From public reporting to public prosecution, Gree and Oaks struggle to move forward in the process of "mutual tearing apart"

The hottest topic in the automotive industry in recent days is undoubtedly the real name reporting of the BYD incident by Great Wall.

The background of the "reporting door" has been talked about too much by major media, and I will not go into detail here. The subsequent impact of this incident on the two car companies is more worthy of attention. Embarrassed, on the day when Great Wall Motor reported on BYD, the stock prices of both sides fell together. The Hong Kong shares of Great Wall Motors once fell by more than 4%, more than 2.5% of BYD's. The former was also suspected of "hurting eight hundred enemies and losing one thousand".

The Great Wall must have taken this step after careful consideration - some past cases may have also provided inspiration for it.

The real name reporting incident of the top enterprise that caused a huge uproar last time occurred with two home appliance giants, Gree and Ox. In June 2019, Gree reported the unqualified air conditioners produced by Oxfam to the State Market Supervision Administration through official microblog and official account, which attracted the latter to send a counterattack overnight.

At first glance, there is not much correlation between the new energy vehicle and home appliance industries. But in reality, both industries are facing increasingly fierce internal competition, and friction between top companies is constantly intensifying.

Where will the Great Wall, BYD's "reporting door" incident and the entire new energy vehicle industry go? The experiences of Gree, Ox, and the air conditioning industry may have some reference value.

History is constantly repeating itself: 'reporting doors' are often just a microcosm of coercion

Looking back at the "report gate" incident that caused a sensation in the home appliance industry four years ago, the intensity of the confrontation between Gree and Oaks is even greater than that of Great Wall and BYD today.

On June 10, 2019, Gree issued a report letter stating that after laboratory testing by the company, there was a significant gap between the energy efficiency values of some models of Oaks air conditioners and the official promotion and nominal values. In order to verify this claim, Gree also hired an independent third-party organization for review, and the results showed that the energy efficiency ratio and cooling power consumption of the Ox air conditioner were not qualified.

Holding this monitoring report, Gree denounced Ox in the report letter for seriously infringing on consumer rights and causing significant damage to national energy conservation and emission reduction policies and fair market competition. With such a big hat on all of a sudden, Oaks certainly wouldn't sit idly by and quickly released a series of public letters to counterattack.

In its first public statement, Ox insisted on being a "responsible and responsible enterprise", confident in the quality, cost-effectiveness, and positive reviews of its products, and willing to accept supervision from consumers and relevant departments; On the other hand, he was extremely dissatisfied with Gree's behavior and stated that he would "report the case to the public security organs and file a lawsuit with the judicial organs" as soon as possible, threatening to use legal means to safeguard his legitimate rights and interests and market competition order.

But the story afterwards became very clear to everyone.Gree did indeed come prepared, and Oaks' tough counterattack did not win the recognition of regulatory authorities and testing agencies.

On June 11, 2019, the Market Supervision Bureau of Ningbo City and the Market Supervision Bureau of Zhejiang Province jointly established an investigation team to investigate the "Report Gate" incident. Subsequently, energy efficiency testing was carried out on multiple models of Audi air conditioners reported by Gree, including KFR-35GW/NFI19+3 and KFR-25GW/ZC+2.

On April 12 of the following year, the investigation results were officially released, and Gree's report was true. The Ningbo Market Supervision Bureau imposed an administrative penalty of 100000 yuan on Oakes. On April 13th, Ox issued an apology statement, promising to compensate consumers who purchased relevant models and batches of products, and offering options such as returns and replacement of new machines.

At this point, the 'reporting door' has settled, but the rift between Gree and Oaks is deepening. Looking at historical data, it can also be found that the diplomatic records of the two major air conditioning giants are far beyond the "reporting door" of 2019.

On the one hand, Gree and Oaks constantly poach their opponents and hoard outstanding talents.According to statistics from Pengpai News, from 2010 to 2017, there were over 300 key employees in the R&D and quality inspection departments of Ox who transferred from Gree, and they also took away Gree's core technology and the latest project information. This battle was a complete victory for Oaks.

On the other hand, the two sides have repeatedly engaged in patent wars and filed multiple lawsuits.Unlike in the talent war where Ox took advantage, both sides in the intellectual property war had their own victories and were evenly matched. In 2015, Gree sued Ox for infringement of its utility model patent rights, and the Guangdong Provincial High Court sentenced Gree to victory and received a compensation of 2.3 million yuan; In 2021, Ox sued Gree for violating both of its invention patents and won, receiving a total compensation of 167 million yuan.

In addition to the patent war and talent war, the two major manufacturers have never ceased their verbal battles.Dong Mingzhu, who has suffered multiple patent lawsuits, directly accused Ox of being a "patent hooligan" and even proposed to relevant departments to restrict unfair patent competition during the 2020 National People's Congress.

The above examples indicate that Gree and Oaks have been feuding for a long time, and the "reporting gate" is just one of the representative works of the long-term confrontation between the two sides. In the view of the Value Research Institute, whether it's the Great Wall today or Gree back then, the step of real name reporting is closely related to the deterioration of the industry's competitive environment.

six hundred and eighteenAs we approach, are home appliance manufacturers preparing for a new round of "mutual tearing"?

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six hundred and eighteenThis e-commerce shopping festival has little to do with car companies, but it has extraordinary significance for air conditioning manufacturers.

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(Image from Forward Industry Research Institute)

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However, has the fate of Ox and Gree really reversed after the 'reporting gate'?

The answer is no. Gree's report did indeed damage Oaks' reputation, but it did not have a significant impact on their sales.2019six hundred and eighteen

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As the industry leader, Gree has always had a bias towards science and technology, relying heavily on air conditioning products for revenue. The cold weather in the air conditioning market has left Gree exhausted.

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The air conditioning market is becoming increasingly popular, and where can top manufacturers still go?

With the overall shrinkage of the air conditioning market and the continued weakness of the market, there is no point in fighting inside out. The pressure on performance has also left major manufacturers struggling, let alone struggling to compete with their competitors. From Gree and Ox, who specialize in air conditioning, to Midea and Haier, who are developing in all aspects, there is now only one task: to unleash consumer potential through technological progress and return the market to a growth trend.

At the 2022-2023 China Air Conditioning Industry Summit Forum, Peng Yudong, General Manager of Zhongyikang's Home Appliances Business Unit, also stated that the air conditioning industry has entered a stage of stock competition. Data shows that as of the end of last year, the total number of air conditioners in China had reached 540 million units. With the decrease in new demand, the market will maintain a low-speed growth trend in the next two years without any surprises.

In other words, at this stage, air conditioning manufacturers should shift their focus from pursuing scale to pursuing quality, and only by producing high-quality products can they impress existing users.

As is well known, the core technology of air conditioning is not complex, mainly including several links such as compressor, air supply, and air exchange. Gree was able to establish its own technical barriers in these areas by relying on the slogan of "good air conditioning, Gree made" to make a name for itself and secure its position as the leader of air conditioning.

For example, in 2021, it launched a self-developed two-stage enthalpy increasing variable frequency compressor to maintain stable operation of the air conditioning in an ultra-low temperature environment of -30 degrees Celsius, and subsequently launched a three cylinder two-stage variable capacity compressor to expand the temperature range to -35-54 degrees Celsius to meet the cooling needs in extreme climate environments. The latter technology was pioneered and launched by Gree, truly leading the world.

However, in recent years, with the maturity of various technologies, there have been fewer breakthroughs.Objectively speaking, this situation is likely to occur in all industries, and it is not that home appliance manufacturers are not working hard. As research and development continue to deepen, breaking through bottlenecks will only become increasingly difficult. But no matter how difficult it is, we cannot give up. The air conditioning industry must always put in effort in technology to overcome its decline.

On the one hand, leading manufacturers are still focusing on the core areas of compressors and air supply technology, and building supply chain advantages through self built laboratories and processing plants.

For example, Haier announced this year that it will invest 340 million yuan to build a production base for air conditioning compressors in Zhengzhou, focusing on the research and development and production of variable frequency and high-efficiency rotary compressors, with a planned annual production capacity of 15 million units. It is revealed that Haier will apply the newly produced compressor to the variable flow air conditioning product line and use it in conjunction with independently developed heat exchangers, in order to reduce power consumption.

On the other hand, in addition to the core technologies mentioned above, air conditioning manufacturers are still exploring more "micro innovations".For example, developing new refrigerants, improving control technology and intelligence (such as PID control technology), improving sterilization effects, and so on.

Not all technological innovations can bring revolutionary results, but fully considering user needs and making targeted changes is definitely not wrong.

In recent years, Gree has created many new businesses, but not many have been successful. Recently, multiple media outlets reported the dissolution of Gree's mobile team, and the official website is currently unavailable. Turning around, in the end, Gree still couldn't do without the basic unit of air conditioning.

The business of air conditioning is not as easy to do as before, but leading brands such as Gree will always have their own fans. However, after the market shrinks and the competitive environment deteriorates, top manufacturers also need to show more sincerity and creativity in order to leverage the existing market and impress increasingly picky consumers.