Text: Xiao Yuan
At the beginning of 2022, the mainland automobile industry still shows a good development trend of steady growth. The annual production and sales of continental automobiles were 26.082 million units and 26.275 million units, respectively, an increase of 3.4% and 3.8% year-on-year, respectively, maintaining the first automobile production and sales in the world for 13 consecutive years! The annual growth of production and sales has further consolidated the position of the mainland as the world's largest automobile market and moved towards the world's automobile power.
In 2021, the automobile industry reversed the downward trend for three consecutive years, contributing to the sustained recovery of the mainland's industrial economy and stable macroeconomic growth. With the gradual improvement of residents' income level, the mainland automobile market has shown a clear trend of consumption upgrading. In 2021, the mainland sold a total of 21.482 million passenger cars, up 6.5% year-on-year. Among them, high-end brand passenger car sales were 3.472 million units, an increase of 20.7% year-on-year.
Mainland new energy vehicles are also showing a good momentum of improving both market size and development quality with richer product supply, higher technical level and better supporting facilities. The production and sales of new energy vehicles reached 3.545 million units and 3.521 million units, respectively, ranking first in the world for seven consecutive years. Mainland new energy vehicles have undoubtedly entered a new stage of accelerated development. So, who will the sales king of new energy vehicles spend?
According to the December 2021 and full-year sales rankings released by the Association, BYD, Tesla China and SAIC-GM-Wuling are the top three new energy vehicle manufacturers. Previously, due to the shortage of chips and the rise of the epidemic situation in various places, automobile production and sales were affected to a certain extent. With the continuous improvement of the supply chain in the fourth quarter, production and sales have risen, and inventories have begun to pick up, making sufficient preparations for peak season sales. More importantly, BYD, which ranks first, will also become the second private car company to rank among the world's top 500 companies after Geely.
BYD's monthly sales have increased for ten consecutive times, with annual sales of more than 730,000 units, and it has handed over the most beautiful report card in early 2022. In the last Fortune Global 500 list, the entry threshold for Lydela was $24 billion. At the time, BYD's revenue was $22.7 billion, a missed opportunity. BYD's revenue in the first three quarters of last year has reached $22.8 billion, and it is expected to reach about $30 billion for the whole year, which means that BYD has pre-booked tickets for this year's Fortune 500. The development of BYD is also inseparable from the founder Wang Chuanfu.
Wang Chuanfu is the founder and president of BYD, born in the countryside, from nothing to "iron rice bowl", Wang Chuanfu has the courage to give up everything and start from scratch again. Wang Chuanfu was born in 1966 to a rural family in Anhui Province. In junior high school, he had to pay for his brothers' tuition and living expenses. Later, he had the honor of majoring in metallurgical physical chemistry at Central South University, and after graduation, he entered the Beijing General Institute of Nonferrous Metals Research for further study.
The 26-year-old Wang Chuanfu was promoted to deputy director and has an "iron rice bowl" that does not worry about eating and wearing. With the trend of going to the sea to do business swept the country, it also awakened Wang Chuanfu's pursuit of the meaning of life. In 1995, Wang Chuanfu found that popular mobile phones were very expensive, and a nickel-cadmium battery inside was worth thousands of yuan, and he was keenly aware that this would bring huge business opportunities, so he quickly made a decision, quit his job, and went to the sea to start a business.
Wang Chuanfu started his business in an old workshop in Buji, Shenzhen. At that time, he could not afford to hire too many people, the salesman was himself, the engineer was himself, and when the deadline was tight, the workers on the production line were also himself. Soon, Wang Chuanfu created success with good technology, ranking 1st in the field of nickel-cadmium batteries and 3rd in the field of lithium batteries.
Since 2003, Wang Chuanfu has acquired Qinchuan Automobile and announced its entry into the field of automobile manufacturing. He increased investment in research and development, and soon made 3 breakthroughs in traditional internal combustion engine power technology, and ranked among the top 3 private automobile companies. Unlike other car companies, Wang Chuanfu is based on battery technology and is more in line with the trend towards the era of new energy vehicles. The hero saw the same thing, and around the same time, Musk also invested in Tesla in 2004.
The fates of Wang Chuanfu and Musk met for the first time in the new energy automobile industry, and they are destined to shine in the new energy automobile industry. In 2018, BYD's new product launch, cross-seat monorail "cloud rail" accelerated the pace of going abroad, and signed strategic cooperation agreements with a number of overseas countries. This straddle monorail "cloud rail" can be run on an elevated highway, took five years of research and development, and the construction cost is only one-fifth of that of the subway.
Nowadays, the development of new energy in China is enthusiastic, and full progress has been made in exports. In 2021, a total of 310,000 new energy vehicles will be exported, an increase of 3 times year-on-year, exceeding the historical total export volume. At the same time, the supporting environment for the development of the new energy industry has also been further optimized. By 2021, a total of 75,000 charging stations have been built, 2.617 million charging piles have been built, 1,298 power stations have been replaced, and tens of thousands of power battery recycling service outlets have been set up in 31 provinces, autonomous regions and municipalities directly under the Central Government.
In 2021, the penetration rate of the mainland new energy vehicle market has reached 13.4%, an increase of 8% over the previous year. It is estimated that in 2022, domestic sales of new energy vehicles will reach 5 million. Moreover, the penetration rate of new energy vehicles in 2025 and 2030 is expected to reach 20% and 40% respectively. Nowadays, the new energy market is expanding rapidly, the capital market will continue to be hot, and all new energy automobile companies are facing huge market opportunities and unprecedented competition. Who will continue to be the biggest winner? Most people would say Tesla, but some analysts think it's BYD.
Citibank has predicted that "BYD's sales will surpass Tesla's in 2023." It is worth noting that Tesla faces fierce competition in places like Asia, and the same competitive landscape may soon emerge in the United States. By then, Tesla will no longer be the only mainstream option for electric vehicles, and consumers may soon begin to make choices based on the actual quality of the car.
Tesla has been criticized many times for car quality issues. Late last year, Tesla recalled more than 475,000 Model 3 and Model S electric vehicles. The reason is that there are problems with its rearview camera and front cover, which can easily increase the risk of collision. In addition, Tesla's vehicles often have potential safety hazards such as driving failures and automatic driving mode failures.
In the future market competition, new energy vehicles with a price of less than $18,000 will quickly occupy the market. Tesla has not yet reached this price range, Wuling Hongguang MINI is still innovating, BYD is also developing different car series, therefore, Tesla also needs to innovate. At present, the competition in the new energy automobile industry is still in the "first half". Although some auto companies have established intelligent barriers, the competition in the "second half" is still a competition of market size. Whether BYD can still continue to win the new energy vehicle sales king, we wait and see.