text | Zhou Youhui
edit | Wu Rui
1. Those who have ambition do not play golf
In 2001, Huawei stripped the power supply department and sold it to Emerson, the United States at a high price of 750 million US dollars. This was the largest domestic merger and acquisition case that year. Looking back, it was also a turning point in the rise of Shenzhen's manufacturing domestic products.
Huawei employees who joined Emerson with Ansheng Electric, mostly became foreign company Jinling because of this transaction, realizing financial freedom. An employee who later became an executive of a listed company recalled: "I received 900,000 yuan in compensation at that time, but not much among colleagues. At that time, the housing prices in Shenzhen were only 5,000 and 6,000 yuan per square meter." Some employees drove top-notch cars, lived in luxury villas, and were more addicted to golfing.
But there are also a group of people who started their business with this first pot of gold. On the later GEM and SME Board, more than 10 Huawei-based A-share listed companies, including Huichuan Technology , Yingweiteng, Hewang Electric, Yingweik , Lanhai Huateng, Xinrui Technology, Shangneng Electric and McGmitt , were born.
They have a common characteristic: a strong Huawei imprint, and the industrial control and power markets exclusively occupied by foreign brands in the early years, which opened a gap. , the most eye-catching thing among them is Huichuan Technology, a market value of up to 145 billion yuan, which is several times higher than that of domestic competitors in the industrial control sector.
1992, Huichuan Technology founder Zhu Xingming was still a newly graduated graduate student. After a brief job at Shenzhen Huaneng, he switched to Huawei as product director. At that time, in order to overcome the core technology of inverters, Huawei set up Huawei Electric Hangzhou Research Institute. It was on the West Lake that Zhu Xingming led the team to accumulate a large number of technologies about inverters.
But couldn't wait to be commercialized, Huawei Electric was sold to Emerson . In 2003, Zhu Xingming, who was in a state of dissatisfaction, resigned from Emerson to found Huichuan Technology, and 16 of the 19 co-founders have Huawei backgrounds.
frequency converter is a power supply device that converts the alternating current in daily use into various frequencies. Almost all automation equipment that requires a motor needs it. But in the wave of urbanization construction in China at the beginning of the century, the most urgent need for inverters comes from elevators - controlling the rise, fall and operation of mechanical transmission. The rising skyscrapers not only made the elevator industry successfully rich, but the upstream inverter manufacturers also made a lot of money.
The most powerful inverter brands at that time were foreign players such as Siemens and ABB, but they were not the ones who got the dividends of the rise of the elevator. The reason is that elevators are lower-end than machine tools and heavy machinery, and foreign brands will not customize them for the Chinese market. This crack attracted a fierce attack from domestic manufacturers.
Around 2000, there were more than 40 foreign-invested brands in the Chinese inverter market and more than 200 domestic brands. But more than ten years have passed, only Huichuan Technology has successfully broken out of the low-end quagmire and lived well.
In the hot robot market in recent years, Huichuan has once again staged a counterattack battle against foreign capital. Extending from the frequency converter, Huichuan directly points to the lifeline of Yaskawa Motor in the field of servo motor, which is one of the four major families that dominate the robot market. Huichuan technology inverter and servo motor have a market share in China that exceed European and American, Japanese and Taiwanese brands, ranking first.
In people's prejudice, the domestic manufacturing industry is always unable to escape the labels of "demographic dividend" and "low-end industry". Those who hold this view might as well take a look at Huichuan's 2021 report card: revenue of 18 billion yuan, net profit after deducting non-operating items reached 2.956 billion yuan, a year-on-year increase of 54.55%, and the net profit margin after deducting non-operating items reached 16%.
Twenty years ago, no one would have thought that a low-end inverter company could shake the market position of overseas industrial control and robot giants and make money through core technologies.
2. Don’t be afraid of the small market, as long as the value is high
In a nutshell, Huichuan’s core strategy is to explore the non-standard needs ignored by foreign brands and explore high gross profits on leading customers.
In 2003, Zhu Xingming, who had just started his business, decided to enter the market from inverters and positioned Huichuan to be the best inverter in China, targeting the mid-to-high-end OEM customers served by imported brands, but the price is 10% lower than that of imports. At that time, although domestic brands emerged like mushrooms after a rain, they all lacked core technology and their performance was far inferior to foreign brands. "Even the water pump factory in Shanghai uses European inverters." The clear direction of
does not mean that it can be smooth all the way. Zhu Xingming and his R&D team of more than 20 people were researching and developing day and night at the Bao'an factory in Dabao Road, Shenzhen. As a result, the inverter launched to the market the next year was directly evaluated by downstream agents as - ugly.
turning point occurred in 2005. In response to the pain points of high maintenance costs in the elevator industry, Huichuan launched an integrated elevator drive control special aircraft. Previously, the mainstream solution in the market was the universal inverter + control board mode. These two communication protocol 's different parts belong to different suppliers, and elevator manufacturers need to manage the quality and supply of multiple suppliers respectively. Such a design is redundant for elevators, but since there is no upstream willing to customize it for elevator customers, the latter can only be used.
(Picture: Huichuan Technology targetedly launched an elevator integrated controller product in the elevator field)
Huichuan's all-in-one machine saves overall volume, material consumption and cost. Zhu Xingming once compared that before, skilled workers could only debug two elevators a day. After using the all-in-one machine, workers with a little training can debug one elevator in just 20 minutes. The gross profit of its integrated elevator aircraft is as high as 60%, which is higher than the inverter industry average of about 40%.
In 2008, Huichuan Technology's market share in the elevator industry became the number one among domestic brands. In the same year, Huichuan made a bolder decision: entered the servo motor market.
Zhu Xingming posted an article within the company at that time that a single inverter product is already difficult to meet the future industrial automation needs. Downstream industries often need a complete set of comprehensive automation solutions, and to form the ability to provide industry-level solutions, the premise is that has an independent research and development servo system.
frequency converter and servo system are the core devices that control the operation of the motor during electrical transmission , and are widely used in various industrial automation machines.
is within a certain range. The servo system can do all inverter scenarios, but the inverter cannot be compatible with the servo system upwards. Because the servo structure is much more complex than the inverter, has better control performance and higher single-unit value, it is mainly used in CNC machine tools, and industrial robots.
(Figure: Comparison of the underlying control technology of the servo system and the frequency converter)
As shown in the figure above, the servo system includes an encoder, servo driver and servo motor. plays a role in automation equipment like the nervous system of the human body - after analyzing neural signals, execute the motion instructions issued by the "brain" (controller). This is also the core technology of robotic hairbanako and Yaskawa Motor.
After the elevator battle, Zhu Xingming has already enjoyed the sweetness of doing industry customization business. In the servo field with higher technical barriers, Zhu Xingming chose the injection molding machine industry as the entry point.
Injection molding machine is one of the industrial master machines. Its principle is similar to that of syringes - extruding molten thermoplastics into molds and shaping them into plastic products of various shapes. The finished products range from washbasins, lighters, mobile phone case to large as electric vehicle frames and car plastic bumpers.
At that time, traditional injection molding machines mostly used hydraulics, and the oil pump was driven by a motor, which accounted for more than 80% of the total processing electricity bill. In addition to the heating and cooling process, the huge energy consumption makes the injection molding machine known as " electric tiger ", saving power and cost reduction is a basic need for all factories. In the upstream, injection molding machine brands such as Haitian International and Esmi are looking for more power-saving manufacturing solutions.
Based on this, Huichuan Technology has developed and launched the IS300 series servo drivers, with a power saving rate of more than 40%. This is because, by using a servo system to control the motor, the rotation speed of the oil pump motor can be adjusted in real time according to the power requirements of each link of the injection molding machine to change the output power.To use the Internet language as a metaphor, it is "refined traffic operation".
(Picture: Technical principles of servo energy-saving system of Huichuan injection molding machine)
Just like the business growth after the customized research and development of the elevator industry, the compound growth rate of Huichuan injection molding machine special servo has reached 380% within three years after the launch.
(Picture: Changes in the servo revenue for injection molding machines for Huichuan Technology)
In 2010, relying on the inverter products and the servo system that just opened the market, Huichuan Technology successfully landed on the GEM with a price-to-earnings ratio of 72 times. In the following three years, Huichuan Technology, which had funds and ammunition, successively acquired Changchun Huitong and Ningbo Yistong for 30 million yuan and 110 million yuan.
Changchun Huitong has filled Huichuan's shortcomings in encoder, and through cooperation with Ningbo Yistong to sell injection molding machines and share customer resources, Huichuan's servo drive and servo motor can be "packaged and sold" with the injection molding machine controller of Yistong , so that Huichuan's self-developed products can get feedback from the real market.
To sum up, the core of Huichuan Technology's strategy is that aims to replace imports, specializes in customized special aircraft for industry customers, and relies on a product with high quality and average performance to specialize in small businesses and expand market share.
However, although Huichuan servo was successful in injection molding machines, at that time, Huichuan's market share in 2015 was only 3%. Because in the high-end servo applications controlled by giants - industrial robots, CNC machine tools, etc., the technical high wall facing Huichuan is still solid.
3. Domestic robots, three Long March roads,
Industrial robot industry can be divided into upstream core components (controllers, servo systems, reducers), midstream robot body production, and downstream integrated applications for industry. Among them, the three core components determine the level of the robot's motion control technology, accounting for 70% of the cost of the final product. Corresponding to
, the possible paths for domestic brands to break through to core technologies are roughly divided into three: pure parts, the entire industrial chain and "parts + body". The choice of play depends on the genes and starting point of the company behind it.
1. The pattern path of pure components is to directly harden the single core parts of the robot, all in all R&D investment and robot giants compete for the domestic market.
Take the harmonics of Suzhou green as an example. Zuo Yuyu, the founder of the metal processing industry, broke through the self-developed harmonic reducer starting from the most basic mathematical modeling . Japan's Nabotsk and Hammerak have absolute advantages in the field of reducers, and the four major families also need to purchase them. However, the domestic market has given green harmonic development opportunities. In 2013, Green Harmonics received the first order from Chery Automobile's robot company, Eft .
Now green harmonic terminal customers include Xinsong Robot , Huazhong CNC , Xinshida , Eft and UBL. There are also Zhongdalide, RV reducer, and double-ring transmission , which are taking the pure parts path. Unlike harmonic reducers used in small and medium-sized machines, RV reducers are mainly used in large heavy-duty machinery.
2. Grasping the entire industrial chain can be said to be the ultimate goal of all robot manufacturers, and this is also an important reason for the rise of the four major families.
These include veteran players like Shenyang Xinsong Robot, which was established in the early 2000s and Anhui Eft, as well as new stars like Nanjing Eston who gathered all industries.
Eston started out as a machine tool CNC system. In 2011, industry expert Dr. Wang Jiegao joined Eston and activated Eston's robot business. In the following three years, Wang Jiegao developed 7 different types of robots. Based on the upstream and downstream layout of the industrial chain, the price was cut to half. The four major families had to face Eston's price competition head-on.
After going public in 2015, in order to expand its technological advantages, Eston began to acquire domestic and foreign companies around the industrial chain. As of 2020, Eston has acquired 7 companies from core components to system integration, with a total of 2.742 billion yuan. The subsequent release of performance depends largely on whether Eston can absorb this series of huge mergers and acquisitions.
3. The way of playing parts + bodies is mostly based on existing parts technology to extend to robot bodies, which is a common competition path.
In the words of Huichuan technology, it means that the "flour + process" developed in 2013 to the "whole machine + process" in 2016. Flour refers to Huichuan's existing servo system, and the process refers to different types of industrial robots, and Huichuan provides different process guidance. At the same time, it also forms strategic cooperation with robot manufacturing companies.
But Zhu Xingming found that the robot industry was not strong enough at that time, and the lack of downstream applications and demand feedback could not give full play to its own technological advantages. Therefore, in the first half of 2016, Huichuan decided to directly deploy robot body manufacturing to provide the industry with an overall solution.
(Picture: Comparison of core components and downstream layouts of Eston, Huichuan and Fanucou Picture source: Snowball@4D Space aaa)
Among many industrial robot types, Zhu Xingming chose to apply more than 70% of SCARA robots in the fields of 3C electronics and semiconductors, that is, horizontal multi-joint robots. is mainly used for electronic components patches, assembly machines and component production. An electronic product production line requires hundreds of SCARA robots. Behind this choice of
is the downstream applications of the domestic servo industry in recent years that are undergoing drastic changes: the rise of semiconductor and 3C industries, and the shortened production and manufacturing cycle calls for servo systems that can quickly iterate. This is obviously difficult for the four major families who are used to collecting money in the automotive industry.
(Figure: servo systems account for changes in downstream application fields in 2011, 2015, 2018 and 2020)
Therefore, the wave of domestic substitution emerged in SCARA robots. In order to meet the rapidly changing needs of the electronic manufacturing industry, domestic manufacturers launch new products almost every year to catch up with foreign brands.
Looking back, the SCARA product is a fulcrum for Huichuan to leverage 3C manufacturing. Assembly is the last process link in 3C manufacturing. When launching the robot machine used in this link, Huichuan has the opportunity to understand the entire 3C production process.
In the production process before assembly, the SMT production line used for electronic original assembly and the FPD joint machine used for module assembly all require a large number of servo systems, which is a much larger market than the robot body. Huichuan has indeed entered the production lines of Apple and some domestic mobile phone brands.
(Picture: Typical electronic manufacturing servo application equipment)
In 2020, Huichuan became the first domestic brand in SCARA robot, following the Japanese brands Yamaha and Epson. Yamaha, who felt the pressure, also launched an economical SCARA robot with a cost-effectiveness focus in 2020.
After opening the electronics manufacturing industry market, Huichuan Servo's revenue expanded from less than 200 million yuan in 2012 to 2.185 billion yuan in 2020. In 2021, Huichuan's general servo market share will be the first in China.
4. Why is the market value of 100 billion yuan?
A shares, most of the companies with industrial automation market value are around billions, and Huichuan Technology with a market value of hundreds of billions is an "outlier". Why is such an upstream company so valuable?
Huichuan and his peers are the most significant difference lies in their ability to respond quickly to downstream demand, which is rare in upstream industry .
Huichuan has a definition of "star products" - a single product has a sales of more than 50 million per year, and a total sales of more than 200 million in series products. In 2019, Huichuan had 24 star products, and the number of platform-based products and non-standard products accounted for about half each, which shows its importance to the non-standardization needs of different industries.
Take the new energy vehicle industry as an example. After supporting the servo motor business in 2015, Huichuan entered the motor and electronic control system of new energy buses through cooperation with Yutong Bus .
By 2020, Huichuan once again tied up the leading customers of passenger cars - the new car manufacturing force Xiaopeng , Ideal and WM Motor. As new energy vehicles continue to increase in volume, Huichuan Technology's new energy vehicle electronic control market share has increased from 2-3% in 2019 to 10% in 2021, closely following BYD and Tesla .The annual report shows that the revenue of the new energy vehicle business reached 1.8 billion yuan in the first three quarters of 2021, an increase of 180% year-on-year.
(Picture: Changes in the structure of domestic passenger car electronic control customers in Huichuan Technology)
's response ability has also been demonstrated in the sudden rise of masks.
Mask machine is also a type of industrial automation equipment, and the internal transmission structure also requires a servo system. Even BYD, the servo system of the mask machine needs to be purchased from Japan's Omron . 80% of the workload of N95 mask machine and flat mask machine production line equipment comes from mechanical-related installation and debugging.
For this reason, Huichuan adopted full servo control, replacing mechanical transmission with electrical transmission, and the workload of equipment debugging was also reduced by one third.
During the epidemic, BYD made drawings in 3 days, made export masks in 7 days, and 10 days of products leaving the factory are well known. But in the invisible upstream, Huichuan has quietly gained more than 200 new customers with short, flat and fast technology research and development. According to MIR Rui Industrial statistics, Huichuan Technology ranks among the top in the mask industry.
(Picture: Huichuan Servo ranks first in the total performance contribution of the mask machine industry. Data source: MIR databack)
To a certain extent, the robot companies that "kill" parts and make whole machines are like "BYD", trying to grasp every link in the upstream and downstream of the supply chain. Huichuan Technology is the " CATL " of the robot industry. It only does the key technology of motor control , and it has made a leap forward between downstream industries and finally gains the development dividends of emerging industries with the factory.
Huichuan model has also been recognized by the capital market.
In June last year, Huichuan Technology successfully completed a targeted additional issuance of 2.13 billion yuan to 12 institutions, including Hillhouse Capital, Liren Investment, CITIC Securities , GF Fund , etc., and also includes UBS , Morgan Stanley , J.P.Morgan and other foreign institutions. Among them, Hillhouse was allocated nearly 800 million yuan. After the additional issuance of , Huichuan Technology's market value once exceeded 200 billion yuan. After the private placement of
, Huichuan said that it would build an intelligent factory, an industrial software technology platform and a digital project. As the core of automation equipment, servo motors and frequency converters have greater advantages over other companies to obtain production data and undergo digital transformation.
However, intelligent manufacturing has always been a complex system that drives the whole body. The new technologies born in the era of intelligent machinery are also bringing an impact on Huichuan's old path. It is still unknown whether Huichuan can maintain the valuation of 100 billion yuan and successfully innovate itself. The road to counterattack in the past 20 years has been magnificent, but who can resist the tide of new technology?
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