CoMotion GLOBAL '25 - Panel: Scale, Innovation and Strategic Integration – China’s Mobility Playbook

uh you know future editions of commotion global we'll report back to you in the near future but next up uh obviously one of the reasons as John mentioned at the outset of the conference yesterday that

commotion global is here in Riyad is because uh here is where we can convene many of the Chinese companies that are really setting the agenda when it comes to global transportation whether it is

China's massive energy sustainable renewable energy buildout wind and solar uh across its western regions whether it's incredible investments in battery technology. It's making uh its EV

technology. It's making uh its EV industry which we can see here in the uh in the exhibition hall. Uh and the incredible ranges of its transportation, the features and interiors and the

glowing reviews that continue to come out as global north auto critics are astounded by the qu build quality of these vehicles. Um yes, there is much to

these vehicles. Um yes, there is much to be learned from China and its ecosystem, but also there's a lot of mystery that surrounds it as well. what was the policy architecture that really helped

create this this colossus of global mobility industry? And so our next panel

mobility industry? And so our next panel is going to address some of that. It's

going to explain some of the levers that were pulled, some of dispel some of the myths that get told around China, and really help us understand exactly what's going on inside of that combination of

industrial policy and private entrepreneurial uh vigor and energy that has led China to this step. And so uh we're going to have a fantastic panel to do this. is going to be led by Bill Russ

do this. is going to be led by Bill Russ Bill Russo who's the founder and CEO of Automoility. So, I'm very excited for

Automoility. So, I'm very excited for this. Bill, please bring them on up.

this. Bill, please bring them on up.

Good afternoon everyone. Um yes, I am Bill Russo. I'm the founder and CEO of

Bill Russo. I'm the founder and CEO of Automoility. Uh it's great to be here in

Automoility. Uh it's great to be here in in Riad. Uh my firm uh we're a strategy

in Riad. Uh my firm uh we're a strategy and investment advisory firm based in Shanghai. Uh I've lived in China for 21

Shanghai. Uh I've lived in China for 21 years. uh came to China in 2004 then

years. uh came to China in 2004 then with Chrysler um a US automaker. I ran their Northeast Asia business uh working with uh several

partners in c in the country. Um and

after spending the first part of my career in the United States working for IBM and then Chrysler uh 17 years in Detroit, I came to China at a time where

it was about a 3 million unit a year market. Um, in that time it's risen to

market. Um, in that time it's risen to now producing more than one-third of all the cars in the world, about twothirds of all the electric vehicles, and about

75% of the EV batteries. The

commercialization of technology at scale. China is truly the the uh

scale. China is truly the the uh accelerator for the commercialization of the 21st century definition of the car.

Um my company automat advises global companies, startups and mobility tech investors on how the intersection uh between the east and west between China and the global automotive industry, how

these models intersect. And that's what we're here to talk about today. China's

built one of the fastest moving mobility flywheels in the world, combining scale, tightly integrated supply chains, and rapid software iteration. That's the

part that I think the world doesn't really have a close proximity to and I want to discuss that as part of our discussion today with our three panelists. Our goal today is to

panelists. Our goal today is to understand how the China model works, where it creates advantages, where the friction points emerge, and where

meaningful convergence with global systems where it's already taking place.

Uh let me briefly introduce the three panelists and uh their backgrounds. We

have uh Dr. Failong Vio CEO of HyperView a full stack intelligent driving uh business bridging again having worked in

General Motors having worked in in the supply chain as well uh understanding and how to how to bridge US and China in innovation categories that's what Dr.

Leo brings uh Tien Jun Jun uh the CEO of J Middle East is on the front line of global localization. I think we can use

global localization. I think we can use the term gloalization you know global in view but localized in markets and he is bringing that to from J to the Middle

East region and Lola Wetszel who I've known for many years managing partner at Global 6 Limited uh bringing decades of experience 40 years in China. Wow,

you're double where I am.

Amazing. Um, and bringing experience from her prior role and have having set up Mckenzie in China, their business the and been the director of the McKenzie Global Institute has a really true macro

view on China's economic and industrial transformation. I'm going to have uh

transformation. I'm going to have uh three topics that I'd like to cover. I

want to start with how did this happen?

What enabled China's mobility leap?

Let's start with that. Um, and to kind of frame that, as I described, China really, the rise of what we've seen in China is relatively recent, right? It's

it's 3 million units now to more than 31.4 million last year. It will top that this year. More than onethird of all the

this year. More than onethird of all the cars made in the world. Um, but what caused what enabled that to happen? Uh,

scale investments technologies consumer adoption, right? a whole

lifestyle shift toward embracing mobility at the core. Uh I'm going to start with Lola. Based on your work and your observations over many years in

China, what macro forces allow China to scale mobility technology innovations like electric and intelligent mobility so quickly?

>> Well, uh thanks Bill. And so, um I guess I have 21 minutes. So, so

>> you don't have all of that. [laughter]

So um well I mean in a sense so I I graduated from uh the University of Southern California a long time ago. Uh

and when I graduated I I sat there and I listened to the names of everybody graduating in the electrical engineering department and all these other departments and you could count on the

fingers of two hands the number of non-Chinese names. So we knew that the

non-Chinese names. So we knew that the next generation decades ago of electrical engineers of computer scientists were going to be Chinese. The

only question was where would they work?

Would they work in the US or would they work in China? So the all the and obviously I think they started working in the US and I think Dr. Leo can speak to this uh but now they're really working in China. So I think the first

and most important policy was the supportive environment for the the development of human capital. So in the words of Jack Maw, you know, we may not

have the the money, we may not have the the IP, but we have brains and Chinese brains are as good as any other brains and so we just have to use those brains

and from that came Alibaba. So that's

one. The other one briefly is infrastructure is that I think China got the uh the balance right between where you should put the public money and where you should put the private money.

And so the public money goes into the infrastructure, the private money goes into the things that go on the infrastructure. And so we we built the

infrastructure. And so we we built the infrastructure in advance. And then yes, the point of building the infrastructure was to unlock the demand. And the demand came from the private sector. So I think

they got the right right mix between public and private policy to to scale what is now of course worldleading industry.

>> Great. Great. Uh Failong, I'm going to come to you. Having again lived in in the US, having now being from China and now doing business with your company,

intelligent driving obviously being your area of focus, uh we heard you earlier talk about your hydrogen business as well. So you have a multis- sector of

well. So you have a multis- sector of view. uh but having lived in both worlds

view. uh but having lived in both worlds and worked across the borders uh what makes China uniquely suited for leading this development of in your case now

full stack intelligent driving. Uh thank

you hos and uh I want to add a little bit point to the uh Laura said about the infrastructure will you know uh I work in US for more than 10 years and the work for General Motors and developing

the autonomous vehicle too and what I feel different between the US and China's strategy is uh outside China uh most company emphasize on the smart

vehicle >> and but inside China and uh there's another Peter say connected vehicle.

>> Mhm. So [clears throat] there's where there's a word called ICV ICV >> intelligent intelligent connected vehicle >> vehicle right and and uh you [clears throat] know China is as Laura said that China love to invest in

infrastructure thing you know for example the 5G network whatever right now I you know as far as I know the China has uh some funding support to

developing more towards to like V2X >> you know the um V2 communication uh cloud computing and uh I I assume the value to that is um uh you know [clears throat]

uh uh without infrastructure support you have to make a car super smart to be able to drive autonomously right because the car make a decision by itself right you have to have a lot of sensor high

computing capacity and just like a smart smart driver right but with the with the with the cloud support with the infrastructure support uh we can somehow downplay a little bit on the car level

>> right so that like you you have a very good highway and every car can drive it something like that you know so and and actually u sometimes you know because uh

the car sensor has a restriction by line of sight we have to see it on the same line on the line so be be uh before you can detect anything right but the V2S

can broadcast the vehicle from any angles and say around corner and where you have a blind spot but they V2S can tell you there's car coming right >> and that can increase uh you know safety

level you know so for some for some sense You know we agree that the uh the connected vehicle can add some uh additional layer of the redundancy or safety to the autonomous driving

capability. I think that's uh where

capability. I think that's uh where China is putting some efforts there you know but of course you know that's require a lot of money and I understand in uh you know uh you know to build a

very good road uh infrastructure say a V2X perhaps every 500 meter in the urban area you need to put some sensor and roadside unit and uh uh mobile edge

computing uh lighter sensors that's all all you know all about investment right and uh so I think that's still uh some distance to go But uh uh but as Laura said, Chinese love to invest in the

infrastructure, you know, and we will see there. I guess

see there. I guess >> you brought up a very important thing that I want to make sure people take away. Uh the term in the west is

away. Uh the term in the west is softwaredefined vehicle that tends to view the computer as the car standalone.

The intelligent connected vehicle is where the car is part of the distributed network of information, >> right? The car is connected to the

>> right? The car is connected to the infrastructure.

>> Yes. Yes. And I think that's where as you said lowering the cost of the development in vehicle is because we put some attention to the compute power that

informs the vehicle. It's a local area network. Exactly. The transportation

network. Exactly. The transportation

system.

>> We you know as by the connected vehicle uh architecture that the car and the car can share information. Right.

>> Right.

>> You see and mean my right. We

communicate through the cloud. Right. So

that means uh uh we have more information to make my own decision because I know you are coming on different directions and also uh potentially that can uh remove some very

expensive sensor on the individual car because you have a a cloud to help you right you know China has a cloud infrastructure like Alibaba what Tensson did you know [clears throat]

>> we'll turn to Tien um CEO of Agile Middle East region uh a little bit background on for those who know I think a lot of do know Julie but they're one of the only and I probably the only

truly successful crossber merger. Julie

has built its business as a global company around in an inorganic approach through M&A.

Obviously the most classic example of that was the acquisition of Volvo in 2009. Uh but even before that, London

2009. Uh but even before that, London Taxi, Manganese Bronze, uh this is the owning the company that owns the that uh

that business. Uh as one of the first

that business. Uh as one of the first Chinese companies to truly become a global player.

Um you have some unique perspectives I think to bring to the question of how do Chinese companies and what are different about Chinese companies as they go global. I'm going to ask how did the

global. I'm going to ask how did the learnings that Julie has acquired over time, how do they translate into helping you compete in global markets in the

brands that you represent in the international markets?

>> Okay. So when Chinese OEM uh go to global market, how to transfer their capability in China to this

market? So in my uh point of view

market? So in my uh point of view uh the key words uh first is localization the second I think is

ecosystem. [clears throat]

ecosystem. [clears throat] >> So the localization when we go to uh certain market the first step normally we should do uh

market research and also tech technical regulation study.

So we must understand the consumer and also understand the standards the homologgation standards and then we will get conclusion and

develop our products and modify our products accordingly.

So the Chinese version cannot ex export to US market direct without any localization. We must do localization to

localization. We must do localization to comply with the regulation and also the market demands. the consumer's

market demands. the consumer's preferential preference. So this is the

preferential preference. So this is the second step we must do finish localization and pass the homeation in overseas market. And the third step

overseas market. And the third step after we finish the overseas version global washing vehicle before we deliver

to uh the consumer we must do some uh root test and also car clinic in the local market. So after we confirm

local market. So after we confirm everything is right, everything [clears throat] is ready then we will launch to those market to guarantee

everything is good. So the product quality is 100% confirmed by us before we launch to market. So this is very very normal strategy for our

localization.

>> Okay. And uh besides the localization, I think uh the product competitiveness is one aspect for our success in the market and

we also should consider about after sale service.

>> Okay. In the local market. So we must for example we establish our spare part center in this middle east region in

free trader room of UAE. So we can deliver our spare parts to our customer very quickly compared with to deliver from China to here. So quality of the

products, high quality of the sales service and also uh

if we hope to successful in the US market another two very important

element is we must control our quality and cost. So cost the product products

and cost. So cost the product products price here must be reasonable. Okay,

[clears throat] not cheap but reasonable. Okay, and also the quality

reasonable. Okay, and also the quality must reach the same level with China.

Mhm.

>> So the second the key was ecosystem. Uh

I explain in I mean we must not only concede the technical innovation but also we should consider high technology

quality cost and also after service. If

all those issue you are ready to go to Os market and then you will be very very successful in those market.

>> Okay.

>> Great. Uh and you use the word ecosystem. I want to highlight that

ecosystem. I want to highlight that that's one of the features that I see very common among Chinese companies is building ecosystems at the local level is something that really is requires

partnerships. And I think that's

partnerships. And I think that's something Chinese companies will look for as they come to the international markets. It's not I've got to control

markets. It's not I've got to control everything the way I do it in China.

Localization means you've got to make adaptations for the local market as as I think you've highlighted. Um I'm going to turn to Yeah, I want to turn to the

second question which is what defines the speed to market that we see Chinese companies operating. How do how do

companies operating. How do how do Chinese companies innovate and iterate so quickly? How do you go as quickly as

so quickly? How do you go as quickly as possible into these markets? Uh if it's talking about exports, exports, just so people understand, 5 years ago in 2020,

China only exported less than 1 million cars a year. Last year it was 5.9 million. This year it's going to be

million. This year it's going to be somewhere close to 7 million. Uh but

it's also bringing new technology at scale, EVs and connected vehicles. Uh

now autonomous driving experimentation.

I'll talk turn to Failong. What enables

this rapid inter iteration across chips, sensors, software integration? What

makes it possible for China to move at such high speed?

>> Uh I think the there's a many factor driving the innovation in China. I mean

speaking of myself example that why I go to China founding this company is because I think the China has in my eye there's uh three pillars uh investment.

I think China has an investment you know on to supporting financially you know and uh China has a market China is a market the car market relatively is a

young and open mind and they are accept new technology right I mean if you put some fancy stuff about car I mean the people like it you know they are not very conservative so market is also one

one key the third thing is about the uh the people right I think that Laura indicated that there are many engineering background student in China you know and uh you know so the human

resource also u you know uh supportive so for for your question that why the innovation happen in China in a faster speed I think the money market people could be some factors >> right

>> in my eye you know that's why that's how we work you know we we had a lot of young guy >> and u uh they know nothing they know nothing about autonomous when they come to company but become expert after two

years you know we grow our own people because there are no mature people anyway, no technology. So, so I think that's uh that's my my my two cents, you know.

>> Right. Great. Uh Lola, um Ken mentioned ecosystems. I want to ask you about that. Uh from your observations, how do

that. Uh from your observations, how do ecosystems factor in? And by that we can extend it beyond partnerships, but talent, suppliers,

investments, data. Uh how does

investments, data. Uh how does ecosystems shorten accelerate? I mean I I think that this is something people might not fully appreciate unless you

are in China is that China is is a country of course but China is also a culture it's a civilization and uh uh the first question people will ask you

when you get to China asking about just background is a need yeah where are you from and you [snorts] don't say China [laughter] >> you say I'm from city ho I'm from Shanghai I'm from wherever I am from

>> or the district of the city >> so the ecosystem is very spatial And so I used to do a lot of work with local governments and basically what we would say okay so we've got 50 km of

land we have a GDP target how are we going to fill this in so you then you go out and you go find an anchor tenant and that anchor tenants usually an assembler of some sort an OEM and then you tell

the anchor tenant okay I would like to have you come here I'll give you a lot of incentives but I want you to bring everything like I want you to bring your whole supply chain I would like you to bring the R&D I'd like to bring pretty much everything and Well, and then I'll

make space for all of that. And then I would like you to train the human capital. I'd like to have all these

capital. I'd like to have all these people learn from you. And surprise

surprise, you know, 10 years later, you get Junglson or you get Shian or you get Shanzhan. And so that's how you do it.

Shanzhan. And so that's how you do it.

And it's not rocket science. And I think that this playbook has been run elsewhere in the world. But China's done it at scale and it's done it the mindset of saying like we are going to be supporting of this ecosystem. We are

going to consciously not really be in it for one company. We are in it for all of it and so we will give preferences to individuals who do the things that we like them to do but you know it's a

competitive world and if we have another competitor coming in well we'll be uh we'll be happy to have them too. So in

Shanghai we had GM but we also had Volkswagen, >> right? [clears throat]

>> right? [clears throat] >> And so in every place the the orchestration is many times done by what we'll call quasi public authorities, right? And I think that builds it.

right? And I think that builds it.

>> You don't wait till you've had it all vertically integrated. You look for

vertically integrated. You look for partners and build ecosystems together and that accelerates the development.

>> Correct. the uh 10 um how to ecosystem factors if you go beyond the borders of China you're having that now going global and China doing it at speed I

mean going from 1 million exports to 7 million in 5 years is another example of China speed uh how does speed translate

into overseas markets what adaptations are needed in order to continue to work at that high speed as you move beyond the borders.

So uh I would like to clarify the ecosystem there's one ecosystem for OEM for manufacturing and also in OS market we are supposed to establish ecosystem for consumer

>> right >> okay so are we go to Osis market we uh are supposed to uh how to say to uh

each type of ecosystem for the consumer for the vehicle the vehicle should connect to the local internets and also to utilize the local navigation and also

download music and also some other function. So vehicle to vehicle vehicle

function. So vehicle to vehicle vehicle to facility. So this going to be when

to facility. So this going to be when the future is a a trend when you clear it.

>> So when the consumer drive a new added vehicle the experience will be very very exciting and totally different from the traditional ICE model. So this is what

we are uh working on that to establish ecosystem for overseas consumers as well.

>> Yeah. For manufacturing we have a ecosystem from center from supply chain and from manufacturing and also uh a lot

of a whole indust supply chain. Okay.

For overseas mark we have another ecosystem for the for the for consumer.

>> Right. And I want to contrast that because all of us who've been in the industry for a period of time have seen the playbook of Japan and Korea.

But when Japan goes global, it brings Japan and its Kuretsu. When Korea goes global, it brings its partnership ecosystem. What I've observed is when

ecosystem. What I've observed is when China goes global, it opens up new ecosystems. As you point out, the ecosystem of China doesn't necessarily translate perfectly to the world. So

that opens up the door for partnerships.

Ecosystems can be built at the local level with overseas partners. That's

something I don't think the world really re recognizes. China's going global, but

re recognizes. China's going global, but it's doing it differently >> than the than what we've seen before.

Uh, one last round. We'll make it a fast round. Convergence, friction in the next

round. Convergence, friction in the next decade. Looking forward, there's going

decade. Looking forward, there's going to be push back. There's going to be challenges. And I'm going to ask each of

challenges. And I'm going to ask each of you from your own point of view, what do you think the biggest challenges are for China going as it goes becomes a global player in auto and mobility tech? What

do you see the the main friction points and challenges going forward? And we'll

go from left to right. Start with you fail.

>> It's a big question, huh?

>> Yeah.

>> Yeah. I mean uh [clears throat] uh I don't have a uh I think that I think the you know our uh you know as you know we do a two business unit. one

is autonomous driving another about hydrogen truck you know for example when you try to sell the hydrogen truck I think the uh the reason why we come to Saudi because we see uh the current you

know geopolitician geopolitics situation right now right and the China US has tension you know middle east seem to be neutral you know and uh friendly to

China so I think the [snorts] the next five to 10 years perhaps you know uh uh building a find your good partner globally and u you know localize and

leverage this uh uh say a good Middle East China connection and uh and then we are at first step maybe the Europe and the US later

>> I think maybe that's uh practical to go I think >> great so are you responsible for sales and marketing so for me good to middle east

market the biggest challenge for new energy vehicle first is charging infrastructure >> not enough here. So the this is the first

>> so replicating the boundary conditions which made it possible in China it's harder to do outside >> in China charging facilities very very easy but here very difficult to find >> same I would imagine it's true for the

intelligent connected vehicle. Oh,

exactly. Even hydrogen will be worse, you know, but you can still sell your gas car, right?

>> Yes. If you're a company like Julie or you know, many of them, uh, the ability to flexibly be able to work with both the old and the new is an advantage.

>> Uh, another challenge for auto industry in Sud in case I think is supply chain.

>> Yeah. Uh, this is also very very crucial for the automotive mobility development.

Okay. The third I think all of us include the consumer and all the distributor here we are looking forward to the government encourage policies to

support the new energy industry.

>> You bring up a po important point.

China's always been policyled. The rest

of the world doesn't really have the equivalent of that. Policies are absent and it often leaves things you know open for interpretation. Um, and Lola, I've

for interpretation. Um, and Lola, I've heard you talk about this. You know,

lack of policy is one of the big challenges I think the Chinese companies will face as they go outside. They

they're used to being told what the rules are. It's hard to really interpret

rules are. It's hard to really interpret that market by market as you go global.

Yeah, I mean I think that's that's probably a good note to sort of summarize a little bit that and as on previous panels mentioned this notion of capacity and I think that you know the

reality is that there is uh unevenness in the capacity of regulators of the state of infrastructure u throughout the world that is now desperately wanting

the the the benefits of the outcomes of of the technology that China has but they don't perhaps not everywhere has the capacity to absorb it.

>> And in order to enter that market with that technology, one needs to have the infrastructure. One needs to have the

infrastructure. One needs to have the human capital. One needs to have the

human capital. One needs to have the decision-making authority, the governance. And if those things aren't

governance. And if those things aren't there, well, you may not be able to get the best technology, but you'll get some technology. And so, I think the majority

technology. And so, I think the majority of Chinese exports actually are IC vehicles at this point.

>> That's right. A and so yes, you'll probably get that, but you will not be getting the autonomous CV unless you actually build the capacity in the receiving side. So I think that the the

receiving side. So I think that the the short answer is that the biggest challenge for Chinese companies and for in globalizing is to understand what they're dealing with. Uh are they dealing with an environment where they

can in fact deploy their technology to its maximum or should they take it more let's just say one step at a time?

>> Yeah. Well, I hope you take away from this that there are certain things that are very different, but we can learn from each other, right? There's

opportunity for convergence.

Collaboration is possible within the story around China's mobility playbook.

It's not a closed ecosystem. It's an

open ecosystem. Um, it's about integrated ecosystem based approach enabling rapid learning cycles and a willingness to embrace new ways of thinking. Uh, that's what I've learned

thinking. Uh, that's what I've learned in my 21 years in China. Hopefully uh if you do business in and with China, you'll learn a bit about how open it how

how surprisingly open and uh partnership opportunities are working with some of the leading players uh some of whom were represented here. So thank you very

represented here. So thank you very much. That's the end of our session.

much. That's the end of our session.

like it.