Will a profit margin of 1% be the killer feature of Xiaomi cars?

Recently, there have been some news related to Xiaomi cars, many of which are fierce.

It is said that Lei Jun has convinced the board that Xiaomi Auto's overall profit margin in hardware will not exceed 1%, and the later profit depends on software services and the surrounding ecosystem.

When Xiaomi previously released mobile phones in 18 years, it was mentioned that the net profit of hardware businesses such as mobile phones and consumer products would not exceed 5% every year, and even if it exceeded, it would be returned to Xiaomi users in a reasonable way, and after that, Xiaomi did fulfill this commitment.

Nowadays, coming to the automotive industry, this practice is indeed very small, it is a routine operation, in technology products, this trick is very good in the market, but can it be effective in the automotive circle?

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Some brands have said this before

The phrase 1% profit margin is not the first to be proposed by Xiaomi in the automotive circle, and whether this data can play a key car purchase guidance in today's market is actually still unknown.

Previously, GAC NIO, the predecessor of Innovation Energy, announced the BOM list when it released Hechuang 007, and the costs of three electricity, body architecture, intelligent network connection system and other costs were directly placed in front of consumers, and the final manufacturer's pricing was only about 3,000 yuan per car.

However, the response of the market is not as expected, because although its profit margin is low, the overall selling price is not fully attractive in the market, after all, the price has come to the 300,000 range, on the contrary, it sells well is the subsequent launch of more affordable products, therefore, whether it will eventually let consumers buy it, is a comprehensive consideration.

Therefore, after Xiaomi cars enter the market, the consumer level will definitely hope to give a surprise price directly from the price like when it released the mobile phone, and the profit margin mentioned by Lei Jun at the level of consumer attention is to be put in the back position.

Another point is that the entire industry level now, will find that recently released products will make a fuss on the price, and consumers' expectations for pricing are lower and lower, although this phenomenon can not be called the embodiment of the healthy development of the industry, but in the knockout stage, everyone wants to survive, seeing the opponent's move, if they do not accept is waiting for death, there will be hope for a good fight.

Under this trend, Xiaomi is estimated to also want to release information about this in advance to give consumers who pay attention to its brand some confidence. After all, this is also a message to give the product a low price.

At this time, you can actually look at this matter from a different angle.

For Xiaomi, building a car is really not an easy thing, a few years ago it was difficult to build a car independently, and now it is even more difficult in the general environment.

If Xiaomi still uses the traditional set to talk to the market about how powerful its hardware is and how excellent its software is, then it may soon be buried by the market, because not only you can speak, but everyone will speak, and one is more fancy than the other.

But at this time, throw out a number, combined with the brand's own traditional connotation, which actually makes consumers' eyes shine, if this is a practice of the Lei Jun roll market, it is better to understand it as a new marketing method.

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How much room is there for software profitability

Hardware is not profitable, it definitely needs other aspects to fill, as mentioned earlier, Xiaomi relies on software and surrounding ecology as the main way to make money. So is the future of this point relatively bright for Xiaomi?

First of all, it needs to be clear that the basis for achieving profitability by software is to have a quantity guarantee. From the current annual sales of new force brands, there is still no way to wrestle with those traditional car companies, on average, if you can achieve annual sales of 100,000 is actually a relatively good result.

It is obviously not easy to sell cars to achieve the sales level of smart technology products, after all, the attributes of products are completely different.

The second is whether the long-term income of software can be maintained, the current automotive industry in the software to make money is better is Tesla, FSD once the installation rate was relatively high when it was close to 50%, but after about two years, this data dropped to about 10%. But Tesla is able to accept software without making money, after all, after so many price wars, the profit can still be maintained at about 20%, which is an existing amount and can also control costs.

Many domestic brands are also using this model, whether it is software services or surrounding ecology, etc., are made into an optional package, such a benefit is to make their product entry price further down, but for domestic consumers, they are more concerned about the price of the downward, and for some paid items, the degree of interest is relatively low.

In the previous Xiaomi official announcement of the car, in fact, it also highlighted its own intelligent driving business, at that time its goal was still relatively ambitious, in this regard, some people also mentioned whether Xiaomi as a technology company can use this automatic driving as a means of profit for its own external sale, just like Baidu.

From the current development point of view, this road is gradually narrowing, many times traditional car companies will not take this as the focus of publicity, but through the actual experience in recent times, it will be found that these brands are stuffy to do things, many traditional car companies in the experience of intelligent driving is very good, not lost to these main new force brands in this regard, and basically most of them have achieved self-sufficiency in this technology.

Another point is the first-mover advantage at the software level, now many car companies or car companies' autonomous driving related companies actually began to layout many years ago, from planning, research and development, testing to the current landing has experienced a relatively long period of time, the most important point during this period is the accumulation of data.

Like the collection of road data, automatic driving test mileage has a relatively large impact on the subsequent use, like many brands have now mass-produced, then after mass production, the data collected by the system in the actual road and the analysis and optimization of its own model will obviously make it have faster progress and improvement in the future.

The subsequent Xiaomi in the software advantage should be the integration of the intelligent cockpit and the surrounding ecology, now can achieve the integration of technology companies themselves can only the cockpit is basically Hongmeng and Meizu, there may be chip manufacturers to launch public versions, but domestic users for localization actually has relatively high requirements, Xiaomi in the smart mobile device related industries for many years of accumulation can establish a certain advantage for it.

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Must be rolled

If Xiaomi car can eventually go to the market, according to Xiaomi's style, it must take the cost-effective route, and other manufacturers will be very uncomfortable, from the point of view of Lei Jun giving a 1% profit margin, it is also more determined.

Regardless of whether this matter is rational from the current point of view, whether Lei Jun can reproduce the Xiaomi model in the automotive industry is indeed a thing worth looking forward to, after all, the industry and the market are changing too fast, there are no rules and routines to follow, the last venture does not fight, who will know what the result will be? 【iDailycar】