FF’s Bridge Strategy to Provide U.S. Consumers with Same High Value that Chinese Consumers Enjoy

Hello everyone! Thanks to Jia Ke for the invitation. I am delighted to be back at the China Auto Blue-Book Forum again and join the conversation.

Ten years ago, I brought up the SEE Plan, aka Super Electric Ecosystem Plan, which predicted that Chinese intelligent electric vehicles would take the lead. Today, this vision has been validated through the efforts of all. I believe that both LeSEE and FF, as pioneers, have more or less inspired the industry.

The Chinese domestic AI EV industry has been going through a hyper-competition time, with many companies struggling to make a profit, not to mention investing heavily in innovation, research and brand upgrades. The prevailing anxiety was masked by the apparent prosperity. Guided by the hindsight that future reflection might offer, I believe that the Chinese automotive industry should shift from internal competition ('Nei Juan', 内卷) to an outward-oriented ('Wai Zhan', 外展) approach aimed at global high-value markets. This means expanding outward, capturing new market opportunities (blue oceans), and fostering collaborative success through co-creation. Instead of being constrained by internal competition, the industry can unlock its maximum potential within the global context.

The global automotive industry is undergoing a profound transformation, and a major factor driving these changes, in my opinion, is the Chinese automotive industry's transition from focusing primarily on domestic competition to adopting a strategy that emphasizes expansion into global markets. The challenges the Chinese automobile industry will face, could potentially be addressed through collaborative efforts in building the China-U.S. Auto Bridge and expanding operations on a global scale. 

Despite being the second-largest and most valuable automotive market globally, in 2023, only 8% of vehicles in the US were pure electric models. In contrast, this figure was 36% in China. When including other new energy products like hybrids, China's adoption rate for new energy vehicles surpassed 50%. The significant gap represents a substantial market opportunity in the US. What’s more, within the price ranges of $20,000 to $30,000 and $30,000 to $40,000, the EV adoption rate is even lower, representing an super “blue ocean”.  Because at this price range, there is currently no decent AI EV product on the US market, whereas the Chinese EV market offers users a huge variety of choices. 

Then, how do Chinese companies enter this “blue ocean” market? One possibility could be to leverage FF’s China-U.S. Bridge Strategy, seeking to align with potential partners and quickly introduce products with exceptional price-performance ratio, catalyzing rapid growth in the US AI EV market.

Some may also wonder if there's any opportunity left for Chinese automakers, given that the US government has quadrupled tariffs on imported electric vehicles to over 100%. Yes, of course.

The Bridge Strategy aims to provide a comprehensive solution designed to empower Chinese enterprises that aim to prosper in the U.S. market, covering the entire value chain. It includes four key value empowerment points:

1. Empowerment through the product, technology, R&D, and vehicle engineering system based on the "FF aiHyper 6X4 architecture 2.0". This could involve applying much of the core technology used in the $300,000 FF 91 to mass-market vehicles.

2. Empowerment through FF’s vehicle manufacturing capability in our California factory, including a production team, quality control, and systems for product compliance certification and market entry.

3. Empowerment through the construction of a unique user ecosystem that includes brand building, marketing, sales, and after-sales service to effectively acquire and operate users.

4. Empowerment through creating global profit potential for partners while enhancing capital value.

What would be the benefit for FF in considering this strategy? Such approach could enable FF to participate in the cost effective supply chain of the Chinese new energy vehicle sector for its own products. We even could consider establishing a second brand to have a differentiation to our existing and future FF product portfolio. Our strong belief and a big essential element of our core values is “sharing” and this strategy could offer an ideal concept to establish a fruitful win-win constellation in multiple aspects.

Recently, we have been in discussions with several domestic OEMs regarding potential cooperation plans. The most frequently asked questions initially were: How can FF execute this strategy?  With such low current delivery volumes of the FF 91, how can FF sell a meaningful number of vehicles annually in the future?

First, in the initial phase of the Bridge Strategy, we may seek to focus on large-scale procurement of "quasi-complete" components and parts from OEMs. This could focus on products in the $20,000-$30,000 and $30,000-$40,000 price ranges. Subject to funding availability, we could look to sign contracts and make advance payments if and when the financial situation allows.

Second, FF has vehicle manufacturing capabilities in the U.S., including body, painting, and assembly. With appropriate modifications, it may be possible to enable large-scale localized production of mass-market vehicles. Additionally, FF has built a complete supply chain and compliance testing team in the U.S. over the past ten years, which could offer solutions for parts procurement, packaging, logistics, and tariff control, and help ensure product compliance with U.S. regulatory standards.

Third, FF has created a unique user ecosystem that can complete sales entirely online, almost eliminating the need for offline flagship stores for display and sales, requiring only after-sales service offline. This system has already been fully implemented in the FF 91 user ecosystem.

Fourth, we could look to apply the ideas and models from LeEco's Super TV and Super Phone to automotive products, such as full-process direct-to-user sales, "double the performance at half the price," and extreme cost-performance ratios, aiming to disrupt the American AI EV industry just as we did with the television industry.

Some may ask if we have enough funding to realize this strategy.

Currently, we are looking to secure financing from strategic investors that could help support this strategy. Additionally, the commercialization of my intellectual property could help support this effort.

I believe that, given the significant untapped market potential and favorable conditions, courageous individuals will join efforts, working together to co-create and share in the resulting success.

Next month, we expect to officially launch the Bridge Strategy and share more details.

As many would agree, achieving success in the U.S. market is essential for a company to be considered truly global. I hope that the Chinese automotive industry will move away from intense domestic competition and focus more on expanding into international markets. FF, being a U.S. company established by a Chinese founder, could help facilitate this international expansion. The goal is to provide U.S. consumers with the same high value that Chinese consumers enjoy, benefitting all involved in this strategic collaboration between China and the U.S., and achieving mutual success for the automotive industries in both countries.

I invite visionary and courageous pioneers of China's automotive industry to join hands, and reshape the future of the U.S. AI EV mass-market vehicle industry.

Thank you.