Original link: https://www.latepost.com/news/dj_detail?id=1618
The Shanghai Auto Show in 2023 will end the debate on whether the future market will be fuel vehicles or new energy vehicles, and new energy vehicles will become the absolute protagonists. More than 150 new models were launched at the auto show, and about 100 of them were new energy vehicles.
This is not only the consensus of domestic car companies, but also large overseas car companies have made a choice.
Volkswagen announced that it will electrify most of its Chinese models by 2030. Volvo, Mercedes-Benz, and Rolls-Royce have also set the timetable for electric transformation in 2030. Honda announced that it will stop selling fuel vehicles by 2040. BMW does not intend to give up fuel vehicles, but its booth is full of new energy vehicles.
Traditional luxury brands also exhibited their most competitive products at the Shanghai exhibition, such as the pure electric version of the Mercedes-Benz EQG concept car, the pure electric version of the Maybach EQS, and the world’s most expensive electric car Rolls-Royce – Shining (575 million yuan for sale). However, their degree of discussion is not as high as that of BYD, which is opposite Lamborghini, looking up to U8 and U9, and they even need to queue up to enter.
The three-year epidemic has cut off opportunities for overseas car companies to communicate closely with the Chinese market. They desperately want to regain their previous market position, only to find that the table is already full of local Chinese brands. The three-year changes in China’s auto industry have been compressed into one auto show.
The Volkswagen Group chartered two planes and brought board members of the Group and Volkswagen, Audi, Porsche, Lamborghini and other brands from Germany to Shanghai for the exhibition. Kang Linsong, chairman of the board of directors of Mercedes-Benz, landed in Beijing a week ago. Half of BMW’s board of directors chartered a flight to Shanghai. In the night of BMW Visionary Future, BMW China CEO Gao Le gave a speech in Chinese for the first time in public.
“The transformation of the Chinese market from fuel vehicles to pure electric vehicles is very fast, exceeding the sum of all other places in the world, and faster than we imagined.” said Von Peide, member of the Porsche Global Executive Board.
This is the result of domestic new energy car companies suffering from the suspension of production due to the epidemic, the rupture of the supply chain, and the lack of cores and electricity. The knockout rounds have begun.
“The most enjoyable three years in this industry have officially begun!” Li Xiang, CEO of Ideal Auto, posted on Weibo before the opening of the auto show, “2023-2025 is the three-year elimination competition for smart electric vehicles. The ability to roll to death, the barrel theory, are indispensable.”
Yu Chengdong, CEO of Huawei Terminal BG and Car BU, believes that 2025 will be a watershed in the era of smart electric vehicles. The era of smart electric vehicles is strikingly similar to the era of smartphones more than a decade ago. “No matter how powerful a company is today, it may disappear in the future.”
Ideal, Xiaopeng, and Wenjie have defined the urban driving assistance development plan for this year, and Jikrypton, Weilai, Lantu, Wenjie, and Jixing will all redefine new luxury. Competition is escalating, and the most competitive and exciting market in the world is in China.
“Later Auto” selects the speeches of 17 auto practitioners during the Shanghai Auto Show to record the qualifying competition in the Chinese auto market when the most intense competition comes.
Will gasoline cars disappear?
Ola Källenius , Chairman of the Board of Directors of Mercedes-Benz:
“Fuel vehicles and electric vehicles will coexist for ten years.”
Many new energy brands such as Ideal, Weilai and Xiaopeng regard traditional luxury brands as competitors. Kang Linsong said that Mercedes-Benz has realized the electrification of its entire brand and will continue to promote the “full electric” strategy in the future. However, as long as fuel vehicles are still being sold, they will not stop improving the performance of internal combustion engines.
He believes that in the next ten years, fuel vehicles and electric vehicles will coexist. At the end of this decade or in the next decade, we will enter an era with a high market share of electric vehicles. Mercedes-Benz will grasp the rhythm and launch a new pure electric architecture in 2025. If conditions permit, it will fully transform to electrification in 2030.
Björn Annwall , Chief Commercial Officer and Deputy CEO, Volvo:
“Introduce a pure electric model every year, and transform into a pure electric luxury car company in 2030.”
Amberyan said that the competition in the automobile market has always been fierce, “there is no essential difference from the previous market competition.”
They want the market to become more competitive. Faced with the trend of electrification, Volvo plans to transform into a pure electric luxury car company in 2030. Amberian said that many new forces have launched innovative products and models in the past five years, but not all of them have succeeded. Some traditional OEMs also hope to make electrification transformation, but not all of them have succeeded.
But Volvo is confident because of its high-end market positioning, clear strategy, and profitability. In the first quarter of 2023, Volvo’s operating profit was SEK 18.409 billion (approximately US$1.74 billion), a year-on-year increase of 45%.
Oliver Zipse , chairman of the BMW Group:
“Both fuel vehicles and electric vehicles can be considered. BMW has the ability to develop a variety of driving forms. No other company can do it.”
BMW does not intend to abandon fuel vehicles, at least until 2030-this is also the deadline for many traditional fuel vehicle giants to announce their transition to new energy sources.
But Zipse believes that fuel vehicles and electric vehicles can coexist, this is not a single-choice question, “fuel vehicles and electric vehicles are not an either-or relationship.” BMW will make full efforts according to market demand, and there is no need to bet.
His reason is that in the current global automobile market, the share of pure electric vehicles is less than 10%. “Why not go to a larger market?” Zipse said. He believes that different power forms of cars will coexist for a long time, and the advantages of BMW’s multi-pronged approach will also be highlighted.
The rhythm of BMW’s transformation is to launch 11 pure electric products in 2023. By 2030, pure electric models will account for more than half of the group’s global sales.
Detlev von Platen , Member of the Executive Board of Porsche AG:
“In the next 20 to 30 years, we will still see many fuel vehicles on the road, such as 911.”
After coming to China three years later, Feng Peide said that there are already brands of cars on the road that he does not recognize. The transformation speed of the Chinese market from fuel vehicles to pure electric vehicles has exceeded his imagination, “probably exceeding the sum of all other places in the world.”
In the past three years, new energy vehicle brands have changed the market structure he is familiar with. Von Peide believes that moving towards pure electric vehicles is an inevitable development trend. Porsche’s goal is that by 2025, electric models will account for half of new car deliveries, and by 2030, pure electric models will account for more than 80% of new car deliveries.
The remaining 20%, he believes, do not belong to pure electric vehicles. One of Porsche’s “Double e Strategy” is e-Fuels, a clean fuel synthesized using renewable energy and carbon dioxide, which will be applied to fuel vehicles.
Betting on the Chinese market
Ralf Brandstatter , Chairman and CEO of Volkswagen Group (China):
“The group’s attitude is very clear, in China, for China.”
Bai Ruide believes that the Chinese auto market is undergoing rapid changes, “no other market in the world has the same speed.” In order to match the speed of the Chinese market, Volkswagen China has obtained more autonomy from Wolfsburg.
During the auto show, Volkswagen set up a technology company “100% TechCo” in Hefei, which is expected to operate in 2024. “The decision-making speed of China’s local OEMs is very fast. Volkswagen has to consider more dimensions from the global level. The establishment of ‘100% TechCo’ is to make decision-making smoother and faster.” Bai Ruide said. Volkswagen’s plan is to complete the electrification of most Chinese models by the end of 2030.
Hiroki Nakajima , Toyota Motor CTO, Vice President:
“Even if I knew that China is the world’s largest auto market, I still feel the number of brands and the number of new energy vehicles.”
The importance of the Chinese market for Toyota’s pure electric vehicles is rising. Its goal is to launch 10 pure electric vehicles by 2026 and sell 1.5 million pure electric vehicles per year by then, “most of which will need to be completed in the Chinese market.”
In order to achieve the goal, Toyota decided to promote the research and development of China-specific pure electric vehicles. Hiroki Nakajima said at the press conference: “The important thing is not to make the car you want to make, but to make the car that really makes Chinese consumers happy.” For reference, in 2022, Toyota’s global sales of pure electric vehicles will be 24,000 vehicles.
Ashwani Gupta , Nissan Board Member, COO:
“China’s auto market has passed a turning point, fuel vehicles will decrease, and China’s auto industry will soon realize electrification.”
Three years ago, Gupta believed that China’s automobile transformation would transition from internal combustion engines to hybrid technology and then enter the pure electric stage. Now, the “huge changes” in the Chinese auto market have changed his mind.
Independent new energy brands are robbing the Japanese car market. In the first quarter of 2023, Nissan China sold 162,000 vehicles, a year-on-year decrease of 36.8%, while BYD’s sales in the same period were 552,000 vehicles. Gupta acknowledged that “local automakers have seized a larger market share from the joint venture auto market, and the trend is clear”.
By 2026, Nissan will launch 7 electric drive models in China, including e-POWER (Nissan’s hybrid technology) and pure electric power. The goal in 2030 is to account for 80% of the sales of electric drive models.
Qin Lihong , co-founder and president of NIO:
“Hold and score.”
“Don’t question why so many new companies in China are so chaotic. If the chaos is not ours, but someone else’s, we will be so disappointed.” Qin Lihong said. He believes that the current market competition is like the most critical 10 minutes of a football game. If you defend and score a goal, the global trend will be more active, but it is not the end of the industry after this year or next year.
His judgment is that the final remaining players in the knockout round “must be in double digits, there must be more than a dozen.” The automotive industry is different from e-commerce, airlines, and mobile phone industries, and will not be monopolized by oligopolies. Just like the fuel vehicle market, among the dozen or so car companies, there will be some very niche and distinctive companies, such as Ferrari, Porsche, Mercedes-Benz, BMW, Audi, Volvo, and even Cadillac, each with its own website. bit”.
Yu Chengdong , Executive Director of Huawei, CEO of Terminal BG, CEO of Smart Car Solution BU:
“2025 will be a watershed between smart electric vehicles and fuel vehicles.”
Yu Chengdong believes that 2025 is equivalent to 2013 in the mobile phone industry, and “is a big change in the industry.” He was in charge of Huawei’s terminal business in 2013 and witnessed the disappearance of many mobile phone manufacturers at that time. The big changes in the era of smart electric vehicles, he believes that if the opportunity of automation cannot be seized, no matter how powerful a company is today, it may disappear in the future. “When the giant fell, the body may still be warm.”
He said that the industry attributes of smart electric vehicles have undergone important changes. In the past, engines and chassis were dominant, with strong manufacturing attributes. In the era of smart electric vehicles, technological attributes and consumption attributes are more important.
“Tipping the table” price cuts, does it have little effect?
Qin Peiji , President of Volvo Greater China Sales Company:
“Why did some players crash the whole network? Because his system was defeated.”
In March 2023, nearly 40 car companies will be involved in a price war, and the war will focus on the fuel car camp. By April, Volvo announced a price cut, with a discount of 30,000 to 60,000 yuan for some models. “Volvo has withstood the pressure by relying on a strong system force, and adjusted the price at a staggered peak.” Chinpeji said. He believes that Volvo’s system capabilities as a mature car company are a sharp weapon to break through the fierce market competition. “Don’t think that many companies have a bloated and lengthy decision-making process. Why do you think it can live for a hundred years?”
He believes that traditional car companies can build the products and R&D capabilities that new forces are good at, but the system capabilities of traditional car companies need a long period of running-in and verification. “There are new forces that we can learn in three years; we have things that new forces can’t learn in ten years.”
Detlev von Platen , Member of the Executive Board of Porsche AG:
“A price war is not a long-term solution, and Porsche never wants to participate in a price war.”
In mid-March, when the price war in the Chinese auto market was in full swing, Porsche announced that it would maintain its selling price and would not participate in the price war. Feng Peide emphasized: “China’s positive growth should not be based on price wars, which will only hurt customers’ confidence in products and brands.”
The Chinese market has been the largest single market for Porsche for eight consecutive years. In the first quarter of this year, sales in the Chinese market accounted for about 26.49%. Von Peide said: “If Porsche cannot succeed in the Chinese market, then there will be no success in the global auto market.” But a Porsche is a Porsche and “will not be affected by any quantitative goals.”
Li Ruifeng , Chief Growth Officer of Great Wall Motors:
“How many companies put forward the price with great pride, and how much blood bleeds in his heart when the people below exclaim, ‘wow’, and applaud. He can’t even hold the cost of some things.”
In this round of automobile price war, many independent and joint venture automobile brands participated, and Great Wall Motor was also involved, passively “taking some measures.” Li Ruifeng believes that this kind of unhealthy competition will have a very bad impact on Chinese auto brands and even the entire Chinese auto industry, especially when the overall consumer confidence is relatively weak after the epidemic.
He said that due to inventory pressure and other reasons, it is an irrational choice for some companies to snatch the market at a price that is almost halved. Car companies should balance short-term and long-term strategies, and participate in market competition on the basis of maintaining long-term business operations, otherwise they will only dig their own graves.
“We are applauding him now, perhaps for his ‘death’ in the near future. Everyone has a schedule in their hearts. Let’s pick the dragon and let’s see who will fall next.” Li Ruifeng said.
Lu Fang , CEO of Lantu:
“If the price war worked, everyone’s cars would have been sold out.”
Lantu also participated in the price war. In March of this year, Lantu also gave some models a 90-day period, no threshold to enjoy a limited-time subsidy of 30,000 yuan and OTA upgrades and other preferential policies. The price cut has stimulated sales to a certain extent. In January and February this year, the delivery volume of Lantu showed a downward trend, with 1,548 and 1,107 units delivered respectively. In March, the sales volume of Lantu reached 3,027, a year-on-year increase of 116% and a month-on-month increase of 173%. . But this result is still not outstanding among new energy car companies.
Lu Fang did not announce the specific sales target for this year, but he said that on the whole, it will double or triple the basis of last year. In 2021, Lantu will deliver a total of 6,791 vehicles, and in 2022, it will sell 19,400 vehicles. According to Lu Fang’s requirements, this year’s sales target should be between 38,800 and 58,200 vehicles. “This is a bottom-line goal, and it is the basis for ensuring the survival of an enterprise first,” he said.
In Lu Fang’s view, real competition is not just based on price competition, but real competition is the competition of the entire system’s capabilities and efficiency. “Whether it is at the R&D end, manufacturing end, or sales end, Lantu hopes to face current and future competition with extreme efficiency.”
Luxury, who has the final say?
Detlev von Platen , Member of the Executive Board of Porsche AG:
“Although new brands and products continue to enter the Chinese market, it is still unclear who can really win in the field of pure electric luxury cars.”
Traditional OEMs and new power brands have a common goal to redefine luxury. Porsche is always on the target.
Feng Peide’s evaluation is that these new forces are very smart and have created their own customer group, which is characterized by technology and digitalization, and car comfort. Porsche has paid attention to these trends and “is not stagnant”, but the focus of Porsche is to focus on Porsche’s DNA, which has experienced the precipitation of time and cannot be achieved overnight.
He believes that as far as the luxury car field is concerned, Porsche’s pure electric models have shown “great innovation”, including luxury quality, advanced technology and driving experience.
Qin Lihong , co-founder and president of NIO:
“In the high-end market, creating blockbusters is not the right strategy.”
Weilai’s latest positioning has been adjusted from “mid-to-high-end” to “high-end” auto market. Qin Lihong believes that the high-end market needs to have appropriate diversity, so creating a hit is not a good strategy. NIO pursues a unified vehicle technology platform, and seeks differences in materials and details, so that each vehicle can find its own user group.
He proposed that the high-end market has a 3×2 matrix: “3” refers to products, services and user communities, and “2” refers to originality, advanced spiritual connotation, and better experience. Only when the two aspects and six links are done well and the multiplier effect is realized, can a high-end brand be truly built.
Yu Chengdong , Executive Director of Huawei, CEO of Terminal BG, CEO of Smart Car Solution BU:
“Refrigerators, sofas, and color TVs are all at a well-off level, not luxury standards.”
Wenjie also targets the luxury car market. After the M5 and M7, the price of the third model M9 has risen to 500,000-600,000 yuan. At the press conference, Yu Chengdong called the Wenjie M9 “the best SUV within 10 million yuan”.
He said the standard of luxury goes beyond hardware. “Refrigerators, sofas, and color TVs are all at a well-off level, not luxury standards. The real luxury standard is beyond everyone’s imagination.”
In Yu Chengdong’s view, luxury beyond imagination includes “real technology” in addition to space and comfort. Huawei has invested in this for many years. At the latest press conference, it showed the AR-HUD (head-up display) that integrates intelligent driving navigation, intelligent car lights that do not dazzle the eyes of other drivers when the high beam is turned on, and the one that does not cause dizziness when watching videos. Light field screen and so on. In the future, intelligence may also become a part of luxury.
Feng Dan , General Manager of Polestar China:
“No ultra-luxury brand is static, and Polestar is willing to give it a try.”
Polestar is positioned in the ultra-luxury market. Feng Dan believes that this market is relatively friendly to new brands and is not as fierce as the competition in today’s mass car market. The main new energy products come from new car manufacturers. But Feng Dan believes that Jixing and China’s new forces are not rivals. “Tesla and BYD grabbed the volume of which new force? They grabbed the volume of the original Volkswagen, Toyota and ABB (Audi, Mercedes-Benz, BMW). It’s just that many new forces rose up later, and they will compete with each other. “Feng Dan said.
In Feng Dan’s view, the common opponent of Polestar and the new forces is fuel vehicles. The power of fuel vehicles lies in the premium price of a century-old brand and the recognition of many consumers, but this is not indestructible. “We believe that the revolution of electric vehicles is from the bottom up. In the end, our cost and sense of use will catch up with traditional luxury brands. This is an inevitable trend.”
Liu Jie , Vice President of Li Auto Sales:
“Consumers’ choices are not as solid as before, and there will be choices across vehicle categories, and even choices across price segments.”
Ideally positioned in the mid-to-high-end car market, it sold a total of 133,000 vehicles last year, ranking first in sales of new energy vehicles worth more than 300,000 yuan, and also ranked first in sales of SUVs worth 300,000 to 500,000 yuan, including fuel vehicles. This year, ideals began to sink to third- and fourth-tier cities. In the past, this market had a high loyalty to traditional luxury brands such as BBA, but Liu Jie believes that today’s consumer behavior is not as solid as before.
According to ideal statistics, the penetration rate of new energy vehicles worth more than 200,000 yuan in third- and fourth-tier cities has exceeded 20%, and the growth rate reached 80% last year, “similar to the situation in first- and second-tier cities 1-2 years ago.” Liu Jie said.
He believes that the growth potential of the mid-to-high-end market in third- and fourth-tier cities is very large. “Today, consumers are more concerned about the value provided by the product and the brand as a whole, and the barriers between models and prices are not so obvious.” Liu Jie said.
Assisted driving in the city: Rolled into standard configuration
He Xiaopeng , Chairman and CEO of Xiaopeng Motors:
“In 2023, the driving ability of XNGP is equivalent to that of a driver with 4-5 years of driving experience.”
He Xiaopeng said, “Today, no autonomous driving is really doing well.” The reason is that the first is that it is difficult in the city, the second is very expensive, and the third supports few models.
But he believes that “everything will be resolved within five years.” The recent goal is that the experience of XNGP in Chinese cities will exceed that of FSD in the United States within this year. He said that in the next five years, intelligence will become a rigid demand, ranking among the top three decisive factors for users to buy cars, and the era of driverless driving will truly come.
This requires car companies to achieve the following three points for intelligent assisted driving: safe enough; wide enough to use; cheap enough.
Chen Mo , future chairman of Tucson:
“It is nonsense to say that L4 level unmanned driving is nonsense, and I can’t refute it.”
Tucson’s main business is L4 self-driving trucks, but last year it decided to add a new L2+ business, based on Nvidia chip self-developed domain controllers. During the auto show, Tucson launched a domain-controlled centralized large perception box, which was sold to OEMs as standard parts.
Chen Mo said in an interview with the media, “Some people say that unmanned driving is nonsense. He should mean L4 unmanned driving for passenger cars. I can’t refute him.”
The reason that cannot be refuted is that, including Waymo, no L4 company in the world has completed commercialization. “I hope we are the first L4 company to achieve commercialization, to prove it to the world, but now we can’t prove it.”
Lang Xianpeng , Vice President of Li Auto Intelligent Driving:
“In the future, cars without high-level intelligent driving cannot be called smart electric vehicles.”
The ideal positioning of urban NOA is that it will be free for life. Lang Xianpeng said that both standard configuration and free of charge are ideal strategies that have been formulated since the first day of entering smart driving, and they have never changed.
He felt that everyone was “rolling up”, but he was in favor of “everyone rolling up together”. Because the development of technologies such as large-scale artificial intelligence algorithms and user acceptance have reached an “inflection point.” The more competition there is, the faster it develops.
One of the yardsticks to measure the ability of each company’s intelligent assisted driving is the speed of covering cities, “see who dares to say 10 cities, 50 cities, 100 cities”. The ideal plan is to cover 100 cities by the end of 2023. However, “now everyone is still talking about it, and the specifics still depend on actual performance.”
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