Ren Zhengfei: the companys profit is too much this year. Suggest terminal companies make less money

 Ren Zhengfei: the companys profit is too much this year. Suggest terminal companies make less money

Netease science and technology news on November 15, today, Huawei Xinsheng community released the summary of the German media Roundtable by Mr. Ren Zhengfei, with the interview time of November 6. When talking about the overseas customer supply of the companys products, Ren Zhengfei said: in a few days, it will be a shopping festival in China. I suggest that the terminal company can make less money, because the companys profit this year is too much. The terminal CEO agreed, but the supply chain didnt, saying, weve prepared 10 million units for the shopping festival. If we reduce the price, we may greatly expand the demand. If we cant deliver the goods, its a blank check.

Here is the summary of the round table:

Summary of the German media Roundtable

Shenzhen, November 6, 2019

Ren Zhengfei: welcome to Huawei, nice to meet you, and willing to accept your questions.

First of all, thank you very much for inviting us. Im glad to be here. Thank you for your willingness to spend an hour communicating with us. Just after I came in, my curiosity was aroused by the environment here. My question is also related to the environment here. I found on the corridor next to the stairs on the first floor a large painting of the coronation of the French king Napoleon. On the other side is a large portrait of the battle of Waterloo. The battle of Waterloo meant the end of Napoleons empire. Inspired by these two paintings, I would like to ask you: is Huaweis empire rising or declining? Are you in a state of war?

Ren Zhengfei: these two paintings have nothing to do with Huaweis current situation. They are purely artistic decorations. The picture of the 200th anniversary of the battle of Waterloo I saw in the Belgian museum was very beautiful, so I bought it to decorate the house; the painting of Napoleons coronation was painted by a family member of an employee in four years. He was going to give it to me and hang it at home, but our family was too small to hang it, so he transferred it to the company. These paintings have nothing to do with the state of the companys operations.

Georg fahrion: in your opinion, what is Huawei in? Because the word trade friction has been repeated many times. Is Huawei in a state of war? If not, can you describe Huaweis current status?

Ren Zhengfei: Huaweis development, like the index curve, is generally on the rise, with a twist in the rise. Generally speaking, Huawei is developing healthily at present.

2. LFR? Ller from Germany: I saw this picture in Huawei park. This is a fighter that was riddled with bullets during World War II. Why do you choose such a picture to compare Huaweis current situation?

Ren Zhengfei: when the entity list came out, I happened to see this picture on the Internet. The plane is riddled with bullet holes, but it is still flying. I think Huawei is very similar to this plane. It is riddled with holes, still exists, and still flies tenaciously. In this period, we will step up efforts to mend the holes so that Huaweis aircraft can continue to fly and land safely.

At present, we have transferred many scientists and experts who have done research and development in the next five to ten years to form a homecoming group to kill and mend the hole. Now its for survival, to mend the hole first, not to lead the world. Now most of the holes have been mended, and the aircraft can continue to fly; there are some more important holes, which will take two or three years to completely overcome. We have gathered thousands of scientists, experts and engineers to work together. In two or three years, our broken airplane may become a brand-new airplane.

Ulfr? Ller: who is shooting at Huawei? Is the US shooting Huawei?

Ren Zhengfei: Yes, the US government shot.

Ulfr? Ller: how to shoot?

Ren Zhengfei: entity list, forbidding us to use American parts and software All kinds of ways.

3. Frank Sieren, DVH media group: you extended an olive branch to Europe and expressed your hope for open cooperation with Europe. Huawei has become so strong, why should it make such a gesture? From a broader perspective, how important are western countries to Huaweis future business development?

Ren Zhengfei: of course, we want our products to be sold all over the world. The more we sell, the better the profit. Because we need to offset the R & D cost, etc., or need the market scale, no matter in Europe, Africa, the Middle East Its all our market space. We should actively provide services for people in these areas. Its difficult to operate in Africa and its impossible to make a lot of money, but we are still working hard to serve in Africa.

We believe that the German Parliament and government will choose policies that are in the interests of the German people. At the same time, we believe that based on facts, evidence and full discussion, Germany will make the best decisions. If there are a few countries in Europe that explicitly do not choose us and do not have any ideas about these countries, it is OK to withdraw from the market sales of this country.

Frank Sieren: why does Huawei want to cooperate with Germany or Europe in R & D? Huawei is already strong in technology.

Ren Zhengfei: This is an era of globalization and opening-up. Taking a closed road will not succeed. For example, we work with European scientists to study future products, and support Europe to develop its own software capabilities, application capabilities and industrial capabilities, and work together to contribute to the intelligent society. Have you visited our production line? Our production line uses software from Siemens, Bosch and Dassault, and most of our production equipment is from Germany and Japan.

Frank Sieren: Hows it going?

Ren Zhengfei: well done. We added some artificial intelligence in the software of Siemens, Bosch and Dassault, which basically realized the high efficiency of the production line. So, we are very open, not only in Europe to study our new products, but also to provide services to Europe. For example, Huawei is currently the strongest artificial intelligence in the world in terms of driverless and intelligent cars. We have increased cooperation with European enterprises in many aspects. In terms of Intelligent Computing of automobiles, we can cooperate in a whole, cut cooperation and only sell chips And grow together with European companies. So we are also making great contributions to Europe.

Frank Sieren: why is Huawei so strong in driverless?

Ren Zhengfei: because we designed chips according to L4 standard at the beginning, and all chips were designed according to this standard. Europe, Japan and China follow the same technical standard, while the United States follows another one. Huaweis intelligent computing has a very high position in the world, so we are very strong in this respect.

4. Steffen wurzel: if the final decision of the German government is not in Huaweis interest, will Huawei consider withdrawing investment from Germany?

Ren Zhengfei: investment will not be withdrawn. Investment has nothing to do with sales. If you say that our products are not up to the requirements, if you dont buy them, we can not sell them. We will not be sentimental. For example, the Canadian government was entrusted by the United States to detain my family. I didnt hate Canada because of this, so I reduced my investment in Canada. We have invested a lot in Canada this year. We have added more than 200 scientists and experts this year. We support Canada to turn itself into an innovation center like Silicon Valley. Because Canadians and Americans are mainly from the same nation, have the same living habits, and are very close together, it is easy to attract some friends to participate in innovation. At the same time, many scientists cant get American visas, and many international conferences can be transferred to Canada. When they open more, innovation will boil. We separate personal resentment from company development.

If Germany does not choose us, it will not affect our progress in Germany. You see, we recently built a 1 million square meter new Industrial Park factory in Songshan Lake, and purchased industrial equipment from Japan and Germany on a large scale to meet the production scale next year. If we do not consider our own interests, we will only consider a political attempt, which is too naive.

From my personal technical judgment, Germany needs us very much, because artificial intelligence is very important to German industry 4.0, and German precision manufacturing industry needs low delay and large bandwidth transmission system to support. Because we do the best, customers know to choose us.

Frank Sieren, DVH media group: but you shouldnt buy Industrial equipment from Japan. Other places may offer more favorable prices.

Ren Zhengfei: thats not true. Japanese companies are also our strategic partners. Why not buy them? The Japanese management is different from the German management. The Germans are confident that the products will be tested only when they are produced. The Japanese are too careful to test every process. Therefore, we have built factories in welheim, Germany and Japan respectively, combining the advantages of Germany and Japan, so that we can produce high-quality products. Customers dont buy? Impossible. The key is that we havent sold so many products. We are mobilizing Chinese customers to buy less. Lets supply foreign customers first. As you know, it is a process to expand the production line of new products.

Frank Sieren: how can you persuade them to buy less? Its hard.

Ren Zhengfei: persuasion is also very difficult, but there is no way. We cant supply it. In a few days time, it will be the double ten one shopping festival in China. I suggest that terminal companies can make less money, because this years profits are too much. The terminal CEO agreed, but the supply chain didnt, saying, weve prepared 10 million units for the shopping festival. If we reduce the price, we may greatly expand the demand. If we cant deliver the goods, its a blank check.

Frank Sieren: its a big problem.

5. Daily Fabian Kretschmer: Recently, trump government released some positive signals to try to downgrade trade friction and take the first step to reach a phased trade agreement with China. Mr. Ren, if this agreement can be reached, what do you expect? Can this help repair the hole in Huaweis plane?

Ren Zhengfei: because we have no sales in the United States, the Sino-U.S. trade negotiations have nothing to do with us, and I have not paid attention to the news in this regard, which cannot be answered to you.

Second, we dont need the United States to solve the supply problem. The United States keeps the list of entities, and we can survive well. I wonder if you took photos when you visited our exhibition hall? When the associated press visited the exhibition hall, we allowed them to take photos of each circuit board, which was no longer equipped with American chips and parts. The list of entities in the United States hurts American companies, not us. The U.S. government cancels the list if it likes to cancel, or cancels the list if it doesnt love to cancel. It only needs to consider the interests of American companies, and it doesnt need to help us.

6. Steffen wurzel: how about your daughter in Vancouver now? How often do you communicate by phone?

Ren Zhengfei: we seldom make phone calls. Her mother is with her, her life is good in general, her mental state is strong, I believe she can pass this test.

7. Steffen wurzel: you must have a special relationship with Europe. The environment we are in now is all European style. The porcelain we drink tea is also made in Germany. China also has a lot of good porcelain. Why do you like European porcelain?

Ren Zhengfei: and the wine cup is also German, so are the hard knives and forks. I once said that if there is no labor law in Germany, all the knives and forks in the world may be made in Germany. The use of artificial intelligence will free Germany from the fetters of labor law and lead to blowout development.

George fahrion: you are a very humorous person, but I still want to ask a serious question. You just mentioned that Huawei is facing problems in terms of supply. From the perspective of sales, the United States is not an important market for Huawei. But from the perspective of procurement, the United States is an important market for Huawei. How does Huawei plan to overcome the current procurement difficulties, especially Google and Android?

Ren Zhengfei: Im sure that we can continue to develop at a high speed without American supply. However, we will always be willing to cooperate with American companies and embrace globalization. We will not follow the closed path of independent innovation and self-reliance.

9. Spiegel Georg fahrion: in another 14 days, Huawei may not be able to use Googles products, including the Google App store. How to solve this problem? I know Huawei is developing its own operating system, but its a huge system project, which needs time. How does Huawei plan to overcome the short-term difficulties?

Ren Zhengfei: lets look at this issue again on November 20. Welcome to visit again on November 20.

10. LFR? Ller, Germanys second channel: I want to ask you a personal question. Before this interview, I also read some introductions about you. I think your personal development is a good reflection of Chinas rise. When you were a child, your family was flat, you didnt have enough to eat, and you didnt have much money. But you are a real successful person sitting here now. In many ways, this is similar to the process of Chinas rising and becoming a superpower. Lets look at Europe again. You just said that many of Huaweis products are very good, and other companies cant make them, and these products are very important. As you mentioned just now, many tableware, knives and forks here are from Germany, and many cultural exhibits in the museum are also from European countries, but there are no high-tech products from Europe here. Take Germany and Europe for example. Do you think that compared with China, Europe is on the decline, and China is on the rise to become a superpower?

Ren Zhengfei: the high technology provided by Europe may be invisible to the naked eye. Huaweis human resource system management uses SAP software. The whole system of product design, production and supply uses Siemens, Bosch and Dassault software. We still use many advanced European high-tech products. Our equipment contains a lot of mathematics, physics, chemistry, aesthetics Also from France, Germany, Italy We use a lot of advanced European technology.

Europe should now change some business rules and dare to sell things to China. Will Europe and China fight? Since there is no war, why continue the rules of economic blockade in the past? It is a good opportunity for Europe to develop greatly if the United States does not sell this thing. Why not take the opportunity to fill the gap in the United States? Obviously we need chip products on a large scale. Why dont Europe invest in advanced chip manufacturing on a large scale? Why not make money? There are large chip factories in Europe. As long as you increase your investment, we will increase our purchase. Of course, the investment from the United States is less. If it exceeds 25%, the United States will limit your sales. If you dont need Chinese investment, you can absorb investment from the Middle East.

As we all know, the speed of social informatization is getting faster and faster, and now the supply capacity cannot keep up with it. Many basic industries in Europe, such as Infineon, NXP and Italian French semiconductor, need to increase investment in equipment. Chip equipment is also produced in Europe. You can persuade them to invest. If they dont have money to build a factory, we can pay in advance to support their development. Its a rare opportunity. We must take the opportunity to develop as soon as possible. If we miss this opportunity, we cant catch up.

11. Frank Sieren, DVH media group: in your opinion, whats the difference between western enterprises and Chinese enterprises? Is there a difference?

Ren Zhengfei: western enterprises are better. What does the name Germany and Switzerland mean? It means high quality. Chinese enterprises do not have such brand influence.

Frank Sieren: except Huawei.

Ren Zhengfei: Huawei has not reached such a level.

12. Spiegel Georg fahrion: in mid October, Huawei released financial data for the first nine months, with revenue growth of nearly 25%. Considering the current global economic environment, how can this growth be achieved?

Ren Zhengfei: our growth rate in October has dropped to 17%. The reason for this years growth may be that all employees feel the crisis of survival, strive to row, and increase their income and profits.

13. LFR? Ller: when I arrived in China, I learned that Huawei was regarded as the pride of the country by the Chinese people. More and more Chinese now choose to buy Huawei mobile phones, hoping to help Huawei through the difficult period of trade friction. My question is, if Germany makes a political decision not to let Huawei participate in its 5g construction, will Germanys automobile and other industries be countered in China? The Chinese government has done such a thing before. How would you react to it?

Ren Zhengfei: first, I have criticized the companys internal, do not over consume the enthusiasm of Chinese people for us, we should adhere to the customer-centric, put customer experience and customer perception first. Second, will there be a psychological reaction to cars in Germany and Japan? It turns out that China is still full of German and Japanese cars.

Source: responsible editor of Netease technology report: Yao Liwei, nt6056