Tesla fired the first shot of price reduction at the beginning of this year, and then many car companies such as Qianjie and Xpeng followed the price reduction, even BYD, which has the first sales volume in 2022, recently lowered the starting price of the newly launched DM-i model to less than 100,000 yuan for the first time.
To some extent, Tesla's price cut has disrupted the order of the domestic new energy vehicle market. In January this year, the sales of many new energy vehicle companies declined. "In this process, we can't sit still, the Euler brand will definitely follow (price reductions), and there are currently some preferential measures that customers perceive." There are full range of products for tanks, Haval and Wei brands, and there will be new pricing strategies for PHEV models. Li Ruifeng, chief growth officer of Great Wall Motor, told reporters that new energy is not afraid of price wars, but new energy competition should pursue healthy development and adhere to long-term principles, and the balance of "quantitative-profit model" is a problem that enterprises must think about, and sufficient resources and profits can ensure the advancement and leadership of technology research and development.
Li Ruifeng said that behind the logic of Tesla's price reduction is the large item model, Great Wall Motor has previously enjoyed the same dividend, Haval H6 has dominated the domestic SUV market for many years. "Scale can achieve cost sharing, when others enter the SUV market, Haval H6 achieved a unique cost model of 20,000 yuan in 2018, which is the only way for Great Wall Motor to support star items." Li Ruifeng said.
However, with the advent of the era of new energy vehicles, in the SUV field, the Haval H6 will be surpassed by BYD PLUS DM-i in 2022. As the main sales force of Great Wall Motor, last year the Haval brand announced a comprehensive transformation of new energy, and Great Wall Motor also accelerated the speed of transformation. However, Great Wall Motor's market performance in the past year has been lower than expected. According to official data, Great Wall Motor's cumulative sales in 2022 will be 1.0675 million units, down 16.66% year-on-year, and its sales of Haval, Weipai, and Ora have declined. Among them, the sales volume of new energy vehicles was 131,800 units, and the proportion of new energy sales was 12.34%, which was lower than the penetration rate of 28% in the overall new energy market.
"It is very easy to increase the number of wholesale sales of hundreds of thousands of vehicles through the adjustment of business policies, last year we adjusted the inventory structure of terminal dealers and limited internal departures, only dealers can invest more resources in coordinated development with enterprises and win this battle for new energy transformation." Li Ruifeng told reporters.
A research report released by Essence Securities recently shows that in the past one year, Great Wall Motor's products have had an outstanding reputation, but some strategic and tactical mistakes have caused new energy sales to be less than expected.
At the end of 2022, Great Wall Motor will integrate its six brands (Haval, Weipai, Ora, Tank, Great Wall Pickup and Salon Brand). Among them, Weipai and Tank will realize the layout of new energy for the high-end luxury new energy market from product categories, intelligent technology to off-road experience, and jointly shoulder the overall brand upward mission of Great Wall Motor; Euler and Salon will be fully integrated in the organizational management system. After the adjustment, Great Wall Motor has formed four new vehicle organizational structures, including the Haval business segment, the pure electric business segment composed of Salon and Ora, the high-end intelligent new energy business segment and the pickup truck business segment composed of Tank and Weipai.
This reform is called the "5-4-1" station-wide management model within Great Wall Motor. "5" refers to the establishment of five middle platforms of brand, channel, user, digital and sales service, and the organizational construction has been completed. "4" refers to four battle groups, including Wei He Tank, Euler and Sharon, Haval and Pickup Truck, and Overseas Market Operation Group. "1" refers to the unified action plan, the same voice in the global market, the realization of the same systematic management.
"Great Wall has too many category brands, and previously planned to incubate new brands, but now the market competition is so fierce, it turns out that entering a blue ocean market with a brand can avoid competition, and now this market no longer exists." Li Ruifeng told reporters. In the future, focus on a Great Wall corporate brand, empower brands in various categories with the help of unified technology brands, and position each brand more clearly after strategic adjustment.
For the development of the Haval brand, Li Ruifeng said that fuel vehicle products will focus on the main channel of 80,000~150,000 yuan. At present, Haval mainly has two major product series, the H series of urban SUVs and the light off-road dog category, and Haval will also launch a new energy series, establish new channels and new pricing models and strategies. On February 27, the first new energy model of the Haval dog category, the second generation big dog of Haval, was officially launched, and the new car launched two models: DHT-PHEV 105KM Chaodian Edition Plus and DHT-PHEV 50KM Chaodian Version, with an official guidance price of 16.28-175,800 yuan. It is worth noting that this price overlaps with the price of the BYD Song PLUS DM-i main sales model.
"The product should be subtracted to create a star big item, and there is a star big item in each main price range and the main level channel, and it takes energy to fight." Li Ruifeng said.
At the same time, Weipai's product strategy has also been adjusted, and it is a high-end brand under Great Wall Motor. In the early stage of product launch, Weipai had created unprecedented sales performance of its own brands, but then showed a trend of high opening and low going. Behind the sales dilemma is Weipai's continuous wavering brand, product and channel strategy, and the path of future development needs to be clarified. Li Ruifeng believes that in the past, Wei brand pricing was high, and the next step will be to launch medium-endurance models to enrich the price range. The Wei brand will be fully elected, and this year will return to the main price competition range by launching medium-range products, of which the flagship model of the Wei brand large 6-seat SUV "Blue Mountain" is the core large item. Ora will launch a pure electric coupe SUV, the salon's first product, the Mecha Dragon, will start pre-sale at the Shanghai Auto Show, and tanks and pickup trucks will also be fully electrified.
According to the plan, Great Wall Motor has set a sales target of 1.6 million units in 2023. Among them, the penetration rate of new energy vehicles is 40%~45%. With many car companies cutting prices, the competition in the new energy vehicle market will become more fierce this year. Recently, Changan, Geely, Chery, etc. have also increased their investment in the field of new energy, and for Great Wall Motor, it is not a small challenge to complete the target of 1.6 million vehicles.