In China's air conditioning market, Gree and Midea have long been rivals, dominating nearly half of the domestic market for nearly two decades. Their rivalry, often described as a fierce battle between titans, has intensified in recent years, manifesting in both aggressive pricing strategies and legal battles over patents. Despite rarely engaging directly in public, these companies have engaged in numerous patent disputes. As recently as the end of June, they each filed four patent infringement lawsuits against one another, with claims reportedly reaching nearly 100 million yuan.
Gree and Midea operate under very different corporate structures. Gree is a state-owned enterprise with a dispersed shareholder base, while Midea is a privately owned company where management and ownership remain closely aligned, avoiding some of the pitfalls common to family businesses. A decade ago, the gap between the two was vast, but today, Midea has rapidly closed that distance, standing neck-and-neck with Gree in terms of size and influence. Financial results for 2015 showed Gree with a revenue of 97.745 billion yuan and a net profit of 12.532 billion yuan, while Midea reported revenues of 138.44 billion yuan and net profits of 12.7 billion yuan. By 2016, Midea continued to outpace Gree in terms of revenue, achieving a total operating income of 159.8 billion yuan, a year-over-year increase of 15%, compared to Gree's revenue of 110.113 billion yuan, a rise of 9.5%.
Despite Midea's lead in revenue, Gree maintains an edge in profitability. The two companies are also taking divergent paths in their approach to innovation. Gree has focused on independent research and development, aiming to master core technologies and maintain self-reliance. While this strategy is commendable, it remains in the exploratory stages, balancing the pursuit of speed with the need for technological maturity and product reliability. Midea, on the other hand, has pursued a strategy of strategic acquisitions, buying mature enterprises like Germany’s Kuka Robotics for 29.2 billion yuan in 2016. This approach allows Midea to leverage established technologies and products, giving it a competitive edge in global markets.
The competition between Gree and Midea is also evident in their respective shareholders' actions. Gree's Chairman, Dong Mingzhu, has consistently increased her holdings in the company, signaling confidence in Gree's future. Conversely, Midea's actual controller, He Xiangjian, has quietly reduced his stakes, perhaps reflecting concerns about potential challenges facing the home appliance industry. Rising raw material costs due to supply-side reforms and stricter real estate regulations could strain the sector, prompting He Xiangjian to adjust his investment strategy.
Dong Mingzhu's unwavering faith in Gree is evident in her bold moves, including her vocal support for new ventures like electric vehicles and her commitment to employee benefits. Her decision to increase Gree's holdings sends a clear message: regardless of external uncertainties, Gree remains committed to its leadership role in the Internet-connected home appliance space. Meanwhile, He Xiangjian’s actions suggest a more cautious outlook, hinting at a belief that the white goods industry may soon face significant changes.
Historically, the rivalry between Gree and Midea has been intense, but as the market becomes increasingly saturated, both companies are seeking new growth opportunities. While Gree continues to explore areas like smart homes and mobile phones, Midea has made significant strides in robotics and small home appliances. With the air conditioning market showing signs of stagnation, these companies must adapt to survive. The race to dominate emerging sectors like robotics and smart home solutions is intensifying, with Midea currently holding an advantage in these areas. However, Gree's focus on core technologies and independent innovation may yet yield unexpected breakthroughs.
In conclusion, the competition between Gree and Midea reflects not just a fight for market share but also a broader battle for technological supremacy and strategic positioning. As both companies navigate uncertain times, their choices—whether to invest in innovation or consolidate existing strengths—will define their futures in the evolving landscape of consumer electronics.
Oil Filter For HONDA
HONDA Oil Filter Replacement,Oil Filter For HONDA Cars,HONDA Car Oil Filter,HONDA Auto Oil Filter
Zhoushan Shenying Filter Manufacture Co., Ltd. , https://www.renkenfilter.com