Author丨Fang poetic
Editor丨Rokuko
In the new energy era, what market is the hottest? The first thing that comes to mind must be electric vehicles, but the first reaction of car owners who have experienced the "crisis" of energy replenishment may be charging services.
Whether it is a charging pile or a charging station, it is a huge market in China, and the prospect of hundreds of billions of dollars attracts a large number of players of different sizes to enter the game, although the market concentration is high, but the overall competition is very fierce. One of the reasons is that there are many "platform" players, which form a service network by connecting many charging piles operated by different entities.
On September 11, the China Charging Alliance released the "Operation of National Electric Vehicle Charging and Swapping Infrastructure in August 2023", which shows that TOP15 operators have 94% of the total charging piles, 6 enterprises operating more than 100,000 charging piles, and 11 enterprises with more than 50,000 units. The top five were 451,000 special calls, 408,000 Star Charging, 379,000 cloud fast charging, 196,000 State Grid, and 127,000 Xiaoju charging.
Among them, the fifth ranked small orange charging is a special existence, because behind it stands Didi. Born out of Didi's former automotive aftermarket layout - Xiaoju car clothing, Xiaoju charging is actually the product of Didi's "encountering" the new energy wave in the process of developing energy services, which belongs to Didi's Xiaoju energy business segment.
Therefore, Xiaoju Energy's early layout is insufficient, and it can squeeze into the forefront of the market, relying on platform development and absorbing third-party charging piles to do large-scale. Although this is similar to the route of competitors such as Star Charging, it is a pity that it started late and the scale is slightly behind.
Therefore, born of worry, even if it is in the top five and holds more than 100,000 charging piles, Xiaoju Energy is still a little "panicked".
01
"Orange's car suit compromises energy"
Just on October 9, the market reported that Didi re-proposed its growth plan after three years, and the key was the unit volume. However, compared with three years ago, the travel market has also been firmly tied to new energy, and its impact is not only in the online car hailing business, but also in the increasingly complex car service ecology.
However, looking back at the "up-to-top" process of Xiaoju Energy today, we can see a trace of luck: Xiaoju Energy, or Xiaoju charging, did not get enough attention in the layout of the car service business in the early stage. Its status comes more from Didi's feeling of the general trend of new energy in the process of operating travel services, and Xiaoju Energy is "carried up" by market trends.
This has to mention Didi's layout of the automobile ecology. In August 2018, Didi officially upgraded its three-year car service platform to "Little Orange Car Service" and injected up to $1 billion into it. It can be seen from the name that Didi at that time was still aiming at the automotive aftermarket.
Indeed, this was a promising track for the time. The simplest case is the financing story of Tuhu, the star of the car service market at that time, Tuhu Cars. In the second half of 2018, Tuhu completed a US$450 million Series E financing led by heavyweights such as Tencent, Carlyle Capital and Sequoia Capital, with a valuation of about RMB16.5 billion. Therefore, choosing to cut into the popular automotive aftermarket track is a reasonable choice for Didi's ecological extension of the vehicle.
In contrast, in 2017, before Didi made its decision, data from the China Association of Automobile Manufacturers showed that the national production and sales of new energy vehicles were only 794,000 and 777,000 units, while the total sales of automobiles were 28,878,900 units. At that time, it seemed that the layout of energy and fuel itself could only do some preferential refueling platforms, the strategic potential was insufficient, the new energy climate was not achieved, the uncertainty was too great, and Didi chose to "stabilize".
As a result, this "stability" missed the moment of the outbreak of new energy. According to data from the China Association of Automobile Manufacturers, domestic production and sales of new energy vehicles remained stable at 1.2 million units in 2018 and 2019, nearly doubling from 2017. The most sobering example is Tesla, whose sales data shows that from 2017 to 2019, Tesla's sales soared from 103097 to 367,500 vehicles, which seems to be an absolute value, but actually means that once the leading brand appears, the market window has opened.
* Source network
In July 2019, Xiaoju upgraded its organizational structure and established the Automotive Enterprise Department and Xiaoju Energy Business Sector, at that time, Xiaoju Energy covered refueling and charging business, led by Chen Ting, senior vice president of Didi and general manager of Xiaoju Automotive, and the importance is no less than the sum of various businesses such as customized cars and car rentals. After its status was raised, Didi quickly cooperated with platforms such as China Southern Power Grid, and Xiaoju Charging also began to interconnect with the charging platform it operated.
This is a bit of an afterthought. According to the China Electric Vehicle Charging Infrastructure Promotion Alliance, as of January 2019, Tel had 122,000 charging facilities, and the top five operators had 88.4% of the market share at that time. Little Orange Energy's rapid rise in status and focus on charging is more like forced by the situation and must catch up. Otherwise, energy services may even shake Didi's ecology.
On the one hand, Didi's financial report shows that in the 12 months ended March 31, 2023, Didi China had 19 million active drivers. Although the proportion of new energy operation is not disclosed, since it is in the Didi ecology, Didi naturally has no reason to give up these tens of millions of future needs.
On the other hand, energy is the basis of vehicle operations, if Didi does not provide energy services, drivers have to choose a third party, which may lead to drivers gradually having a tendency to change platforms.
Taking T3 Mobility as an example, T3 Mobility has been ranking in the top three in the order volume of online ride-hailing regulatory information interactive platform for many years, and its CEO Cui Dayong said in September this year that more than 90% of T3 Mobility's transportation capacity is new energy vehicles, so it has established a one-stop charging service and won charging discounts for drivers. The cost of energy itself is an important cost in the eyes of drivers, and if it can be saved, the attractiveness of the platform will naturally increase.
You know, T3 Travel, backed by the three major car companies of Dongfeng, Changan and FAW, was only established in 2019, and has achieved the top three in the industry scale and the first growth rate in four years. As a travel brand born during the peak period of new energy popularization, it is inseparable from the advanced awareness of energy services. Therefore, although the current market structure is undecided, energy services must strengthen their layout under pressure.
Doing a good job of Xiaoju Energy is the only way for Didi to establish key advantages in the process of replacing the automobile market, and it faces the clearest challenge in the most competitive track.
02
"Little Orange Energy is "in the whirlpool""
As mentioned earlier, it seems that the top players are highly ahead, but they actually have the credit of the platform mode.
*Source: China Charging Alliance
According to data from the China Charging Alliance, as of August 2023, the cumulative number of charging infrastructure in the country was 7.208 million units, an increase of 1.998 million units and 67.0% year-on-year, while the sales of new energy vehicles reached 5.374 million units in the same period. The market gap still exists, which will attract more small and medium-sized players to take advantage of the policy encouragement in some regions to disperse and expand their layout. For example, Changzhou, Guangdong Province, Shanghai and other places in Jiangsu have subsidies for the construction and operation of charging facilities, and according to the annual operating power or electricity consumption, the payback cycle of small and medium-sized players has been shortened, and the willingness to invest is ready to move.
Then, for Xiaoju Energy, which wants to establish a brand effect in the market and expand its ecological network, Didi's financial strength is obviously difficult to support its asset-heavy layout like small players.
For example, Azure Fast Charging, which occupies a place in the top 15 statistics of the China Charging Alliance, although the number of charging piles in its operation is only about 44,000, which is far from the head. However, it aims at community scenarios for targeted promotion breakthroughs, and through resources and ground promotion advantages and property cooperation, it has achieved the top 3 in the national community charging market. However, for Didi, it is obviously difficult to make the business scale larger by targeting a small market, but the large-scale promotion and independent charging station construction are difficult to bear.
In particular, there is a strong opponent at the head of this industry who has insisted on self-production and self-sales for many years. The half-year report of the company's charging network business in the first half of the year achieved revenue of 2.367 billion yuan, but the price is still huge: last year, with the guarantee provided by Truide, the total amount of loans obtained from banks was about 1.508 billion yuan.
Therefore, it can be said that about 450,000 special calls and a market share of nearly a quarter of the charging pile are victories that have been "burned" by burning money for many years. According to the financial report, as of the end of June 2023, the number of registered users of the special call APP has exceeded 10 million, equivalent to about half of the number of domestic drivers in Didi. At present, Didi may not have much spare power for Xiaoju Energy to repeat this growth.
Didi's second-quarter results report released on September 9 showed that the net loss attributable to Didi's common shareholders in the second quarter was 300 million yuan, of which other businesses other than China's mobility business and international business brought an adjusted EBITA loss of 1.21 billion yuan. Didi is now investing more in new unit volume growth targets, let alone investing in energy business indefinitely.
At this time, although there are many participants in the industry, there are many eliminated players because of blind competition, so the integration demand is also in a period of strengthening. Xiaoju Energy seized this opportunity to open up the ecological construction platform.
On September 6, Liao Lanxin, CTO of Xiaoju Energy, announced the launch of a new supply chain opening plan - "Unicorn Plan", absorbing small and medium-sized pile enterprises into the Xiaoju ecosystem, providing software and hardware solutions for them, and rapid mass production layout, so as to establish their own supply capacity and compete with industry chain players such as special calls.
On the other hand, through the franchise model, Xiaoju Charging continues to absorb joint charging service providers, and provides merchants with operational and marketing assistance to expand its own access scale. In March this year, Xiaoju Charging further launched the self-identified "Xiaoju Preferred Station" and began to strengthen brand building.
* Source network
This platform-based mode has been previously verified by Star Charging. In the early stage of the development of Star Charging, the "crowdfunding pile" and "shared charging pile" mode was directly adopted, thus giving full play to the asset-light advantage and achieving the second place in the industry. However, this also reflects the reality that if Little Orange Energy wants to continue to expand, it has to accelerate the race with the head players.
At least, compared with the previous ambition to grasp the aftermarket, Xiaoju Energy's entry is more accurate, which has the shadow of Didi's growth process, that is, first do a good job of the platform, and then gradually improve its own brand and provide more services in ways such as customized cars. But charging services are not ride-hailing after all, and they can solve all problems by mode. The competition in the charging field is only in its infancy, and Xiaoju Energy still has many points to improve.
03
"Little oranges need more grippers"
According to the data disclosed by Xiaoju Charging, the average utilization rate of its charging pile reaches 25%. Everbright Securities once estimated that the utilization rate of the break-even point of the charging pile is about 8%. So, is Xiaoju charging really leading the industry and sit back and relax?
The answer is probably not certain, and the "average" utilization rate obviously does not represent that the input and output of all charging facilities are positive. The reason why the charging station with a high degree of control by itself was born is also to make important stations more valuable. Behind this, Little Orange Energy has not shaken off the anxiety of benign growth.
First of all, Xiaoju charging itself is an aggregation platform, although its current market share is relatively leading, but compared with more advanced and industrial chain advantages, the flow advantage of Xiaoju charging has the risk of being broken. You know, in the early days, this business can rely on Didi's ride-hailing customers, and after the scale is expanded, it must attract more users. At this time, Didi's signature effect has weakened, compared with the professional brand effect of car companies and the penetration ability of local capital, Didi is beyond reach.
Why is the king of industry scale so far ahead? In addition to the long-term investment mentioned above, more importantly, because it firmly follows the joint venture route of cooperating with state-owned platform companies with government functions to build urban charging networks, according to official news, its partners include Heilongjiang Provincial Communications Investment Group, State Power Investment Jiangxi Company, Ganzhou Municipal Government, etc., and even local governments have taken the initiative to visit the special call to attract investment.
*Source: Energy Magazine
The financial report pointed out that in the first half of 2023, the charging volume of special calls was as high as 4.1 billion kWh, still ranking first in the market. In February this year, data from the China Charging Alliance showed that the number of charging piles operated by special calls was 377,000, and Xiaoju charging was 100,000. By August, the number of charging piles for special calls had grown to 451,000, and Xiaoju charging had only grown to 127,000, which was less than the head, and there were obviously obstacles to landing.
Therefore, compared with this kind of local advantage barrier, Didi's traffic advantage is not strong, the construction should optimize the supply, to avoid being stuck by the industry, operation, Didi's flow to attract external charging users has a limited role.
* Source network
It is worth mentioning that Xiaoju energy technology is mainly based on "soft technology" such as operation tools, but the current charging market is accelerating, and more complex layouts such as solar storage and charging integration are becoming more and more sought after.
For example, Nenglian Zhidian recently won the bid for the Zhejiang Anji heavy truck "optical storage and charging" integrated station project, providing a one-stop solution for optical storage and charging. Special call data shows that as of April this year, more than 200 microgrid charging stations have been built for the optical storage, charging and discharge inspection microgrid solution of special call, and once again give full play to the advantages of self-research and self-manufacturing.
In contrast, the first optical storage and charging demonstration station built by Xiaoju Charging at the end of 2021 adopts the solution of Lingchong Chuangxiang, and there is not much public information after entering the game in the early stage. In the long run, if it fails to grasp the core competitiveness in this regard, Xiaoju Energy may once again encounter the problem of blocking the expansion in the era of solar storage and charging integration.
Therefore, at the current stage of the group of heroes, even if Xiaoju Energy has achieved a certain corner overtaking, it cannot relax its vigilance. On the one hand, platformization means that there is a lack of control, and more efforts must be made to control the quality of service; On the other hand, when the industry is becoming more and more involuted, its competitive direction has expanded the charging station to the integration of "solar storage, charging and discharging", and the requirements for industry resources and construction capabilities are getting higher and higher, which is not good news for Xiaoju Energy, which has only the advantage of Didi flow.
All in all, the core and end point of the charging service market is the new energy infrastructure, and the industrial Internet with energy as the core is the general trend. Such a large industry outlet means that the test of time and resources will be amplified, and Xiaoju Energy and Xiaoju charging cannot rely only on the digital intelligent operation of charging facilities to achieve peace of mind.
For Didi, the biggest possible future devouring of Didi may be the charging service platform, new energy vehicles to lead the travel market is imperative, and new energy vehicle owners may be the core resources grabbed by the travel market in the future, after all, a large amount of energy consumption every day behind the high cash flow, sufficient cash flow is enough to support a charging platform to create a new taxi software. So the real race may have just begun.
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