"If supply chain companies in And around Shanghai can't find a way to dynamically resume work and production, all Chinese automakers may have to stop work and production in May." On the evening of April 14, the chairman of Xiaopeng Automobile spread the news through the circle of friends and Weibo.
He Xiaopeng's anxiety, Yu Chengdong felt empathy. "If Shanghai continues to be unable to resume work and production, after May, all science and technology and industrial industries involving Shanghai's supply chain will be completely shut down." Yu Chengdong said through the circle of friends.
The troubles and pains of He Xiaopeng and Yu Chengdong are just the epitome of the entire automobile industry. Raw material prices soared, market sales fell, lockdowns, production stoppages, Q1 2022, the automotive industry that had just been respite was once again facing severe challenges, and a cold spring came unexpectedly.
As the leaders and leaders of independent car companies, BYD, Geely and Great Wall have the most intimate feelings about this spring cold. As the helmsmen of these three enterprises, Wang Chuanfu, Li Shufu and Wei Jianjun have responded to the challenges in completely different ways.
Wang Chuanfu all in new energy
"As a manager, I have been thinking about whether there will be new crises in the future, how to master more technologies, how to grasp the development direction of the industry, whether the strategy we have formulated will be offset, and whether we will bury hidden dangers while growing rapidly?"
As the helmsman of China's largest new energy vehicle company and the most valuable car company, Wang Chuanfu revealed his inner troubles and worries for the first time at a media communication meeting in December 2021.
In April 2022, BYD released a production and sales report. According to the data, BYD sold 104,145 units in March, an increase of 179.78% year-on-year. At the same time, BYD announced that it will stop production of fuel vehicles from March 2022. "In the future, in the automotive sector, we will focus on pure electric and plug-in hybrid vehicles."
At the investor meeting, BYD revealed that "it is conservatively expected to sell 1.5 million vehicles in 2022, and if the supply chain is good, it will hit the sales target of 2 million vehicles." "This means that after becoming China's largest new energy vehicle company, BYD is likely to become China's largest independent car company in 2022 and launch an impact on the north and south Volkswagens."
The situation was very good, but Wang Chuanfu was troubled. At the 2022 China Electric Vehicle 100 People's Conference, Wang Chuanfu strongly called for "the purchase tax reduction and reduction policy can continue to be extended." "According to the previous plan, policies such as new energy vehicle purchase subsidies and purchase tax reductions and exemptions will be completely withdrawn by the end of 2022."
With the withdrawal of the purchase tax reduction policy, BYD bore the brunt. At present, consumers only need to pay vehicle and vessel tax, compulsory traffic insurance and commercial insurance when purchasing PHEV models. After the withdrawal of tax incentives, consumers also need to pay 10,000-20,000 yuan of purchase tax, which has weakened BYD's price competitiveness to a considerable extent.
On the other hand, although sales and revenue far exceeded expectations, due to high R&D investment and rising raw material costs, BYD fell into a strange circle of increasing revenue and not increasing profits. In 2021, BYD's auto business achieved revenue of 112.5 billion yuan, but only generated a gross profit of 19.6 billion yuan, and the gross profit margin was only 17%, far lower than Tesla's 29% and Weilai's 20%.
Li Shufu Taoguang is obscure
"I have been working for the enterprise for nearly 40 years, I must cultivate a group of new people with leadership ability, and let everyone have the right and responsibility, only in this way can we mobilize everyone's enthusiasm and creativity, can we truly cultivate endogenous talents, and can the enterprise transform and upgrade sustainable development."
In March 2022, as in previous years, Li Shufu gave a sharing session entitled "6 Insights" at the Geely Lecture Hall. Not long ago, he resigned as a director of Geely Automobile, which is another major change after stepping down as the legal representative and chairman in 2021.
Li Shufu revealed that his main work will focus on the level of Geely Holdings, and gradually withdraw from the management and board level of Geely Automobile. "The reason and purpose of this is to promote modern corporate governance in a more compliant manner."
Li Shufu's withdrawal means that Geely Automobile is moving from the "Li Shufu era" into the "post-Li Shufu era". Geely Automobile in the "post-Li Shufu era" is full of unlimited opportunities and markets, and is also facing many difficulties and challenges.
In 2021, Geely Automobile sold a total of 1.328 million units, a slight increase of 1% year-on-year. Sales barely increased, but bicycle efficiency declined. In 2021, Geely Automobile's operating expenses were 15.443 billion yuan, an increase of 64% and 25% over 2019 and 2020 respectively, which means that the cost of selling bicycles is much higher than before the epidemic.
At the same time, due to the substantial increase in total operating expenses, Geely Automobile's profits were quickly swallowed up. In 2021, Geely Automobile's net profit attributable to the mother was 4.847 billion yuan, down 12.4% and 40.8% respectively from 2020 and 2019.
In the midst of difficulties and challenges, there are also opportunities. Geely Automobile announced that it will launch more than 8 Models of Thor Hi · X oil-electric hybrid and super electric hybrid products, to create flagship products such as Xingyue L and Lynk & Co 09 to enhance the brand's premium ability and profitability.
Wei Jianjun's silence
"Many people in the industry think that if the ideal ONE is replaced by the car logo of traditional car companies, then it will not be able to sell so much." In January 2022, when the media threw the issue at Wei Jianjun, he domineeringly replied, "They know a fart."
After the domineering return, there was a long silence. When Wang Chuanfu called for an extension of the new energy purchase tax reduction policy at the Hundred People's Meeting, and when Li Shufu shared 6 insights at the Geely Lecture Hall, Wei Jianjun unexpectedly remained silent, neither interviewing nor publicly appearing during the period.
In Q1 2022, Great Wall Motors' sales declined. In Q1 2022, Great Wall Motor sold a total of 283,500 units, down 16.32% year-on-year.
Specifically, the Haval brand sold 222,700 vehicles, down 25.13% year-on-year; the Great Wall pickup truck sold 59,400 units, down 27.68% year-on-year. Euler sold 33,800 units, up 10% year-on-year; Weipai sold 14,300 units, up 22.3% year-on-year; and tanks sold 25,800 units, up 79.8% year-on-year.
Although Euler, Weipai and tanks achieved sales growth, they were forced to increase prices and stop production due to rising raw material prices and supply chains. In March 2022, the price of Euler Good Cat was raised by 6,000-7,000 yuan. In April, the price of weipai coffee series models was raised by 5,000-12,000 yuan. At the same time, due to the impact of the epidemic in Shanghai, Jiangsu, Geely and other places, tank 300 has been suspended since April 14.
The negative impact of declining sales, falling profits and long price increases is also reflected in Great Wall Motors' stock price. Since January 2022, Great Wall Motor's stock price has fallen from 48.54 yuan per share to 26.35 yuan per share, during which more than 200 billion yuan of market value evaporated out of thin air. Even in the context of the overall decline of the stock market, this cliff-like decline of Great Wall Motors is rare.
Also in Q1 2022, Great Wall Motors released some gratifying signals. In March 2022, the Tank 500 was officially launched, and the price of 335,000 yuan to 395,000 yuan made it the most expensive car ever sold by Great Wall Motors, which is self-evident in the significance of the brand upwards.
At the same time, the autonomous driving company under Great Wall Holdings completed the A+ round of financing of hundreds of millions of yuan, and the power battery company Honeycomb Energy loading volume reached 0.35GWh, ranking fifth among all power battery companies, with a market rate of 4.2%. This means that Great Wall Motors' new vertical integration strategy has begun to bear fruit, and the parts and components companies that were originally only supplied by Great Wall are being recognized by external investors and the market.
From 2009 to 2019, BYD, Geely and Great Wall have gained a firm foothold in the low-end market by virtue of their cost-effective advantages, and completed the original accumulation of brands and sales. Since 2019, without exception, they have faced the dual pressure of market switching and the new crown epidemic. In response to the new challenges and stimuli, all three companies have made corresponding adjustments. In the era of smart cars, BYD, Geely, and the Great Wall, who will stand out? Who will fall?