Zeng Yuqun had gambled correctly in front of him, and it would be difficult to say in the trillion era of Queen Ning

Wen 丨Nick Editor 丨 Du Hai

Source 丨Zhengjingshe(ID:zhengjingshe)

Looking back on the past year, the Ningde era is undoubtedly the brightest boy. After the stock price of the new energy vehicle track rode to the dust and became the hot focus of the capital market, it was also labeled as "Ning Wang".

Behind the rise of Ningwang's domineering spirit is a vigorous wave of global energy structure transformation, and the green energy represented by electric new energy vehicles has staged a revolution for traditional fuel vehicles.

According to the data released by the Association of Automobile Manufacturers, China sold 2.989 million new energy vehicles in 2021, up 169.1% year-on-year; in the latest December 2021, the penetration rate of new energy vehicles has reached 22.6%, which means that for every 5 cars sold, one is a new energy vehicle.

In this wave, the "heart" power battery of the new energy vehicle owned by Ning Wang once became a fragrant feast for major car companies to break their heads. As a result, zeng Yuqun's company from the small city of Ningde, Fujian Province, which was only established in 2011, easily broke the trillion market value mark in just ten years.

You know, this is a goal that many companies have been difficult to achieve for tens or even hundreds of years.

However, Uncle Zheng thought:

When an institution is in a difficult situation, we need to focus on its ability to bottom out, and when he is in the ascendant, we have to see his hidden risks.

Today, on the basis of combing through the refining of the "trillion Ning Wang", the analysts of the "Zhengjing Society" try to interpret the major challenges facing the Ning King in the post-trillion era.

1

"Nobleman" BMW

In 2011, the 43-year-old Zeng Yuqun started a business for the second time with the aura of "Apple supplier" and founded Ningde Times New Energy Technology Co., Ltd. in the small city of Ningde, Fujian Province.

At that time, the new energy market was in the ascendant, and the power battery field was monopolized by Japanese and Korean giants such as Panasonic and LG, and there was no technology accumulation and no capital in the Ningde era, just an obscure small character.

Any success story seems inseparable from the appearance of a noble person. "Zhengjing Society" analysts combed and learned that in 2012, BMW Brilliance launched a "Zhinuo 1E" electric vehicle in the Chinese market in order to test the water of new energy vehicles, and in order to promote the production and sales of the local market, BMW intends to find a Local Power Battery Manufacturer for the Nuo 1E. At that time, there were not many options for BMW, and the cooperation with a state-owned enterprise was also dispersed due to many problems in product quality, cooperation efficiency and other links.

As a result, the opportunity landed fortunately on the head of the Ningde era. Although BMW is trying to cooperate with a try-and-try attitude, for the CATL era, this is not only the first single-power battery business, but also a heavyweight customer in the industry, and only by successfully seizing this opportunity can it gain a firm foothold.

Of course, the process is not so easy. The technical requirements given by BMW at that time far exceeded the capabilities of the Ningde era. In order to help CATL produce power batteries that meet the requirements, BMW also sent a senior engineer to CATL for two years of on-site guidance, and provided a full set of original German power battery production standards up to nearly 1,000 pages.

To this end, Zeng Yuqun personally led the team, in accordance with BMW's requirements to carry out research and development item by item, day and night, and finally successfully produced a power battery that met BMW's standards, and won a large order from BMW. Subsequently, yutong bus and other car manufacturer customers came to buy batteries for BMW, and the Ningde era opened a circle of friends.

02

"Good time and place"

If BMW is the "nobleman" who rose in the Ningde era, then the policy East Wind in 2015 is the "time and place" of the rise of the Ningde era.

On March 24, 2015, the Ministry of Industry and Information Technology formulated the "Automotive Power Battery Industry Specification Conditions", launched the power battery "white list", the new energy vehicles on sale can only enjoy the new energy vehicle subsidy if they are equipped with power batteries that meet the conditions and enter the "white list" directory.

Analysts from the "Zhengjing Society" learned that the release of the "white list" policy is equivalent to helping the Ningde era avoid direct competition with foreign Japanese and Korean battery giants. At the same time, BYD, which has a relatively strong domestic power battery strength, adopted the strategy of self-production and self-sale of power batteries at that time, and was only configured on BYD's self-produced electric vehicles, without exporting, resulting in the Ningde era also having few competitors in China.

So far, with the assistance of "time and place", NINGDE times have successively won almost all the orders of domestic mainstream car companies, and the market share in the domestic market has been rising.

In 2017, the Ningde era, which has only been in business for six years, has reached the top of the domestic power battery market in one fell swoop.

3

"Gamble strong"

Meituan Wang Xing once told such a story:

In the early years, Zeng Yuqun hung a picture in his office: Gambling is stronger.

Some investors asked why they did not hang up "love to fight to win", Zeng Yuqun's explanation was: fighting alone is not enough, it is physical work, gambling is mental work.

Zeng Yuqun's genes that dare to "gamble" are also deeply rooted in the rise of the Ningde era.

According to the "Serious Society" analysts know, at first there were obvious differences in the technical route of power batteries, BYD's lithium iron phosphate technology has always been the mainstream technology in the industry, and ternary lithium technology is not optimistic. If you choose a lithium iron phosphate battery, the safety is higher, but the battery capacity ceiling is low; on the contrary, the ternary lithium battery is high capacity, but the safety is low. At that time, the domestic electric vehicle boss BYD chose a safer lithium iron phosphate battery, Ningde era for the curve overtaking, at the risk of losing everything, ALL IN is not optimistic about the ternary lithium battery.

In 2018, the domestic electric vehicle subsidy policy introduced the concept of energy density, ternary lithium entered the highlight moment, and the Ningde era gambled. The original boss BYD has retreated to the second oldest in the industry. Other companies that choose the wrong route, such as Guoxuan Hi-Tech and Jianrui Woneng, have fallen into the whirlpool of losses.

Another fierce bet in the Ningde era is to expand production capacity. Since landing on the capital market in 2018, in just three years, it has raised a total of more than 80 billion yuan through channels such as stock issuance and debt financing.

In November 2021, another 58.2 billion yuan of fixed increase financing was released, setting a record for the largest private enterprise fixed increase in the history of A-shares. After being questioned by the market and exchanges, the amount of funds raised was reduced to 45 billion yuan.

After frequent large-scale financing, CATL has invested a lot of money in capacity expansion, and the planned production capacity will reach 592GWh by 2025, which will increase by about 4 times compared with 2020. At the same time, it has also invested in or controlled upstream and downstream companies in the industrial chain such as lithium ore, lithium salt, cathode materials, and manufacturing equipment, and intends to deeply bind the entire lithium battery industry chain through capital.

It can be said that Zeng Yuqun and the Ningde era with real money and silver crazy bets, with the new energy vehicle market from 2020 to 2021 like a hot blowout, the huge production capacity bet by the Ningde era seems to be rapidly realized, once there were car bosses to get the power battery, squatting in the office of the Ningde era. This also pushed the Ningde era to ascend to the throne of trillions of market capitalization and become the "trillion King of Ning". In December 2021, the market value once exceeded 1.6 trillion yuan.

04

The herd began to chase the deer

Analysts from "Zhengjing Society" combed and found that the Ningde era, which has passed the trillion market value, has entered the top 40 in the global list of listed companies. Alongside them, most of them are Companies based on To C consumer business or To C traffic business, such as Apple, Amazon, Procter & Gamble, Disney and so on.

The core component supplier companies with to-B business based on the To B business similar to the BUSINESS model of the CATL era are all semiconductor giants, such as TSMC, Nvidia, Intel, Asmail and so on.

In the business world, it is easier for To C companies to build brand barriers based on consumption habits to gain a lasting competitive advantage; while to B companies in the Business are more difficult to establish a solid moat and are more likely to be replaced by downstream customers.

As we all know, the semiconductor chip industry is an upstream technology monopoly industry, especially the level of technology at home and abroad is very different, several major foreign semiconductor giants almost monopolize the most cutting-edge technology in the chip industry, for example, semiconductor equipment that can produce advanced process chips below 7nm is only asma in the world, and Huawei cannot produce high-end smart phones because of the chip embargo.

In the new energy vehicle power battery industry in the Ningde era, the competition is more intense, and it is far from such a deep technical barrier. Moreover, compared with the Ningde era, foreign Japanese and South Korean giants LG technology reserves are more comprehensive, and Panasonic battery technology is more advanced.

At the same time, the protective wall built by the 2015 power battery whitelist for the Ningde era has long collapsed, and now it has to face the strong competition of Japanese and Korean battery giants. BYD's blade battery has also led the rise of lithium iron phosphate again, and began to supply externally, and domestic second-tier battery manufacturers are also expanding production on a large scale, eager to try.

I have to say that the challenges faced by the Ningde era after standing on the trillions have just begun.

According to media reports, some senior executives of head car companies have declared that there is not much difference in the battery technology of various companies now, which is nothing more than "the difference between one failure and one failure of ten thousand and one failure of twenty thousand."

Analysts from "Zhengjing Society" combed the production capacity disclosed by major mainstream power battery manufacturers so far and found that 21 power battery manufacturers such as Cataline Times, LG New Energy, AVIC Lithium Battery, Yiwei Lithium Energy, BYD, panasonic and so on have disclosed a total production capacity of more than 3100GWh. Based on the average bicycle 45KWh, the number of vehicles that can be supported is as high as 70 million. At present, the total global sales of automobiles are 90 million, that is to say, it will not be long before the new energy vehicle power battery market will change from a seller's market to a buyer's market, and a fight is inevitable.

5

Not irreplaceable

Semiconductor giants have almost irrefutable voices in the industrial chain, and even customers as strong as Apple have to accept TSMC's price increase requirements.

In the power battery industry chain, although the Ningde era currently has a relatively strong business bargaining power with a market environment of short supply, some terms are unbearable for car companies. Historically, in the traditional automotive supply chain, the attitude of suppliers in front of car companies is not high. From a realistic point of view, a big drama in which car company customers want to distance themselves from the Ningde era seems to have slowly begun to play out.

Industry news obtained by analysts of "Zhengjing Society" shows that in order to ensure the safety of the supply chain, some car companies have begun to support the second supply and the third supply, and play a game with the Ningde era. In addition to the Ningde era, Xiaopeng Automobile intends to increase AVIC lithium battery as a supplier. Since May 2020, GAC New Energy has not used the battery of the Ningde era on the new model, and the rumors of cooperation between Tesla and BYD are almost certain, and even the original "noble" BMW of the Ningde era has also introduced Ewell lithium energy.

At the same time, some strong car companies have even begun to build their own battery factories. On March 15, 2021, the Volkswagen Group presented its battery strategy and technology landscape for the next 10 years at its first "Power Day". According to the plan, by 2030, the Volkswagen Group will build six super battery plants in Europe with a total annual production capacity of 240 gigawatt hours. Back in 2014, Tesla built the Gigafactory Super Battery Factory in Nevada, USA. In addition, Mercedes-Benz, General Motors, as well as domestic Geely and Great Wall Motors, also have similar actions.

In order to ensure the supply of core components, reduce costs, choose to cultivate multiple supplier systems or build their own battery factories, car companies show a fact that the batteries of the Ningde era are not irreplaceable.

06

Face another bet

The development of power batteries so far is still a very immature product. Battery energy density is not large enough, charging speed is not fast enough, battery fire and other issues are still the biggest obstacle for users to purchase new energy vehicles, becoming a card neck problem that restricts the development of the industry.

At the same time, in the big showdown such as Tesla has been released and Samsung has also announced the trial production of large cylindrical batteries, although Zeng Yuqun and his Ningde era originally bet on lithium iron phosphate and lithium ternary lithium, they gambled a lot to win a pot full of pots, but still in the rapid update of iterative battery technology and more positive fierce competition, zeng Yuqun had to bet again.

Analysts from "Zhengjingshe" combed the financial report and found that the research and development expenses of the Ningde era have increased year by year, from 2017 to 2020 and the first three quarters of 2021, it has increased from 1.632 billion yuan to 3.569 billion yuan and 4.595 billion yuan. Huge R&D expenses have been invested in next-generation emerging battery technologies such as cobalt-free batteries, all-solid-state batteries, and rare metal-free batteries.

That is to say, before the lithium battery technology matures, the Ningde era must gamble on another technical outlet at the same time.

Looking back at the trillion road in the Ningde era, there is the luck of noble people to help each other, the opportunity of time and place, and of course, it is inseparable from its own efforts, persistence, strength and courage. After trillions, whether it can become an enduring top To B supplier in the industrial chain like Intel and other international semiconductor giants is still a question mark. In short, new energy vehicles are indeed a good track, but the last laugh is not necessarily the Ningde era. 【Produced by "Zhengjing Society"】

Editor-in-charge | Tang Weiping| Du Hai Proofreader | Ranran

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