Jiang Xipei commented on the Xian subway cable incident: if the bid is won at a lower price, the next Okay will appear if there is no change

Jiang Xipei, Chairman of the Board of Directors of Far East Holding Group Co., Ltd., accepted an exclusive interview with Sina Finance at the 2017 Boao Forum for Asia Annual Meeting today. Far East Cable, a subsidiary of Far East Holdings, has participated in urban subway projects. Talking about the quality door of Okay Cable, which has caused a social sensation recently, Jiang Xipei pointed out that if the bid is won by a lower price and the quality is not changed, it will be similar to the case of the Xi'an subway problem cable. It will happen again.

To avoid the Xi'an subway cable problem, Jiang Xipei believes that supervision, enterprises and users need to make changes. Regulatory agencies need to strengthen on-site supervision, including incoming samples and delivery inspections, and detailed inspections and co-management. Companies must be honest, users can't just chase low prices.

Far East Holdings implements a development strategy of "main business + investment". Last year, Far East Smart Energy Company and Detroit Electric Vehicle Company jointly established an electric vehicle company. In this regard, Jiang Xipei said that the future of new energy vehicle products will be positioned in the high-end, and it is expected to achieve mass production of 50,000 vehicles in 2020. On the other hand, he also revealed that the company has invested in gigabits called "demon stocks" by the market through a fund, and has achieved good returns.

The issue of the succession of the "second generation of enterprises" is the heart disease of many private enterprises. However, in Far East Holdings, the handover has officially begun. Jiang Xipei said that his eldest son is already a group director and chairman of the listed company Smart Energy, while the younger son is a successful entrepreneur. He recalled that at the beginning of his business, he started a company just to "support his family", but now he hopes to become a century-old enterprise.

Excerpts from the interview are as follows:

Winning the bid at a lower price does not change the Xi'an subway cable door will also happen

Sina Finance: Far East Cable, a subsidiary of Far East Holding Group, is a leading company in the industry. What do you think of the cable incident in Xi'an Metro?

Jiang Xipei: I think this incident reflects a lot of problems. How can it conform to the country's reform and development strategy of rejuvenating the country through quality and brand power, so that good products and services can be known and accepted by users? At the beginning, it was to solve the problem of top-level design and planning.

If you still win the bid at a low price, especially at a lower price, regardless of quality, this phenomenon will still occur. As far as I know, not only our industry, but many industries have such problems.

Second, the manufacturer must be conscientious and sincere. If you want to produce good products, you have to resort to tactics, and you have to talk about the consequences and ultimately lead to catastrophe. There is also our users, we cannot be greedy for cheap. Although it advocates high quality and good price, the price is good, but this is really difficult. If you don’t talk about quality, just talk about price, there is no lower, only lower, it will be difficult to guarantee the quality.

On the other hand, the supervision of our government must be in place, including testing agencies, to deliver to your side, or to send samples to your side for acceptance? Is it the incoming sample acceptance or the arrival acceptance? This is different. Therefore, we suggest to check the co-management carefully, so that our Chinese-made, Chinese products, and Chinese services can reassure more people (43.990,0.49,1.13%) and win the country’s reputation.

Sina Finance: Far East Cable Products has also participated in bidding for urban projects. In the past bidding experience, how does the Far East feel?

Jiang Xipei: Far East Cable is a wholly-owned subsidiary of our Smart Energy listed company. He has also participated in many iconic projects across the country, such as Xi’an Metro. Because Far East is now an enterprise in the industry that has won the National Quality Award, it is also a better one. Brand-influenced companies, and the top 500 Asian brands.

We think that only when the market has improved, coupled with the fact that your equipment is world-class, management is first-class, the materials used are good, the management is in place, the law is respected and the integrity is maintained, can you win users with better products. Win the future.

Far East's new energy vehicles will be sold at a domestic price of one million in the future

Sina Finance: Last year, Far East Smart Energy Company signed a contract with Detroit Electric Vehicle Company to form a joint venture to form an electric vehicle company. In recent years, various domestic capitals and enterprises have entered the new energy automobile industry through independent research and development or mergers and acquisitions, and competition has become increasingly complicated. What are the competitive advantages of the new energy automobile industry under the Far East? When can we see the products on the market in China?

Jiang Xipei: I think our country attaches great importance to the field of new energy and regards the development of new energy vehicles as an important component of the national industrial strategy. I hope that our Chinese companies can expand in this field and become a global leader.

Far East has previously acquired Foster Company. Foster is currently the first Chinese company in the field of power lithium battery 18650 production and the third largest company in the world, so we have a puzzled relationship with this industry. It just so happens that the Detroit Electric Vehicle Company, which has a global history of one hundred years, came to China to develop, and we became attached.

We plan to prepare for the construction this year, and then apply for approval next year, pass the catalog, and roll off the entire vehicle in 19 years. By 2020, we will be able to produce 50,000 mid-to-high-end electric vehicles per year. By 2021, we will produce 100,000 units and 500,000 units by 2025. We plan to be a company with a scale of 1 million units by 2030. We will become a global leader. Electric car company.

Sina Finance: What should the market size be in terms of amount?

Jiang Xipei: Our current product has been sold in Europe, the United States and other places. It costs 135,000 U.S. dollars per car, and it’s about 1.5 million or 2 million cars in China because of tariffs and so on. In China, there are 400,000 to 1 million cars, which are basically relatively high-end. We design for the middle class and for people who love cars. Whether it is its safety performance, experience or fashion, I believe many people will be very like it.

Sina Finance: We know that there is BYD before the Chinese (new energy vehicle) market, and there are others like you afterwards, including Dong Mingzhu and Wang Jianlin. Is this cake enough?

Jiang Xipei: There is no doubt that this buckle-end belt field is definitely optimistic for many capitals. Because it is so huge, everyone hopes to enter this field, but in the future it is indeed impossible to have one hundred or two hundred auto companies. There are more than 0, and the top 10 will account for 89%. Ten market. You have to have enough competitive advantage to get ahead.

If you make mid-to-low-end products, although there is a big market, the competition is more intense; if you make mid-to-high-end products, there is no technical content, no brand recognition, and many people are unwilling to pay for it. But Detroit Motor Company is the father of global electric vehicles, and it has such a (technical) foundation and conditions.

Far East invests in "demon stock" gigabit through fund

Sina Finance: After the listing of Gigabit, it caused market shocks and once became a higher-priced stock in the two markets. I noticed that the news on your official website indicated that Gigabit is an investment company of Far East Holdings. Can you disclose the details of the investment? What do you think of the huge success of the invested companies in the securities market?

Jiang Xipei: We made investment really early. As early as more than ten years ago, some leading companies in some industries in Jiangsu established the China Investment Alliance, and it became one of the top ten news in China's economy that year. At that time, we thought that the power of a company was limited, how could we complement each other's strengths and cooperate in groups.

As the main investment entity, Far East Holdings has invested a lot and got good returns. In addition, some of them were invested through our 22 funds, which are indirect investments.

What you just mentioned (Gigabit) is the more distinctive enterprise invested by our fund, and it has indeed brought us a better return. As for the performance of the capital buckle-end zone market, it must be due to his reasons, whether it is performance, the room for future growth, and the preferences of investors, it all matters.

Sina Finance: Do you have any investment guidelines?

Jiang Xipei: We must first understand and agree with (the content of the project), and at the same time have a good team and performance; second, we choose to be the leader in all walks of life and be one of the best (projects) in the market segment. If it is an angel investment, at least the plan you gave me or the financial data and development plan you gave me can move us.

Sina Finance: Many capitals are now seeking opportunities to invest in bicycle sharing projects. Are you interested in it?

Jiang Xipei: In fact, it (sharing bicycles) solves many pain points that the government and the people are concerned about, including environmental protection, health, and so on. But it also needs the government's understanding, and it needs the government to create a better environment in order to enable such a type of enterprise to have development opportunities. Of course, capital sees such forward-looking. I haven't studied it well yet.

The annual income of employees in 2020 will reach more than 200,000

Sina Finance: In 2015, Far East Cable's name was changed to Smart Energy, which caused doubts about hype in the industry. From 2015 to the third quarter of 2016, the overall operating performance of listed companies maintained growth. In your opinion, has the company's operations completed the transition from power cable production and sales to smart energy technology, products and services?

Jiang Xipei: Our company was founded in 1985. At the beginning, we made instrumentation, and in 1990 it was wire and cable. (The latter) has been one of our core businesses to this day. In fact, we began to transform and upgrade in 2010, when we saw the future of the Internet and the Internet of Things. Therefore, as a leading company in the industry, we have advanced the button end belt (field) to create a global electrician and electrical e-commerce platform, as well as a global material trading platform.

Cable (business) entered a listed company in 2010. At that time, it was still called Far East Cable, but it was later renamed. We are not hype, because this is our company's development strategy. Our plan is that by 2020, telecommunications cables will only account for less than one-third of our revenue targets. We aim to become the world's leading smart energy and smart city system service provider. So although the Shanghai Stock Exchange and so on also have doubts, after we explain it clearly, they think it is a very good thing.

Sina Finance: Far East Holdings has a group plan for 2020. In addition to the total assets of more than 100 billion yuan and annual operating income of more than 135 billion yuan, it also includes an average annual income of more than 200,000 yuan per employee. Why is there such a specific target for employee income?

Jiang Xipei: We hope that as the company develops, employees can also get the rewards they deserve. Therefore, we have created to encourage qualified and high-quality employees, that is, core employees, to become business partners of the Far East. But we not only have equity incentives, but we also have other incentives. The so-called "Five Sons Encouragement" in the Far East requires not only tickets, but also seats, but also houses, lining, and face.

We are a listed company that announces the average annual income target of employees. This indicator is an important indicator in addition to profit, revenue, and market value. Every year, the annual growth rate of about 15% must be followed to achieve the goal of per capita income and wage income of employees exceeding 200,000 yuan in 2020. I think it makes a lot of sense.

Jiang Xipei revealed that the eldest son has begun to take over the younger son to start a business

Sina Finance: You were born into an ordinary peasant family, and you have transformed from a watchmaker to a successful entrepreneur. Do you think your success may be copied in the current era?

Jiang Xipei: Everyone does not necessarily take the same path. (Entrepreneurs) can learn from the paths taken by our early entrepreneurs, but now the environment is different, with greater openness and fiercer competition. If I can help and learn from the current entrepreneurs, it is our craftsmanship, mission, responsibility and honor. This is our strength.

Sina Finance: You mentioned in the past that you hope to pass on the business to the next generation. Do you now plan to let your two sons come to the front? What are your requirements and expectations for them?

Jiang Xipei: I didn’t think so much when I founded the company. At that time, it was to support the family. But today, the company has a history of 31 years. I hope that my company can be inherited for a hundred years and become a continuous company. This is of course ideal and dream. We hope that people in the future, including my sons, can have such wisdom and ability, and at the same time have such hobbies to inherit such a career.

Now my eldest son, Jiang Chengzhi, is already a shareholder and director of the group, and also the chairman of our Smart Energy; my second son, Jiang Chenghong, founded Linyun Technology Company in Beijing, which is a social platform for virtual reality. (Linyun Technology) received a business license on March 1st last year with a registered capital of 1 million. Due to his team’s efforts and good entry point, he was valued at 30 million in two months and was valued at 99 million in September. Now I heard that some people think his company is at least 6 million. The value of one hundred million and eight hundred million is under development.

I hope they can find their own platform and find a career they particularly like and have the ability to do well, not only for themselves, but also for their families, and for the whole society.