Ideal exploded cash reached 70 billion! Next goal: spend money?

"With more than $70 billion in cash on the books, we need to turn it into continuous competitiveness." Some media reported that at the autumn strategy meeting held by Ideal Auto recently, the ideal senior management reached a consensus that "spending money".

Ideal cars have money on their books, but it's nothing new. In August this year, Li Auto's second-quarter financial report data showed that Li Auto's operating income in the second quarter reached 28.65 billion yuan, a year-on-year increase of 228.1%, a record high. The company's free cash flow has reached 73.77 billion yuan, an increase of 42.8% sequentially.

The ideal of "slamming the door"?

Although it is much more generous than before, the ideal spending has always been known for "picking the door", and it is one of the most "provincial" enterprises in all automobile companies, and even because of the "low" investment in R&D expenses, it is questioned by the outside world that its R&D strength is weak.

The data shows that its R&D investment in 2018, 2019 and 2020 was 790 million, 1.17 billion and 1.1 billion respectively; In the same period, NIO's R&D investment was 3.9979 billion yuan, 4.43 billion yuan and 2.487 billion yuan, respectively; In the same period, Xiaopeng's R&D investment was 1.05 billion, 2.07 billion and 1.726 billion respectively. Obviously, the ideal in the early stage of R&D investment, is indeed significantly less than peers.

In 2021 and 2022, Li Auto increased its R&D investment, investing 3.29 billion yuan and 6.78 billion yuan respectively, but it is still not comparable to NIO's 4.591 billion and 10.84 billion yuan, but it will exceed Xpeng's 5.21 billion in 2022.

However, in the case of R&D investment not comparable to the main competitors, the ideal car has achieved the next place. It has to be said that the ideal car is the most expensive to live among all the new forces of car manufacturing and even all automobile companies.

For the problem of low R&D investment, founder Li Xiang has previously clarified this: the absolute value of R&D expenditure of ideal car single models is the highest among Chinese brands (neither multi-brand, nor multi-model). In the direct management system, the sales and management expense ratio is the lowest among Chinese brands, far lower than the R&D expense ratio. Among the directly operated enterprises, each car has the highest R&D content and the lowest proportion of marketing.

Where is the money to be spent?

However, the melon-eating masses are still curious, what is the reason why such a "door-picking" enterprise suddenly decided to spend a lot of money? It is reported that under the grand strategy of strengthening investment, the theme of the strategic meeting involves intelligent driving acceleration, product rhythm, R&D investment, timing of going to sea and so on.

Among them, intelligent driving has been mentioned to unprecedented heights, and it is reported that the ideal strategy will spend a separate day discussing how to invest in intelligent driving. Li Xiang even reflected on himself at the strategy meeting that smart driving should be fully invested half a year in advance, that is, from the middle of last year, not at the beginning of this year.

It can be seen that it is not that the ideal car is reluctant to spend money, but that in the early days, the family was thin and had to save money to live, and now it is time to spend a lot of money, especially in the field of intelligent driving, and must increase investment.

Li Xiang knows very well that intelligent driving determines the end of this round of automobile revolution. The intelligent driving technology strength of competitors such as Huawei and Xpeng is currently ahead of the ideal, and if you do not make efforts at this time, you may be backward and beaten in the future.

Where is the target pointed?

It is reported that at this strategy meeting, the management of Li Auto focused on how to deal with Huawei. Some people believe that the company even intends to transmit relevant high-voltage signals to the middle and senior management, "making some people who did not understand and value Huawei nervous."

In terms of intelligent driving, the main competitor - Huawei has continued to invest heavily in the past. Yu Chengdong, Executive Director of Huawei, CEO of Device BG, and Chairman of Intelligent Vehicle Solutions, previously said: "In the era of smart vehicles, we insist on empowering the development of electric connected vehicles with 'soft, hard, core, and cloud' digital technologies. In this field, Huawei invests more than 10 billion yuan in direct R&D and 7,000 direct R&D personnel every year, not including indirect R&D investment, and we also apply the accumulated ICT technology to vehicles. ”

As things stand, the ideal car does need to catch up in terms of intelligent driving, and it is already recruiting on a large scale. On October 10, Li Auto released a special recruitment feature for intelligent driving teams, opening a total of 50 social recruitment positions in algorithm engineers, large model engineers, software and hardware engineers, test engineers and operations.

It is worth noting that the topic of Li Auto's strategic discussion has even extended to 2028. Ideal Auto believes that at that time, the penetration rate of domestic new energy vehicles can reach 90%, if the industry will only leave four or five companies, BYD, Tesla, Huawei are among them, ideal if it wants to stay on the card table, at least 2028 to sell more than 3 million vehicles, double the original target of 1.6 million sales in 2025.

Correspondingly, the product SOP plan of Li Auto has also reached 2027. During this period, its technology platform will also complete iteration, and it is expected that by 2026, a new generation of technology platform will be launched, which will have full autonomous driving capabilities.

At present, ideal has achieved profitability for three consecutive quarters, if everything goes well, ideal car is expected to achieve the goal of turning losses into profits in 2023, becoming the first new force to successfully "go ashore", and from the information revealed by this strategy meeting, achieving profitability is no longer an ideal goal, it has aimed at the top positions of the industry's head, and may even be the first, and then it depends on whether the ideal can continue to spend money on the blade.

Text: Zhang Zhongyue Editor: Qi Meng Format: Zhao Fangting Image source: official website of the company