Highlight:
- From Grass Hut to Global Giant: Chery’s journey began in a dilapidated brick factory with just $43,000. Today, it’s a multi-billion dollar company selling cars in over 80 countries. This is a story of defying the odds.
- The “No” Heard Around the World: When Western companies refused to share engine technology, Chery’s founder boldly declared, “We’ll do it ourselves!” This defiant spirit fueled their independent rise.
- More Than “Made in China”: Chery isn’t just assembling cars; they’ve designed and built China’s first truly independent car engine, the ACTECO, a symbol of national technological achievement.
- Chrysler Came Calling: Global giant Chrysler sought out Chery for its engineering expertise, proving that Chinese automakers are no longer just low-cost manufacturers.
- Beyond Electric Dreams: Chery isn’t just chasing the EV trend; they’re investing billions in becoming a global technology company, developing intelligent and connected car solutions.
- Huawei’s Big Bet: Tech giant Huawei chose Chery as its partner in the race for smart mobility, indicating that Chery is at the forefront of China’s automotive future.
In the bustling landscape of the global automotive industry, Chery Automobile stands as a testament to China’s remarkable rise as a manufacturing powerhouse. From humble beginnings in a dilapidated brick factory, Chery has emerged as a leading Chinese auto manufacturer, renowned for its commitment to technological innovation, a relentless pursuit of quality, and a growing presence on the world stage.
Founded in 1997 in the city of Wuhu, Anhui province, Chery’s journey reflects the ambitious spirit of a nation determined to shed its image as a producer of low-cost goods and establish itself as a creator of world-class products. At the heart of this story is Yin Tongyue, the visionary founder of Chery, a man driven by an unwavering determination to build a Chinese car brand that could rival global giants.
Leaving behind a promising career at one of China’s established state-owned automakers, Yin Tongyue returned to his hometown with a dream and a meager 300,000 yuan (approximately $43,000 USD in 1997) in seed funding. He assembled a team of passionate engineers, united by a shared belief in China’s automotive potential. Together, they embarked on a journey marked by relentless hard work, resourceful problem-solving, and a refusal to be deterred by seemingly insurmountable challenges.
Chery’s rise has been nothing short of remarkable. Today, the company boasts a diverse portfolio of vehicles, ranging from fuel-efficient compacts to sophisticated SUVs and technologically advanced electric vehicles. It has established a strong foothold in the Chinese market, earning a reputation for quality and reliability, and expanded its reach to over 80 countries, becoming a leading exporter of Chinese automobiles. Chery’s success is a reflection of its core values: technological independence, a customer-centric approach, and a commitment to continuous improvement. These values are deeply ingrained in the company’s culture, shaping its strategic decisions and guiding its interactions with customers, partners, and employees alike.
In the fiercely competitive global automotive market, Chery has not only survived but thrived, defying expectations and challenging the established order. It’s a story of ambition, innovation, and unwavering determination, a testament to the transformative power of a dream and the collective effort of a group of individuals who dared to believe that a Chinese car could one day stand tall among the world’s best.
From Humble Beginnings to National Recognition: The Birth of Chery
The Genesis of a Dream
In the early 1990s, Wuhu, a city nestled on the banks of the Yangtze River in Anhui province, was at a crossroads. Its traditional reliance on light industries, particularly textiles, was faltering, and the city’s leaders were eager to find a new engine for economic growth. The automotive industry, with its potential for job creation and technological advancement, seemed like a promising path forward. A small, village-run factory in Wuhu had demonstrated this potential, achieving significant revenue by assembling cars through rudimentary methods, sparking a vision among local officials – Wuhu could become a hub for automotive manufacturing. This ambition aligned perfectly with the provincial government’s initiative to develop the Wanjiang region and create an economic powerhouse to rival the burgeoning success of Shanghai’s Pudong district.
The seeds of Chery were sown in this fertile ground of ambition and necessity. In 1992, with the support of the Anhui provincial government, the “951” project was launched – a top-priority initiative aimed at establishing a full-fledged automotive manufacturing base in Wuhu. However, the city lacked the necessary expertise and resources to embark on such an ambitious endeavor.
Enter the “Eight Immortals”
The search for a leader who could bring this dream to life led to Yin Tongyue, a talented engineer working at First Automotive Works (FAW), one of China’s oldest and largest state-owned automakers. A Wuhu native, Yin Tongyue had risen through the ranks at FAW, earning a reputation for his technical prowess and leadership skills. He was approached by Zhan Xialai, then the vice mayor of Wuhu and later the first chairman of Chery, with a compelling proposition: return to his hometown and lead the effort to build a truly Chinese car.
Fueled by a deep sense of patriotism and a desire to create something truly innovative, Yin Tongyue was swayed by Zhan’s impassioned plea: “Working for foreigners all the time will get us nowhere.” In 1996, Yin Tongyue left his secure and well-paying job at FAW, bidding farewell to his family and embarking on a journey fraught with uncertainty. Armed with a 300,000 yuan investment from the Wuhu municipal government, he gathered a small team of like-minded engineers, the “Eight Immortals,” and set up shop in a dilapidated brick factory on the outskirts of the city.
The “Small Grass Hut” Spirit
The early days of Chery were defined by hardship and ingenuity. The team worked tirelessly in makeshift offices, utilizing whatever materials they could find to create workstations and meeting spaces. They braved the scorching summers and frigid winters in a facility that offered little protection from the elements.
Yet, this period of adversity forged a spirit of resilience, resourcefulness, and camaraderie that would become an integral part of Chery’s identity – the “Small Grass Hut” spirit. Yin Tongyue, leading by example, worked alongside his team, sharing their hardships and inspiring them with his unwavering belief in their shared mission.
Early Triumphs and the Quest for Legitimacy
Despite the challenges, progress was swift. By December 1999, the team had achieved a significant milestone – the first Chery car, named Fengyun, rolled off the production line. The Fengyun, based on the platform of the SEAT Toledo, was a testament to the team’s determination and technical capability. However, a major hurdle remained: Chery lacked the government-issued production license required to legally manufacture and sell cars in China.
Without this license, the company’s future was in jeopardy. The team had poured their heart and soul into creating the Fengyun, but it risked becoming a symbol of unfulfilled potential. To overcome this challenge, Chery explored various options, including applying for a license and seeking partnerships with established automakers.
A Strategic Alliance and a Bold Decision
After facing rejections from other major players, Chery secured a strategic alliance with SAIC Motor, one of China’s “Big Three” automakers. The agreement, struck in 2001, granted Chery the coveted production license, but at a cost: SAIC received a 20% equity stake in the company. The partnership allowed Chery to legally sell its cars, but it came with significant constraints. SAIC imposed a production quota, limiting Chery’s growth potential, and restricted its access to valuable resources and distribution networks.
Despite these limitations, the alliance provided Chery with a crucial opportunity to establish itself in the market. The Fengyun, priced significantly lower than its competitors, quickly gained traction among Chinese consumers, exceeding the initial production quota set by SAIC. Chery’s success, however, created friction with its partner, who sought to exert greater control over the burgeoning automaker. By 2003, the relationship had become untenable, leading to a mutual decision to part ways. SAIC relinquished its equity stake, and Chery was free to chart its own course, armed with valuable experience, a growing customer base, and a fierce determination to achieve its ambitions on its own terms.
The Rise of Chery: A Decade of Growth and Innovation
The Engine of Success
Freed from the constraints of its partnership with SAIC, Chery embarked on a period of rapid growth and innovation. Central to this success was Yin Tongyue’s unwavering commitment to technological independence. He understood that to truly compete on the global stage, Chery needed to develop its own core technologies, rather than relying on foreign partners. This conviction was evident in the company’s early decision to acquire a second-hand Ford engine production line from the UK for a hefty sum of nearly $30 million. While the initial plan was to rely on foreign expertise for installation and commissioning, the project faced significant delays due to the lackadaisical attitude of the British engineers.
Frustrated by the slow progress and sensing a critical window of opportunity slipping away, Yin Tongyue made a bold and daring decision: he sent the foreign experts packing and tasked Chery’s engineers with completing the project. It was a risky gamble, but one that ultimately paid off. After over 500 days of relentless effort, the engine production line was up and running, marking a turning point in Chery’s history. The successful completion of this project instilled a sense of confidence and self-reliance within the company, proving that Chery’s engineers were capable of mastering complex technologies. This spirit of “doing it ourselves” became a defining characteristic of Chery’s culture, driving its pursuit of innovation and its determination to break free from technological dependence.
ACTECO: Powering a Nation’s Automotive Dreams
The successful commissioning of the engine production line paved the way for Chery to develop its own proprietary engine series, a landmark achievement that would solidify its position as a serious player in the automotive industry. Named ACTECO, this engine series represented a culmination of years of research, development, and a deep understanding of the Chinese market’s needs.
The first ACTECO engine, launched in 2005, was a testament to Chery’s growing technological prowess. It was China’s first truly independently developed car engine, a symbol of national pride and a testament to the company’s commitment to innovation. The ACTECO series would go on to power a range of Chery vehicles, becoming synonymous with reliability, fuel efficiency, and performance. This success was not merely a technological triumph, but a cultural one, demonstrating that Chinese engineers were capable of developing world-class engines, challenging long-held perceptions and setting a new standard for the domestic auto industry.
From Domestic Success to Global Ambitions
While Chery was making strides in engine technology, it was also expanding its vehicle portfolio, capturing the hearts of Chinese consumers with affordable, stylish, and practical cars. The Chery QQ, a compact city car launched in 2003, became an instant sensation, earning the moniker “the people’s car” for its affordability and youthful appeal. The QQ’s success cemented Chery’s position as a leader in the Chinese market, demonstrating its ability to cater to the needs of a rapidly growing consumer base.
As Chery’s domestic success grew, so did its global ambitions. The company’s first foray into international markets came in 2001 with the export of 10 Fengyun sedans to Syria, a deal struck through a chance encounter on a Shanghai street. This seemingly insignificant transaction marked the beginning of Chery’s journey to become a global brand, a journey driven by a desire to showcase Chinese engineering on the world stage.
A Partnership with Global Giants
Chery’s reputation for quality and innovation attracted the attention of global automotive giants, leading to a significant partnership with Chrysler in 2007. The collaboration, focused on developing small cars for the North American and European markets, was a testament to Chery’s growing technological capabilities. Chery was responsible for the design and engineering of the vehicles, while Chrysler would provide its brand recognition and distribution network.
This partnership, however, was short-lived. The 2008 financial crisis had a profound impact on the global automotive industry, forcing Chrysler to undergo a major restructuring. The collaboration with Chery was ultimately deemed non-essential and was terminated in 2009.
Despite its abrupt end, the partnership with Chrysler served as a valuable learning experience for Chery. It exposed the company to the rigorous demands of the global market, providing insights into international standards and best practices. More importantly, it reinforced Chery’s belief in its own capabilities and strengthened its resolve to achieve its global ambitions through independent development. The experience with Chrysler served as a turning point, marking the end of Chery’s reliance on foreign partners and the beginning of a new chapter focused on building a truly global brand on its own terms.
Navigating Challenges and Redefining Strategies: Chery’s Transformation
A Period of Reflection and Strategic Shift
As Chery entered the 2010s, the company found itself at a critical juncture. While its early success had propelled it to the forefront of China’s burgeoning auto industry, maintaining this momentum in an increasingly competitive landscape presented new challenges. The termination of the Chrysler partnership, coupled with a maturing domestic market and the rise of new rivals, forced Chery to engage in a period of deep reflection and strategic reassessment.
One of the most pressing challenges was the company’s fragmented brand portfolio. In its pursuit of growth, Chery had adopted a multi-brand strategy, launching sub-brands like Riich for luxury vehicles and Rely for commercial vehicles. This approach, however, stretched the company’s resources thin, diluting its brand identity and hindering its ability to establish a clear and consistent market position.
Recognizing the need for a more focused approach, Chery embarked on a major restructuring in 2013. The company abandoned its multi-brand strategy, consolidating its operations under the “One Chery” banner. This strategic shift signaled a commitment to streamlining its product portfolio, concentrating resources on core strengths, and building a stronger, unified brand image.
This period of transformation also marked a renewed focus on quality and technological advancement. Chery recognized that to compete effectively in a more demanding market, it needed to elevate its standards across the board. The company invested heavily in research and development, upgrading its manufacturing facilities, and implementing stricter quality control measures. This dedication to improvement was evident in the launch of new models like the Arrizo and Tiggo series, which featured more refined designs, improved performance, and enhanced safety features.
The Pursuit of Premium: A Story of Trials and Tribulations
Despite its success in the mass market, Chery harbored ambitions to move upmarket and compete in the premium segment, a lucrative but highly competitive arena dominated by established international brands. This pursuit of premium, however, proved to be a challenging endeavor, marked by a series of trials and tribulations.
Chery’s first foray into the premium segment was the launch of the Riich brand in 2009. Positioned as a luxury marque, Riich aimed to rival the likes of Audi and BMW, offering a range of sedans and SUVs with sophisticated designs and advanced features. However, the brand failed to resonate with Chinese consumers, who remained skeptical of a premium offering from a relatively young domestic automaker. Riich was quietly discontinued in 2012, after failing to achieve significant sales volume.
Undeterred by this setback, Chery attempted another foray into the premium segment with Qoros, a joint venture established in 2007 with Israel Corporation. Qoros aimed to target discerning global consumers with high-quality, technologically advanced vehicles designed and engineered to meet international standards. The brand garnered critical acclaim for its safety, performance, and design, even earning top ratings in European crash tests.
However, despite its impressive product offering, Qoros struggled to gain traction in the market. Its relatively high price tag, coupled with a lack of brand recognition and a limited dealer network, hampered sales. In 2017, Chery sold its stake in Qoros to Baoneng Group, a Chinese conglomerate, marking the end of another ambitious but ultimately unsuccessful attempt to crack the premium segment.
These experiences provided valuable lessons for Chery. They highlighted the challenges of building a premium brand in a market dominated by established players with strong reputations and extensive customer loyalty. They also underscored the importance of brand building, a long-term effort requiring consistent investment, strategic marketing, and a deep understanding of consumer perceptions.
Exeed: A Renewed Push for Premium
Despite its previous setbacks, Chery remained determined to establish a successful presence in the premium segment. In 2019, the company launched Exeed, a new brand designed to appeal to discerning Chinese consumers with sophisticated tastes and a desire for high-quality, technologically advanced vehicles.
Exeed represents a culmination of the lessons learned from Chery’s previous premium ventures. The brand boasts a distinct identity, with a focus on modern design, advanced technology, and a premium customer experience. Its product portfolio includes a range of SUVs and crossovers, featuring sleek styling, luxurious interiors, and cutting-edge features such as advanced driver assistance systems and sophisticated infotainment systems.
Exeed faces stiff competition from both established international brands and a growing number of ambitious domestic rivals. However, Chery is confident that Exeed has the potential to succeed. The brand leverages Chery’s extensive experience in automotive engineering, its proven track record of quality and reliability, and its deep understanding of the Chinese market.
Furthermore, Exeed benefits from Chery’s strategic partnerships with leading technology providers like Huawei, which is helping the brand enhance its offerings in areas such as intelligent cockpits, autonomous driving, and connected car technologies. Exeed’s success will depend on its ability to effectively communicate its brand proposition to target customers, build a strong dealer network, and deliver a consistently premium experience that sets it apart from the competition.
Chery’s pursuit of the premium segment is a testament to its ambition and its commitment to constant innovation. The company has learned from its past experiences, refining its strategies and adapting to the evolving demands of the Chinese market. Exeed represents a renewed push for premium, a bold endeavor that could redefine Chery’s position in the global automotive industry.
Chery in the Era of Electrification and Intelligent Vehicles: A New Chapter
Embracing the Future of Mobility
As the global automotive industry undergoes a profound transformation driven by electrification and intelligent vehicle technologies, Chery has embraced this shift with characteristic ambition and a commitment to shaping the future of mobility. Recognizing the inevitable transition away from traditional internal combustion engines, the company has made significant investments in new energy technologies, developing a comprehensive strategy to position itself as a leader in the era of electric and intelligent vehicles.
Chery’s commitment to electrification is evident in its development of dedicated EV platforms, designed specifically for electric vehicles. These platforms offer several advantages over converting existing gasoline-powered platforms, including optimized weight distribution, enhanced battery capacity, and improved interior space. This approach allows Chery to create electric vehicles that are not only efficient and practical but also offer a superior driving experience.
The company has also invested heavily in battery technology, collaborating with leading battery manufacturers to secure a stable supply of high-quality, high-performance batteries. Chery’s focus on battery technology extends beyond simply sourcing components; the company is actively involved in research and development efforts aimed at improving battery range, charging speed, and overall lifespan.
Furthermore, Chery is exploring alternative energy solutions such as hydrogen fuel cell technology, recognizing the potential of this technology to complement battery electric vehicles in specific applications, particularly in long-haul transportation.
“Yaoguang 2025”: A Bold Vision for the Future
Chery’s commitment to the future of mobility is encapsulated in its “Yaoguang 2025” strategy, a bold and ambitious plan that outlines the company’s roadmap for the next five years. The plan, unveiled in 2021, calls for a massive investment of over 100 billion yuan (approximately $14 billion USD) in research and development, focusing on areas such as new energy technologies, intelligent connectivity, autonomous driving, and advanced manufacturing processes.
This ambitious plan is not merely about developing new technologies; it’s about transforming Chery into a global technology company. To achieve this goal, the company is actively recruiting top talent from around the world, building a workforce capable of driving innovation and pushing the boundaries of automotive technology. This includes attracting highly skilled engineers, software developers, and data scientists, recognizing that the future of mobility will be driven by software and artificial intelligence as much as by hardware.
“Yaoguang 2025” also outlines plans to establish 300 “Yaoguang Laboratories” dedicated to cutting-edge research in areas such as artificial intelligence, big data, and advanced materials. These laboratories will serve as hubs for innovation, fostering collaboration between researchers, engineers, and industry partners to accelerate the development of next-generation automotive technologies.
The strategy also encompasses a global vision, with plans to establish six research and development centers around the world, leveraging the expertise and resources of different regions to drive innovation on a global scale. “Yaoguang 2025” represents a pivotal moment in Chery’s history, marking a shift from being a traditional car manufacturer to becoming a technology-driven company that is actively shaping the future of mobility.
Partnering with Huawei: A Strategic Alliance for Smart Mobility
A key element of Chery’s strategy for the future is its partnership with Huawei, a global leader in information and communications technology (ICT). This strategic alliance, announced in 2020, leverages the strengths of both companies to accelerate the development of intelligent, connected, and autonomous vehicles.
Huawei brings to the partnership its expertise in areas such as 5G connectivity, cloud computing, artificial intelligence, and software development. Chery, on the other hand, contributes its deep understanding of automotive engineering, manufacturing, and the global automotive market.
This collaboration focuses on several key areas, including the development of intelligent cockpits, advanced driver assistance systems (ADAS), and connected car technologies. Huawei’s HarmonyOS operating system is being integrated into Chery’s vehicles, creating a seamless and intuitive user experience. The partnership is also exploring the use of Huawei’s Mobile Data Center (MDC) platform to enhance Chery’s capabilities in autonomous driving.
This alliance goes beyond simply integrating Huawei’s technology into Chery’s vehicles; it involves joint research and development efforts aimed at creating innovative solutions tailored to the specific needs of the automotive industry. The two companies are working together to develop new technologies and applications that will enhance safety, improve efficiency, and deliver a more personalized and engaging driving experience.
The Chery-Huawei partnership is a testament to the growing convergence of the automotive and technology industries. It highlights the importance of collaboration and knowledge sharing in driving innovation and staying ahead of the curve in a rapidly evolving market. This strategic alliance positions both companies to play a leading role in shaping the future of mobility, bringing together the best of automotive engineering and cutting-edge technology to create a new generation of intelligent, connected, and sustainable vehicles.
Conclusion: Chery’s Enduring Legacy and Global Aspirations
Chery’s journey is a remarkable testament to China’s emergence as a global force in the automotive industry. From its humble beginnings in a dilapidated brick factory, the company has transformed into a major player on the world stage, driven by an unwavering commitment to innovation, technological independence, and a deep understanding of its customers’ needs. This journey has not been without its challenges, but Chery has consistently demonstrated its resilience, adaptability, and determination to overcome obstacles and achieve its ambitious goals.
The “Small Grass Hut” spirit, forged in the company’s early days, continues to permeate its culture, inspiring its employees to strive for excellence and embrace a “can-do” attitude. This spirit is evident in Chery’s relentless pursuit of technological advancement, its willingness to challenge conventions, and its dedication to providing customers with high-quality, reliable, and innovative vehicles.
Chery’s enduring legacy extends beyond its commercial success. The company has played a pivotal role in paving the way for other Chinese automakers to compete on the global stage, demonstrating that Chinese brands can rival established international players in terms of quality, technology, and design. Chery’s early success in exporting vehicles to developing markets, followed by its ambitious expansion into developed regions, has inspired a new generation of Chinese automakers to set their sights on global dominance.
As Chery looks to the future, its ambitions are bolder than ever. The “Yaoguang 2025” strategy, with its massive investment in research and development, its focus on attracting top talent, and its goal of becoming a global technology company, signals Chery’s determination to lead the way in the era of electric and intelligent vehicles. The company’s strategic partnerships with leading technology providers like Huawei further enhance its capabilities, positioning it to compete effectively in a rapidly evolving market.
Chery’s future is bright. The company has the potential to become a truly global brand, recognized for its innovation, quality, and customer-centric approach. Its continued success will not only benefit the company itself but will also contribute significantly to the advancement of China’s automotive sector, driving technological progress, creating jobs, and enhancing the nation’s economic competitiveness. Chery’s story is a powerful reminder that with vision, determination, and a relentless pursuit of excellence, even the most ambitious dreams can become reality.
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