The king returns, Chery is back with a bang!

On March 4th, Chery announced that its entire series of brand models, both new and used vehicles, are eligible for a lifetime warranty. Subsequently, they launched a trade-in event with a hundred billion yuan in subsidies for new purchases.

These two consecutive announcements have attracted the attention of many consumers.

This not only signifies that Chery will break industry norms by becoming the first automaker to offer a lifetime warranty, but it also demonstrates Chery's determination to re-enter the domestic market.

Looking back at the 28 years since Chery's establishment, from its initial fame in a thatched cottage to its struggle for survival in adversity, although it is no longer the number one automaker in the country, Chery has always adhered to its original intention in the independent research and development of technology for vehicle manufacturing.

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It is precisely this original intention that has allowed Chery to achieve impressive results in 2023.

According to the latest data released for the previous year, Chery Group's annual revenue reached 315.1 billion yuan, a year-on-year increase of 50.4%, compared to the 200 billion yuan in revenue in 2022. In just one year, Chery's revenue has increased by 100 billion yuan.While everyone was focusing on BYD and Geely, Chery quietly made its way to the top of the list with an annual sales volume of 1.881 million vehicles.

As major domestic enterprises were spending money on various new energy vehicles, Chery earned a fortune by exporting half of its total annual sales overseas, securing its position as the top exporter for 21 consecutive years.

The difficulty of Chery's comeback this time may only be known to Chery itself, with the bitterness behind the scenes. In recent years, rumors about Chery have been incessant.

Some said it was about to restructure, while others claimed it was planning to sell. Generally, a car company would have been out of business after such turmoil for a few years, but Chery has been through this for a decade, not only surviving but also making a strong comeback, all thanks to its overseas export business.

In fact, Chery's export journey began quite by accident.

As early as 2002, a year after the launch of the Chery Fengyun, several foreign businessmen happened to see the Chery Fengyun on the street and wanted to bring the car back to their own country.

After many twists and turns, they found Yin Tongyao, which then started Chery's overseas export business.

At that time, among domestic car companies, there were very few independent brands that could keep pace with Chery.The Great Wall is one, mainly exporting pickup trucks, but at that time the overseas market had a higher demand for sedans, so Chery's journey to the seas began very smoothly.

In addition, Chery's independent technology research and development also fundamentally guaranteed the export path of Chery automobiles.

Starting with the first export model, Fengyun, whether it's the body or the internal structure, Chery has always been pursuing independent research and development, and has invested a lot of cost in research and development.

Chery has successively mastered the four key technologies of engines, engine management systems, automatic transmissions, and sedan chassis. With these, Chery's export vehicles have more advantages than enterprises without these technologies.

Firstly, Chery's engines can be produced independently, which can save Chery a large amount of procurement costs every year and greatly increase the profit space per car.

Secondly, Chery has mastered the engine management system, which can automatically adjust according to the different export regions, allowing each model to be globally deployed.

In overseas markets with less competition, Chery's competitive advantage continues to expand, and the export business has gradually expanded to emerging economic development countries such as Egypt, Russia, and Brazil.

Although the average price of Chery's exported models is not high, and they are in some politically and economically unstable countries, this income is the life-saving money for Chery in those difficult years.

In addition to whole vehicle exports, Chery's overseas business also includes more profitable engines.As early as 2006, just one year after the successful rollout of Chery's first-generation Acteco engine, Chery successfully exported engines to the Fiat Group and an American energy company. Following this, Chery has exported over 1.2 million engines to more than 80 countries and regions, including the United States, Japan, Eastern Europe, Israel, Turkey, India, Brazil, and others.

In 2016, Chery also announced a collaboration with Austrian Austro Engine to produce small aviation engines that meet EU standards, which were used in two best-selling products, DA40 and DA42, by the renowned Austrian small aircraft manufacturer Diamond Aircraft. With this, Chery became the first independent brand to design, manufacture, and export aviation engines.

It can be said that without Chery's consistent and unwavering investment in technology, the success in overseas markets would not have been possible.

In addition to the revenue from overseas business that has kept the company afloat, Chery also secured another lifeline by selling its CVT technology to a company in Zhejiang. Although the CVT automatic transmission developed by Chery could save a significant amount of cost for the company's vehicles, other car manufacturers could not use it due to the Chery brand association.

At that time, in order to keep the enterprise alive, Chery reluctantly sold the CVT technology in 2016 for a total of 2.6 billion yuan, which included 1 billion yuan in cash and a 12.34% stake. The acquisition fee, the guaranteed dividends for the first three years, and the annual dividends all became crucial lifelines for Chery during critical moments.

Apart from these, Chery has also ventured into shipbuilding and agricultural machinery manufacturing, and the R&D technologies in these areas have been generating diverse revenue streams for the company.To discuss why Chery has been so formidable in technology research and development, one cannot overlook the contributions of two men: one is the technical founder Yin Tongyue, and the other is the co-founder Zhan Xialai.

Thanks to them, Chery has become what it is today.

In 1991, Anhui province was hit by a flood disaster. During the post-disaster reconstruction, a village managed to manufacture hundreds of small cars in a year using the most rudimentary tools, with revenue directly surpassing one hundred million yuan. This gave Wuhu, which had been economically lagging, a glimmer of hope and decided to use car manufacturing to transform the local economy.

In 1993, after much effort, Wuhu partnered with one of the three major automobile groups, FAW Group, to establish the FAW Yangzi Automobile Chassis Factory in Wuhu.

They had hoped to use this as a springboard for economic construction, but Wuhu, which lacked resources, was eventually abandoned by FAW and withdrew from the joint venture.

Determined not to give up, Wuhu decided to go it alone, and this heavy responsibility fell to Zhan Xialai, who was then the deputy mayor of Wuhu.

At that time, he faced two major challenges: first, there was no automobile manufacturing plant within the province to share experience, and second, he himself was a layman with no knowledge of automobiles.

What to do? If one doesn't know how to make cars, they can learn; if there is a lack of talent, they can seek it out.Zhan Xialai first poached Yin Tongyao, the head of the workshop in charge of FAW Jetta, to his own team.

In 1996, Yin Tongyao, along with several technical colleagues, came to Wuhu, Anhui.

With a startup fund of 300,000, an abandoned factory, and a team of eight engineers led by Yin Tongyao, they embarked on the dream of car manufacturing.

The first issue that needed to be addressed was the engine, which is the heart of a car.

However, at that time, the engines of domestic cars were basically imported, and no domestic car company had mastered this technology; they had to buy it.

After inquiring from various sources, Zhan Xialai and Yin Tongyao learned that the Ford Company in the UK wanted to upgrade its equipment and was phasing out an engine production line.

In order to purchase this production line, five state-owned enterprises in Anhui Province and Wuhu City jointly invested to establish Anhui Auto Parts Co., Ltd., with an investment of 700 million yuan for building the factory and purchasing equipment.

In 1997, Yin Tongyao led a team to Ford in the UK and spent a high price of 29.8 million US dollars to buy back the discarded engine production line from Ford.

The production line was bought back, but problems arose during the assembly process.At that time, the engineers from the UK who came to assemble the equipment were not serious, thinking that Yin Tongyao and his team did not understand the technology, so they delayed the construction period.

Months went by, and not even half of the production line was installed, while Geely had already taken the lead in manufacturing its first car, which made Yin Tongyao very angry.

He directly drove away the engineers from the UK and decided to take on the task with his team.

Faced with Zhan Xialai's worries, Yin Tongyao directly thumped his chest and made a promise: "If we can't do it, I will jump into the river."

With the unremitting efforts of Yin Tongyao and his team, it took 13 and a half months, and in May 1999, the first engine was successfully rolled off the assembly line.

Although this was a revolutionary breakthrough, it needed to be installed on a car to make it meaningful.

In order to seize the time to enter the market, Yin Tongyao directly purchased the technology of the Toledo model from Seattle, and Toledo is the sister car of Jetta, which is very familiar to Yin Tongyao. During his work at FAW, he studied Jetta every day.

Due to the familiarity with the car body, many troublesome debugging processes were saved, and as it is the sister car of Jetta, suppliers do not need to make new molds for the car model, which also greatly shortened the time for the car to come out.

On December 8, 1999, just half a year after the first engine was assembled, the first Chery-branded car was successfully rolled off the assembly line and named "Fengyun".

However, in 2000, Chery, which had already produced more than 2,000 cars, could not sell the cars to the outside world due to the lack of a production license, and could only be used as taxis in Wuhu.No one would be content with the hard-earned cars they built only being used as taxis.

In order to sell Chery's cars beyond the province, Zhan Xialai and Yin Tongyue made strenuous efforts through various channels. Finally, in January 2001, they paid the price of 20% of the shares to affiliate the company under SAIC, and the enterprise was renamed "SAIC Chery," starting on the path of selling cars.

At that time, the market price for a Santana was 200,000 yuan, while the "Fengyun" only cost 80,000 to 90,000 yuan. The extremely high cost-performance ratio made the "Fengyun" cause a sensation as soon as it was launched.

In the first year of its launch, the annual sales volume reached 28,000 units, with sales of over 2 billion yuan. The second year saw a doubling of growth, with an annual sales volume of 50,000 units, surpassing the three major automobile companies and becoming the sales champion.

At this time, Chery finally made a name for itself from an inconspicuous small company.

Although the Chery Fengyun received good reviews as soon as it was introduced to the market, this car was not, in the traditional sense, a sedan independently created by us Chinese.

At that time, most of the cars produced by Chinese independent brands were disassembled piece by piece according to the purchased cars, and then imitated and made.

In order to build a car that belongs to the Chinese people, Chery almost invested without regard to cost in recruiting talents and research and development.

In 2001, in order to recruit all the technical backbones who left the Second Automobile Factory, Chery established Jia Jing Technology and offered one-third of the shares, specifically for designing car shapes and parts.

In less than a year, they delivered three car model designs to Chery, which were the medium-sized sedan Dongfang Zhi Zi, the microcar QQ, and the upgraded version of Fengyun, Qi Yun.In it, the "Eastern Son" is the first medium-sized car product of the self-owned brand, while QQ is one of the most successful micro cars in the history of self-owned brands.

Chery has launched four models in succession, which not only attracted a lot of attention for Chery, but also increased its sales and revenue continuously, far surpassing other self-owned brands that are still exploring.

This made Yin Tongyue and Chery see the dividends brought by technological innovation, and further strengthened the determination to focus on research and development.

Starting from 2003, Yin Tongyue successively recruited senior engineers from foreign-funded enterprises represented by Xu Min, Wu Xuebin, Gu Lei, Qi Guojun, etc.

They all have more than 10 years of experience working in foreign car companies, not only with advanced technology, but also with the methods and capabilities to develop car products positively.

In terms of technological research and development, in order to have its own independent research and development engine, Chery signed a joint engine design and development agreement with the Austrian AVL company in 2003, and sent more than 200 engineers to study at one time.

In just two years, Chery's independently developed engine with complete independent intellectual property rights, the Acteco series, was successfully launched.

Since then, Chery has completely broken the history of more than 50 years without independent intellectual property rights car engines after the founding of New China.

With its own engine, Chery's new car models are as numerous as dumplings, and the sales are increasing faster and faster.

From the first car Fengyun launched in 2000, to the three models launched in 2003, to 2006, Chery directly launched six new cars, and by 2009, Chery had four major brands: Chery, Kai Rui, Rui Lin, and Wei Lin, with more than 30 car models.Almost every three years, the number of new models developed by Chery is doubling.

The increase in models has also promoted a surge in sales. Since 2003, Chery has firmly held the position of the top-selling independent brand.

By 2010, Chery had reached its sales peak since its establishment, with a volume of 682,000 units.

At this time, Chery could be said to be dominating the Chinese automotive industry and enjoying unlimited glory.

However, the faster and higher Chery flies, the more it expands its own problems during rapid development.

First is the issue of corporate profitability.

Although the company's sales have been rising year after year in the 10 years since its establishment, the uncontrolled investment in research and development, the internal market cannibalization due to overly similar models, and the high supply chain costs brought about by too many models have all made Chery appear glamorous on the surface, but in reality, it has not made any money.

Secondly, the company's strategy of focusing on research and development while neglecting marketing has made Chery's cars technically solid, but not attractive to the average people who do not understand technology.

But Chery's problems are far from over.

Due to the division of engineers within the company into domestic and foreign factions, there are also disagreements on the development and research of cars.Overseas engineers tend to be more methodical and steady in their approach, while domestic engineers are often more about solving problems as they arise. Additionally, the salaries of returning overseas engineers are often higher than those of domestic engineers, which has exacerbated internal conflicts, leading to a significant exodus of engineers.

The accumulation of various issues erupted completely in 2011. Starting from this year, Chery's sales volume has been on a downward trend, falling out of the first tier of car manufacturers.

In recent years, Chery, which has been quietly under the radar, has re-emerged in the car sales rankings, especially with its successful overseas expansion, making Chery the leading exporter of Chinese cars for 21 consecutive years.

In just February, Chery exported 90,000 vehicles, an impressive achievement that has made many peers envious.

Chery set a modest goal of increasing sales by 20 percentage points in 2024, but achieving this goal may not be easy. Chery is now clearly lagging behind other domestic car manufacturers in the new energy race.

Looking at the current new energy car manufacturers in China, BYD is leading the pack, followed by a host of other new energy car manufacturers in hot pursuit. This year, Huawei and Xiaomi have also joined the fray, coming on strong.

To be frank, Chery's ambition to carve out a large slice of the new energy vehicle market is indeed a significant challenge.

Yin Tongyao publicly stated that over the next five years, 100 billion will be invested in the research and development of new energy technologies.In terms of marketing, Chery may only just pass, but in terms of technological research and development, Chery has always been an honor student.

Additionally, in Yin Tongyao's heart, there is an even bigger dream:

"We hope that in the Oxford English Dictionary, CHERY becomes a term specifically representing Chinese automotive companies."