The largest luxury car IPO in history has come, and Porsche is valued at 600 billion

Porsche is also going to an IPO.

The investment community - Daily IPO has learned that Volkswagen has selected lead banks for Porsche's listing plan, including Goldman Sachs, Bank of America and JPMorgan Chase as co-coordinators. Wall Street had expected that if Porsche was successfully listed independently, its valuation would range from about 60 billion to 85 billion euros, equivalent to between 400 billion and 600 billion yuan, and it was expected to become the largest IPO in automotive history.

Founded in 1931, Porsche has gone through 90 years of ups and downs, and today China has become its largest single market. In 2021, Porsche's new car delivery volume reached 300,000 units worldwide, of which 96,000 were purchased Chinese, and the minimum price of one car was 500,000 yuan, and the consumption power was amazing. The Macan, a midsize SUV, is currently Porsche's best-selling model.

Every car brand needs years of precipitation. In the era of the traditional automobile industry, it is difficult for us to give birth to our own Porsches; but in the era of electrification, China's electric vehicles are in full swing, will we give birth to the top luxury electric vehicles that are comparable to Porsche?

Father and son join forces to create the world's most profitable luxury car

Now it's time for an IPO

How did Porsche rise? It all starts with a soul figure – Ferdinand Porsche.

Born in 1875 in a modest blacksmith family, Ferdinand Porsche showed a keen interest in mechanical engineering from an early age. In 1893, at the age of 18, Ferdinand joined the Swiss motor company Bela Egger, the predecessor of today's Swiss ABB Group. Here, Ferdinand demonstrated his excellent design and development skills, inventing the wheel motor to drive the car, that is, the electric motor installed in the wheel of the car directly to drive the vehicle forward. The technology was patented in 1896, when Ferdinand was only 21 years old.

In 1898, Ferdinand joined the Vienna-based Ludwig Lohner Vehicle Company and in 1899 developed an electric car called Lohner-Porsche. In 1900, his first electric car appeared at the World Exposition of Industrial Products in Paris, and then set an Austrian speed record at 35 miles (56 kilometers per hour). Since then, he has been known as the "father of electric vehicles".

Later, Ferdinand came to Daimler AG in Austria and designed a number of epoch-making new cars, such as the Mercedes-Benz S, SS and SSK supercharged supercharged cars that shocked the car world, which swept the car world and won countless championships and dominated the car industry in the 1820s. Later, Ferdinand had to hang up his crown because he was at odds with Daimler's philosophy.

In 1931, Ferdinand and his son Ferry Porsche set up their own design studio in Stuttgart, Germany, which would later become known as porsche cars. Soon after the company was founded, they received a design order from Volkswagen and also designed a classic Beetle car for it.

But Ferdinand did not launch a car that truly belonged to Porsche. It was not until 1948 that the 356 model designed by his son Ferry Porsche was born and officially named after porsche. In 1950, the Porsche 356 entered mass production. It was with this car that Porsche established itself as the king of sports cars.

In 1951, the founder of Porsche Cars, Ferdinand, died and distributed the property to his son Ferry and daughter Louise Porsche, who continued to be responsible for the design and management of Porsche. In 1963, the most important model in Porsche's history, the 911, was unveiled at the Frankfurt Motor Show.

Today, the 911 has become a model for top-of-the-line performance sports cars. The Porsche 911 series is one of the most legendary models in the whole of Porsche and in Germany. Among them, the classic elements such as Porsche 911's iconic frog-eye lamp and horizontally opposed engine have been determined and passed down to this day.

In the mid-1980s, Porsche suffered its worst crisis in history, forcing it to cut its car production in half, slashing prices and laying off a third of its workforce.

It was not until 1993, when Porsche released the Boxster concept car, that the business situation gradually dawned. After the launch of this convertible sports car in 1996, it set off a global rush to buy it. In 1998, Porsche took advantage of the victory and unveiled the new 911 convertible at the Geneva Motor Show, which was once again stunning.

Through the storms, Porsche has gradually become one of the most profitable luxury car brands in the world. At the same time, Porsche has successively launched the 911, Panamera, Cayenne (Cayenne), Macan and other series of models. In 2015, Porsche spent 1 billion euros to build a new electric vehicle factory to build the first all-electric sports car. Four years later, Porsche's first electric sports car, the Taycan, made its world debut, marking the beginning of Porsche's entry into the era of electrification.

Nearly 100 years after its founding, Porsche is finally going public. It will be another luxury car brand seeking an IPO, after Ferrari, Aston Martin and Volvo.

According to Wall Street, if Porsche Motors' independent IPO, the valuation will be about 60 billion to 85 billion euros, equivalent to between 425 billion yuan and 600 billion yuan, which is close to the market value of volkswagen group of 100 billion euros. From this point of view, Porsche created the largest IPO in European history.

The minimum is 500,000 yuan, and the annual income is 230 billion yuan sold in China for 100,000 vehicles a year

Through Porsche, we can get a glimpse of what a luxury car is like.

In March this year, Porsche officially released its 2021 annual financial report - in 2021, Porsche AG's operating income climbed to 33.1 billion euros (about 230 billion yuan), an increase of 4.4 billion euros from the previous fiscal year, an increase of 15% year-on-year; sales profit was 5.3 billion euros, an increase of 1.1 billion euros from the previous fiscal year, an increase of 27%, and a 16% return on sales.

It should be known that in the context of chip supply shortage and rising raw material prices, Porsche's operating income and sales profit have hit a record high, which is not an easy task.

According to Porsche China's official website, Porsche has a total of six models on sale, including the 718, 911, Tayca, Panamera, Macan, Cayene and so on.

In 2021, Porsche delivered a new all-time record of 301915 units. Among them, the mid-size SUV Macan is the best-selling model of the Porsche brand, with the official price starting from 554,000 yuan, while the Price of the Macan GTS is from 848,000 yuan. Even so, global sales of the model reached 88,362 units, up 13% year-on-year.

It is worth noting that Porsche is also enthusiastically embracing electric vehicles. The data shows that about one in every four new cars delivered by Porsche worldwide in 2021 will be pure electric or hybrid models. Porsche also announced a new goal for electrification in 2030 at the earnings meeting: the pure electric Macan will be officially launched in 2025, and the 718 series is planned to be fully electrified. By 2025, half of Porsche's new global deliveries are expected to be electrified, both electric and hybrid, and by 2030, all-electric models are expected to account for more than 80% of new vehicle deliveries.

Surprisingly, the Chinese market has become Porsche's largest single market. According to the data, in 2021, Porsche's delivery volume in the Chinese market will be nearly 96,000 units; while in the United States, the delivery volume will exceed 70,000 units; in the European market, such as Germany, Porsche's new car delivery volume will reach nearly 29,000 units.

Since 2001, Porsche has been deeply engaged in China for 21 years, from the Porsche 911, which became famous in World War I, to the later performance SUV Cayenne, which has witnessed the love of domestic consumers for Porsche.

In fact, Porsche doesn't have much hope for the Taycan, the first work of electrification, but the enthusiasm of Chinese consumers is beyond expectations.

In 2020, Porsche's new Taycan China debuted and simultaneously opened the pre-sale in the Chinese market, with an official guidance price of 888,000 yuan, which was sought after by Young Chinese people as soon as it was listed. In 2021, the Taycan contributed the highest increase in Porsche products, with more than 41,000 new car shipments worldwide, more than double the number in 2020. Among them, Porsche delivered 7,300 Taycans to Chinese users, accounting for 18% of total sales. This means that for every 6 Taycans sold, one is shipped to China.

When luxury brands such as Mercedes-Benz BMW were frustrated on the electrified track, Porsche seemed to be riding the dust. After seeing the charm of the Chinese market, Obomu, Chairman of porsche's Global Executive Board, lamented that many of the emerging technologies are initially from China and are gradually being applied to other markets around the world. "Therefore, China will become a very important base for our innovation experiments."

At the beginning of 2021, Porsche established Porsche Digital Technology, hoping to deepen the Chinese market and understand the needs of consumers in the Chinese market for digitalization in a timely manner. According to reports, Porsche Digital Technology focuses on three major business directions, including digital products, vehicle connection products and services, and customer innovation. This year, Porsche opened a new R&D branch in China to complement the existing digital business in China.

According to Obermou, Porsche expects to invest 15 billion euros (about 105.6 billion yuan) globally by 2025 in electric mobility and digital transformation, some of which will be directly invested in China, and will increase cooperation with local Chinese technology companies to better provide Chinese consumers with convenient digital solutions.

Will China give birth to its own Porsche?

Just like Porsche, almost all car companies are currently in IPOs.

Among them, new energy vehicles are particularly enthusiastic. Not long ago, China Zero Run Automobile has submitted a listing application to the Hong Kong Stock Exchange, with CICC, Citi, JPMorgan Chase and CCB International as joint sponsors. Once the zero-run car is successfully listed, it will become the fourth new car-making force to land on The Hong Kong stock market. As the helmsman of zero-run cars, Zhu Jiangming studied electronic engineering at Zhejiang University and founded a listed security company, Dahua Shares, with a market value of 50 billion yuan so far.

In 2015, after Zhu Jiangming saw the future prospects of electric vehicles, he threw himself into the wind and fire car-making movement and founded a zero-run car. Since the release of the first model in 2019, ZeroCar has delivered a total of 52,832 vehicles, achieving more than 3 billion yuan in revenue in 2021 alone.

Another new car-making force, Nezha Automobile, is also actively preparing for an IPO. It is reported that Nezha Automobile has launched a Pre-IPO round with a target valuation of about 45 billion yuan, or US$7 billion, and plans to launch an IPO in Hong Kong within this year.

Back in 2014, Fang Yunzhou, who was the host of Chery's new energy project, founded Nezha Automobile, and has been quietly working on the new energy vehicle track. According to the data, Nezha Automobile delivered a total of 69,674 units in 2021, an increase of 362% year-on-year, ranking fourth among the new forces of new car manufacturing.

Coincidentally, another new car-making force, Gaohe Automobile, also began to spread the news of IPO after the sales soared. Founded in 2017, Gaohe Automobile focuses on ultra-luxury positioning, and has a high-end SUV, Gaohe HiPhi. At present, gaohe HiPhi X has a total of 6 models on sale, with a price range of 57.00-80.00 million.

In just a few years, Gaohe Automobile has emerged in the luxury car market. In the whole year of 2021, Gaohe Automobile sold 4237 vehicles. According to the retail data of the Data Resource Center of China Automobile Center, Gaohe Automobile ranks high in the sales volume of luxury brand electric vehicles with more than 500,000 yuan. In January 2022, Gaohe HiPhi X models sold a total of 550 units, ranking first, higher than Mercedes-Benz Andes and Hongqi Motors.

In March this year, GAC Aeg, a wholly-owned subsidiary of GAC Group, recently completed a capital increase and share expansion, amounting to 2.566 billion yuan. The investors include the employee shareholding platform and three strategic investors such as the production and investment Ai'an Fund, China Chengtong, and China Southern Power Grid, and the company's valuation has reached 39 billion yuan. Relevant people of GAC Group have said that according to the market environment, it is expected to submit application materials before the end of 2023 at the earliest and choose the opportunity to IPO.

In addition, Dongfeng Group is exploring the possibility of an independent listing of its intelligent high-end electric brand Lantu. "In order to introduce investment, Lantu has set up relevant departments to carry out docking." Relevant people familiar with the matter revealed.

Chinese new energy vehicle companies are piling up for IPOs, a sight not seen anywhere else in the world. Behind the reflection of a truth: if in the era of fuel vehicles, it is difficult for domestic brands that start late to enter the international stage. Then in the era of electrification, the opportunity for domestic independent brands to overtake in curves has come.

As an investor who has been following the automotive industry for many years put it, "From the endgame, more than 70% of China's auto market may be independent brands." More critically, Chinese car companies, especially the new car-making forces, are leading the innovation of intelligent electric vehicles in the world.

Just imagine, if we follow the rise path of fuel vehicles, it is difficult for us to have a chance to produce luxury cars that can compete with Porsche. But after a change of track - in the era of electric vehicles, will China have the opportunity to give birth to its own Porsche? We'll see.