Annual salaries of car company executives revealed, even 30 million can’t make it into the top five, so state-owned enterprises can’t beat private enterprises?

Recently, the salary dispute among senior executives of auto companies has been brought up again, which has caused many people to think about the gap in competitiveness between state-owned enterprises and private enterprises.

Some time ago, many automakers released their first-half financial reports. According to the relevant data, the top three private companies are BYD, Geely Auto and Great Wall Motor, with a combined net profit of 31.235 billion yuan; the top three state-owned companies are SAIC Group, Changan Automobile and GAC Group, with a combined net profit of 10.976 billion yuan, which is only 35% of the top three private companies. If we do not specifically distinguish between private and state-owned enterprises, in fact, the top three state-owned enterprises in the first half of the year are not even close.

Looking at the salaries of some of the executives of the auto companies (based on 2023), Wei Jianjun, chairman of Great Wall Motors, has an annual salary of 5.757 million yuan; Wang Chuanfu, chairman of BYD, has an annual salary of 6.61 million yuan. On the state-owned enterprise side, in 2023, Wang Xiaoqiu, chairman of SAIC Group, has an annual salary of 4.394 million yuan; Zhu Huarong, chairman of Changan Automobile, has an annual salary of 2.635 million yuan; Zeng Qinghong, chairman of GAC Group, has an annual salary of 1.3337 million yuan.

Although this is only the "payroll" of some senior executives, it can basically represent the salary gap between state-owned enterprises and private enterprises. Combined with the financial reports of some mainstream auto companies in the first half of the year, private enterprises with more outstanding salary levels are obviously much higher than state-owned enterprises in terms of performance. Does this mean that private enterprises that pay higher salaries can attract more talents and thus gain stronger competitiveness?

In fact, this is not necessarily the case. Because there are many "negative cases" of this result. If you don't believe it, we can take a look at Nezha Automobile.

Recently, everyone has heard that Nezha Auto is caught in the whirlpool of public opinion about layoffs, salary cuts, and delayed payments. In the face of "tight conditions ahead", some people suspect that Nezha's own executives have not been paid in full, so there are problems in operations.

As a result, someone found out the "salary slip" of Nezha Auto CEO Zhang Yong and found that it was not the case.

The prospectus submitted by Nezha in June this year shows that in 2023, Zhang Yong's total compensation will be 30.994 million yuan, including salary, discretionary bonus (year-end bonus), share payment, and company benefits. From this information, it can be seen that Nezha Zhang Yong's annual income of "30 million" is not a rumor. This level is second only to Nezha founder Fang Yunzhou, who has an annual income of 47 million, that is, "Dr. Fang" in the prospectus.

Although the figure of 30 million does not rank among the top five salaries of executives of Chinese auto companies, from the perspective of ordinary people, it is already horrifying enough - how many Nezha cars must be sold to pay Zhang Yong's salary? After all, Nezha Auto's gross profit margin in 2023 was -14.9%, and it would result in a net loss of 55,000 for each car sold.

Originally, it is not a problem to have strong ability and high salary. However, judging from the current situation of Nezha Auto, Zhang Yong's ability and salary are not equal.

In 2023, Nezha Auto delivered a total of 127,500 vehicles, a year-on-year decline of about 16%. Even though Zhang Yong once reflected on this on Weibo, it did not seem to have any effect. In 2024, the decline did not improve. According to the data released by Nezha Auto, the delivery volume in the first nine months of this year was only 85,900 vehicles, a year-on-year decrease of 12.13%.

It seems that competitive salaries for executives do not necessarily translate into more competitive sales.

Of course, objectively speaking, the development of automobile companies requires more talents to support it, and a hard-core condition for retaining higher-level talents is salary.

Last year, Shenzhen Business Daily compiled a list of the most powerful employees in car companies. According to the report, Li Tie, chief financial officer of Ideal Auto, has an annual salary of 100.4 million yuan; Shen Yanan, a former executive of Ideal Auto, received a salary of 87.5 million yuan in 2021; Zhu Jiangming, chairman and CEO of Leapmotor, and Wu Baojun, president, received annual salaries of 56.36 million yuan and 43.82 million yuan respectively; and An Conghui and Gui Shengyue, executives of Geely Auto, both received annual salaries of 41.88 million yuan.

Judging from the operating conditions of the above-mentioned auto companies, the sky-high salaries of executives seem to be helpful to the development of auto companies. However, at the same time, we also need to admit that there is no absolute logical relationship between the salaries and abilities of executives of auto companies, and there are many other factors that affect the competitiveness of auto companies.

Judging from the current development ideas of various automobile companies, private automobile companies are obviously stronger than many state-owned enterprises in terms of technological investment and innovation capabilities.

For example, BYD's R&D investment in the first half of the year reached 20.177 billion yuan, a year-on-year increase of 41.64%, and its net profit was 6.064 billion yuan higher than the same period.

From 2021 to 2023, Great Wall Motors' cumulative R&D expenditure exceeded 32.2 billion yuan. Great Wall Motors' investment in R&D far exceeded its net profit level (net profit of 7.02 billion yuan in 2023), reaching more than 11 billion yuan. R&D investment in 2024 will still remain at a high level.

In fact, it is precisely because many private car companies attach great importance to technological innovation, coupled with their serious attitude towards the trend of new energy and active product layout that they have formed a relatively strong competitive advantage.

Although state-owned enterprises also invest in R&D, most of them are not as willing as private enterprises. More importantly, many enterprises lack awareness, resulting in a growing gap in competitiveness. The reasons are also easy to understand. In the past, the strong momentum of state-owned enterprises was actually due to certain policy "dividends".

In the past, the Chinese auto market was basically controlled by the six major auto groups, including FAW, SAIC, Dongfeng, GAC, BAIC, and Changan. They had basically all the resources, including policies, funds, and technology, and they also had the support of joint ventures, so they could naturally suppress private enterprises. But now it is different. In a free competition environment, state-owned enterprises no longer have the resource advantage. In addition, the trend of new energy has led to a weaker and weaker share of joint ventures. The "bonus" is gone, and the innovation speed is relatively slow. It is normal for private enterprises to "kill" them.

This "counterattack" is clearly verified in the sales data.

Taking the financial reports of relevant automobile companies in the first half of the year as an example, the interim performance report released by Dongfeng Group showed that the group's revenue in the first half of the year was 51.145 billion yuan, a year-on-year increase of 12.06%; net profit was 684 million yuan, a year-on-year decrease of 47.95%.

GAC Group's first-half financial report showed that the group's operating income was 45.808 billion yuan, a year-on-year decrease of 25.62%; the net profit attributable to shareholders of listed companies fell to 1.516 billion yuan, a year-on-year decrease of 48.88%; the net profit after deducting non-recurring gains and losses, the profit data directly turned negative, equivalent to a loss of 338 million yuan, a year-on-year decrease of 112.51%.

Changan Automobile's semi-annual report is slightly better. The company achieved operating income of 76.723 billion yuan in the first half of the year, a year-on-year increase of 17.15%; net profit of 2.832 billion yuan, a year-on-year decrease of 63%; non-net profit of 1.169 billion yuan, a year-on-year decrease of 5.89%.

All signs indicate that, whether it is a state-owned enterprise or a private enterprise, salary is not the only factor that determines the final direction of an auto company. Sky-high salaries help auto companies obtain a more competitive talent team, but more far-sighted decisions, stronger technological innovation capabilities, and more comprehensive product layout ideas are the fundamental internal driving force for auto companies to achieve a leap forward.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.