Author | Walker
Edit | Egg total
Produced by | Bullet Finance (aka Bullet Finance)
Since its inception, the ideal car that relies on a single model to "hit the world" has issued an annual report.
On February 25, 2022, just before the U.S. stock market opened, Ideal Auto released its financial results for the fourth quarter and full year of 2021. Due to the good performance, Li Xiang, the founder of Ideal Automobile, simply took up the role of product manager in the analyst conference call held later, and popularized "how to make the product excellent" to everyone.
According to the financial report data, Ideal Automobile achieved revenue of 10.62 billion yuan in the fourth quarter of 2021, delivered 35221 vehicles, and the quarterly revenue exceeded 10 billion yuan for the first time; in 2021, it achieved revenue of 27.01 billion yuan, an increase of 185.6% year-on-year. In terms of net profit, the net profit in the fourth quarter was 107.5 million yuan, and the net loss in 2021 was 321.5 million yuan, an increase of 111.9% year-on-year.
In the annual sales segment, Ideal Auto delivered 90,491 units in 2021, an increase of 177.4% year-on-year, and vehicle sales revenue was 26.13 billion yuan, an increase of 181.5% from 9.28 billion yuan in 2020. The latest data show that in January 2022, Ideal Auto delivered 12,268 Ideal ONE, successfully achieving the goal of delivering more than 10,000 vehicles for three consecutive months.
On the whole, although the net loss of ideal cars is still increasing, compared with the other two new car-making forces that often exceed billions of yuan in losses, ideal cars control the loss at about 320 million yuan, which is not easy. In fact, among the new forces of car manufacturing, the gross profit margin of Ideal Automobile is relatively high, and the 2021 financial report shows that its gross profit margin has risen from 16.4% in 2020 to 21.3%.
This means that the ideal ONE, which costs more than 300,000 yuan, has a gross profit of 60,000 yuan per car.
Reflected in operating cash flow, Ideal Auto increased from $3.14 billion in 2020 to $8.34 billion, and as a basis, as of December 31, 2021, Ideal's total cash and cash equivalents, restricted cash, time deposits and short-term investments reached a historic $50.16 billion.
Of course, more than 10 billion yuan is due to the financing income from listing in Hong Kong, and it is the substantial expansion of reserve funds that also allows Li xiang to have new ideas for the research and development of the next stage of the ideal car and begin to focus on investment. Ideal Automobile's cumulative R&D expenses for the whole year of 2021 were 3.29 billion yuan, an increase of 198.8% year-on-year; the R&D expense ratios in each quarter of 2021 reached 14.4%, 13%, 11.4% and 11.6% respectively.
In a way, this is indeed a report that exceeds people's expectations. It is also affected by this report that the ideal stock price has experienced a volatile upward trend in the past few days. As of Feb. 28, Hong Kong's Ideal Auto shares continued to rise to close at HK$110.1, while U.S. stocks rose less than 2 percent to $27.89 as of press time, gradually flattening the high line of shares in recent months.
Therefore, Li wants to be unusual in the analyst meeting after the release of the financial report, it is rare to play the whole field, and its new model is about to be launched, and Li wants to open a unique "60 minutes, from beginner to proficient" product manager training course.
Everything looks beautiful, but multiple challenges are also within reach.
1. Extraordinary gross profit margin
Objectively speaking, among many automobile manufacturers, it is indeed rare for the automobile sales business to achieve a gross profit margin of more than 20%.
Generally speaking, the gross profit margin of traditional automobile manufacturers to maintain the automobile business is basically between 10 and 15%, and the figure of mature automobile manufacturers may be compressed downwards, because it also includes the depreciation of some production equipment.
For example, SAIC Motor, its 2021 third quarter report data show that as of September 30, 2021, the company achieved car sales of 538.373 billion yuan, with a sales cost of 476.585 billion yuan and a gross profit margin of only 11.5%.
From this point of view, the ideal car relies on a car alone to achieve a gross profit margin of more than 20%, which may be regarded as a "miracle in operation".
In this regard, Li xiang believes that after more than a year of adjustment, the management of the supply chain of ideal automobile has become mature, and due to the application of a large number of digital management software, its efficiency of supply chain management exceeds that of ordinary enterprises.
Coupled with the increase in sales of Ideal Auto in 2021, the number of stockpiles increases each time, and the product price of individual accessories in the supply chain will decrease, which will eventually make the gross profit margin of the whole vehicle break through to the highest level in history.
"It is undeniable that the ideal as a latecomer cross-border advantage, they cite a lot of digital management software and programs to strengthen the efficiency of the supply chain," Zhang Yurong, who worked at Beijing Benz, told "Bullet Finance", "Ideal Car has only one car, even if it is ordered parts, as long as the number of this car sold is enough, the cost of supply chain production will be reduced, and the price will also come down, which will increase the gross profit margin of the car." ”
In Zhang Yurong's view, the ideal ONE is still in a more flattering situation. "Unlike BYD DMI's technology, the ideal ONE's fuel engine is only responsible for driving the generator and transmitting electrical energy to the battery and motor, which is a line for the same energy transmission, rather than a dual energy transmission line like DMI, which will inevitably reduce the price of accessories and increase the stability of use."
In other words, the ideal ONE will use fewer parts than the DMI dual drive technology, which also gives the ideal car with supply chain management capabilities an innate advantage in development.
"In the industry, everyone knows that the ideal car is 'more critical', and they will ask for a lower cost on the production line and supply chain, in fact, this is a good spirit of doing companies, especially car companies." Zhang Yurong said that he believes that the gross profit margin of ideal cars in this annual report is a good proof.
After all, high gross profit margins will inevitably lead to an increase in revenue, and an increase in revenue will lead to an increase in cash flow brought about by operation, which forms a positive cycle. Zhang Yurong believes that if an enterprise enters such a positive cycle, the overall trend of its development will be better and better like a snowball.
As gross margins increase and cash flows increase, companies will have more money to invest in research and development and product optimization, thereby improving the efficiency of production and development, which is invaluable to an automotive brand.
2. Scientific research investment of "crazy make-up class"
All along, because the ideal car only has an ideal ONE car, and the corresponding technology is relatively stable, the ideal car gives people the feeling that they do not pay much attention to research and development.
This fact will change by 2021.
According to the previous prospectus information, as of March 31, 2021, ideal automobile research and development personnel is 1633, accounting for 33.3% of the total number of employees; by the end of 2021, this number will expand to more than 5,000 people, while the company's overall employee size is 11,901 people.
This means that nearly half or even more than half of the employees of ideal cars should be in the first line of scientific research, and the gross profit margin that ensures that R&D expenses can continue to be invested has reached 22.4% in the fourth quarter of 2021, excluding the impact of new energy vehicle points sales, this data has reached the highest level in the history of ideal cars.
Previously, Li Xiang clearly proposed that only a healthy gross profit margin can ensure long-term R&D investment of more than 10 points, so the ideal car that enters the positive cycle has "fallen into the scientific research class" in the past two years and is "crazy" to make up for it in 2021.
Graph /Photo Network, based on VRF protocol
The news shows that NOA (Navigate on Autopilot) and AEB (Automatic Emergency Braking) are the core technologies that Ideal Car will invest in so much research in 2021. Li Xiang also said at the earnings analyst meeting that Ideal Auto has become the third domestic automobile manufacturer with the three core technical barriers of intelligent cars, and it is completely independent of intellectual property rights.
Therefore, in 2021, these two technologies are attached and all the technologies are free, which has become one of the important reasons why the ideal car is snapped up by consumers. After all, on the side of competitors such as Tesla and Weilai, these two technologies belong to consumers who must pay separately every year to obtain.
Although the level of these two technologies is relatively low, the level is relatively simple, only part of the road traveled by Tesla, Xiaopeng, etc., but after all, it solves the problem of "whether there is one", and the superposition of this point makes the ideal car in 2021 become "fragrant" in the eyes of consumers.
However, whether these ideal core intelligent technologies can stand on the same starting line as other players in the next stage depends on how Li Xiang's "very strong" intelligent driving team, voice AI team, domain controller team and next-generation electrical and electronic architecture team play.
However, a rather ironic point is that a few hours before Li wanted to repeatedly emphasize the need to constantly replenish technical capabilities, the news of the long-rumored departure of CTO Wang Kai was settled - Ideal Automobile announced that Wang Kai, the core research and development leader, would resign as the CTO of Ideal Automobile for personal reasons, and Chief Engineer Ma Donghui took over the responsibility for the research and development of the company's intelligent car-related technologies.
This surprises many people who pay attention to the development of the ideal car.
"Now there is no way for the outside world to judge what is really happening inside the ideal car, because there is too little information and the incident is sudden. Under normal circumstances, the head of the company's core R & D team will not be so suddenly announced unless there is a major disagreement with the founder's philosophy, or the company's R & D funds can not be guaranteed. A gentleman with luggage of an ideal car told "Bullet Financial Outlook".
Wang Kai joined Ideal Auto in September 2020, and now he has left in the past 17 months, and in the context of Ideal Auto's large-scale expansion of R&D team and increased R&D funding in 2021, Mr. Li believes that "this is really sudden, we can't figure it out." ”
But in any case, such a thing will inevitably affect the research and development progress of the ideal car research and development team. For the ideal car to release a high-end large plug-in hybrid SUV in the second quarter of this year, the relevant impact can not be controlled within a certain range, testing the core management team's ability to operate in the next few months.
Of course, in addition, the core management team of Ideal Car faces more challenges than these, and if it cannot be solved, the problems behind it will be more obvious.
3. The last year of plug-in hybridization
In 2021, the sales of plug-in hybrid new energy vehicles are extremely hot, not only ideal cars, BYD's DMI models have ushered in explosive growth, and it is doubling explosive growth.
Behind it is related to the decline of subsidies and the green card policies in various places.
On the one hand, in 2021, the state's subsidies for new energy vehicles are gradually declining, consumers instead of buying pure electric vehicles, waiting for 4 to 5 years to update, it is better to buy a gasoline-electric hybrid car in one step, if the battery is lost, it can still achieve a long time through the gasoline engine to drive the motor to work.
On the other hand, in Shanghai, Guangzhou, Shenzhen and other cities, hybrid plug-in vehicles have also been identified as new energy vehicles and awarded green license plates, which can be controlled without restrictions on policies.
However, it is said that from 2022, various localities will tighten the green card policy, which will also trigger a rush of consumers for plug-in hybrid new energy vehicles after October 2021. Ideal Auto's annual report also notes and explanations for this, especially in the last month of sales exceeding the record.
But that's where the problem lies.
First of all, according to the corresponding information found now, the plug-in hybrid vehicle declared by the Ministry of Industry and Information Technology before 2018 can be identified as a new energy vehicle, and then the plug-in hybrid vehicle declared later, the production end should be declared in accordance with the fuel vehicle, it is possible to lose the identity of new energy vehicles from the perspective of departmental regulations, and cannot enjoy the effect of subsidies and green cards.
This is also why BYD's plug-in hybrid does not manufacture models separately, but integrates with existing car series.
However, Ideal Auto has planned to launch a new plug-in hybrid new energy high-end SUV in the first half of this year, and how to solve the "identity problem" is probably an important problem that the management team needs to solve urgently in the near future.
Secondly, the impact of subsidy decline on new energy vehicles will gradually appear in 2022. According to the Notice of the Development and Reform Commission of the Ministry of Industry and Information Technology of the Ministry of Finance on Further Improving the Financial Subsidy Policy for the Promotion and Application of New Energy Vehicles, the subsidy standard for new energy vehicles in 2022 will be reduced by 30% on the basis of 2020.
Among them, the pure electric passenger car mileage below 300 km without subsidies, the cruising range of 300-400 km (including 300 km) of pure electric passenger car subsidies dropped to 13,000 yuan; more than 400 km (including 400 km) of pure electric passenger car subsidies fell to 18,000 yuan, in principle, the 2020-2022 subsidy standards were reduced by 10%, 20% and 30% on the basis of the previous year.
The key is that in 2023, the subsidy will be completely abolished, and there will be no state subsidy for the sales of the corresponding car, and the price will be completely borne by the consumer. Unlike Weilai and other peers who use renting batteries to reduce the down payment, the ideal car uses the technical route of hybrid oil and electricity, which determines that the way of reducing the price of battery rental is not feasible.
Third, this year's plug-in hybrid new energy vehicles can also be green cards in many large cities in accordance with the new energy vehicle method, but the latest news shows that including Shanghai, Guangzhou and other places will no longer issue new energy vehicle licenses for plug-in hybrid vehicles in 2023.
This means that the strong basis for consumers to choose hybrid vehicles no longer exists.
Li wants to know this of course, last year's Guangzhou Auto Show Ideal Automobile announced that it is intensively developing pure electric vehicles, and will be listed at the end of 2022 and the beginning of 2023.
But the problem is that the pure electric vehicle research and development that li wants to and his team really leaves, the production time is less than a year. The industry's competition for pure electric vehicle battery capacity has entered a white-hot stage, and if the ideal car joins the capacity competition for large-capacity vehicles, how many chances of winning are not known now.
Coupled with the adjustment of the corresponding control system of pure electric vehicles, the continuous iteration of the intelligent platform, and the detection of automobile design, safety collisions, and vehicle operation conditions under extreme temperatures, it will take time.
There is no doubt that although the ideal car has a fantastic annual start, 2022 is still a year of challenges for Li Xiang and his team. Can Ideal Auto and Lee continue to take the "ideal path"? Looking forward to their next answer sheet.
*The title image in the text is from the photo network, based on the VRF protocol.