From：Internet Info Agency 2019-02-12 09:42:29
Editor's note: I’ve known Dr. Hanschen for some time. He was a key member of the management team led by former Volkswagen Group China President & CEO, Prof. Dr.h.c. Winfried Vahland. At the time, Dr. Hanschen moved with him to ŠKODA headquarters in the Czech Republic. When Dr. Hanschen came to China in 2017 as the President of ŠKODA China, he therefore already was a very experienced senior management talent in the automotive industry. Coinciding with his appointment as President, the ŠKODA brand launched its SUV offensive and announced that it was significantly increasing its investment into the Chinese market. Until then, ŠKODA has focused on a balanced development between SUVs, sedans and wagons. In 2018, despite a challenging market environment, ŠKODA achieved remarkable results in China. Outside of work, Dr. Hanschen is a stylish and handsome German who enjoys drinking tea, goes cycling on weekends, and occasionally does some online shopping. As the President of ŠKODA China, Dr. Hanschen is on the road frequently, and he loves travelling by high-speed train. Dr. Hanschen told me: “It is amazing that in China, such a big country, high-speed trains always run on time. This is one of the many reasons why I have such sincere admiration for this country”. (By Li San, Internet Info Agency)
With its 124-year-long history, ŠKODA is one of the most longstanding automotive brands and an industry pioneer. Today, it is also a representative of the Czech Republic. The timeless design language of ŠKODA models is built on the foundation of the century-long cultural heritage of Czechoslovakia.
It has been only 12 years since ŠKODA entered China in 2007, which is not long compared to many other international brands. In the brand’s third year after entering China, ŠKODA China was set up, taking on important responsibilities such as brand management, communications, and product planning. Among the four presidents which ŠKODA China has had so far, Dr. Ralf Hanschen is the youngest. He was only 38 years old when he was appointed to the position in 2017. Bringing his youthful spirit to the century-old brand demonstrates ŠKODA’s efforts to energize the brand.
The first impression people usually have when meeting Dr. Hanschen is that he is young and handsome. After several meetings, most people find him gentlemanlike, humble and nice. Dr. Hanschen studied economics at university. He joined the Volkswagen Group in 2004, started to work on China-related projects in 2004, and later became a key member of the ŠKODA management team.
Dr. Hanschen’s appointment as ŠKODA China President coincided with the acceleration of ŠKODA’s development: ŠKODA acquired a stake in the joint venture SAIC Volkswagen and enjoyed favorable conditions to grow the ŠKODA brand in China; the official launch of ŠKODA’s SUV offensive was followed by intensive product launches; and expanded investment in China laid good groundwork for ŠKODA to further grow, as well as prepare for electric mobility and digitalization.
The importance of the Chinese market is self-evident. Handing responsibility for the China market to a young executive like him represents the group’s great recognition of his achievements and abilities, as well as their expectations towards young leaders.
Young
“Young” is an important signal which ŠKODA is now sending out, not only with its brand and products, but also with its management team. Still in his 30s, Dr. Hanschen is definitely a young China president compared with other multinational top leaders in China. Moreover, Dr. Hanschen shared that the current ŠKODA China management team is around 40 years old. “Our team consists of young but experienced colleagues. They understand not only the needs of young people, but also the ways to meet market demands."
As one of the oldest automobile brands in the world, rich history and culture are important aspects of the ŠKODA brand value. However, a brand needs to have both tradition and freshness in order to keep up with the times. "One of the aspects in which we are continuously evolving is our design language, to which we have added more emotional elements in recent years,” said Dr. Hanschen.
The evolution of ŠKODA's design language has become prominently visible since the brand’s third generation SUPERB. Crystalline shapes, inspired by the world-renowned Czech crystal-cutting craft, have been integrated into ŠKODA‘s designs. Hence, classic Czech cultural elements are now intertwined with the brand. Practicality, spaciousness and affordability are no longer the only highlights of the ŠKODA brand. ŠKODA’s smooth and dynamic designs have started attracting more young consumers. In the automobile industry, design is the best way to showcase a brand’s culture and establish a connection with young consumers.
In terms of brand communication and marketing, Dr. Hanschen said that ŠKODA has long been a patron of sports which are popular with young people, such as cycling and ice hockey. Both sports are deeply rooted in the ŠKODA brand. Its connection to cycling is evident, as ŠKODA itself started as a bicycle factory back in 1895. As for ice hockey, ŠKODA’s 26-year-long sponsorship of the World Ice Hockey Championship set a Guinness World Record. Dr. Hanschen loves cycling himself. He sees sports sponsorship as a very important pillar for shaping ŠKODA’s brand image, and he is pleased to see that an increasing number of young people gains interest in sports.
Integration
As the President of ŠKODA China, Dr. Hanschen reports on the latest trends and needs of the Chinese market to the ŠKODA headquarters. Furthermore, his work is characterized by working closely to others with the joint-venture colleagues from SAIC Volkswagen. When it comes to management and communication, cross-cultural cooperation is the biggest challenge faced by joint-ventures and multinational companies. “Even at the ŠKODA’s headquarters in the Czech Republic, our colleagues have different cultural backgrounds. Compared to the cultural differences between countries in the West, those between China and the West are even more challenging and it takes more effort to understand and manage them,” said Dr. Hanschen.
“In Chinese culture, it is very important to consider guanxi.” Dr. Hanschen is clearly aware of the importance of guanxi for Chinese people, as he said, “In China, it is common to establish connections with colleagues and get to know each other first, before doing business together.” For a German, he knows Chinese culture very well.
One of the advantages of appointing a young manager to lead ŠKODA in China is that young people generally love experiencing local cultures in both work and life, and then integrate them into their own culture. For example, Dr. Hanschen has a traditional Chinese porcelain tea set on his desk and tries to experience and understand Chinese tea culture. When traveling to different cities, he insists on having an in-depth understanding of the history of the city. For example, he was very interested in Xi’an, the starting point of the ancient Silk Road. Dr. Hanschen strongly believes that knowing about China’s long history contributes to a better understanding of present-day China.
He also applies the same effort at work, promoting cross-country communication and the integration of technology and information. With its rapid growth and development, China is not only the world’s largest auto market, but also a world leader in technological innovation and other areas. Therefore, a very important task of Dr. Hanschen and his team consists of communicating Chinese market trends and consumer needs to the ŠKODA headquarters.
The idea to replace the ŠKODA logo on the rear of the car with the ŠKODA brand name was proposed by the Chinese team. This design will also be applied to other ŠKODA models around the world in the future.
To integrate the needs of Chinese customers into global product development, ŠKODA has adopted a two-way communication approach. "On the one hand, we send Chinese colleagues to the ŠKODA headquarters, where they directly participate in important projects such as the R&D of new models, as well as contribute ideas about the changes and trends in the Chinese market,” Dr. Hanschen said. “On the other hand, we also send, for example, colleagues from the headquarters, such as designers, to the joint-venture in Shanghai. There, they work closely together to understand the needs of the Chinese market and integrate the Chinese market demands into the development of new ŠKODA products."
“We are strongly focusing on the needs of our Chinese customers. We do not only update our current designs to suit their wishes, but we are also continuously developing new products especially for the Chinese market, such as the small SUV KAMIQ and the KODIAQ GT which we launched last year. “My colleagues in the Czech Republic envy me for being able to drive a KODIAQ GT in China,” said Dr. Hanschen with a slightly excited expression. In addition, the idea of displaying the ŠKODA brand name in letters on the rear of the KODIAQ GT's was proposed by Chinese colleagues. This design will be applied to other ŠKODA models around the world in the future.
Freshness
Constantly “trying new things” is an important characteristic of young people. Dr. Hanschen is indeed very willing to try new things such as mobile payment, online shopping and new means of transportation. He often travels by high-speed train. “China is not only developing rapidly as a whole,” he remarked, “its automobile market has also changed tremendously over the last one and a half year. Now, China’s electric vehicles, mobility services and customer needs are ahead of the international market.”
The ŠKODA DigiLab is an innovation hub, responsible for the development and exploration of new business ideas, mobility solutions and products.
Volkswagen Group has officially launched a new digitalization and mobility services strategy, and is looking to transform itself from a traditional automobile manufacturer to a smart mobility solutions provider. “In China, the goal and direction of ŠKODA is to provide customers with clever solutions for a better life,” Dr. Hanschen said. To achieve this goal, ŠKODA can leverage the technology and resources of the Volkswagen Group. Moreover, ŠKODA has set up the ŠKODA DigiLab in the Czech Republic to roll out new digital and mobility services such as project ‘Care Driver’. With ‘Care Driver’, ŠKODA provides door-to-door mobility services with dedicated drivers, aiming to take the best care of specific customers, including kids and seniors.
“We are studying whether it is suitable to provide similar services in China,” Dr. Hanschen said. “We will not merely copy the European business concept in China, but we will use it as a reference and then consider how to provide similar services here.” ŠKODA China is also exploring possibilities of launching new businesses in China. To this purpose, the brand is closely collaborating with colleagues from ŠKODA DigiLab.
The “Best” Resources and the “Worst” of Times?
After more than a decade of rapid growth, last year, the Chinese auto market saw its first negative growth in 28 years. According to a forecast by the China Association of Automobile Manufacturers, this slowdown will continue for three years or so while the market adjusts, before growth will resume. Will these three years be the worst of times for automakers in China? The answer is definitely NO! As always, the market will become even more competitive. And the stronger players will outperform the overall market and continue to grow.
Despite the slowdown of the automobile market over the past year, many companies countered the trend and continued to grow. In 2018, ŠKODA delivered 341,000 vehicles in China, a 4.9% increase over the previous year, thereby contributing more than a quarter of the brand’s total deliveries worldwide. The proportion of SUV sales more than doubled. According to Dr. Hanschen, there are three reasons for ŠKODA's success in China over the past year: a successful product/ SUV strategy, close cooperation with partner SAIC Volkswagen, and the trust and loyalty of ŠKODA’s customers.
This year and the next few years will be a difficult period for automakers in China, but this does not mean that the industry will stop growing. ŠKODA is currently investing RMB15 billion in China over five years in new products, new technologies, new energy vehicles, as well as in the brand itself.
ŠKODA’s ambitious product offensive will continue. Dr. Hanschen revealed that the new SUPERB and KAMIQ GT car models will launch in 2019. With the rapid growth of the new energy vehicle market, ŠKODA will move forward with its strategy on new energy vehicles. By the end of 2022, ŠKODA will have launched 10 electric vehicle models worldwide. At this year's Shanghai Auto Show, ŠKODA will reveal a new electric concept car.
Regardless of whether this is the best of times or the worst of times, ŠKODA is well-prepared and has the right resources and capacity for its further development in China. Its earlier efforts are already paying off, gradually achieving good progress and results. Under the leadership of Dr. Hanschen, ŠKODA expects to build an even stronger brand and achieve greater success in China.
(Interviewer: Li San | Author: Wang Jingya)
