Source: Company e
"Euler black cats and white cats just stopped taking orders, not stopped production, we are actively seeking solutions." A few days ago, Euler brand CEO Dong Yudong in an interview with the Securities Times e company reporter, revealed the reasons behind the suspension of orders for two of Euler's hot models.
Dong Yudongtuo said that taking black cat as an example, after the sharp rise in raw material prices in 2022, the average loss of a car has exceeded 10,000 yuan. This has put a lot of pressure on enterprises.
Recently, the securities times · e company reporter went to the Euler new energy 4S store located in Chaoyang District, Beijing for an on-site visit, and found that the promotional materials related to the Euler white cat and black cat in the store have all been removed. The sales staff told reporters that when the two cars can resume receiving orders, there is no notice in the store.
The suspension of orders from Euler white cats and black cats reflects the survival dilemma of small electric vehicles under the background of rising raw material prices. On the other hand, the decline in subsidies for new energy vehicles and the decline in the trading price of new energy vehicle credits have further increased the cost of electric vehicles.
"At the current cost, it is basically to sell one at a loss." An insider of a car company who did not want to be named revealed that although the rise in raw material prices and the decline in subsidies for new energy vehicles are common challenges facing the entire industry, in contrast, the difficulties faced by small electric vehicles are more prominent. When the original cost advantage no longer exists, where should small electric vehicles go? It is plaguing the operators of businesses.
Subsidies have receded and raw material prices have risen, and new energy vehicles are now collectively rising in price
On March 17, Tesla's official website in China showed that the price of the rear-wheel drive Model Y was raised to 316,900 yuan, an increase of 15,000 yuan. It is worth noting that this is the third round of price increases made by Tesla China to its products in just seven days.
Up to now, the Tesla Model 3 high-performance version has raised a total price of 28,000 yuan and is now priced at 367,900 yuan; the Model Y high-performance version has raised a total price of 30,000 yuan twice, and is now priced at 417,900 yuan.
As for the reasons for the frequent increase in prices, Tesla said that it was mainly affected by factors such as rising raw material prices. Tesla CEO Elon Musk also posted on social media that Tesla and its rocket company SpaceX are facing huge inflationary pressures in raw materials and logistics.
On March 18, Xiaopeng Automobile announced that due to the continuous sharp rise in the price of upstream raw materials, Xiaopeng Automobile will adjust the price of the models on sale, and the increase in the price before subsidies will range from 10,100-20,000 yuan. The price adjustment will take effect from 00:00 on March 21.
On March 16, Chery New Energy also raised the price of its small ants and QQ ice cream models, ranging from 3,000 yuan to 6,000 yuan. It is reported that before the price adjustment, the price range of these two small electric vehicles was 29,900 yuan to 81,900 yuan. After the adjustment, the price of chery ant 408km full sugar version has risen to 89,000 yuan.
Chery New Energy said that due to the adjustment of national policies and the continuous sharp rise in the price of battery and chip raw materials, the cost of many models of Chery New Energy continued to increase. In order to be able to continue to provide users with products, the company has raised the price of some models.
"The rise in the price of raw materials for power batteries has been going on for a year, and in 2022, this upward trend is still intensifying," Dong Yudong told the Securities Times E company reporter that the pressure from the upstream is gradually transmitting to downstream car companies.
Public data show that in 2022, the price of lithium carbonate opened a jump mode after 300,000 yuan / ton on the New Year's Day station, rushed to 400,000 yuan / ton in mid-February, and broke through the 500,000 yuan / ton mark in early March, up nearly 70% from the beginning of the year.
Recently, under the long-short game, the price of LME nickel once rose to 100,000 US dollars / ton, which once again pushed up the raw material price of power batteries. In the past week, the price of battery-grade nickel sulfate has risen sharply, up 30.6% during the week.
CICC revealed that according to the feedback from car companies, the current cost increase of new energy vehicles is 10-20%, and the number of bicycles is about 10,000 yuan.
"At present, the cost and selling price of some new energy models have been inverted," Zhang Junyi, managing partner of Oliver Wilshire Consulting and head of auto and private equity business in Greater China, told securities times e company reporters, in this case, price increases are an inevitable trend.
According to the incomplete statistics of the Securities Times E company reporter, since the beginning of this year, Weilai, Xiaopeng Automobile, Nezha Automobile, Zero-run Automobile, WM Automobile, GAC E-An, Feifan Automobile, BYD, Euler, SAIC-GM-Wuling, Volkswagen, Extreme Krypton, Geometric Automobile, Ford Automobile, etc. have all raised the price of their new energy vehicle products, with price increases ranging from several thousand yuan to tens of thousands of yuan, covering nearly 40 mainstream models in the current electric vehicle market.
Saic-GM-Wuling insiders told the Securities Times e company reporter that the sharp rise in the cost of raw materials for power batteries is an objective difficulty for every new energy vehicle company.
Since March, a number of new energy vehicle companies have opened a second round of price adjustments for their models, which is suspected of setting off another wave of "price increases".
At the same time as the price increase, some car companies have had to suspend the receipt of orders for their hot models to cope with the crisis caused by rising costs.
A few days ago, Euler Automobile announced that its white cat and black cat models will suspend orders. Previously, these two cars were the hot sales force of Euler Automobile. After suspending the acceptance of orders for both models, Euler Automobile's sales in February this year also fluctuated slightly. In February this year, Euler car sales were 6261 units, down 15.09% year-on-year and 52.68% month-on-month.
Dong Yudong told the Securities Times E Company reporter that the suspension of orders is a measure of last resort, and the average black cat and white cat sold is currently an average, and the loss range is about 10,000 yuan. At the same time, due to the shortage of chips, the delivery cycle of vehicles has been elongated. In the long run, it is not good for consumers and businesses themselves. At present, Euler is actively seeking a solution.
Recently, the securities times e company reporter went to the Euler new energy 4S store located in Chaoyang District, Beijing for a field visit. The sales staff told reporters that the models currently on sale in the store are only good cats and good cat GT, and when the orders of Euler white cats and black cats will resume, they have not yet received a notice.
"At present, good cats are in stock, and good cat GT needs to wait about two months to pick up the car after booking", the above sales staff suggested that if you consider buying, you need to do it as soon as possible. The manufacturer has notified a new round of price increases, but the specific adjustment time is not yet known.
It is understood that on March 1 this year, Euler Automobile announced on the official App that the price of the new Euler good cat was adjusted from the previous 103,900-143,900 yuan to 121,900-151,900 yuan, an increase of between 8,000 yuan and 18,000 yuan.
In fact, behind the wave of price increases set off by new energy vehicle companies, there is not only an increase in raw material prices, but also closely related to the recent adjustment of the state's subsidy policy for new energy vehicles and the decline in the price of new energy vehicle credits.
According to the 2022 new energy vehicle promotion and application financial subsidy policy jointly issued by the Ministry of Finance and other four ministries and commissions; in 2022, the subsidy standard for new energy vehicles will be reduced by 30% on the basis of 2021. At the same time, 2022 is also the last year of the implementation of the national subsidy policy.
According to the latest subsidy plan, from January 1, 2022, the subsidy for pure electric vehicle models with a cruising range of 300 km (inclusive) to 400 km is 0.91 million yuan, a decrease of 3,900 yuan compared with 2021; the subsidy for pure electric vehicle models with a cruising range greater than or equal to 400 km is 12,600 yuan, a decrease of 5,400 yuan compared with 2021.
At the same time, the transaction price of new energy vehicle credits (NEV points) is also declining. Fang Yunzhou, founder and chairman of Nezha Automobile, revealed to the Securities Times E Company reporter that in 2021, the average price of NEV points will be 2,000 yuan / min, but by the beginning of 2022, the price of NEV points has fallen back to about 1,000 yuan / min, with a large fluctuation range.
"Previously, NEV points can soar up to 2500 yuan / point, and the latest point price may only be 500 yuan / min - 800 yuan / min", Dong Yudong said, the decline in the price of points, as well as subsidies decline, raw material prices and other factors superimposed, making the loss of small electric vehicles has become inevitable.
Costs have risen, delivery order has been chaotic, and small electric vehicles have exposed their survival dilemmas
In recent years, new energy vehicles are undoubtedly the hottest sector in the market. Even under the multiple pressures of the epidemic and chip shortage, the new energy vehicle market still maintained a trend of contrarian growth.
According to the latest data released by the China Association of Automobile Manufacturers, the production and sales of new energy vehicles reached 368,000 units and 334,000 units respectively in February this year, an increase of 2.0 times and 1.8 times year-on-year. From January to February 2022, production and sales of new energy vehicles were 820,000 units and 765,000 units, up 1.6 times and 1.5 times year-on-year.
From the perspective of product structure, A00-class and A0-class small electric vehicles undoubtedly occupy half of the new energy vehicle market. Relevant data show that in the past two years, the average market share of small pure electric passenger cars has exceeded 40%. After the new energy vehicles to the countryside activities, its market share is still further rising.
Cui Dongshu, secretary general of the National Passenger Car Market Information Joint Association, told the Securities Times E Company reporter that small electric vehicles have small bodies and affordable prices, which are just needed products for many consumers and are also suitable as "second cars" in the family.
In 2020, SAIC-GM-Wuling became a "net red" in the new energy vehicle market with a Wuling Hongguang MINI EV, which further heated up the small electric vehicle market.
"The current new energy vehicle market has taken on a dumbbell shape, with high-end models and low-end small cars occupying more market share." A securities analyst told the Securities Times E company reporter that the development trend of small electric vehicles has been very optimistic in the industry, and it is also conducive to the further promotion and popularization of new energy vehicles.
However, under the collective action of the repeated new crown epidemic, rising raw material prices, chip shortages and other factors, small electric vehicles are also facing certain survival dilemmas.
A few days ago, the Securities Times e company reporter visited a 4S store of SAIC-GM-Wuling in Beijing's Chaoyang District, in the huge storefront, one after another display of various types of exhibition vehicles, of which the most popular market attention and popular Wuling Hongguang MINI EV can only be placed outside the store.
"There are too many exhibition cars, the store really can't open, and these models placed outside the store have no existing cars, just waiting for reservations," the sales staff told the Securities Times e company reporter, from now on to place orders, it is expected to wait for about 1 month to pick up the car.
When asked why the car could not be picked up immediately, the other party said that it was mainly affected by the epidemic and the supply chain.
The Securities Times E company reporter noted that due to the current delivery pressure faced by new energy vehicle companies, a business of resale orders has gradually emerged on the Network.
The reporter landed on the salted fish and other second-hand trading platforms, randomly entered several popular new energy brands such as Extreme Kr, Tank, Euler, Wuling, etc., and added "order" as a keyword, which will immediately pop up a number of transfer orders, and also some users have commented on the need for high-priced orders.
According to a salted fish seller, at present, this kind of transfer order is basically based on local transfer and does not accept inter-provincial. Many sellers keep an eye on the hottest models to book, especially those that can be ordered online. After successfully grabbing the order, it will be resold to consumers who urgently need to buy a car at a certain premium. For some consumers, it can save time waiting in line.
Zhang Junyi told the Securities Times E Company reporter that the hot salted fish order reflects the chaos of the current production order and delivery order of the new energy vehicle market. After the supply chain problem is improved, the price of raw materials falls, and the production of car companies is restored to stability, this phenomenon will slowly fade.
"At present, some car companies are acquiescing to this behavior, but in the long run, it is also a kind of harm to the brand", some industry insiders analyzed that the inability to provide timely and stable supply will reduce consumers' sense of identification with the brand to a certain extent.
Previously, the suspension of orders from the white cat and black cat of Euler Automobile has caused a lot of waves in the market.
The above-mentioned person said that compared with other classes of models, the small electric vehicles of the A00 class have limited profit margins and mainly rely on the benefits brought by scale. When the cost rises sharply, its profits will inevitably be further squeezed, and its existential crisis will be exposed first.
"At present, the market demand for small electric vehicles is very strong, if according to the current sales rhythm, the loss of bicycles may increase to 17,000 yuan next year," Dong Yudong told the Securities Times e company reporter, continue to accept orders, losses will expand, the delivery cycle will become longer and longer, the current small electric vehicle companies must make certain adjustments.
Cost reduction OR brand upgrade, where is the small car electric vehicle?
How do the once-popular small electric vehicles get out of the current predicament? For many car companies, this is undoubtedly a problem.
Zhang Junyi told the Securities Times E company reporter that some of the parts used in the A00 small electric vehicle are not the vehicle standard level, but the consumer level, and the car companies are further optimized at the parts level, and the cost of the whole vehicle is expected to be further controlled. However, in the long run, the upgrading of products and brands will bring higher profit margins and gross profits to enterprises.
In fact, upgrading products is currently a route generally recognized by small electric vehicle companies.
"For small electric vehicles, it is obviously unrealistic to continue to increase prices and suspend orders, or even stop production", Fang Yunzhou believes that for car companies, the scale strategy of products should be firm enough and cannot be easily transferred by cost price fluctuations or other factors. At the same time, in the case of rising costs, car companies should think more about how to create high-priced products.
Fang Yunzhou believes that high cost performance is the advantage of small electric vehicles, but also its unique competitiveness. To maintain this cost-effectiveness, enterprises must rely on technological upgrades to achieve the reduction of research and development costs, the universality of functions, and so on.
Dong Yudong also said that simply increasing the price of products, consumers may not necessarily pay, and even will have disgust. Therefore, he believes that the rise in the price of small electric vehicle products must be accompanied by the increase in configuration and the improvement of the sense of science and technology.
The Securities Times E company reporter noted that when Euler announced the price increase of the product on March 1 this year, it did also publish the instructions for additional configurations.
Dong Yudong said that in the early stage of industrial development, A00-class pure electric vehicles are very good products, which has led to an increase in the penetration rate of new energy vehicles, but with the rise in raw material prices and subsidies, the trend of loss is becoming more and more obvious. At the same time, we realize that our existing brands and products need to be upgraded, and the "waist market" including A0-class, A-class, B-class new energy products will usher in a round of collective rise sooner or later.
"With the development of the industry, we have fully realized that only more than 150,000 products have room for profitability. Therefore, the current Euler must go up. Dong Yudong judged that in the future, the domestic new energy vehicle market may gradually form a "rugby-shaped" market pattern with the upgrading of various products.
Coincidentally, SAIC-GM-Wuling, the current sales king in the market of small electric vehicle companies, has also recently improved and upgraded its products.
An insider of SAIC-GM-Wuling told the Securities Times E Company reporter that since the launch of the Wuling silver label, SAIC-GM-Wuling has launched the first step of transformation and upgrading, and the pace of Wuling's product and brand upgrade will be carried out according to the user's consumption upgrade needs.
Zhang Junyi analyzed that although SAIC-GM-Wuling has fully enjoyed the market dividend of small electric vehicles in the early stage, the company has a very sense of urgency, and if there is no pressure from the epidemic and supply chain level, the company's upgrade pace may be faster.
In the face of the collective upgrading of small electric vehicle companies, some insiders have put forward another voice: the enterprises that do small cars are collectively upward, and who will maintain the existing low-end market? Will the penetration rate of new energy vehicle products be reduced?
In this regard, Zhang Junyi believes that with the general trend of consumption upgrading, the product and brand upgrading of car companies is a major trend. The existing small electric vehicle market needs to be upgraded and entered by those engaged in the research and development and production of low-speed electric vehicle products. In his view, allowing low-speed electric vehicle companies to upgrade and create A00 and A0-level electric vehicle products is more conducive to manufacturing upgrading and high-quality development of the industry.
"If you rely on traditional car companies to 'reduce dimensions' to create low-end products for a long time, it is not conducive to manufacturing upgrading and the sustained upward movement of the industry." Zhang Junyi believes that from this point of view, small electric vehicle companies to the higher market impact, although they will face certain challenges, but it is the road they must take, but also to cope with the current challenges of the "optimal solution".
The rise in raw material prices is unsustainable, and the enthusiasm for terminal consumption is undiminished
Although the "rising price tide" of new energy vehicles has been higher than a wave, the demand in the terminal market has not been reduced.
The sales staff of SAIC-GM-Wuling 4S store told reporters that the Wuling Macro Mini EV in the store was ordered out early, and the last batch of orders had just been delivered. In his view, because the price of small electric vehicles themselves is not high, consumers buying the product is basically in the need of transportation, so the fine-tuning of the price will not affect their willingness to buy.
Cui Dongshu also believes that at present, the head of the new energy vehicle companies have mastered a certain pricing power, they make price adjustments, will not affect the demand of the terminal market, so the association for this year's expected sales target for the new energy vehicle market has not been adjusted.
At the same time, Cui Dongshu also pointed out that the current rise in raw material prices is unsustainable and will eventually return to rational market pricing.
The research report released by Soochow Securities shows that due to the strong demand for downstream power batteries and energy storage batteries, the short-term new supply of lithium carbonate is limited, and the impact of some manufacturers hoarding goods has accelerated since the beginning of 2022. However, the recent increase in the price of battery-grade lithium carbonate has gradually slowed down. At the same time, in the long run, the global nickel production capacity is gradually released, the supply tension will be alleviated, and the new production capacity is mostly integrated, which can effectively reduce the cost of the lithium battery industry chain. The current rise in nickel prices has a relatively limited impact on the industrial chain.
CICC analyzed that the impact of the current battery price increase has landed, and car companies have followed up the price adjustment to form a preliminary profit. It is expected that the continued high prosperity of new energy will further alleviate market concerns and maintain the annual sales judgment of more than 5 million new energy passenger cars.
"According to the law of the market, the raw material price of power batteries will not always be at a high level, and it is bound to return to rationality", Fang Yunzhou believes that for small electric vehicle companies, it is necessary to learn to balance in the case of huge changes in cost and price, and adhere to their own strategy and determination. In his view, cost-effective products that meet the needs of the public still have a broad market space.
Xu Haidong, deputy chief engineer of the China Automobile Association, told the Securities Times e Company reporter that the market demand for small electric vehicles has existed for a long time, especially under the promotion of new energy vehicles going to the countryside, the penetration rate of electric vehicles in cities and villages has increased significantly, and this trend will continue for a period of time in the future.