Behind the spontaneous combustion of Weimar Motor: More friends means more success? Suppliers are more about quality than quantity

In October, three consecutive spontaneous combustion and explosion incidents at WM Motor attracted close attention and triggered a series of discussions on the safety of electric vehicles. Following the long-distance "battle" between WM Motor and its battery cell supplier ZTE High Energy, people once again turned their attention to WM Motor's supply chain system.

Shen Hui, Founder, Chairman and CEO of WM Motor

Shen Hui, founder, chairman and CEO of WM Motor, has always been proud of the supply chain of his own company. He has mentioned more than once that "supply chain is our strength" and the "face recognition" between "friends". However, in several spontaneous combustion incidents, the mutual "blame-shifting" between WM Motor and its suppliers has become a special "scenery" - which makes people think deeply: In the automotive industry, especially in the field of electric vehicles, is it really true that the more supplier "friends" the better?

A Weimar car exploded at the Zhongguancun Institute of Mechanics

On October 28, the day after the explosion at the Zhongguancun Institute of Mechanics, WM Motor issued a recall notice through the State Administration for Market Regulation, attributing the spontaneous combustion to the fact that the battery supplier had mixed impurities during the production process, causing abnormal lithium deposition in the power battery. It is understood that the battery model of this batch of vehicles is ZNP3914895A-75A, and the supplier is ZTE High Energy Technology Co., Ltd.

ZTE High Energy responds to WM Motor recall

The recall statement, issued the day after the "explosion", successfully relieved some of the public pressure on WM Motor and directed the conflict to ZTE High Energy. On the same day, ZTE High Energy issued a statement saying that it had nothing to do with the fire in WM Motor on October 27. At the same time, the company stated in the statement that "in the two fires in WM Motor vehicles in Shaowu City, Fujian Province, the vehicles involved were equipped with batteries from high-energy technology", but "the specific cause of the fire is still under investigation."

This is not the first time that WM Motor has been "replied" by suppliers. On August 25, 2018, a WM EX5 caught fire in the WM Motor Research Institute in Chengdu. Four days later, WM Motor stated in an open letter that the vehicle was equipped with a cylindrical battery pack produced by Zhejiang Gushen in 2017. The next day, Zhejiang Gushen issued an open letter stating that it "would not take the blame" and revealed that after the vehicle caught fire, WM Motor not only did not take the initiative to contact Zhejiang Gushen, but also refused to allow Zhejiang Gushen to send relevant personnel to the scene. On September 3, CATL also stated on the Shenzhen Stock Exchange Interactive Platform that "the batteries installed in the WM Motor 'spontaneous combustion' test vehicle reported by the media recently are not our products"...

Zhejiang Gushen issued an open letter to "respond" to Weimar

According to statistics, WM Motor's current battery cell suppliers include five companies, including CATL, Lishen, Suzhou Yuliang, ZTE High Energy, and Jiangsu Tafel. Compared with "new car-making forces" such as NIO, Ideal, and Xpeng, WM Motor has the largest number of battery suppliers, which also tests the company's supply chain management level more.

Mr. S, a senior industry insider, said in an interview with the Economic Daily-China Economic Net reporter that in the automotive industry, the supply of core parts usually considers strategic cooperation channels, and there are two or three alternative suppliers for parts of general importance. Too few suppliers will cause problems such as "bottlenecks", and too many suppliers will lead to chaos. As for the electric vehicle industry, for a single component, especially a core component such as a battery cell, the more suppliers the better.

Dr. Q, a senior expert in the new energy vehicle industry, said, "In theory, if the battery supplier (product) is of high quality, then it is best to have only one battery supplier for a car - this places particularly high demands on battery suppliers."

Such "high requirements" are not only for the height that certain performance parameters of the battery can reach, but also for the stability and consistency of its product quality. Dr. Q explained, "Companies will set a standard for the quality of products supplied by suppliers, but whether suppliers leave a certain margin to meet this standard is not a mandatory requirement of the company. In addition, rather than leaving a parameter margin, companies prefer to see suppliers control product quality fluctuations to the minimum."

"Because electric vehicles have a control strategy for batteries, the fluctuations of some parameters - even if they fluctuate upward, the excess part (such as energy) will not only not be used, but will also consume some functions of other electronic components," said Dr. Q. "The practice of 'leaving margin' is a last resort and is not a preferred choice."

In addition, there are too many battery suppliers, and in addition to the difficulty in ensuring product quality deviations, there are also problems with matching the battery cell with the battery pack and the battery control system. Dr. Q pointed out that the technical core of the battery cell lies in its chemical formula, which is not interoperable between suppliers. This means that even if the company gives a unified technical requirement and different suppliers can meet this requirement, there will still be slight parameter differences in the products of different suppliers, which also means that it is impossible for the company to use only one battery management system to match batteries from different suppliers.

“Maybe not all OEMs will do such detailed work, but for those that do, it is too expensive to do such a matching,” said Dr. Q. “The cost pressure of electric vehicles is very high now. The cost of developing one (supplier) is already unbearable, let alone two or three more.” If a company has too many battery suppliers and the OEM does not match the supplier with the whole vehicle system, then the quality of the whole vehicle product will be difficult to guarantee - either the user’s driving experience is not good, or the battery will be inadvertently abused…

Mr. S believes that in the long run, the company will not be completely controlled by others. If an electric car has high profits and good sales, then after a certain stable sales volume is formed, the company will definitely consider opening up another matching channel. However, at present, there are very few high-quality battery suppliers in China, and WM Motor is far from having the spare capacity to develop multiple matching systems. Having many "friends" does not necessarily mean an easy road.

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.