Text | Liu Zhentao
19 years ago, Wang Chuanfu made a big stroke of the pen and acquired 77% of the shares of Xi'an Qinchuan Automobile for 270 million yuan, completing his dream of building a car. But the capital market is not optimistic, a battery-making company, with what to build a car?
Within 2 days, BYD's stock in Hong Kong stocks fell sharply, and the market value evaporated by HK$2.7 billion, and at that time, BYD had just been listed on Hong Kong stocks for about a year, and the market value was only a few billion Hong Kong dollars.
For the acquisition of Qinchuan Automobile, Wang Chuanfu said that it is to prepare for profitability in 5 to 10 years. 2 years after the acquisition of Qinchuan Automobile, BYD's F3 mass production, a hit, BYD in the field of fuel vehicles to gain a lot of glory, the company's stock price and profits also rose.
19 years later, on April 3, 2022, Wang Chuanfu waved again, not to buy anyone, but to slash BYD's fuel vehicles, becoming the world's first company to officially announce the suspension of fuel vehicles.
As early as 2007, BYD Automobile F6 off the line, The Pingshan base was completed, wang Chuanfu changed the low profile of the past, and said: "BYD will become the world's first automobile company in 2025." ”
How to achieve the first? Wang Chuanfu once explained: "2020 is the world of electric vehicles, the technical core of electric vehicles is the battery, and BYD's core technology is battery technology." ”
BYD cut off the fuel vehicle, as if there was a feeling that Wang Chuanfu wanted to honor the target he had shouted. However, swinging a knife to cut off the back of the fuel vehicle is not only courage and confidence, but also more helplessness.
The undertone of the knife: battery and ability
Wang Chuanfu's courage and confidence in swinging the knife comes from BYD's deep cultivation in battery technology and the field of new energy battery power vehicles for a long time, and has accumulated a lot of technical experience and achievements for a long time.
When BYD was founded in 1995, it was mainly engaged in the development and production of nickel-cadmium and nickel-metal hydride batteries. In 2002, BYD successfully listed in Hong Kong, and only one year after its listing, BYD became the world's second largest rechargeable battery manufacturer, leading the way in all "three electricity" technology areas (lithium-ion batteries, nickel-cadmium and nickel-metal hydride batteries). At that time, Mobile phone giants such as Motorola and Nokia were BYD's customers.
Since it started from the battery industry, after BYD entered the automotive field, it relied on battery technology to engage in new energy battery power vehicles.
In 2006, BYD successfully developed the first "F3e electric vehicle" equipped with lithium iron phosphate batteries; in 2008, BYD developed the first hybrid car "F3DM". However, after the F3DM was listed, only 48 vehicles were sold, plus research and development expenses, making BYD lose more than 1 billion yuan.
In the face of dismal sales, Wang Chuanfu still did not change his judgment. In his view, although F3DM lost money, the research and development funds were exchanged for more than 600 patented technologies.
Later, BYD continued to improve its hybrid technology. After continuous improvement, in January 2021, BYD launched a new hybrid solution - DM-i Super Hybrid Platform.
According to relevant car media reports, DM-i creatively changed the traditional hybrid technology mainly relies on the engine, oil-based design architecture, which mainly relies on high-power and high-efficiency motors for driving, with large-capacity power batteries for energy, the engine only plays an auxiliary role. In 2021, BYD's three DM-i models will sell 180,000 in the whole year.
In addition, BYD also has its self-developed blade battery, and is also laying out in the industrial chain of new energy vehicles such as IGBT chips. Today, BYD holds more than 9,000 patents and is the only new energy vehicle manufacturer in the world that can develop batteries and motors.
In recent years, the market demand for new energy vehicles in the mainland has been very strong, and production and sales have repeatedly reached new highs. In 2021, the output of new energy vehicles in the mainland will be 3.545 million units, and the sales of new energy vehicles will be 3.521 million units, and quantuo data predicts that by 2025, the sales of new energy vehicles in the mainland are expected to exceed 6 million units, which is almost double compared with 2021 sales.
Mastering the core technology with one hand and facing the huge growth space of new energy vehicles in the future, it can be said that Wang Chuanfu slashed the BYD fuel vehicle with a knife and had confidence.
However, although Wang Chuanfu wielded a knife fuel vehicle, it was also the helplessness of BYD's development behind it.
The helplessness of swinging the knife: fuel vehicles cannot be sold and do not make money
Wang Chuanfu wielded a knife to cut off BYD's fuel vehicles helplessly: First, BYD's fuel vehicles are not easy to sell, and the market's statement about BYD fuel vehicles has become that BYD will only build cars and will not sell cars.
Before 2017, in BYD's automotive business, fuel vehicles have always been BYD's largest revenue, new energy electric vehicles are the second, and after 2017, the first and second have changed, new energy electric vehicles have become BYD's first growth curve, fuel vehicles have become the second growth curve, and sales have negative growth.
According to BYD's annual report, in 2017, BYD's fuel vehicle sales were 245,000 units and new energy vehicles were 113,000 units. In 2021, BYD's fuel vehicle sales fell to 136,300 units, a five-year drop of 44.37% compared with 2017; sales of new energy vehicles reached 603,800 units, an increase of 434% in five years compared with 2017.
The best fuel car BYD sold was the original F3, which sold 111,000 units a year. Since then, BYD has released a number of fuel vehicles.
For example, in 2018, BYD even launched two new cars, the Tang second-generation fuel version and the Qin fuel version, but the sales were very dismal. In 2019, BYD launched the fuel car Song Pro, which sold more than 100,000 vehicles in 2020.
BYD seems to see the dawn of fuel vehicles, and has released a fuel version of Song Plus without stopping. However, it failed to stir up a splash, and the market performance was flat, with sales of the Song PLUS fuel version in 2021 being 39,000 vehicles. Not only is the sales average, but the price cannot be sold.
According to the Economic Daily, the guidance price of Song PLUS DM-i is 152,800 yuan to 202,800 yuan, while the guidance price of the fuel version of Song PLUS is only 115,800 yuan to 143,800 yuan.
On the one hand, fuel vehicles cannot be sold, and on the other hand, new energy vehicles are sold, and under this contradiction, BYD stopped producing fuel vehicles in March 2022.
More importantly, BYD had expected to achieve the goal of 1.5 million sales in 2022, and this goal must rely on new energy vehicles to complete, after cutting off fuel vehicles, you can focus on the production and sales of new energy vehicles, in order to better complete the target.
Wang Chuanfu's helpless second point is that BYD sells a lot of cars, but makes very little money and lacks profitability.
In 2021, BYD sold 730,000 vehicles throughout the year, an increase of 75.4% year-on-year, behind the highlight of sales, BYD did not make money. In 2021, BYD's net profit for the whole year was 3.045 billion yuan. Compared with domestic counterparts, Geely Automobile earned 4.72 billion yuan in 2021; Great Wall Motors earned 6.726 billion yuan; and Changan Automobile earned 3.552 billion yuan. Judging from the comparison of BYD, Geely, the Great Wall and Chang'an, BYD earns the least.
Looking at a set of data, from 2016 to 2021, BYD's operating income rose from 103.47 billion yuan to 216.142 billion yuan, while net profit fell from 5.052 billion yuan to 3.045 billion yuan, and in 2017, 2018, 2019, 2021 four years, BYD's net profit is negative growth.
In 2021, BYD's operating income was 216.142 billion yuan, and its net profit was only 3.045 billion yuan. The gap between revenue and net profit is too big. In addition, in 2021, BYD new energy subsidies to 5.867 billion yuan. Among the non-recurring profit and loss items, the government subsidy included in the profit or loss of the current period was 2.263 billion yuan. That is to say, in addition to the money subsidized by the government, BYD's actual net profit in 2021 may only be 782 million yuan, which is less than 1 billion.
The operating income of more than 200 billion yuan corresponds to the actual profit of less than 1 billion yuan, which makes people question the profitability of BYD. BYD needs to improve its profitability.
BYD's new energy vehicles and fuel vehicles, the price of new energy vehicles is higher than that of fuel vehicles, and the sales of fuel vehicles for BYD, has become a burden, cutting off fuel vehicles, can save costs, focus on new energy, with the penetration of new energy vehicles, and sales rise, fang further enhance their profitability.
However, at present, bydir all in the new energy track does not mean that there are no challenges. On the one hand, BYD needs to break through from the fierce competition on the crowded new energy track, on the other hand, the cost pressure brought about by the rising price of upstream raw materials and the supply chain guarantee pressure caused by the lack of core materials.
Wang Chuanfu suddenly cut off BYD's fuel vehicles, perhaps a little radical. Because, the steps are too big, easy to pull crotch. Whether BYD, which cuts down fuel vehicles, can achieve better development remains to be tested by time!
Reference: "BYD abandons fuel vehicles, it is difficult to say goodbye to low profits" - Leopard change