they pay more and more attention to the Chinese market.

　　They will improve. For example, Volkswagen sells 3 million cars in China, while selling 1 million in Germany. If the design of their vehicles keeps building cars baset on the preference of German customers, it may not meet the needs of Chinese customers. In fact, Volkswagen has already added Chinese factors to its vehicles, and even set Research and Development programs in China. This way, the wining probability is much higher.

　　END

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