Tech giants start by disassembling systems

Chapter 50 Shuffling and Shaking

In June 2017, the Mavic Pro officially went on sale in mainland China.

Priced at 6999 yuan. Foldable, portable, with excellent image quality and precise flight control.

It completely changed the market landscape for consumer drones within a month.

The first wave of bankruptcies in Shenzhen's drone industry began in the second week after DJI's release.

Three small manufacturers using the same flight control system announced production halts in the same week. Two others announced a shift to other electronic products. Several others simply closed down without making any announcements.

Su Chen was not surprised at all.

In my past life, the second half of 2017 was the darkest period for the Shenzhen drone industry. Hundreds of small and medium-sized drone companies would collapse in the following six months. The reason was simple—they all used generic flight control solutions, lacking any technological barriers. When DJI raised the bar for the consumer market with the Mavic Pro, those products that relied on disassembling and assembling modules completely lost their space to survive.

Hongyuan did not fall.

Because Hongyuan has self-developed flight controllers, a stable customer base of small businesses in county towns, a dual-track system of dealers and ground sales, and a growing ecosystem of plant protection flight controllers.

But the pressure still got through.

June saw the first decline in F2 series monthly sales since its rebirth – dropping from 3,500 units last month to 3,100 units.

The decline was not significant, at about 12%. However, this was the first month-on-month decrease in 14 months.

Su Chen wasn't surprised. The release of the Mavic Pro would draw away some customers who might have originally bought the F2—especially young users in first- and second-tier cities. However, Hongyuan's core customer base—small business owners in county towns—had very little overlap with the Mavic Pro's customer base.

A wedding photographer in a small county wouldn't spend seven thousand yuan on a fancy but fragile folding camera—what he needs is a two-thousand-yuan working machine that can withstand drops and fly stably in the wind.

This is precisely the positioning of the F3.

But what Su Chen didn't expect was that the sales decline would cause a much bigger reaction within the company than he had imagined.

The ground sales team was the first to feel the pressure.

In her end-of-month weekly report, Meng Xiaoxu mentioned that three out of the fifteen field sales teams experienced a significant drop in weekly sales this month. This was mainly concentrated in Guangdong and Zhejiang provinces—consumers in these two provinces are more sensitive to new technology products, and the Mavic Pro had the most direct impact on them.

What worries Meng Xiaosui even more is the team's morale.

"Mr. Su, several team leaders have told me that their team members feel DJI's new drones are too powerful, making it increasingly difficult to promote the F2 to customers. They asked me—does the company have any solutions?"

Su Chen did not answer immediately.

Over the next two days, he observed the atmosphere within the company.

Inside the production workshop, the workers were still working normally, and the product quality did not fluctuate significantly—the system gain halo ensured this. But Su Chen could sense something subtle spreading in the corridors, canteen, and rest areas—a whisper similar to "How much longer can we hold on?"

He overheard a conversation between two assembly workers while eating in the cafeteria.

"Have you seen DJI's new drone? It flies amazingly in the video. It folds up, and it's so small."

"I saw it. That thing sells for seven thousand. Their machines cost seven thousand, ours cost two thousand, how can we compare?"

"But customers don't see it that way. They only see that DJI's machines are more advanced and therefore think ours are inferior."

Su Chen put down his chopsticks.

This isn't a product problem—it's a confidence problem.

The F2's flight control system remains the best in its price range. However, when DJI redefined the market's perception with a product that was ahead of its time, all products that were "not DJI" were psychologically lowered.

Even though Hongyuan's customers and Mavic Pro's customers hardly overlap—the employees didn't see it that way. What they saw was, "DJI has released a new machine again, what are we going to do?"

Su Chen decided to do something he rarely did—hold an all-staff meeting.