Original link: https://www.latepost.com/news/dj_detail?id=1609
Competitors Ideal and Xiaopeng both believe that there will only be single-digit players left in the new energy vehicle industry after the fierce knockout competition. Li Xiang thinks there are 5 companies, He Xiaopeng thinks it is 8 companies, but Weilai President Qin Lihong believes that there will be more than a dozen companies left.
He said that the auto industry is different from the e-commerce, airline, and mobile phone industries, and will not be monopolized by oligopolies. If you don’t believe me, you can look at fuel vehicles. After the century-long competition has been eliminated, there are still “niche and distinctive” companies such as Ferrari and Porsche.
“Porsche sells more than 200,000 cars a year, but its profit is higher than that of Volkswagen Group, which sells more than 10 million cars. This is the charm of the auto industry.” Qin Lihong said.
Of course, these two companies did not exist independently, but were acquired by larger automotive groups. Weilai did not position itself as a niche car company. In April this year, Li Bin, the founder of Weilai, said in an interview with the media: “From the perspective of long-term competition, the annual sales volume of 2 million vehicles is the life and death line.”
Qin Lihong added that the 2 million sales were in the global market. In the era of fuel vehicles, there are more than a dozen fuel vehicle companies with a global sales volume of 2 million. “Why can’t more than a dozen companies do it in the era of trams?”
In the first quarter of this year, Weilai, which has six products on sale, sold 31,000 vehicles, ranking behind BYD, Tesla, Aion, and Ideal. In 2023, Weilai’s goal is to sell 240,000 vehicles, and the Weilai brand will achieve breakeven in the fourth quarter.
At the Shanghai Auto Show, Weilai brought the new ES6 based on the NT 2.0 platform. In the first half of this year, NIO will also deliver a total of four new models, namely the new ES8, facelifted ET7 and EC7.
Qin Lihong said that at present, ES8, ES6 and EC6 of NIO’s old-generation platform have all been ordered, and the 2022 model of ET7 is coming to an end. The models on sale in May this year are basically only ET5 and ES7. In the second quarter, Weilai is still in the transition period from the first-generation platform to the second-generation platform. But he judged that in the third quarter, Weilai’s product sales will start to climb.
Today China is the most competitive market for new energy. In 2017, Weilai participated in the Shanghai Auto Show for the first time, bringing its first mass-produced car ES8 and concept car EVE. Among the 1,400 vehicles on display that year, new energy vehicles accounted for only 11%. This year the proportion has exceeded 50%. All major car companies have launched their own new energy products, and the booths of fuel vehicles are deserted.
“In the 2019 auto show, everyone had mixed opinions on new energy vehicles. By this year, they were basically all new energy vehicles. It has only been four years since everyone talked about it and took action.” Qin Lihong said.
But Qin Lihong believes that now it is only a qualifying match and will be eliminated just like the World Cup group stage, but it does not need to win every game. It won’t be until 2025 that the smart electric car finale will really begin.
“Now it’s like the most critical 10 minutes of a football game. If you defend it and score a goal, the overall trend will be more active, but it’s not the end of the industry after this year or next year.” Qin Lihong said.
The following are the main points of Qin Lihong’s speech when he was interviewed by “Later Auto” and other media:
No company does not cut costs
In a face-to-face event with users this year, Li Bin said, “The operation in the first half of 2023 will determine the company’s mid-term direction. If the work is not effective, 2024 may become 2019 again.”
In 2022, Weilai will invest heavily in R&D and operation management, with a gross profit margin of 10.4%, returning to the level of two years ago. But unlike two years ago, Weilai now has more than 40 billion yuan in cash in hand and is listed in three places. In 2019, Weilai’s cash flow is about 1.056 billion yuan.
“You don’t have to worry about Weilai’s funds,” Qin Lihong said. As for the general concern of the outside world, the capital efficiency of Weilai, Qin Lihong believes that the automobile is a long-term industry, and Weilai still needs to resolutely invest in this stage. He made an analogy: If the child in the family is seven or eight years old, and you think his life is long and promising, you should spend money to let him go to the best school instead of a job. “It depends on your future. expectations”.
Of course, Weilai is also working hard to reduce costs, Qin Lihong said. In the past, Tesla did not use lidar because of its high price. However, Weilai invested in Tudatong to reduce the cost of lidar to a few hundred dollars. The manufacturing cost of Weilai bicycles has dropped by 60% in the past 4 years.
He also mentioned a few more subtle places, showing that Weilai is frugal. For example, he and Li Bin share an office, which is only one-third the size of the meeting room. From Li Bin to the cleaners, the standards for business trips and hotel stays are exactly the same, and the entire company does not reimburse for business class. He himself doesn’t sleep very well, so he travels in business class, and spends hundreds of thousands of his own money to subsidize travel every year; executives have to pay the full price for a car without discounts. “Whoever wants to say that our family spends money recklessly, they can also show their boss’ treatment.” Qin Lihong said.
“There is no company that does not reduce costs. The difference lies in whether everyone talks about cost reduction.” Qin Lihong said. High-end brands will not emphasize cost reduction, but focus on experience.
But Weilai is also very determined where it thinks it needs to invest. Qin Lihong said that the replacement of fuel vehicles by new energy vehicles first started in the 150,000-300,000 yuan market, and has not yet spread to more than 300,000 yuan. “If you want to catch more water when it rains heavily, you must first make the basin bigger.” He made an analogy. The basin used by Weilai to catch the heavy rain is “experience, word-of-mouth, and brand”. must be caught”.
In the second quarter, major products completed platform switching
At the Shanghai Auto Show, Weilai brought the new ES6. Compared with the old model, the biggest change of the new ES6 is switching to the NT 2.0 platform, equipped with Banyan smart cockpit system, lidar on the roof, and cameras on the side fenders, improving the ability of intelligent assisted driving. In addition, this car has also optimized the interior space, and the rear headroom has been increased by 75mm.
The old ES6 is NIO’s best-selling car. According to data from the China Automobile Center, in 2022, about 42,000 units of this car will be sold, surpassing the BMW iX3 (about 27,000 units), and it will be the first in the insurance volume of 300,000-400,000 pure electric vehicles. The new ES6 is expected to be launched in late May, and the final pricing has not yet been announced. In December last year, Weilai released the ES8 on the NT 2.0 platform, with a starting price of 530,000 yuan, which is 80,000 yuan more expensive than the old ES8 (starting price of 450,000 yuan).
Qin Lihong said that the price positioning of the Weilai brand is 300,000-600,000 yuan, and the cheapest car is ET5 (328,000-386,000 yuan). At present, no one is cheaper than it, and it will not be in the next three or four years. There will be.
At the Chengdu Auto Show last year, Qin Lihong set a goal for ET5, “ET5 surpassed BMW 3 Series within one year.” From January to March this year, the sales of Weilai ET5 were 5795, 6471 and 6437 respectively; the sales of BMW 3 Series were 7759, 8868 and 13924 respectively. The goal has not been reached. Qin Lihong responded to this: “The ET5 has not yet reached the sales recovery time, and its sales are still climbing.”
His sales target for another sedan, the ET7, is not as high as the ET5. “ET7 will be successful if it can gain a foothold between BBA and second-tier luxury brands,” he said.
At the earnings conference call in March, Li Bin expected that the current product mix could support the monthly sales target of 30,000 vehicles. ET5, ET5 travel version, ES6 with relatively low positioning, target monthly sales of 20,000 units; ET7, ES7, ES8 with higher positioning, combined target monthly sales of about 8,000-10,000 units; coupe SUV products EC6, EC7 sells 1,000-2,000 vehicles per month.
In the first quarter of this year, Weilai sold a total of about 31,000 vehicles. In the second quarter, NIO will deliver the new ES6 and the new ES8 and EC7 released at the end of last year, and also modified the ET7. Qin Lihong believes that Weilai’s most important job during this period is to ensure that “every product is released on schedule, on time, and with high quality, and meets expectations in terms of production, logistics, and quality.” In this way, in the third quarter, new products can successfully complete the climb, and the sales of the second-generation product matrix return to normal levels.
Hybrid is excessive, hydrogen energy is still in the laboratory
At the beginning of this year, Weilai stated that it will add 1,000 new power stations in 2023, and a total of more than 2,300 power stations will be built. At the Shanghai Auto Show, Li Bin announced that from June onwards, Weilai will add 200 new power stations every month.
In order to cooperate with this plan, NIO urgently added a power station factory in Hefei. Now Weilai has a total of three power station assembly plants in China to meet the supply. “Although the cost is high, there will be more problems if you don’t do any charging and swapping.” Qin Lihong said.
Qin Lihong once again emphasized the significance of Weilai’s layout of power station replacement. He believes that in the next 20 years, the ultimate product will be pure electric vehicles. “In the short term, some companies that choose hybrid vehicles have the idea of brand transition, and some hope that they are based on subsidy policies and are not products of the market. Hydrogen energy is still in the laboratory stage and cannot be commercialized on a large scale.”
As for the business model of the battery swap station, Qin Lihong made a calculation: NIO will not fill every battery swap station with a full battery. Even if the battery is fully charged, the cost of a single mobile swap station is more than 3 million yuan. According to the allocation of fixed costs, 8 years, a day is more than 1,000 yuan. NIO serves more than 50 orders per power station on average.
“If this is an independent third-party company, if we Weilai want to purchase services from it, it will make a profit in minutes, but now we are subsidizing it with marketing expenses. It is not a simple loss, we are creating it within the system. A service facility with a higher degree of cooperation at low cost.” Qin Lihong said.
In the high-end market, building blockbusters is not the right strategy
Qin Lihong said that car companies are still in the qualifying stage, and there is still a chance to make mistakes. Around 2025, century-old brands will be awakened and competitive products will be launched, and the intelligent technology route will be relatively determined, and smart electric vehicles will enter the countdown to the finals.
“I don’t know how many houses are left in the end, but I think it must be double digits, there must be more than a dozen.” Qin Lihong said.
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”, “Purify yourself, there will always be someone who likes you.”
Nio is positioned in the high-end auto market. Qin Lihong believes that creating explosive models in this market is not a correct strategy, because it does not conform to the consumer psychology of the high-end auto market, and the high-end market needs to have appropriate diversity. At this point, Weilai’s product strategy is to unify the vehicle technology platform and find differences in materials and details.
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. He believes that the products and services that Weilai makes today are the deconstruction of high-end brands.
On the basis of this thinking, he believes that sales volume is not the only criterion for judging the success of a product. “A car should get its due share, not that there must be more than a certain number of cars to be called good, and less than a few cars to be called bad.”
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