Hangsheng's 33-Year Foundation: Aiming for the "Chinese Bosch"

On the map of China's auto parts industry, there are never a lack of speculators, but it lacks "slow walkers" like Hangsheng who are willing to take the long route.

On September 9, before the 20th Anniversary Celebration of the Automotive Talent Professional Committee of China Talent Research Society, the organizer held a dialogue named "Kunpeng Striking Waves, Leading Autonomously: High-End Dialogue on the Development of China's Automotive Electronics Industry and Talent", directing industry attention to the growth proposition of China's local auto parts. Fu Yuwu, former chairman of the China Society of Automotive Engineers, and Yang Hong, chairman of Shenzhen Hangsheng Electronics Co., Ltd., discussed on the same stage, looking back at the magnificent 20 years of the industry, and detailed the breakthrough path of this local automotive electronics leader over 33 years.

33 years ago, Hangsheng was just a workshop-style small factory relying on processing labor to earn hard-earned money; 33 years later, it has grown into a leading enterprise in China's automotive electronics industry, accelerating towards the dream of becoming "China's Bosch".

Three Key Decisions, Transforming into a Local Leader

At the beginning of its founding, Hangsheng was just a state-owned enterprise workshop starting with only 2.38 million yuan, surviving through processing labor. The "two ends outside" model meant it could only earn meager processing fees, and rising costs were constantly squeezing its survival space.

In Yang Hong's introduction, the enterprise's journey to today stems from three critical life-or-death decisions.

The first is breaking through the system, activating endogenous power with mixed-ownership. As a window enterprise under AVIC, the old system constrained enterprise development. In 1999, Hangsheng promoted restructuring, transforming into a mixed-ownership enterprise, integrating forces from central SOEs, local venture capital, and management to clarify governance responsibilities and rights. Only ten years after restructuring, the enterprise achieved an annual revenue of 1 billion yuan and after-tax profits exceeding 100 million yuan, completing the leap from survival to scaled development.

The second is anchoring technology, treating R&D and quality as a lifeline. To break away from processing dependence, Hangsheng increased its R&D investment ratio from 3% to over 10%, winning China's automotive electronics industry's first national enterprise technology center in 2007. The enterprise introduced aviation industry high-reliability standards into automotive product R&D; introduced the Performance Excellence model in quality management, winning the Shenzhen Mayor Quality Award and Guangdong Provincial Government Quality Award simultaneously in 2011, solidifying the foundation of product quality.

The third is national + global layout, staying close to customers to build an industrial network domestically around OEM supply radii. Hangsheng built manufacturing bases in Hebi, Henan; Ji'an, Jiangxi; Changshu, Jiangsu; and Jilin; distributed R&D centers in Shanghai, Wuhan, and other places; established R&D centers in Germany, Japan, South Korea overseas, and planned overseas manufacturing bases in Thailand and Europe, building a service system facing the globe.

Entering the "15th Five-Year Plan", Hangsheng once again underwent strategic upgrade, proposing the "1+2+N" strategy, which is a new development pattern of "1+2+N" with intelligent cockpit, intelligent driving, and intelligent connectivity as the core, with acoustic systems and new energy control electronics as growth businesses, and software engineering, intelligent ecosystem products, embodied intelligence, etc., as emerging businesses.

The core of Hangsheng's new development pattern of "1+2+N" is to amplify Hangsheng's advantages and achieve structural and scaled growth. "1" is guarding the basic board and main channel, "2" is opening up differentiated growth spaces, and "N" is expanding business incremental space. In the past, Hangsheng relied on automotive electronics to walk on "one leg", now "1+2+N" has formed a product matrix of technology reuse and market synergy, giving Hangsheng the possibility of blooming at multiple points.

The Obsession of Becoming "China's Bosch"

Surviving is just the starting point, to become strong and go far, it requires establishing clear industry benchmarks, Bosch is the target Hangsheng has long been chasing.

Three years ago at Hangsheng's 30th Anniversary celebration, Yang Hong set a vision -- by the time of Hangsheng's 50th anniversary, to become "China's Bosch".

This goal, in the eyes of many, is almost like madness. Yang Hong explained, this pursuit is not simply benchmarking enterprise scale, but learning Bosch's four core characteristics: Leading with technological innovation, core of high quality and high reliability, persisting in global layout, pursuing enduring success, this is also the direction of effort for China's local parts enterprises.

Yang Hong admitted, currently Hangsheng still has gaps in R&D intensity, patent standards, and international brand influence. This ambitious goal requires generation after generation of Hangsheng people to continue striving.

And Fu Yuwu also placed high hopes on Hangsheng. He recalled the Bosch 100th anniversary celebration, insisting on going to the main table, "Foreigners cannot be ranked at the first table, while Chinese industry representatives are placed at the second table." It can be seen that Fu Yuwu has emotions regarding Bosch's "arrogance" deep down, but he also affirms Bosch's concept of "Technology Makes Life Better".

"China's automotive industry needs multinational giants like Bosch as well as local automotive electronics leaders like Hangsheng. I firmly believe Hangsheng can gradually realize this development vision with industry support," said Fu Yuwu.

Exploring Paths for Technology and Going Overseas to Break Through

With technological progress, the industry is also undergoing earth-shaking changes. Regarding the automotive industry, the industry consensus has iterated from "Software Defines Car" to "AI Defines Car". In Fu Yuwu's view, AI is reconstructing industrial order, the internal combustion engine era with 140 years of history is accelerating towards its end, electronic and electrical central computing platforms and cockpit-driving integration are becoming the main battlefield of the next decade.

Hangsheng has also taken steps here early. Currently, Hangsheng has landed the first domestic cabin-driving integration project based on Qualcomm chips, while simultaneously advancing product R&D for Horizon domestic chips, balancing overseas mature solutions and domestic independent routes.

Under high-speed transformation, disordered involution of low-price cost competition and scale competition is hurting the entire industrial chain. Yang Hong explicitly proposed in the dialogue that pure price competition involution has no way out. The core of enterprise breakthrough is relying on technological innovation to create differentiated, high-reliability products, expanding scale relying on brand reputation, and building sustainable core competitiveness. Yang Hong believes that by the end of the "15th Five-Year Plan", the domestic automotive industry is expected to fully return to the development track of high quality and high reliability.

Going overseas has become an important path for domestic parts to jump out of involution. Yang Hong proposed the parts overseas "Three-Step" strategy: Go out to sell products, go in to build localized bases, go up to build international well-known brands, cannot simply copy the domestic model to overseas markets.

In Fu Yuwu's view, Chinese enterprises going overseas face three must-cross thresholds. First is the ESG compliance threshold, environmental protection, social responsibility, corporate governance are not just paper reports, many domestic enterprises understand this shallowly, need systematic make-up classes; Second is the long-termism threshold, going overseas is a long-term career of over 35 years, discard short-term speculation thinking; Third is the cultural talent threshold, creating an international corporate culture with people at the core, the enterprise can only walk steadily and far.

Reviewing the whole dialogue, one will find that talent is the dark thread running through.

Yang Hong said, Hangsheng's talent view is first respect -- "People-oriented is not a slogan, it is to let employees have dignity, career, and sense of gain."

In terms of training mechanisms, Hangsheng does not take shortcuts. Key scarce top talent is introduced from overseas -- Hangsheng once spent four years, going to the UK twice a year, finally inviting an expert from Ricardo Company to Shenzhen. And the vast majority of basic engineers and management backbones persist in independent cultivation.

In terms of talent selection, Hangsheng implements a "Race horses not select horses" selection mechanism, allowing capable people to stand out in fair competition. Middle and senior managers must become internal lecturers, forcing input through output. Party-Worker-Youth league system creates "Family Culture", closely binding employee personal development with enterprise development and national strategy, only then can talent be retained and the company can have long-term development.

From deepening technology to extreme pursuit of talent cultivation and selection, Hangsheng has built industry barriers that are difficult to cross in 33 years. "China's Bosch" this dream has never been a castle in the air, it is a down-to-earth sprint step by step by Hangsheng. Hangsheng's expedition story is just a vivid sample of China's local automotive parts breaking through upwards.