In China, cars are basically standardized products when they leave the factory. In order to meet the personalized and diversified needs of car owners, there is a huge "car aftermarket", namely 4S stores, maintenance stations, and modification plants, where automobile enthusiasts can modify or add some products into their vehicles. Products in the aftermarket do not have to pass the vehicle regulations. These parts will never change the core electronic components or interfere with the car safety, as they belongs to peripheral products. I did a survey and found that most so-called car chips speculated in Huaqiangbei belong to this category! They do not belong to the ABS, ESP, and other parts asserted by Bloomberg in the article!

                                                                 Introduction to Slkor in Chinese and English

III.Inspection of electronic components

I, SONG Shiqiang, as a stall economist in Huaqiangbei and the General Manager of Kinghelm and Slkor, explored some rules by using the basic theories of "Kondratieff waves" and "Fiboracci Arc" in Macroeconomics. With due consideration of the effect of the cyclical constraints of the electronic component industry, functions of the electronic component reservoir in sales order configuration, I found out some rules of electronic business in Huaqiangbei. Once I had drunk too much in Huaqiangbei, I spoke the knack out in bragging. A businesswoman heard about my elucidation on the knack and was consequently enlightened. She followed the ways and means proposed in the elucidation in her speculation and made much profit worth several Bentley cars. She even sent a Bentley model to me to express her gratitude. Businesswomen in Huaqiangbei sighed with astonishment that in addition to writing jokes and advertisement, Mr. SONG from Kinghelm also knew a lot about stall business in Huaqiangbei, "How I wish to meet him  before my speculation rather than after that". One day, I was having tea with businesswomen in Huaqiangbei to do a pre-sale roadshow for my new book “Guide to Speculation in Huaqiangbei”. I accidentally saw a boss throwing a package of glittering items into the trash can behind a small counter. I picked the package up because I enjoy learning. I found it was a package of thin objects covered with a thin layer of blue film! Later, I asked experts of the industry and knew that they were wafer scraps with demerits sold to Huaqiangbei at lower prices from wafer fabs. Afterthese wafer scraps are sealed and tested, they become electronic components sold in counters and stalls in Huaqiangbei. If you want to trace the brand, model, or even the production date, you can find a professional testing company for help. If you need a testing authority, the No. 5^th Research Institute of the Ministry of Industry and Information Technology (CEPREI) in Guangzhou is recommended. In contrast, White Horse Laboratories is a more convenient choice. Additionally, 360IC also has a lab similar to this. By chance, I found ways and means to test electronic components. For problems arising out of the electronic components, causes of problems should be analyzed. If there are disputes, all responsibilities should be clearly defined, or some information should be traced and confirmed. Then the test and inspection of electronic components will play a role.

For example, a testing company has advanced ultrasonic testing equipment capable of doing non-destructive tests widely applied in material test, failure analysis, Research and Development (R&D), Quality Assurance and Reliability (QA/REL) tests. Items can be inspected include electronic components, LEDs, metal substrates, cracks, delamination, cavities and other irregularities. The image contrast can be used to identify the internal impedance anomalies of materials, to determine the shape and size of defects, and to determine the positions of defects. I observed wafer scraps mentioned above with a 1000x magnifying instrument lent from a friend of mine. They were found memory chip made by TSMC with models and capacity specifications clearly visible! Of course, the conventional opening, sol, electrical performance testing, sealing material testing, and sealing process analysis are all available. After this comprehensive test, similar to four ways of diagnosis --looking, listening, inquiring and feeling the pulse practiced by a doctor trained in the traditional Chinese medicine and blood test practiced by a doctor trained in the western medicine, the DNA result reveal the parents of a child clearly!

                                                                          Test results of wafer scraps found in Huaqiangbei

What I want to state here under my name SONG Shiqiang from Kinghelm and Slkor is that in procurement of expensive chips especially those for vehicle use from Huaqingbei, the test report from the professional lab is prerequisite for the issuance of a Purchase Order from a customer for both samples and small batches. A buyer with rich procurement experience in Huaqiangbei knows the origin of a chip, the level of processing of a chip and stage of modifying for a chip through visual inspection with his naked eyes. That is why I was shocked by the simplicity involved in buying chips for vehicle use described in the article by Bloomberg easier than blowing a whistle. Too much emphasis on the importance of customer relationship in the article revealed a blurred business image in Huaqiangbei that is far away from real business practice. The prerequisite for business in Huaqiangbei is the stock available and the same stock with authenticity!

IV Features of Huaqiangbei:

“Huaqiangbei”, Futian District, Shenzhen and "Zhongguancun", Haidian District, Beijing are known as two business centers for the electronic information industry in China. Huaqiangbei in particular is a business card to showcase achievements of the reform and opening-up of Shenzhen Special Economic Zone. The core area of Huaqiangbei business region is about 1.45 square kilometers accommodating more than 50 specialized markets. It is "The No.1 Business Street of Electronic Products in China" awarded by the China Electronics Chamber of Commerce. With more than 60000 enterprises, more than 40000 self-employed businesses, and nearly 300000 employees, Huaqiangbei has created many business miracles. There are more than 50 billionaires emerged from the "one-meter-counter in Huaqiangbei". At that time, the sales efficiency per floor area of Vangard Supermarket ranked No.1 in the world with a daily turnover of RMB 3 million from the supermarket with an area of 3000 square meters. In the summer of 2012, Psy’s "Gangnam Style” rocked every corner of Huaqiangbei. In the evening, almost everyone was practicing "horse-riding dance" in nightclubs. It was at that time I was invited by businesswomen from the Huaqiangbei business circle to do business there. It is the place I left when I was a popular literary and artistic youth 18 year ago. It is also the place I

returned when I was a bald greasy old man 18 years later. I, SONG Shiqiang, developed the business of Kinghelm (www.kinghelm.com.cn) and Slkor (www.slkormicro. com) in Huaqiangbei. Both these two companies have a spiritual value of tenacity similar to the spirit of Huaqiangbei. The flagship store of Kinghelm and the image store of Slkor are the footholds for traders and customers of electronic components serving Huaqiangbei. Huaqiangbei is also an exhibition center without closing period. Both the flagship store of Kinghelm and the image store of Slkor are showcase in Huanqiangbei.

A.  The government regulation:

To be honest, all kinds of commercial ecology in Huaqiangbei in the past were developed in the wild. This was the root of chaos and fraudulence in Huaqiangbei. In contrast, the government has been making great efforts in recent years to regulate Huaqiangbei for its healthy growth. Unprecedented efforts was made to crack down on chaotic markets of beauty cosmetics, counterfeit mobile phones, white-brand headphones and imported snacks in Huaqiangbei. I know a government official in charge of Huaqiangbei from Technical Supervision Bureau of Futian District. He said that he is always in dilemma to ensure a healthy business ecology, to keep innovation, to explore new market, and to crack down on the destruction to rules and orders in Huaqiangbei simultaneously. In many cases, he has been trying to “reduce the harm to the least extent between two harmful choices”. In the first half of this year, Technical Supervision Bureau of the Government imposed heavy penalty including fines and other means on distributors for bidding up prices of car chips in Huaqiangbei!

B.  The Self-discipline of electronic industry:

As the General Manager of Kinghelm,I, SONG Shiqiang do not deny that fake goods selling, deposit cheating, and goods smuggling abound in Huaqiangbei. These misconducts in business have been endangering the Good Will of Huaqiangbei. On the other hand, five A associations with addresses in Huangqiangbei as "Shenzhen Electronic Chamber of Commerce", “Alliance for Electronic ProfessionalsNative to Sichuan and Chongqing” originated from Huaqiangbei, and “Chip Industry Association” organized by electronic professionals of Hunan natives have self-disciplinary conventions. Basic ethics of these associations is that their members shall not be engaged in selling fake goods or disseminating false information! Peers in the electronic industry learn and make progress together. There will also be condemnation both in speech and in writing for the black sheep selling fake goods! This is good for purifying the business environment of Huaqiangbei! There is a supplement to the previous advertising. “Alliance for Electronic Professionals Native to Sichuan and Chongqing” was initiated by WU Bo, vice president of Lichuang Mall, and other professionalsnative to Sichuan and Chongqing inthe electronic industry. WU Bo is the idol of businesswomen in Huaqiangbei. I can always take the advantage to enjoy sausages, Stewed Pig Ears, and Twice-cooked Pork after having functions of the Alliance. It's so enjoyable!

The Spring Festival Annual Meeting of Alliance for Electronic Professionals Native to Sichuan and Chongqing under the Theme "The Flowing Water Brings Good Fortune. Our Ethics Keeps Alive Longer than Inscriptions carved with Metal Tools on Rocks

     C.  The qualification and the quality

Bloomberg’s article “China’s Underground Market of Chips Draws Desperate Automakers” abounds in concept changes. Qualifications of channel traders in Huaqiangbei and the quality of good for trading is a case in point. It is similar to someone who had pronounced that children born out of wedlock were not born by themselves. Even with the result of the DNA paternity test indicating the biological closeness, he was still arguing over carrying on a clandestine love affair or the childbirth without marriage certificatesfor his biological parents. In this sense, Bloomberg's article is too poor! Small companies in Huaqiangbei may have no agent qualification. However, they have the ability to acquire vehicle grade chips through various channels! The efforts to tap channels and to find goods are the gene for them to become "small and indestructible". This also became the struggle spirit of Huaqiangbei, the culture of Huaqiangbei and the core competitiveness of Huaqiangbei!

                                                                        QIU Huilin, Director of Slkor in conducting training sessions for agents

There is a piece of supplementary information that I want to share with you. In Huaqiangbei, there is a growing number of businesswomen who are promoting vehicle-grade silicon carbide MOS of Slkor brand and the BDS/GPS antenna connector of Kinghelm brand. At the time when they are distributing our products, we would issue them agency certificates. Furthermore, we would also provide systematic training for agents. This is something proper to be carried out properly with proper titles. This allows them to master our product knowledge, to expand their knowledge of the electronic component industry, and to revitalize their customer resources accumulated over the years. It's a good practice to benefit various parties concerned!

D.  Better payment terms against delivery conditions for chip suppliers

The shortage of electronic components of vehicle regulations has a huge impact on new energy vehicle factories. For some new energy factories, it is even a matter of life and death. In order to get the scarce resource, payment terms against delivery conditions are open for negotiation or for exemption.

Information from the internet revealed that BYD New Energy Vehicle Factory has purchased a reel of auto grade chip produced by TI in Huaqiangbei with RMB 20 million cash. It is said that this counter is in the First Phase of the Sun Asia Electronic Market. Mr. GU, the boss of the counter used to drink with me. This is a progress for car enterprises that are used to pay in Commercial Acceptance Bills or payment in six months after goods arrival! According to previous rules, only the original factory or the designated agent with the record can supply. Moreover, chips to be delivered must be produced within half a year. In the past two years mingled with pandemic, distributors with goods sourced from original

manufacturers can also supply. Some car manufacturers can accept new goods and original goods manufactured within three years. In addition, the price can also be negotiated with formal customs declaration bills, invoices from upstream partners, and more strict quality inspections required makes it possible to source more electronic components from Huaqiangbei. Huaqiangbei is a large warehouse. At the same time, it is also known as the reservoir of the original chip factory in upstream for inventory control. Previously, devices produced by chip manufacturers in excessive quantity with excessive production capacity were shipped to Huaqiangbei and to be sold out in lower prices or for degraded application scenarios as in industrial products or consumer electronic products. The inventory in Huaqiangbei exhibited its value in the chip shortage this time!

In summary, I, SONG Shiqiang from Kinghelm and Slkor want to justify the name for China's new energy vehicles and boost the morale for Huaqiangbei with relevant proof, with good reason, and with proper control. I do this out of my feeling that the blood is thicker than water, a feeling fabricated and maintained by countless strands of information of with Huaqiangbei, a feeling out of the understanding of and the attention to new energy vehicle industry in the past decades, and ultimately, a feeling out of the responsibility of a Chinese citizen! I hereby present my refutation of and clarification for wrong views in “China’s Underground Market of Chips Draws Desperate Automakers” by Bloomberg. If there is anything inappropriate, you are welcome to present your ideas and discuss with me. Only through discussion, communication and supervision can we make progress, accomplish development and complete standardization! Thank you!

                                                                                                    SONG Shiqiang, General Manager of Kinghelm and Slkor

The author, Mr. SONG Shiqiang

Mr. SONG Shiqiang, a private economic researcher of the Economic Development Center of the State Council, a member of the electronic information expert database of China Association of Science and Technology, and a business research expert of

Huaqiangbei. He was once the CEO of a listed company in international real estate. Now he is investing and operating Shenzhen SlkorMicro Semicon Co., Ltd. (www.slkormicro.com) and Shenzhen Kinghelm Electronics Co., Ltd. to build the brands of “萨科微”, “SLKOR", “金航标”, and “Kinghelm". Both Shenzhen SlkorMicro Semicon Co., Ltd. (www.slkormicro.com) and Shenzhen Kinghelm Electronics Co., Ltd. (www.kinghelm.net) are national high-tech enterprises with dozens of invention patents and software copyrights for their originality. At present, Shenzhen SlkorMicro Semicon Co., Ltd. (www.slkoric.com) is one of rapidly and steadily developing semiconductor enterprises in China. The company's vision is to become "a leader of domestic semiconductor enterprises".

"Kinghelm navigation under the BDS". Since the development of the BDS antenna, Kinghelm completed the development and production of the microwave antenna, RF connection cables, electrical signal connectors and other products to embrace the intelligent era of the interconnection for all things. Mr. SONG Shiqiang has a good reputation and extensive influence in the semiconductor and the BDS positioning and navigation sector as he has been working in the electronic industry for many years. He has been making ceaseless effort for a better business environment in Huaqiangbei with the expectation that Huaqiangbei would become a window of reform and opening-up and a business card for Shenzhen's economic development.