On March 12th, Arbor Day, the Zhongding Holdings Year of the Rabbit Spring Festival Awards Ceremony with the theme "I Believe" was held at the Ningguo Vera Palace Hotel. Chairman Xia Dinghu and his wife Ms. Zhao Jingjuan, Zhongding Holdings Chairman Xia Yingsong, senior leaders from the five major module companies, and employee representatives attended this grand ceremony.
Chairman Xia Yingsong delivered a "I Believe" themed speech to all attendees, expressing trust and confidence in Zhongding. The Air Suspension Module, Sealing Module, NVH Module, Fluid Module, and Headquarters Module presented wonderful programs that integrated their respective development narratives and module characteristics. After each program, the module leader took the stage for a vote appeal, interpreting the program's meaning, introducing the development achievements of the past year to the attendees, emotionally sharing the touching stories of solidarity and hard work behind the program, and expressing firm confidence in creating further glory in 2023.
At the meeting, the company grandly recognized and awarded 12 outstanding sales individuals for 2022, who made outstanding contributions to Zhongding's sales performance. Chairman Xia Yingsong personally presented awards to them and took a group photo. Belief is our expectation of a certain certainty about the future. Three years of the pandemic, superimposed with international situation turbulence, have led to increasing uncertainty for enterprise development and the future between nations. But fortunately, these three pandemic years have finally turned the page.
Over these three years, whether it was volunteers ensuring resumption of work and production, those who sacrificed rest time to support busy production lines, those who stayed overseas unable to return home, especially those who persevered on the frontline during the sudden opening and widespread infections last year, every Zhongding person has made tremendous efforts, perfectly demonstrating the strong resilience of Zhongding's entire value chain, management chain, supply chain, and production chain. In such an uncertain world, we have provided more certainty to customers, society, and our families. This certainty, gathered together, constitutes trust and confidence in Zhongding. Here, I pay my highest respects to every Zhongding person! If belief has energy, how powerful is it?
From small companies to large countries, they are all imagined communities formed by the shared belief of those involved in their existence. The same applies to brands and even currency; otherwise, holding euros or dollars would be just paper. Why do you believe in their value? Because you believe. For enterprises, belief is even more a hidden variable for success. Generally, it is believed that Goals x Execution = Results, but there should be a hidden variable in this formula: Belief, because the consensus formed by belief can multiply the execution force, ultimately affecting the results. Let's discuss three cases:
During the War of Liberation, we had millet and rifles. Under conditions where manpower and tools were backward, why could New China be established? Because we believed we could establish New China; this hidden variable belief played a decisive role. During the early days of establishing the factory in Zhongxi last century, facing numerous difficulties and constraints, the leadership team led by Chairman Xia Dinghu persisted constantly because they believed Zhongding would surely succeed. At the just-concluded National Two Sessions, a new generation of national and party leaders was elected. I believe under the leadership of the new generation of leaders, Chinese intelligent manufacturing will surely reach new heights. For enterprises, the ability to establish, develop, and consolidate trust with customers, partners, investors, and employees is a core key for future development. This is what I believe "belief" means.
Facing 2023, I want to share my beliefs with everyone:
I believe in Zhongding's globalization path. Starting with our product exports to Japan in the late 1980s, our globalization journey has gone through three stages: market goals, technology goals, and industry layout. By 2018, we completed the global strategic integration process of the four major automotive systems within the automotive industry. In 2019, we became an automotive parts company ranked among the global top 100. We completed our own global layout in 30 years. The transition from early capital output to current management output benefited from the persistent globalization path. In 2022, we acquired Bridgestone's NVH segment, a milestone project on our globalization path, truly achieving comprehensive coverage of all global automotive industries. Simultaneously, the SAP management module was successfully applied at AMK. By the end of 2022, the number of management personnel we stationed overseas had reached 18. Today, we have transitioned step by step from past capital confidence to technical confidence and management confidence, possessing unprecedented self-assurance. I believe in Zhongding's future industry layout.
In the past 5-10 years, based on energy utilization technology, internet technology, computing power enhancement, and artificial intelligence development, the automotive industry is ushering in an unprecedented era of change since the birth of the automobile over 100 years ago. In 2018, based on our grasp of industry trends, on one hand, we focused on the development trends of electrification, lightweighting, comfort, and modularization in automotive parts, laying out our own product system; on the other hand, focusing on the opportunities of industry chain reconstruction, we laid out future capabilities to provide a complete set of system solutions including control modules. The goals are arduous, but encouragingly, we are gradually achieving them. AMK, which we acquired in 2018, through five years of integration, will achieve domestic mass production in Xuancheng in 2023. Such products represent our grasp of the future comfort trend direction and have now been validated by the market. At last year's China EV100 Forum, Chairman Chen Qingtai proposed that the automotive industry's value chain and supply chain are accelerating reconstruction. Over 50% of the traditional automotive parts system faces reconstruction. The future automobile is a typical electronic product and internet product based on mechanical products. Purely mechanical products are gradually being phased out by the market. This trend is irresistible and irreversible. The real transformation of China's automotive industry has officially begun. I believe we will certainly dare to face the arrival of this transformative era.
In 2022, NEVs experienced explosive growth in market share domestically and internationally. In January and February this year, China's automobile exports increased by 70% year-on-year. Facing such huge market changes and future uncertainties, our layout in intelligent thermal management and intelligent chassis systems has also begun. This is my belief in our products. What I believe in most is you.
Our company is a team full of passion, not only with veterans in their 50s and 60s but also passionate and energetic young people in their 80s and 90s. Precisely because of you, the trust of our customers, partners, investors, employees, and our families in Zhongding has become a consensus. Because of belief, we are steadfast.
(Excerpt from Chairman Xia Yingsong's "I Believe" speech)