2022-02-16
Charles Ding
Vice President of Vanke Group
Thank you for your invitation! I’m glad to have this opportunity to share with you some of the things Vanke has done. Today I would like to talk about the following aspects. First, the relationship between Vanke Ski Resorts and the 2022 Beijing Olympic Winter Games, and the second is about the post-Olympic era.
Vanke has participated in the 2022 Beijing Olympic Winter Games in a deep-going way. Vanke has the Shijinglong Ski Resort in Beijing, which has always provided all the support for the training of the national games for the people with disabilities. The ski resort is also a base of ice and snow sports for the people with disabilities of Beijing and China Disabled Persons’ Federation, and we have been providing all the support for the national snowboarding team over the past three years.
Vanke has done another very important thing. We are the second largest shareholder of Xiaohaituo, and we have participated in the construction of this project together with BG. Vanke is positioned to run the resort after the 2022 Beijing Olympic Winter Games.
We all know that the 2022 Beijing Olympic Winter Games has fundamentally changed the ski industry in China. There has never been Games as influential as the Winter Olympics, as evidenced by the fact that since 2015 the central government and local governments have issued so many policies to promote the development of the ice and snow industry. Today we are here in Beidahu to attend this ice and snow economy high quality development conference. It is actually a result of such policies. And we can see that after 2015 we see a significant increase in the number of ski resorts, skiers and cableways. Of course we saw a major setback over the past 2 years in 2019 and 2020 because of the COVID 19 pandemic. In 2021, although the general momentum was good, the sector was hit very hard by the epidemic.
To engage 300 million people and especially primary and secondary school students in winter sports is a fundamental reform of China’s ski industry. We can see in Jilin and Beijing a lot of students have these sports or ice sports classes. In the future they will become the next generation of skiers in China. So I believe this program has fundamentally changed the landscape of ice and snow sports in China.
One particularly interesting change after the epidemic is the increase in young skiers. I believe that these young children will become the second or third generation of skiers when they grow up in the future. And China has undoubtedly become the largest market for beginning skiers.
Next, I want to look forward into the future to see how we will address the challenges in the post-Olympic era. So Vanke is a real assets company, but besides that we have also invested in the rental apartments, departmental stores, education, hotels as well as vacations. Of course ice and snow is a very important sector in our culture of tourism and vacation businesses. So, in this sector, how are we going to invest and grow our businesses in the field?
There are three questions. We know that history repeats itself. That the enthusiasm or the interest in the sector may decline instead of growing out, so the first question is whether the momentum will keep or decline on the ice and snow industry after the 2022 Beijing Olympic Winter Games? Second, see what changes the consumers are experiencing and then work to adjust the products and services? And third, how do we excel in the context after the Games?
We can now look back into the history of the ski industry in Japan and in the United States. In fact you can see that the US held the Winter Olympics in the 1960s and Japan held the Winter Olympics in the 1970s. And they both harvested a two-decade building period of the ski industry after the Winter Olympics. The growth in terms of skiers has been lagging behind that of the ski resorts. So in the first place, you need to have the hardware and the infrastructure ready, then you will see the growth in the number of skiers.
Comparatively speaking, we can also expect that China will have a two-decade building period of the ski industry.
In China we have seen the development of the skiing industry for over 20 years. We could see Beidahu purchased by Liu Xiaoshan in 2009 and Songhuahu Resort built by Vanke in 2014. But for the major capitals, they have started to invest in the ice and snow industries only after 2010. So major investors, be they Wanda, Vanke or Genting, when they invested in ice and snow, they did not know about the winter Olympics. But I think it is fortunate that we are now in the best period of development for the ice and snow industry and economy. Someone was saying that the ice and snow industry could become a trillion yuan class industry. Well, I believe that the integration of sports and tourism represent a major trend for China in the next stage.
Regarding the question of what legacy will the Olympic Winter Games leave to the industry, first, huge investments were made in the infrastructure and hardware. If not for the newly built two high-speed railways and if not for the expansion of Zhangjiakou Airport, there would be no Chongli. If the government did not invest substantially in roads and airports in the infrastructure of the major ski areas, and if there was no involvement of major investors, and if we did not introduce this most sophisticated equipment, we will not be able to see this booming development of the ice and snow industry in China.
The second legacy is the supportive policy by the government on ice and snow.
The third legacy is the vision of engaging 300 million people in ice and snow sports. Fourth, young people will become a major consumer force in the future.
Generation Z are very generous in their consumption .They are different from current generations because when we were young we were under a lot of pressure as we wanted to buy a house, get married and have children and we were not affluent. But for the younger generations today, because they are more affluent and they are very generous in their consumption and they also demonstrate a higher level of brand loyalty.
And these are a group of people who were born in the age of the Internet. We must create many opportunities for them. So we collaborate with “the little red book”, and this is the BOGNER store. And in the Songhua resort, Burberry has transformed the pub into Burberry Cafe. And BMW is also having this Christmas event. And on December 31 Tmall will have a live broadcasting event. All in all, I want to say that we need to know the young people to understand our customers.
I think that in the post-Olympic era, competition will be more fierce, and the Ice and Snow industry will attract more capital. And the concentration ratio in this market will be bigger. Of course, we believe that online and offline integration is the most critical, and the APP platform is worth investing in.
I think the potential is huge to develop the clothing of ice and snow sports. And the training, education about skiing is also a popular aspect of the business.
After the Games, Vanke Group also thinks we will have a promising future. Let’s work together for the next two golden decades of the ice and snow industry. Thank you!