Both revenue and profit achieved 6% growth, and the growth rate of performance ranked first in the world’s large household appliance enterprises for 15 consecutive years; The competition in the home appliance market has already turned white-hot, but with an explosive product, it has achieved a leap in the market share of 4% to 19% in the American big drum washing machine market; Under the general environment of shrinking investment, we have invested more than 10 billion yuan to continue to exert our physical layout … Turning to the newly released 2023 report card of Haier Group (hereinafter referred to as "Haier"), three groups of data that "go against the wind" suddenly appear in the dense data.
In the context of the downturn in the real estate market, how can the performance of home appliance leaders increase instead of falling? How to quickly grow from a non-mainstream brand to a mainstream brand when entering overseas markets? Where does the confidence and confidence come from with the countercyclical investment of 10 billion yuan?
With the above questions, shanghai securities news interviewed many people and brand experts of Haier Group, trying to decode Haier’s innovative development in 2023 and look forward to the new future of high-quality development of China enterprises.
Both revenue and profit achieved 6% growth.
On January 27th, Haier revealed its market performance in 2023 at its 2023 annual summary and commendation meeting: global revenue was 371.8 billion yuan, global profit was 26.7 billion yuan, and both revenue and profit achieved 6% growth.
How to achieve a contrarian rise? In this regard, Haier has given several sets of more detailed data: in China, the market share of Haier household appliances will reach 28.1% in 2023; In North America, Haier’s general household appliances have become the fastest growing household appliance company for seven consecutive years; In Japan, the annual share of refrigerators and washing machines has become the first in the industry; In Europe, Haier has achieved contrarian growth in the context of the continuous decline of the home appliance market, and has become the fastest growing home appliance brand in the region for eight consecutive years.
While building a smart residence base, Haier’s layout in other fields has also achieved steady development. On the industrial Internet track, Haier kaos ranked first in the double-span platform of the Ministry of Industry and Information Technology for five consecutive years, linking more than 900,000 enterprises and empowering 160,000 enterprises. By building the "work-giving model" of empowering cities with urban brains and industrial cloud brains, it has been replicated in 20 cities across the country, such as Jinan, Zibo and Linyi. Taking "work-giving Qingdao" as an example, in 2023, there were 5,000 service enterprises, with an added industrial output value of 35 billion yuan. In the big health track, Haier pioneered the low-temperature automation solution of smart pharmacy, realizing the leap of single scene value from one million to ten million; Haier Biomedical provides infrastructure solutions for vaccination in Uganda, Madagascar and other countries, which is highly recognized by the local authorities. On the track of urban governance, Qingdao’s urban emergency solution is taken as a model, and it continues to be replicated in Qihe, Jinan, Hefei and other cities.
"The steady development of market performance is inseparable from the layout of enterprises in scientific and technological innovation." Zhou Yunjie, Chairman and CEO of Haier Group, told the reporter that in 2023, he continued to focus on scientific and technological innovation, and broke through industrial scientific and technological problems such as magnetic control cooling and fresh air conditioning variable shunt. The ultra-high-speed centrifuges that tackled the problem broke through the core technologies to fill the domestic gap, and independently developed key technologies of digital technology industry such as BaaS digital industrial operating system and HomeGPT, the industry’s first smart home vertical domain model. The core algorithm technologies such as high-frequency PFC, press driver and fan driver reached the international leading level.
"In 2024, Haier should maintain its strength, continue to focus on the two major tracks of smart residence and industrial Internet, and become an industry leader in each track." Zhou Yunjie said.
From 4% to 19%, smart living is still the biggest grasp.
In the past 40 years, Haier Group has developed into a global leading brand from a small collective factory on the verge of bankruptcy. In Haier’s view, the most important thing for enterprises to develop is to innovate to meet the needs of users, and there are many stories that people relish. From the earliest washing machine that can wash sweet potatoes to self-cleaning air conditioners and ultra-thin refrigerators in overseas markets, behind every innovative product is the satisfaction of different user groups. In 2023, a similar story was once again staged in overseas markets.
"The washing and drying machine in the American market takes 5-6 hours to wash and dry at a time, and it is still not completely baked. Users complain a lot. In our research, users want to shorten the time by at least half. So we locked in the leading goal of 2 hours of washing and drying. " Gao Yawu, a member of Haier’s North American washing machine team and a post-90 s maker, shared such a story with reporters. After determining the user’s needs, Haier’s R&D centers in Europe, America, New Zealand and China realized collaborative research and development, completely subverting the structure and technology of the existing washing and drying machine in the United States, and creating a brand-new user experience, which not only greatly shortened the drying time, but also made the clothes drying more thorough and uniform.
After the final product was put on the market, even though the price was as high as $2,899, it quickly became a local high-end explosive, and more than 100,000 units were sold in seven months. Before the product was launched, Haier’s share in the local large drum washing machine market was only 4%, but now Haier’s market share has suddenly risen to 19%.
The global expansion of China’s home appliance enterprises has entered the fierce stage of brand output, and it is obvious that Haier has mastered the magic weapon to win. Zhou Yunjie said recently that the smart living track is still the biggest starting point for Haier to become a world-class enterprise. This means that Haier Group will not only be strong and smart, but also deepen the track, and it is particularly important to achieve scientific and technological breakthroughs in the original and key areas of the industry.
According to reports, in 2023, Haier’s global smart home invention patents increased by 6,152, with a total of 29,486, leading the world for 10 consecutive times; In 2023, more than 15,000 new public patents were added, ranking first in the industry; Nine new international standards have been issued, 106 international standards have been issued, 770 national and industrial standards have been issued, and there are more than 100 global standards experts, with the largest number of industries. At the basic research level, Haier has also broken through the core technology of ultra-high-speed centrifuges, filling the domestic gap; At the level of platform technology, Haier has broken through the common scientific and technological problems of air conditioning variable shunt and other industries. All the above results have laid a foundation for Haier to continue to stay ahead in the smart residence track.
"Large enterprises can effectively cope with the impact of economic cycle fluctuations through continuous innovation." Luo Qingqi, a brand expert and senior director of Paler Consulting, said in an interview with shanghai securities news, "As a leading enterprise in the industry, Haier is constantly leading the development trend of the industry. At present, it is no longer simply focusing on home appliances, but upgrading through technology and scenes, providing users with diversified smart life scene solutions, transforming from providing users with home appliances to creating smart life, thus driving the demand of the stock market, which is also the key for Haier to maintain sustained and steady growth in this track."
Zhou Yunjie made it clear that Haier should seize the opportunity of the times to become an eco-smart enterprise with the first brand, the first scale and the first market value in the world, and continue to improve its ecology and strengthen its competitiveness.
Counter-cyclical investment seeking deterministic growth
In addition to accelerating the strategic layout in the field of smart housing, Haier has also accelerated the expansion of the industrial Internet track. Zhou Yunjie proposed at the 2023 annual summary and commendation meeting that Haier should strengthen three platforms and deepen four vertical industries.
The three platforms are kaos Industrial Internet Platform, Haichuanghui Entrepreneurship Acceleration Platform and Haiyongshun Cross-border Service Platform, and the four vertical industries are Big Health Industry Internet, Urban Governance Industry Internet, Automobile Industry Internet and New Energy Industry Internet.
Haier’s ecological forces have already rushed out of the well-known "home appliances" boundary, and continue to cultivate new growth points by continuously cracking the layout.
In January this year, () announced that Haier Group planned to acquire 20% of the shares held by Clifford, with a total transfer price of 12.5 billion yuan. For a time, this incident became the focus of the industry, and this was just the tip of the iceberg for Haier to continue to strengthen the layout of the real economy.
On December 14th, 2023, a subsidiary of Haier Group () announced that it planned to acquire the commercial refrigeration business of Carrier Group for about US$ 640 million (about RMB 4.559 billion) in cash. Also in December, Haier kaos Industrial Internet Ecological Park refrigerator intelligent manufacturing (Phase I) project was officially put into operation, which means that the industrial park built by Haier with a domestic investment of 13 billion yuan is gradually being delivered. According to public information, Haier kaos Industrial Internet Ecological Park has a total planned production capacity of 26 million units, which is the largest among all home appliance parks in the world.
At the commissioning ceremony of the refrigerator intelligent manufacturing (Phase I) project, relevant parties promoted the signing of 10 key projects in the supply chain of smart home appliances industry chain in kaos Xincheng. It includes 3 industrial Internet projects and 7 upstream and downstream supporting projects in the industrial chain, covering the whole chain of sheet materials, precision molds, heat-conducting accessories, sensors, industrial gases, equipment and materials, and packaging materials in the smart home appliance industry, with a planned total investment of 15 billion yuan. In addition, Haier plans to lay out "Top Ten Factories" in the whole industrial chain, such as refrigerators, washing, air conditioners and recycling, in the Haier kaos Industrial Internet Ecological Park project where the factory is located within five years, with an annual output value exceeding 40 billion yuan.
In addition, in June 2023, BWT Haier Intelligent Water Purification Plant was put into operation, with an annual production capacity of 2 million units and an output value of about 200 million euros. In September of the same year, Haier led the Qingdao factory project of Deao Group in Germany, with a total investment of 40 million US dollars, and planned to build five high-end electronic control panel production lines.
Zhou Yunjie told reporters that under the strategic layout of the two racetracks, Haier will continue to promote the industry to be bigger, deeper and more practical, accelerate the construction progress of Haier Central Air Conditioning (Jiaozhou) Intelligent Manufacturing Base, Haier Da Health (Yingkang Yisheng) Digital Intelligence Industrial Park for Medical Devices, Haier Egyptian Industrial Park and other projects, and build new advantages for high-quality development of the industry. At the same time, based on scientific and technological innovation, we will give full play to the platform role of kaos Industrial Internet, and inject surging new kinetic energy into grasping the new development of digital economy.
Luo Qingqi believes that the whole economic circle often says "countercyclical layout", which is actually Buffett’s most famous investment motto: I am greedy when others are afraid. Because this strategic layout often requires less investment, but it will bring greater return on investment. Firmly focusing on the real economy and continuously accelerating the industrial layout is what Haier is doing now and in the future.