"The ET5 became the most ordered model of the day among the new cars released by Wei over the past few years."
This is the news revealed by Weilai CEO Li Bin in the face of the media after releasing the new car NIO ET5 on NIO Day. In addition to becoming a blockbuster of Weilai, its significance may be more than that, such as the lowest starting price of 258,000 into the hinterland of Tesla, and threatening many low-cost models of new forces. Compared with the high-end positioning that Weilai has been walking, this pricing has some defensive opponents to attack.
The Model 3 five years ago left Tesla an indelible mark on the history of the development of new energy vehicles. Will THE WEILAI ET5, which is compared to the Model 3 today, be the seeded player who opens the final circle in advance of the mainstream price of new energy?
Put the sumitomo business price threshold and attack Tesla to take the volume of models
Weilai ET5 is Nio's second mass-produced sedan, but the first one, ET7, has not yet been delivered, and ET5 has come to consumers. Although the delivery time of ET7 in March next year is earlier than that of ET5 in September next year, the configuration and price of ET5 are full of "cost performance" for Weilai, which focuses on high-end, especially THE HIGH-end ET7, which is also priced.
Just look at a few key highlights, such as the same NAD automatic driving system as ET7, dual motors with a maximum power of 360kW, maximum torque of 700N·m, 4.3 seconds acceleration of 100 kilometers, ET5 is like the ET7 with a shrunken body appearance and interior, and the longest battery life pack (150kWh) has a range of more than 1000 kilometers.
However, the starting price of 328,000 yuan before the subsidy and the starting price of 258,000 yuan before the baaS plan subsidy are undoubtedly a city wall that is difficult to bypass in the range of 250,000 yuan to 350,000 yuan.
Why? At present, the Xiaopeng P7 starts at 219,900 yuan, the Extreme Kr 001 starts at 281,000 yuan (266,000 yuan at the time of listing), the BYD Han EV starts at 209,800 yuan, and the Tesla Model 3 starts at 256,000 yuan. By adding and subtracting some configurations, the competition range of car companies is limited to a centralized range.
Strictly speaking, the configuration of different car companies or different models is obviously different, and the target groups are different. But as their prices get closer and closer, consumers will no doubt think more before they buy. After all, budget is the factor that best influences the final decision. Is it better to add some money for a better configuration, or to subtract some unnecessary details? When consumers have this doubt, NIO ET5 has completed the first step of its mission.
For Xiaopeng below the price range, and even Nezha and Zero Run, which may sprint to a higher price range in the future, as well as new energy brands such as Extreme Kr and GAC Aean that are free from traditional car companies, Weilai ET5 gives a cost-effective standard and controls the threshold of entering the high-end of the game. In the face of Tesla's side, Model 3, one of the main forces, is an offensive battle that Weilai's high-end models must fight after benchmarking Tesla, even if the absolute pricing of Model is cheaper.
Li Bin, CEO of Weilai, said at the NIO Day that by 2030, the penetration rate of new energy vehicles will exceed 90%. The burden of penetration growth is certainly not a high-end car priced at 500,000, but a mid-range or even low-end model priced at 300,000 or less. Tesla's sales also prove the importance of volume products.
Another point to note is that the cost performance of NIO ET5 has passed the stage of "losing money and making money", because WEILAI's estimated gross profit margin for NT2.0 platform models is 25%. For an obvious volume model, Weilai, which is still losing money, will only be more cautious in the decision to reduce the price and volume even if it is backed by several high-end models.
Therefore, even if NIO considers a low-cost solution that can maintain long-term cash flow growth from BaaS or other services, the birth of ET5 also shows to some extent that NIO has a stronger cost control ability and a pricing mechanism based on a deep understanding of the market.
Looking at the redesign and renewal of Xiaopeng, Ideal and more car companies, this phenomenon will not only happen to Weilai. Therefore, Weilai ET5 is also regarded by the outside world as a sign, that is, the supply chain of new energy vehicles has matured enough to support car companies to open a more fierce competition, and the price war will not necessarily be fought, but there must be someone willing to reduce prices - such as Tesla, which frequently adjusts prices.
Will ET5 pull Weilai to the 300,000 level of competition, will it be the origin of the butterfly effect?
ET5, which is scheduled to be in the explosive position, has more than enough "breaking the circle" and has not yet arrived
In China, Weilai has always been a high-end positioning with an average price surpassing BMW Audi and Tesla, but the cost-effective products such as ET5 were not in the territory before. In contrast, BBA and Tesla have not given up the parity market. If NIO wants to make a breakthrough outside of luxury SUVs, the luxury car ET7 released in March cannot help it bring the brand to a price level that is acceptable to ordinary people.
It is true that Weilai's high-end positioning has obvious advantages in terms of gross profit margin and user loyalty, but as mentioned earlier, the "breaking the circle" of large brands is the only way to penetrate, and high-end and niche are bound to be not Weilai's goals. The most effective strategy of "breaking the circle" is to explode.
Xiaopeng has P7, which accounts for more than half of sales, Tesla has Model3 and ModelY, BYD Han EV sales in the first half of this year are 38664 units close to ModelY, even zero running outside the T03 will be C11 as a future hit, and the ideal ONE, Euler Black Cat, Wuling Hongguang MINI is a car plus modification to eat all over the world. In contrast, Weilai's ES6 and EC6 are somewhat rainy and dewy, and the more high-end ES8 has a flagship image larger than shipment.
In any case, ES and EC are SUVs, ET7's publicity is a large car, and although the size of ET5 is small, the low price, beautiful appearance, youthful accessories and AR/VR represented by smart features of the BaaS program are aimed at the intended car buying groups of young people in first- and second-tier cities.
Therefore, some of the feedback after the release of ET5 pointed to the "explosion", such as the widespread attention of social media, CEO Li Bin's affirmation of orders, and the Weilai APP server that was crowded on the night of release. This model with the most orders in the history of Weilai may be a dark horse of Weilai.
Of course, due to its lowest-matched BaaS version and high-matching, optional content has a great impact on the final price, the price difference is tens of thousands, and it is almost impossible to meet the definition of cost performance for all consumers. In the end, the proportion of choice is enough, and Weilai will win. It makes more sense to attract potential customers for models such as the Model 3.
The key question is whether ET5 is the button that opens up more fierce competition, and how dominant it is. At present, there are still a lot of variables in it.
The first contradiction is THE NIO ET7, although it is the predecessor of ET5, but the configuration of the two is too similar. For ET5 car owners, those "true fragrance" points are decentralized from ET7, even if the positioning is different, ET7 car owners - especially those who choose Weilai for the first time and do not know too much about Weilai's product system, do they really care at all? Moreover, at present, this comparison stays in PPT, and after delivery, whether the difference in product strength and user portrait between the two sides can correspond to the difference in price is still an unsolved mystery.
Another point is THE OVERALL LAYOUT OF WEILAI, INCLUDING SUPPLY CHAIN AND POST-SERVICE. Nio's production line transformation of its Hefei production site in the past quarter to increase overall production capacity and cope with the production of ET5 and ET7 led to a sharp decline in Nippon's deliveries to 3,667 units in October. Even so, after getting on the right track next year, the JIANGHUAI Weilai base will undertake the production of four main models at the same time, and Weilai cannot sit back and relax. The guarantee at the chip and supplier level can only be cautiously optimistic for Weilai, after all, the general environment is difficult to predict.
In addition, NIO will complete the construction of 1300+ cumulative substations, 6000+ cumulative overcharge piles and 10000+ cumulative charging piles for the purpose in 2022, and cooperate with Sinopec and PetroChina to give charging capacity to gas stations. The overall goal is close to doubling compared to this year, and the pressure is not small. If ET5 becomes a blockbuster, in the face of massive new customers, the post-service system is not only related to user experience and growth, but also linked to the growth of the service business, and the staffing problem is also a "sweet annoyance".
Finally, the highlight of the competition is that the actions of friends are a hidden danger. The delivery of the ET5 is already in September next year, and in this process, the ideal and Xiaopeng's revamps will not stop, including very important lidar, assisted driving and other content. Tesla's price reduction "kill" still has the ability to sacrifice, and even the long-endurance model that it has cut can be picked up again. As for opponents such as the BBA, BYD, and Extreme Krypton, each of them may form a competition.
For Weilai, ET5 does not necessarily have the meaning of declaring war, but whether friends will take the initiative to take the initiative is another matter. The longer the time, the more likely it is. At the very least, the NIO ET5 is a dual motor, while the lowest-priced version of the Model 3 is a rear-wheel drive single motor. That is to say, Weilai has not yet fully launched the meaning of hand-to-hand combat. Whether something unexpected will happen next year is still unknown.
epilogue
In addition to the car, the detailed experience of Weilai's back-end service system and entertainment ecology is also improving at the same time, and the pace of overseas expansion will also accelerate next year. It is difficult for a model to stir up a relatively fixed market, but the overall consumer trend and cognition will produce subtle changes under this "silent" scene.
For Weilai and other car companies, the final battle of new energy is like the two sides advancing towards the Chu River and han borders with one soldier and one pawn, and the short-term contact is an inevitable end. Before that, we will also see more ET5-style products appear, the surface is a competition for cost performance, but in fact it is a competition for competitiveness.