The cause of special concern stems from the words of Dong Mingzhu, the chairman of the rival Gree Electric Appliances. On March 4th, when Dong Mingzhu first promoted Gree Electric Appliances for the first time, in the face of numerous media and dealers, he said, “I don’t comment on the acquisition of the property rights of other companies by several billions of people.†But afterwards, he said “Can buy it.†Technology is not a core technology. Without core technology, there is no continuous improvement in the company."
As for the sarcasm goal of “Red Net†Dong Mingzhu, everyone at the scene knew that she was the group that meant the United States. Dong Mingzhu’s above-mentioned targeted statement is like a sinking sea, and he did not receive any response from the American group.
U.S. executives look back: There is no achievement without an open mind
The thing fuse starts at the beginning of 2017.
At that time, Midea Group completed the tender offer for Kuka Group, one of the world’s top four robot manufacturers, at a price of approximately RMB 29.2 billion, and its shareholding ratio rose to nearly 95%. Since then, Midea Group has announced the acquisition of the Israeli movement. Control system solution provider SERVOTRONIX. With two acquisitions, Midea Group has become a globally important manufacturer of robotics and industrial automation systems.
In the past, Dong Mingzhu had criticized the United States’ group of companies in general and the American group did not generally choose to respond. In fact, this low-key style conforms to the cultural requirements of Fang Hongbo, Chairman of Midea Group. He said at a recent internal conference: “Entrepreneurship, openness, inclusiveness, pragmatism, and low-key are all these The good genes of the United States."
However, for Dong Mingzhu's deprecating attitude, there are different voices within the Midea Group.
A senior executive of Midea Group told Tencent Finance: “This matter should not have responded to meâ€. However, “What we need to pay attention to is that China’s technological progress since the reform and opening up has been based on introduction, digestion, and absorption. Without such an open mind, we will not achieve such success."
Another US-based group executive told Tencent that “Our entrepreneurs have held such a conservative attitude for so many years of reform and opening up. Then, what is the difference between this mentality starting point and the characteristics of the planned economy era?
In fact, behind this "mutual encounter" atmosphere, there is a more large-scale commercial warfare.
Robots started fighting
The so-called larger-scale commercial warfare is precisely a smart manufacturing industry represented by robots, which is rapidly emerging in China and even in the global market.
IFR (International Federation of Robotics) data shows that in 2015, China holds 36 robots for every 10,000 workers, and by 2020, this million people will increase the number of robots to 150, which is 4 times that of 2015. China’s ranking in global automation density will also rise from 28 to the top 10 globally.
At the same time, related companies and industry giants have also overweight the Chinese market. As early as 2015, another robot giant Yaskawa Electric signed a joint venture agreement with Midea Group to launch the Chinese market. The CEO of KUKA, Till Reuter, who has just been acquired by Midea Group, told Tencent on March 8th that by 2020, KUKA’s revenue in the Chinese market will grow from less than 500 million euros to 1 billion euros.
In addition to the continuous efforts of the United States Group, Gree Electric also extended its diversified tentacles to the field of intelligent equipment represented by robots. According to information provided by Gree Electric Appliances, in 2013, the company entered the field of smart equipment. In 2016, Zhuhai Yinlong purchased 1.933 billion yuan of smart equipment from Gree, which accounted for approximately 61.68% of sales of this type of business. Based on a rough calculation, Gree's 2016 smart equipment revenue was approximately RMB 3.134 billion. In addition, on February 23, 2017, Gree issued a reply to the Shenzhen Stock Exchange's letter of concern indicating that Zhuhai Yinlong planned to purchase Gree's smart equipment and industrial products in 2017 of approximately 19 billion yuan, including smart equipment of 8 billion yuan.
The successful completion of this transaction will enable Gree Electric Appliances to become the leading intelligent equipment supplier in China. However, Zhuhai Yinlong is inextricably linked to Gree Electric and even Dong Mingzhu himself, which is why the Shenzhen Stock Exchange issued a letter of concern.
Of course, Dong Mingzhu, who started with sales, will not limit his business to Zhuhai Yinlong. Competition for the ever-growing market cake will make the game between Midea Group and Gree Electric Co., the two major white giants, rise from air conditioners, refrigerators and small household appliances to smart equipment represented by robots.
Appliance manufacturing industry sailing in the Red Sea, testing the company’s diversification capabilities
Gree Electric Appliances and Midea Group's "Phases and Minds" report reflects the actual bottleneck of the home appliance manufacturing industry.
Since the home appliance industry entered the adjustment period in 2014, the positive growth of many domestic companies was weak. Especially in 2015, the industry-leading Midea Group and Gree Electric Appliances all experienced a decline in annual revenue data, and this trend was extended to 2016. year. In addition, the black power companies have not been able to do their own thing. The judgment of the leaders of the industry's major companies in the market conditions is mostly weak.
As a result, in the context of this industry, diversified transformation has become the path of choice for home appliance companies that have made money in the past decades, and Gree Electric Appliance and Midea Group have taken the lead in diversified transformation.
Gree Electric Appliance Co., Ltd., an air-conditioning business, has gradually expanded its diversified fields of small household appliances, ice washing, and smart equipment since 2010. In addition, Dong Mingzhu, who has a high profile, has also diversified into the past two or three years. Mobile phones, automotive fields. Among them, the diversification of the mobile and automotive fields has encountered many practical challenges.
Since 2016, Midea Group, which has purchased KUKA, KoChuang, Toshiba's home appliance business, announced on March 8th that it will be a technology group that transforms consumer electronics, HVAC, robotics and industrial automation systems into major products. One of the representative companies for the selection of industry diversification paths. This diversified expansion approach based on mergers and acquisitions as the main method has occurred in the home appliance industry in 2016, including the acquisition of GE appliances by Haier Group and the purchase of Sharp by Hon Hai.
From the current point of view, Midea Group leads Gree Electric in a diversified expansion. Based on the closing price on March 8th, the total market value of Midea Group reached 215.2 billion yuan, and the price-earnings ratio was 12.6 times. The gross market value of Gree Electric Appliances was 169 billion yuan, and the price-to-earnings ratio was 11.3 times. In addition, according to the semi-annual report of the two companies, Midea Group's 2016 semi-annual report reported revenue of 28.3 billion yuan more than Gree.
However, for any company, the transition can only be said to be in progress.
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