Who wants to harm the "King of Ning"?

Written by | Water brother

Source | Smart Car Reviews

Ningwang's stock price collapsed, and the territory was dismembered and sealed.

This is the result of the cooperation and conspiracy of vehicle manufacturers, capital and battery manufacturers.

The coronation moment is far from here.

Of course, it can be quickly replaced, but also because there are not enough technical barriers, and although the car power battery has matured, the technology and technical route are still in the very early stage of exploration, and every player feels that they still have hope.

CATL issued a statement yesterday saying that a series of malicious rumors about caterer era being sanctioned by the United States, being excluded from the ChiNext weight index, and negotiating with Tesla have recently appeared on the online platform, which has caused market misunderstandings and distortions and affected the reputation of enterprises. Rumors are unfounded and bad in nature. In order to safeguard the legitimate rights and interests of enterprises, on February 12, 2022, your company has officially reported the case to the public security organs, and will pursue legal responsibility for rumor-mongers in accordance with the law.

At the same time as the GEM-Gond era was in full swing, a rumor was fermented in the market. Rumors say that BYD took part of Tesla's orders from the Ningde era and obtained Tesla's 204,000 units/year battery order, with a single blade battery model of C112F and mass production in March this year.

In the past week, catalpines have fallen from 606 yuan to 489.99 yuan, a sharp drop of 17%. Compared with last year's high of 692 yuan, it has also fallen by nearly 30%.

Even if Ningde debunks the rumors and the stock price collapses in the Ningde era, the real hidden dangers behind it are still expanding - the multi-supplier strategy of smart car manufacturers, and even the de-supplierization is a major trend.

The automotive industry, and all the giants in it, are facing a dramatic change that has not been seen in a century.

The smoke of the century war is thick, and it is unknown whose hand the deer died.

First, vehicle manufacturers should turn the cost center into a profit center

Smart cars and traditional cars have a completely different logical structure and cost structure, so the blow to the traditional automobile industry is completely destructive.

Today, the power, safety, chassis, body and other control systems and operating systems of automobiles will be fully electrified and intelligent, and the new computing architecture will reshape our cognition of automobiles and reshape the value chain of automobiles, which is a far-reaching and comprehensive industry subversion for the industrial chain value of traditional automobiles.

In the past, the automobile was a mechanical system that needed to constantly polish technology and accumulate experience, and it was a closed system, and the key technologies and experience, and most importantly, profits, were in the hands of various automobile manufacturers.

Today, electric vehicles, as well as the core components of smart cars have been modular, from the power battery system to the chip, intelligent software system, are the core cost and profit center, if in the hands of external suppliers, if the vehicle manufacturers just put these together, will be completely reduced to foundries, can only earn very small foundry profits.

The biggest cost of electric vehicles comes from the battery, motor, electronic control "three electricity" system, accounting for nearly 70% of the overall cost of electric vehicles, of which power batteries account for 40%, which can be said to be the heaviest cost of all manufacturers, but also the number one cost problem to be solved.

Brother Shui believes that electrification is only the first form of the future car, the intelligence that is being promoted is the second form of the future car, robots, full automation, will be the mainstream form of the future car, of course, personal transportation like aircraft development is the ultimate form of our future personal transportation.

Electric vehicles are also further evolving to smart cars and automatic driving, and in the future, chips, intelligent sensors, and algorithm systems will be the new cost center and profit center of the smart car track.

The car of the future is a computer on wheels. Chip, software, battery power system has become the car's largest three major profit centers, these three major pieces are impossible for manufacturers to let go, unless there is a monopoly supplier with key technical patent barriers in the future, otherwise, will go down to do it personally.

At the same time, this huge change determines the interdependence and tension of the relationship between smart car manufacturers and suppliers.

The future struggle between pricing power and rule customization power has just begun.

Therefore, all manufacturers will not put this strategic point, placed on the outside, each manufacturer is deeply involved in the field of power battery research and development and production and investment, in the long run must be in the thinning of ningde battery share. At the same time, there are a large number of strong battery suppliers looking at the tiger.

It was obviously premature for King Ning to be crowned king.

Vehicle profits are shifting to the power battery system and AI chips-based intelligent elements, if manufacturers do not want to make wedding clothes for others, they can only personally go down, this, each manufacturer is very clear, all the manufacturers with funds and technical capabilities will firmly grasp these two legs in the body.

Second, it was once forced to the edge of the cliff by LG New Energy

In December 2020, LG Chem also spun off LG New Energy, launched the largest IPO in South Korea's history, and rose all the way after the opening, and has entered the top two market capitalization companies in the Korean market, second only to Samsung Electronics.

LG New Energy became a domestic Tesla battery supplier in 2019, and in 2020, with the surge in sales of domestic Teslas, the global share in the first half of the year once surpassed the Ningde era and reached the top of the world.

LG New Energy's production capacity is spread throughout China, the United States, Poland, Germany, Australia and other countries, Hyundai, Tesla, Volkswagen and other mainstream car companies in Europe, America and South Korea are almost all LG New Energy customers.

Market research institute SNE Research released the 2020 global power battery installed capacity ranking, LG new energy power battery installed capacity market share once rose to 23.4%, and the Ningde era is only about a percentage point gap.

However, last year, Hyundai Motor and General Motors carried out a large-scale recall because of the frequent fires of LG new energy battery problems, LG New Energy undertook the recall cost of nearly 18 billion yuan, and the brand image was inserted, which gave the Ningde era a breathing opportunity. Even so, LG New Energy's market share in 2021 is still as high as 20.3%.

This is the market space that LG New Energy has exchanged for life subsidy manufacturers.

The gross profit margin of CATL has remained above 27% all year round, of which the net profit has remained at 10%. The net profit margin of LG New Energy has been very low, has been hovering above and below the profit and loss line, and the profit margin of its parent company before the unsound listing in 2019 was dragged down by its loss rate of more than 20%.

It is no wonder that despite frequent security problems, manufacturers still use their feet to vote for LG New Energy, and it is in the core interests of manufacturers to support more suppliers before they can do it.

LG New Energy plans to expand its battery production capacity to 300GWh by 2023 and 430GWh by 2025.

Thanks to the large-scale expansion in overseas markets, LG New Energy said in January this year that considering the backlog of battery orders, it is expected that the company's share of the global market will soon exceed that of the Ningde era.

For example, in May 2021, SNE Research's single-month war report, in the "small passenger car" project, LG New Energy actually briefly surpassed the Ningde era, but did not count the trucks and buses that were relatively strong in the Ningde era.

But in any case, the collusion of manufacturers, capital and competitors has cut Ningde's profits and reduced its own costs.

The gross profit margin of ningde era power battery system products slipped from 32.67% in the first half of 2018 to 23% in the first half of 2021, and Ningwang was also forced to let the whole vehicle manufacturers.

Not to mention, the large-scale bloody listing of LG new energy blood loss subsidy manufacturers is a cost transfer for smart car manufacturers.

According to the financial report, from 2017 to 2020, the gross profit margin of the power battery system of the Ningde era was 35.25%, 34.1%, 28.45% and 26.56%, respectively. However, the gross profit margin of many car companies is only single digits. According to Dennis, vice president of finance of Xiaopeng Motors, after the IPO of Xiaopeng Motors, the gross profit margin has been hovering around 10% for many years.

According to it, if the battery with lower cost is switched, it is expected to contribute 1%-2% to the gross profit margin improvement.

The golden cup is drunk together, and the white blade is not spared. This purely profit-distributed business war will continue.

Third, the collusion between vehicle manufacturers, capital and competitors

It is rumored that Zeng Yuqun, chairman of the Ningde times, had a big quarrel with He Xiaopeng over the introduction of China Innovation Airlines. Zhongxin Airlines also replaced CATL as the first supplier of GAC New Energy. Tesla, Weilai, and Volkswagen also seem to have taken a ride with BYD.

Under the joint efforts of vehicle manufacturers, capital and competitors, the first-mover production capacity advantage of the Ningde era has been greatly reduced.

Large-scale ambitious capital is looking for opportunities and making waves in this emerging track.

Power batteries, a manufacturing industry with a long construction cycle and heavy investment, in the case of small technical differences, the market share is largely determined by production capacity.

Since last year, a number of suppliers have announced expansion plans, and production capacity is expanding significantly.

Ammunition is needed to fight wars.

In August 2021, CATL announced that the existing funds could not fully meet the needs of future business development, and the proposed fundraising would not exceed 58.2 billion yuan. In the expansion plan announced by CATL, its production capacity will reach 600~700GWh in 2025; The capacity planning target of Guoxuan Hi-Tech in 2025 is 300GWh; the battery production capacity of China New Venture Airlines has been mass-produced and under construction exceeds 100GWh, and the planned production capacity will exceed 500GWh by 2025.

In December 2021, the International Department of the China Securities Regulatory Commission (CSRC) disclosed the application materials submitted by China Innovation Airlines for the listing of Hong Kong stocks, and it completed 12 billion yuan of equity financing in 2021 alone, with a post-investment valuation of 60 billion yuan. BYD's Fordy Battery will also be spun off and listed independently in the next step.

On January 13 this year, Hive Energy has signed a listing counseling agreement with relevant institutions, and plans to complete the preparation of The Listing Application Documents of Hive Energy by March this year. In 2021, Hive Energy has completed the A round (3.5 billion yuan) and the B round (10.28 billion) financing, and the production capacity target for 2025 has also been raised from 200GWh to 600GWh.

There are also more ferocious wolves following: BMW signed a contract with Ewell Lithium Energy, Weilai reached a cooperation with Weilan New Energy, and old customers such as Mercedes-Benz and Geely have built their own power battery factories. Volkswagen, Ford, Great Wall, General Motors, Geely GAC group, sachinchin motor group all have their own battery research and development and investment plans.

Car companies' self-built battery factories have been rolling in.

Of course, Ning Wang's technical accumulation and experience accumulation in power batteries in the past many years, especially safety, as well as the layout of lithium mines in the upstream, have made it have the capital to go head-to-head today, and the yang schemes of manufacturers may not be able to succeed.

Even more deadly may be competitors' bottom-up on the technical route.

Fourth, the next generation of technology routes are about to emerge

At the same time, new technical routes are emerging in an endless stream, and all vehicle manufacturers have been gearing up to lay out their own battery production.

In February, Panasonic Chief Financial Officer Hirokazu Umeda said it expected trial production of 4680 electric vehicle batteries in Japan at the beginning of the fiscal year that begins in April, which will be the first to meet Tesla's needs.

Tesla officially announced the 4680 battery cell in September 2021, claiming that the single energy is increased by 5 times, the vehicle mileage is increased by 16%, and 86% of the cost can be saved.

Recently, engineers at Drexel University in the United States have also made a breakthrough, bringing significant performance improvements to lithium-sulfur batteries, and their potential for storing energy is several times that of current lithium-ion batteries. After a year of testing and 4,000 charge-discharge cycles, the cathode remains stable, which scientists say is equivalent to 10 years of routine use. The team's prototype of the battery made with this negative electrode can provide three times the capacity of a standard lithium-ion battery.

In addition, compared with traditional lithium batteries, solid-state lithium batteries have better safety, higher energy density, can greatly improve the endurance, and if the economic performance can surpass liquid batteries, it will become the new ruler of power batteries.

Last December, Quantum Scape, a startup backed by Volkswagen and Bill Gates, released its latest solid-state battery performance data, which shows that this solid-state battery can increase the range of electric vehicles by 80%, and fully charge 80% of the power in 15 minutes, with a normal service life of up to 12 years.

According to the forecast of relevant institutions, the global demand for solid-state lithium batteries is expected to reach 44.2GWh and 494.9GWh in 2025 and 2030, respectively, and the global solid-state battery market space is expected to reach more than 150 billion yuan in 2030.

This will be a hot player in the next generation of battery technology, but it is not friendly to the situation in China.

Japan's solid-state battery patents are as high as 916, accounting for almost half of the country, and China ranks second with 362 patents. However, in terms of all-solid-state batteries, Japan is 657, accounting for 75%, China has 128, South Korea has 37, and the United States has only 29.

But this technical route is still in the exploratory stage, and we have not completely given up.

In 2021, Weilai announced that it will release a solid-state battery pack product with a single energy density of 360Wh/kg in 2022, and several domestic solid-state battery companies such as Huineng Technology, Qingtao Energy, and Weilan New Energy have plans to mass-produce solid-state batteries in the near future.

CATL is also investing in the research and development of solid-state lithium metal batteries.

BMW, Ford and Volkswagen are no exception.

The old road is already crowded with competitors, and the entry tickets for the new road seem to be in the hands of others.

This is the basic industry logic of Ning Wang, whose previous profit forecast rose by 150.75%-195.52%, and whose stock price fell by 30% consecutively.

This is a collusion of smart car manufacturers, on the one hand, by adding new battery suppliers, reducing BYD's dependence, on the other hand, by personally taking the battle, this strategic place, from a cost center, to a profit center.

"It becomes the soul, SAIC becomes the body. For such a result, SAIC is unacceptable and must take the soul into its own hands. ”

In June last year, CHEN Hong, chairman of SAIC Motor, responded to the question of why it did not cooperate with Huawei, putting on the table the difficult-to-compromise interest differences between smart cars and suppliers.

BYD is in the battery, chip and even interior materials, a full set of production of self-research, Tesla and Apple also carried out chips and core technology full-stack self-research.

Volkswagen acquires self-driving software startup Argo AI, a competitor to Alphabet's self-driving car subsidiary Waymo.

The three new and old giants have all pointed out a clear path for those who come after. Whether it is power batteries, chips, software systems or data, to grasp the core technology, profits in their own hands, in the long run, the choice of de-supplier, has become an inevitable choice for intelligent car manufacturers. Otherwise, it will only become someone else's body.

Ning Wang also don't think about the fact that there are always people who want to harm you, use your first-mover advantage and market advantage, develop the next generation of batteries, establish stronger technical barriers, only tomorrow, there is tomorrow before the market value.

In fact, the competition of power batteries is not only the competition of a single company, but also the industry-wide profit game, as well as the collision and rise and fall of national strength.

This is a vigorous historical revolution that is underway in a century-old industry, and who kills the deer depends on who is closer to the deer, who has a longer-term vision, who has a stronger bow and arrow, and who is more skilled.

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