Dong Mingzhu: We develop all the software and hardware for our mobile phones ourselves

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Gree, which started the price war of air conditioners at the end of 2014, squeezed out its rivals' market share in the first half of 2015 when the market was declining. The new cold season has begun. As a world-leading air conditioner company, how will Gree play its cards? Is Gree's mobile phone real or fake? Is Gree really making mobile phones? When will the Gree mobile phone factory under preparation be built?

In an exclusive interview with Yicai.com this month, Dong Mingzhu, chairman and president of Gree Electric Appliances, predicted that the air conditioning industry may see a downward trend in 2016, the refrigeration year (starting from August 1, 2015). However, "price-based volume" is not all that Gree is trying to achieve. In 2015, Gree will launch new products such as "Oil Painting Air Conditioner" and seek breakthroughs in diversification. Smart and environmentally friendly home systems, washing machines, dishwashers, etc. will be launched one after another. And the construction of Gree's mobile phone factory "still focuses on stability."

Domestic air-conditioning market may decline

According to the practice of the air conditioning industry, August 1 is the beginning of the new refrigeration year. There are rumors that Gree postponed the opening of the 2016 refrigeration year by one month in order to digest the inventory. "No, we opened normally," Dong Mingzhu clarified to reporters.

Dong Mingzhu admitted: "Starting from September 2014, (Gree Air Conditioner) lowered the price, and our sales volume declined, for example, from 60 billion in 2014 to more than 50 billion in 2015, but it did not affect our profit growth." The outside world predicts that in 2016, the cold year, Gree will continue its price war and continue the practice of "lowering prices for volume."

That's not all. "Gree will have many new products in 2015," Dong Mingzhu revealed. Gree is about to launch an "oil painting air conditioner," which combines an oil painting with a living room air conditioner that evenly distributes air. "We have been developing this for two years. Consumers spend hundreds of thousands of yuan to decorate a house, and tens of thousands of yuan to buy an oil painting, or an air conditioner. It shouldn't be expensive," she said.

Activate smart home with your mobile phone

At the same time, Gree's diversification is seeking breakthroughs at the 2016 Refrigeration Annual Meeting. Dong Mingzhu said: "In the new year, Gree's household appliances and refrigerators will have a full range of products. Cookers have already been launched, and there will also be washing machines and dishwashers. If we want to do it, we will do it the best and not rush to gain market share."

In terms of channels, Gree will also increase the construction of experience stores in 2015. For example, a 200-300 square meter experience store will be built in Guangzhou to more fully showcase Gree's diversified products.

Mobile phones are also an important part of Gree's diversification. However, Gree's mobile phones are currently only in the internal group purchase and trial stage and are not sold publicly on the market. The outside world suspects whether Gree's mobile phones are just a marketing trick.

Dong Mingzhu responded, "Gree is researching the second and third generation of mobile phones. But our current mobile phone business is too small and the outside world doesn't understand it. We are still actively working on it. Gree wants to develop both hardware and software by itself. Gree mobile phones are different from other mobile phones. They are connected to so many Gree products, so the quality must be guaranteed. So we have to do it ourselves and take the path of independent innovation."

I heard that Gree’s own mobile phone production equipment has been moved to Zhuhai. When will Gree build a mobile phone factory? Dong Mingzhu responded by saying “stability is the most important thing.”

In the future, Gree mobile phones will become an important chess piece to activate Gree smart home. This outspoken and outspoken female entrepreneur said, "Home appliances are relatively independent. In the Internet era, mobile phones will play a role of integration. In addition to answering calls, sending messages, and playing games, mobile phones have more practical functions. Among these appliances, mobile phones, as a tool, can not only remotely control, but also monitor. For example, it can remind users where the air conditioner is faulty, and immediately notify Gree headquarters. We will call the user and come to repair it. This is an information age."

In recent years, Gree has also made great efforts in the fields of precision machining, robots and other heavy equipment. "We used to have a mold repair factory with several hundred people. Now it has developed into a mold factory. Our molds can be used 200,000 times without maintenance. Gree made all the molds for its new products in 2015 by ourselves. Our mold factory has also formed a capability and can serve other companies in the future."

Dong Mingzhu said: "We use the world's best equipment for machining. I don't see business opportunities, but responsibilities. We produce personalized products and we must have such capabilities ourselves."

At the press conference, Dong Mingzhu also played a video of the "Gree Intelligent Environmental Protection Home System" for the reporter. It is connected to the Gree photovoltaic air conditioner to supply power to the home appliances, and the excess power can be transmitted to the city power grid; it involves intelligent hot water, intelligent air temperature and humidity adjustment and cleaning, intelligent security, power query and other functions; the whole system can be operated on the mobile phone or IPAD through the APP. "We will also launch this system in 2016, the refrigeration year." Dong Mingzhu said.