In the face of the continuous heat of the new energy vehicle track, the "fruit chain" giant Luxun Precision can't hold back!
Luxun Precision announced on the evening of February 11 that the company and Chery New Energy Automobile Co., Ltd. intend to jointly establish a joint venture company, specializing in the research and development and manufacturing of new energy vehicles. In addition, the company's controlling shareholder, Lixun Limited, intends to purchase Chery-related equity held by Qingdao Wudaokou for 10.054 billion yuan.
According to the announcement, on February 11, Lixun Precision signed the Strategic Cooperation Framework Agreement with Chery Holding Group Co., Ltd., Chery Automobile Co., Ltd. and Chery New Energy, laying a strategic partnership for both parties.
Since 2021, the news of domestic enterprises building cross-border cars has been dazzling. So, how much does a new energy vehicle cost? How high is the barrier to car building? Does the new energy business of listed car companies make money in the end?
From the electronic consumer track to the automotive industry chain,
Luxshare Precision lagging behind?
According to the agreement announced in the announcement, Lixun Precision and Chery New Energy intend to jointly establish a joint venture company, specializing in the research and development and manufacturing of new energy vehicles, and providing cutting-edge R&D design, mass production platform and sea exit for Lixun Precision's core auto parts business.
Among them, Lixun Precision intends to subscribe 500 million yuan to hold 30% of the registered capital of the cooperative subsidiary, and Chery New Energy to subscribe to 1.167 billion yuan and hold 70% of the equity of the registered capital. The cooperation between the two parties is exclusive, that is, Chery Group cannot cooperate with other automotive foundry enterprises in the OEM business, but can independently oem business or cooperate with auto brand enterprises in OEM business.
As we all know, Luxshare Precision is a leading company in the A-share Apple industry chain, oem Apple AirPods headphones, Apple Watch watches and iPhones. However, since the beginning of 2021, affected by a series of bearish news, The stock price of Lixun Precision has been sluggish. Although there has been a rebound since then, the current stock price is still more than 30% lower than the all-time high.
Luxun Precision Weekly Market Chart
According to the third quarter financial report released by Luxshare Precision in October 2021, its net profit in the first three quarters was 4.69 billion yuan, an increase of 0.21% year-on-year, but the net profit in the third quarter fell by 25.28% year-on-year.
In recent years, the new energy vehicle track has continued to be hot. In this context, it seems logical for Luxshare Precision to enter the automotive industry chain from the electronic consumer track.
However, the industry has different views on the huge investment of Lixun Precision. Some people believe that the automobile is regarded as the next generation of mobile phone-level industrial products, and the automobile industry is developing in the two directions of Internetization and intelligence, coupled with the intersection of the corresponding mobile computing scenarios, so the most experienced and accumulated is the mobile phone supply chain, and it is expected to get rid of the overly long-term "low profit" dilemma with the help of cross-border. This move is conducive to Luxun Precision to develop new business segments and lay the foundation for the follow-up Apple automotive foundry business.
There are also views that the current new energy vehicle track is crowded, and the future reshuffle is inevitable, especially in the entry time node, Luxshare Precision has walked behind its peers.
New energy vehicles are hot,
Giants have poured in,
When does the blue ocean become the red ocean?
It is obvious to all that the new energy vehicle track is currently in the upward passage.
On January 12, 2022, the China Association of Automobile Manufacturers released statistics showing that automobile production and sales in 2021 will increase year-on-year, ending the situation of three consecutive years of decline since 2018. Among them, the annual sales of new energy vehicles exceeded 3.5 million units, and the market share increased to 13.4%.
The all-hot track has attracted the attention of many technology giants and traditional car companies and even traditional enterprises. Taking China as an example, Xiaopeng Automobile, Ideal Automobile, Nezha Automobile, Zero-run Automobile, WM Automobile, Extreme Krypton Automobile, Lantu Automobile, and Jihu Automobile are constantly updating their models to seize this market. Xiaomi and Baidu have also announced car manufacturing. In January this year, a number of new energy models of the famous real estate enterprise Baoneng Group were exposed for the first time, and China Evergrande also announced that the first new energy vehicles were off the production line, which was shocked by the industry at that time.
"If it was at the beginning of last year, the investment of Luxshare Precision was definitely good news, but not necessarily now." In the industry's view, the timing of Luxun's entry is late, and more importantly, the investment threshold of the automotive industry is constantly increasing, and there is no end to "burning money".
Since the beginning of this year, due to the global chip shortage and the decline of the national new energy subsidy policy and other unfavorable factors, including Tesla, BYD, SAIC Roewe, Nezha, Xiaopeng, Eian, Zero Pao and other car companies have raised the sales price of their new energy vehicles.
Cui Dongshu, secretary general of the National Passenger Vehicle Market Information Joint Association, said in a previous interview that the release of the subsidy decline policy marks that China's new energy vehicles have fully entered the market-driven stage. He believes that the scale of China's new energy automobile industry has ranked at the forefront of the world, and the ability of enterprises to participate in market competition has been significantly enhanced, even if all subsidies for new energy vehicles have declined, there are still policies in China to support the development of the new energy automobile industry. According to the latest forecast of the Association, with the doubling of the scale of the new energy industry chain and the improvement of cost reduction capabilities, the sales volume of new energy vehicles is expected to exceed 6 million in 2022, and the penetration rate of new energy vehicles will reach about 22%.
For the development trend of new energy vehicles in 2022, Jia Xinguang, chief analyst of China Automobile Industry Consulting and Development Corporation, said that the industry is generally optimistic about the development of the entire industry and has high confidence. And many institutions predict that this year's sales are expected to reach 5 million units, a growth rate of nearly 50%.
The "Carbon Peak Action Plan before 2030" issued by the State Council in October 2021 clearly pointed out that by 2030, the proportion of new new energy and clean energy powered transportation vehicles should reach about 40%, that is, about 10 million vehicles.
But as more and more car companies and other companies cut in, this track is bound to become more and more crowded. When the blue ocean will become a red sea is still unknown.
Beiqi Blue Valley and Foton Motor each lost billions,
Is it difficult to make money doing new energy vehicles?
As a new domestic car-making force, from the data of the first three quarters of 2021, the quarterly losses of Weilai and Xiaopeng Automobile are gradually expanding, of which the former has a total loss of 1.872 billion yuan, the latter has lost 3.576 billion yuan, and the loss of ideal cars has reached more than 600 million yuan.
A few days ago, some domestic listed car companies also released 2021 performance forecasts. Among the eight listed companies that have already issued performance forecasts, half of the expected profit and loss are expected.
As the leading enterprises of domestic car companies, GAC Group and Great Wall Motors both achieved profitability in 2021, and their profits increased year-on-year. Among them, Great Wall Motor's profit increased the most, with a net profit of 6.781 billion yuan. In addition, Jiangling Motors and Haima Motors also achieved profitability.
However, Beiqi Blue Valley, Foton Motor, Xiaokang Shares, and Zotye Automobile are expected to lose money. Among them, the losses of Beiqi Blue Valley and Foton Automobile both exceeded industry expectations, the former is expected to lose 4.8 billion yuan to 5.3 billion yuan, and the latter is expected to lose about 5 billion yuan. Moreover, Beiqi Blue Valley has lost money for two consecutive years.
According to the data, the total output of Beiqi Blue Valley in 2021 fell by 51.84% year-on-year, only 6369 vehicles, and the total sales volume was only 26,000 vehicles. As a former domestic pure electric vehicle sales champion, BAIC BJEV's sales in recent years have continued to be sluggish.
In addition, in 2021, due to the cooperation between its brand Xilis and Huawei, xiaokang shares, which are extremely popular, are expected to lose 1.55 billion to 1.95 billion yuan. Xiaokang co., Ltd. pointed out in the announcement that although the sales volume of new energy vehicles in 2021 increased compared with the same period last year, sales were still in the climbing stage, the amortization of fixed assets and intangible assets increased, and the continuous increase in research and development investment, labor costs, and marketing channel construction expenses led to the impact of the business segment on the net profit attributable to the shareholders of the listed company of about -1.4 billion yuan.
It is worth noting that BAIC New Energy, a subsidiary of BAIC Blue Valley, mainly produces new energy vehicles, and Xiaokang shares have also begun to significantly turn to the new energy vehicle track in recent years, and the iron law of "costing money" for car manufacturing has been confirmed by new energy vehicles again. The 2021 car company financial report also confirms that among the companies that manufacture new energy vehicles, in addition to Tesla, there are few other profiteers. With the end of subsidies and the advent of the era of comprehensive market competition, the capital threshold of new energy vehicles will continue to be high.
Overall, whether it is Beiqi Blue Valley, which mainly promotes ARCFOX, or Xiaokang shares that focus on building Xilis, it is still in the investment period of building a brand, and it seems too early to talk about making money.
Cross-border car building is not a head-slapping project,
Is the threshold for new energy vehicles high?
The question is, is the threshold for new energy vehicles to be built high?
According to reports, Weilai's first mass production car cost $20 billion, Xiaopeng's first car cost $10 billion, and the ideal car ONE only cost $1 billion, and the threshold for car manufacturing seems to be gradually falling.
However, there is no shortage of examples of companies that have not promoted mass production of models after spending billions of yuan. For example, Sailin let the majority shareholder 6 billion yuan of funds adrift, and Singularity spent 7 billion yuan still did not see the mass production of vehicles.
Therefore, it is no wonder that xiaomi plans to invest 10 billion yuan to build a car, claiming that it has 108 billion yuan of reserve funds, which can be described as full of confidence.
It is not difficult to see from the investment of 50 billion yuan in Jidu Automobile plan in 5 years and the investment of 10 billion US dollars in Xiaomi in 10 years that it has become the consensus of the industry to start with 10 billion yuan of car manufacturing.
In addition, Li Bin, the founder of Weilai Automobile, raised the car-making threshold of auto start-ups from 20 billion in 2016 to 40 billion in an interview at the end of 2021. "40 billion yuan is not an accurate number, it is an intuitive judgment." We are still losing money today because we have to invest in the future, otherwise even if we make a profit quickly, it is likely to fall off a cliff in two years. Li Bin said.
Li Bin, founder of NIO (file photo)
In the view of Cao He, president of Allianz Investment Management (Beijing) Co., Ltd., capital is still the primary problem for car companies; secondly, the improvement of vehicle intelligence and networking requires enterprises to strengthen research and development. In the future, the proportion of R&D investment of enterprises will become higher and higher; again, because the new crown pneumonia epidemic continues, supply chain security is a safety factor that car companies must consider at present.
In short, car manufacturing is not a simple thing, whether it is an electronic company or a traditional enterprise, cross-border car manufacturing is not a head project.
Compared with the investment of technology companies and traditional car companies with tens of billions of yuan, how to ensure follow-up continuous investment and the balance between existing business and new business development is also the biggest issue facing Luxshare Precision at present.
For Lixun Precision, the road to car building will be particularly long and difficult.
Reading Chuang/ Shenzhen Business Daily reporter Zhu Feng
Edited by Li Li
Editor-in-charge Ma Qiang
Executive Producer Chen Shu
Proofreader Sun Shijian
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