In the face of the price war, BYD and Aian took the lead in saying no, but where should other new car-making forces go?
Less than a week has passed since December, and Tesla has already carried out two disguised price cuts again. On December 2 and 7, Tesla’s two benefits related to insurance subsidies will directly reduce the “car price” of products that can be delivered this year. “It’s 10,000 yuan cheaper. If converted into the current model price, the model 3 standard battery life version has reached a minimum of 255,900 yuan, which is only one step away from the previous historical lowest price level in China (the previous historical lowest price of the Model 3 standard battery life version 235,900 yuan, the lowest price of the Model Y standard battery life version is 276,000 yuan).
Of course, this is not the first time Tesla has cut prices in the second half of this year. As early as September, Tesla began to use car insurance discounts to carry out price reduction promotions in disguise. The price reduction reached 8,000 yuan, and it was even simpler in October. Brutally and directly, the official price cuts were made on each version of its two popular models, Model Y and Model 3. The price cut range was between 14,000 yuan and 37,000 yuan. In addition to this round of price cuts, it completed four consecutive price cuts.
Near the end of the year, Tesla’s frequent price cuts have to arouse the vigilance of the market and peers. Whether a new round of electric car price war is about to start, and what impact will it have on other new energy car companies, especially new car manufacturers? Wall Street Insights· Jianzhi Research makes analysis and interpretation here.
1. BYD and Aion have said “no” to the price war
As one of the direct impact parties of Tesla’s price cuts, BYD actually bears a lot of pressure. Originally, Tesla’s products were mostly around 300,000 yuan, while BYD’s current main products are still mainly between 150,000 yuan and 250,000 yuan. After that, the price of the brand chose to extend upwards. However, with Tesla’s multiple price reduction operations, the price range has reached about 250,000 yuan, entering BYD’s sensitive range.
At present, Tesla’s price reduction strategy is very successful. Although Tesla’s frequent price reductions have made some potential new energy vehicle consumers wait and see and dare not buy cars decisively, more consumers still choose to accept the discounts. , in November when the price reduction mode was officially launched, Tesla’s sales reached 100,000 vehicles, setting a new monthly record again, with a month-on-month increase of about 40% and a year-on-year increase of 89%.After another disguised price cut in December, Tesla’s sales in the last month of the year are obviously more worth looking forward to。
In the face of the price war initiated by Tesla, BYD has already said no (BYD’s products have been raised by 2,000 yuan to 6,000 yuan), and the confidence behind this comes from the actual product sales and product orders. In other words, the new energy car companies that dare to choose the reverse price increase are all strong car companies that have completed their annual sales targets and have the spare capacity to continue to deal with continuous orders.Compared with Tesla, which has made various efforts to complete this year’s annual sales target (1.5 million vehicles worldwide), BYD’s sales in November this year reached 230,000 vehicles, a year-on-year increase of 153% and a month-on-month increase of 6%. The cumulative sales volume in one month has reached 1.626 million vehicles, completing the target of 1.5 million vehicles set at the beginning of the year ahead of schedule.
GAC Aian also made the same reverse operation, and also raised the official guide price of its related models, ranging from 3,000 yuan to 8,000 yuan, which is basically equivalent to half of the new energy vehicle subsidies withdrawn at the end of the year. In November, GAC Aian achieved sales of 28,765 units, a year-on-year increase of 91%. The cumulative sales volume this year has reached 241,149 units, achieving the annual sales target of 240,000 units one month ahead of schedule.
2. The price war of electric vehicles will start, and the new forces will be under great pressure
Of course, fundamentally speaking, Tesla’s price cuts only played a role in fueling the flames.In fact, the entire new energy vehicle industry will expand its production capacity by doubling the production capacity of major new energy vehicle companies this year, gradually completing the transition between new and old models, and after the domestic new energy vehicle policy is completely withdrawn. Price war. Due to the pressure of raw materials at the beginning of this year, the phenomenon of general price increases of major new energy vehicles will be difficult to reproduce in early 2023.
At present, new car-making forces and some new energy car companies choose to follow Tesla to cut pricessince Tesla began to cut prices in October, Ford (the whole series of electric horses has directly reduced the price by 20,000 yuan to 28,000 yuan), Wenjie (the price has been reduced by 8,000 yuan through insurance), and Leap (the price has been reduced by 6,000 yuan to 1.2 yuan through coupons. 10,000 yuan), Nezha (direct price reduction of 4,000 to 6,000 yuan) both indicated that they would follow the price cut。
Taking Wei Xiaoli, a new force in the traditional front-line car manufacturing industry as an example, judging from the three major indicators mentioned above in the article, it is facing the double pressure of product sales growth that is not as expected and profits that are nowhere in sight.In terms of sales volume, Weilai, Xiaopeng and Ideal have set annual sales targets of 150,000, 200,000 and 200,000 respectively this year. Based on their current sales levels in the first three quarters (82,000 vehicles, 98,000 and 87,000 vehicles) and sales guidance for the fourth quarter (NIO is 43,000 to 48,000 vehicles, and Xiaopeng is 20,000 to 21,000 vehicles. Ideal has not yet disclosed its third quarter report, with a high probability of 25,000 From the point of view, after the sales in October and November, there is basically no possibility of achieving the sales target.
In terms of profitability, the continued expansion of net losses and the difficulty in breaking through the bottleneck of gross profit margins also cast a shadow over the future development of new car manufacturers, and this unfavorable phenomenon is faced by all new car manufacturers.
Weilai’s net loss in the third quarter of this year reached 3.499 billion yuan, a year-on-year increase of 514.2% over the same period last year, and an increase of 54.3% over the second quarter of this year; It was 16.4%, compared with 18% in the same period last year, and 16.7% in the second quarter of this year.
Xiaopeng’s operating loss in the third quarter of this year reached 2.18 billion yuan, a year-on-year increase of 2%, an increase of 2% over the same period last year, and an increase of 4.3% over the second quarter of this year; the gross profit margin of the automobile business was 11.6%, which was -1.9% year-on-year and quarter-on-quarter respectively. pts and 2.6pts are at the bottom of the new forces.
Of course, this is not only the first-tier new car-making forces facing it. Looking at the second-tier new car-making forces, the leading zero-run, the gross profit margin in the third quarter of 2022 will be -8.9%, compared with -44.5% in the same period last year, and – in the second quarter of this year. 25.6%, the net loss in the third quarter of this year reached 1.34 billion yuan, 720 million yuan in the same period last year, and 1.4 billion yuan in the second quarter.
Faced with Tesla’s price butcher knife, Xiaopeng, a new car maker, actually started to cut prices as early as the beginning of the third quarter of this year due to factors such as the decline in its own order growth and unstable sales. After pulling down the price, they decisively offered discounts. Although NIO and Ideal have not taken any measures to reduce prices at present, the competition in the entire new energy vehicle industry has intensified at the end of the year. Leading companies have begun to suppress competitors by lowering prices, and the competition is becoming increasingly fierce. Or they will not be able to bear the pressure and choose to cut prices as soon as possible to ensure sales.
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