Text | Roger
If you ask, what do you think of in the miracles that Chinese brands have created in recent years?
Is it Geely, which has won the top sales of independent manufacturers for 5 consecutive years, or Wei Xiaoli, who has reached an annual sales scale of 100,000 vehicles in the high-end market of 200,000-500,000 yuan, or BYD, which has delved into the technology of Three Electrics and relied on new energy vehicles to increase by 70% in 2021, or even Wuling Hongguang MINIEV, which has suppressed Tesla in the new energy list and sold nearly 400,000 vehicles a year?
These are the proud achievements of Chinese brands, but aside from these, there is actually another brand that has made a miracle of progress, but it is not necessarily remembered by everyone, which is the red flag to talk about today.
According to the news released by Hongqi, its "cumulative sales exceeded 300,000 vehicles" in 2021, and "an increase of more than 50% year-on-year", both figures are a large node, but no more specific sales figures were announced. According to third-party data sources, Hongqi's batch sales in 2021 are 299674 vehicles, which is slightly missing more than 300 units from 300,000 vehicles, and the amount of insurance is slightly lower, with a total of 271565 vehicles in the whole year.
In fact, these are not important, manufacturers from the perspective of publicity slightly whitewashed is understandable, this article is not intended to take the precise number and opponent like a competition, the difference between twenty or thirty thousand vehicles in different statistical methods, regardless of the grand purpose, here is a simple explanation, to avoid misunderstanding of readers. For convenience, the sales data of Hongqi or other manufacturers is mentioned next, which is uniformly based on the amount of insurance.
Why do you say that the red flag creates a miracle? The annual sales volume of nearly 300,000 units is of course the focus.
From the perspective of luxury brands, Hongqi's 2021 risk volume surpasses Cadillac, Lexus and Volvo, and has become the leader of the second-tier luxury camp outside the BBA, of course, this only refers to the Chinese market, in terms of global view, Hongqi and these three are still a little far away.
Putting aside the luxury attributes, from the identity of the Chinese brand alone, in the main sales model of Hongqi, the H5 price range is more than 150,000 yuan, the HS5 main sales price is more than 200,000 yuan, and the price of the entire H9 series is between 300,000 and 540,000 yuan, and the price coverage is high-end positioning. With nearly 300,000 vehicles sold in this positioning, Hongqi was the first Chinese brand to achieve this.
This is the shallowest layer, and what is really unusual is still behind this sales performance.
First, there is the rate of growth. Hongqi's rapid growth began with the listing of H5 in 2018, after the entire Hongqi brand had less than 5,000 vehicles in 2017 and more than 25,000 in 2018. At the same time as the potential of H5 in 2019 was further released, the second key model HS5 was launched, and Hongqi's sales reached 99,000 units that year.
After the car market was hit hard by the epidemic in 2020, H5 and HS5 momentum was stronger, and Hongqi added high-end sedan H9, the annual sales of nearly 200,000 vehicles, and finally in 2021, the entire brand went up a step, one step away from 300,000 vehicles. In just 5 years, Hongqi has jumped from a fringe brand with annual sales of less than 5,000 to the top of the second-tier luxury camp, and this speed can be called a miracle in any market.
Of course, on the growth rate, the domestic market does not lack the precedent that can be comparable to the red flag, as early as 2015, 2015, Zotye, Jianghuai have been in just two or three years, from the humble small factory to 300,000 volume, the rise of SAIC, GAC independent brands, but also in just a few years, the glorious history of Shenche professional Baojun, not to mention more.
However, these inflated car companies have benefited from the same background - the continuous growth of the market market, as well as the outlet of the SUV wave, behind the surge in various manufacturers, are inseparable from one or two SUVs. And when the dividend period of market growth and SUV outlet ends, the market becomes a different pattern.
The difference is that the rise of the red flag just happened in the stage of the downturn in the market and the fierce competition in the SUV market.
In 2018, 19, 20 years, the car market fell successively, but the red flag maintained a doubling growth, in 2021 the market finally stopped falling and rebounded, the driving force is basically relying on new energy vehicles, on the fuel vehicle market alone, the overall scale is more violent than before. In such a market, The Red Flag, which accounts for 95% of the sales share of fuel vehicles, still increases by more than 40% (the amount of insurance), which is another layer of miracle of the Red Flag.
The last layer is cut to the specific product. At present, There are 8 models on sale by Hongqi, divided into 5 fuel vehicles and 3 electric vehicles, and in last year's sales performance, H5 and HS5 two cars accounted for three-quarters, their positioning is medium-sized sedan and medium-sized SUV, and more than 10% of the share is contributed by the H9 positioning medium and large sedans.
From the price point of view, H5 mainly attacked 14-17 million yuan, HS5 is 20-23 million, and the H9 transaction price is concentrated in 33-37 million, the price range of the three main models is far away, and there is almost no overlap. And other mature brands, whether mainstream or luxury positioning, product distribution are interlocked, the price range is closely connected, there is almost no gap, because the gap means a potential growth point, manufacturers will certainly not easily miss.
From the perspective of product type, Hongqi is still blank in the compact market (fuel vehicles), although there is an H7 transition between H5 and H9, in fact, it is already an old product many years ago, occupying a name. Although these are the shortcomings of product coverage, they also contain potential that cannot be ignored, and once the red flags are filled one by one, it is a new round of growth opportunities.
The rise of The red flag mentioned above began in 2018, from that year to 2020, the red flag added a new volume model every year, but in 2021 has not been able to launch a new hot model, but this is only a momentum, the current 2022 can be determined to become a product of the red flag.
The new large SUV LS7, that is, Mercedes-Benz GLS, BMW X7 level, has been officially released in October last year, and then the internet also exposed the news of the new H6 and the new MPV, which are currently in the testing stage and are expected to be listed within this year.
From the above camouflage photos, it can be seen that the front face of these 3 new models is unified with H9, which is the latest generation of family characteristics of Hongqi, and the H5 and HS5 products currently on sale are not old, but in fact, they are already the products of the previous stage of Hongqi, and what kind of potential will be available after the H5 replacement, which is really worth looking forward to.
As for LS7 and the new MPV, they are markets that Hongqi has not set foot in before, but considering that the volume of their respective market segments is not large, the future sales of the two cars are expected to be relatively limited, and the more practical significance is to fill the gap in the large SUV market as a luxury brand, and further develop the coverage category of products.
Of course, the continuous growth of Hongqi is still a potential risk, its current main model, and the main force of the recent new car planning are fuel vehicles, and under the strong growth of pure electric and PHEV plug-in hybrid, the share of the fuel vehicle market is irreversibly shrinking, in addition, the HEV hybrid model that has begun to develop by its own brand is expected to grow rapidly into a new force, and whether it is BEV, PHEV or HEV, Hongqi has no existing models or plans to land soon.
In the owner satisfaction survey of Hongqi's hot models, the owners of various items such as appearance, interior, space, comfort, configuration, power, service and even control gave high evaluations, but did not get high scores in fuel consumption. The core of Hongqi's rapid growth in the past two years and further improvement in the future is to fully explore the home market of ordinary consumers, and for these potential customers, fuel consumption is a direction that needs to be improved.
At present, Hongqi's new energy vehicles are mainly E-QM5, E-HS3 and E-HS9, the sales of the three pure electric vehicles last year totaled more than 10,000 units, regardless of the image of the Hongqi brand, or the style of the current product design, in the field of pure electric are lack of clear attraction, but this is not the focus of Hongqi in the short term.
Considering that the main models are medium-sized and above-level products, 2.0T, or even 3.0T large-displacement engines, the new LS7 is more likely to be equipped with V8 engines, the target customers of these products will not be particularly sensitive to fuel consumption, but as analyzed above, Hongqi's previous and future growth depends on household customers, and reducing fuel consumption is a strategic task that cannot be taken lightly.
On the whole, the current rally of Hongqi is still very strong, and with the completion of a series of new products, the brand volume is expected to rise to a higher level in the short term. However, the challenge in the medium term is also very arduous, under the background of the shrinking fuel market, whether it can achieve a breakthrough in the field of hybrid and electric as soon as possible will determine whether Hongqi can grow into a Chinese luxury brand with world-class influence.
summary
In 2017, someone on the zhihu launched a topic about the poor situation of Hongqi, when Hongqi was on the eve of the launch of new products, and there was only one H7 car in the civilian car field, with annual sales of less than 5,000 vehicles.
The person who answered the question at that time either seriously, ridiculed, or angrily analyzed the reasons why the red flag was not red. However, the highest praise under the topic is an answer I wrote down two years later, when the sales of H5 in May have approached 5,000 vehicles, HS5 has just been listed, I have a feeling after visiting the store, I experienced the faw-hongqi products, as well as the enthusiasm and meticulousness of the service level, and from products to services, there is an extra layer of feelings and solemnity that other brands lack.
A visit to the store made me re-understand hongqi and understand the reason why it can rise again. Chinese have a feeling for Hongqi, Hongqi has strengthened this in all aspects of design, atmosphere, service, etc. Consumers have scruples about new products, especially high-priced Chinese cars, and Hongqi uses the whole vehicle lifetime warranty and 4 years/100,000 kilometers of free maintenance to eliminate.
Government procurement is a source of Hongqi's sales, but the proportion has been surpassed by individual bosses, civil servants and ordinary employees, and the rise of Hongqi is not relying on the upper level, but really entering the household market.
The red flag that once served as the façade of the country in a difficult era is now entering the homes of ordinary people, and relying on the support of the people, the future red flag has the real possibility of going global.