Reporter Chen Jingbin reports from Guangzhou
With the sound of "snap", a customer in the BYD Auto Dynasty Network 4S store in Chancheng District, Foshan City smashed open the "golden egg", and Xiao Zhang, the sales consultant, contributed to the transaction of a new car.
"At the end of 2023, we will sell 3 million vehicles, and the manufacturer has released a wave of benefits, including government subsidies, and 24,000 yuan will be discounted for the models that fuel vehicle owners have. Xiao Zhang told the reporter of "China Business Daily".
Recently, the reporter visited a number of BYD 4S stores, in the store where Xiao Zhang is located, the reporter learned that at present, in addition to the new model Song L, BYD Dynasty Network Han, Tang, Qin and other car types have launched a time-limited fuel transfer fund, that is, the existing fuel owners or have placed orders but have not yet delivered the prospective owners of the oil car to the tram up to 20,000 yuan of "Juhui".
In fact, "Juhui" has become the biggest selling point of new energy vehicles in 2023. If you want to survive in a highly competitive market, the only way to reduce prices and sell is the only way. Wang Chuanfu, chairman and president of BYD, publicly said: "Now is the era of fast fish eating slow fish, not the era of big fish eating small fish, if car companies do not rush up in the next 3~5 years, there will be no chance." In the next 3~5 years, the auto market as a whole or different market segments will continue to fight price wars. ”
The reporter learned that at the end of 2023, all auto brands are trying to seize the opportunity to sprint to the sales target in the last month, whether it is a fuel vehicle or a new energy vehicle, the promotion efforts have been upgraded. BYD took the lead in setting off a "price war" at the beginning of December, and then nearly 20 brands such as Li Auto, Leapmotor, Xiaopeng Motors, Audi, and Volkswagen joined it, and some models even had cash discounts of up to 120,000 yuan.
BYD took the initiative to start a "price war"
In order to achieve the goal of annual sales of 3 million vehicles, BYD took the lead in launching a "price war".
On December 1, BYD announced that Dynasty Network, led by the champion models Qin and Han, launched a limited-time fuel transfer fund with a maximum discount of 20,000 yuan, only in December. Among them, the Qin PLUS DM-i dropped by 10,000 yuan, and the price started at 89,800 yuan for a limited time.
In February 2023, the price of Qin PLUS DM-i dropped to less than 100,000 yuan for the first time, which brought a great impact to the A-class fuel car market, and only 9 months later, the price of the car directly hit less than 90,000 yuan. In addition to Qin, BYD Han will be reduced by up to 20,000 yuan to enter the market below the 200,000 level, Tang will be reduced by up to 15,000 yuan, Song will be reduced by 10,000 yuan, and Yuan will be reduced by up to 6,000 yuan.
Xiao Zhang told reporters that the price war is more the result of the industry's "involution" and sales volume, and many customers at the end of the year are also "refreshing" under the generous discounts. "My understanding is that in order to rush the sales task, in 2023 we will rush to sell 3 million vehicles, now more than 2.6 million vehicles, and it should not be difficult to rush 3 million vehicles throughout the year. Towards the end of the year, many customers will call directly to ask if there is an existing car to pick up, and some customers even come once from buying a car to picking up a car. ”
In fact, the price reduction of BYD Dynasty's champion model is indeed large. According to the sales consultant, at present, the 2023 Han EV Champion Edition 715km Honor fuel vehicle owner has a discount of 24,000 yuan for the sharing of electric vehicles, and if the "old for new" can also enjoy a replacement subsidy of 4,000 yuan. At the scene, the reporter also noticed that a family immediately realized the egg knocking transaction.
With BYD's "price war", followed by Li Auto, Li Auto announced the launch of an annual rate of 2.5% for a limited time in December, and related models can receive a subsidy of up to 36,000 yuan. Also on December 1, Leapmotor announced that it would open a limited-time discount at the end of the eighth anniversary in December, and its C11 models can enjoy a cash discount of 5,000 yuan for a deposit of 5,000 yuan, as well as a 5,000 yuan for the highest optional fund and 8,000 yuan for the highest financial discount. Zhiji Auto also announced on December 1 that it has decided that Zhiji LS6 can enjoy a comprehensive discount worth 37,600 yuan, including a 12,000 yuan discount on cash rights and a specific limited-time equity price.
Changan's Deep Blue Automobile announced that users who made an order from December 1 to 17 can enjoy a deposit of 1,999 yuan for all models to 8,000 yuan for car purchases. Deep Blue Automobile's brother brands Qiyuan and Changan UNI have also launched preferential activities of up to tens of thousands of yuan.
There is also the news that the price reduction of models that have been on the market for less than half a year has also been officially announced. On December 18, Xiaopeng Motors officially said that in December, the whole Xpeng G6 series was reduced by 10,000 yuan for a limited time, and the starting price dropped to 199,900 yuan. Previously, all models of Xpeng P7i started price reduction promotions in early December, with a comprehensive discount of up to 26,000 yuan, and Xpeng G9 also followed up with a price reduction, with a maximum discount of 19,000 yuan.
In addition, independent brands including Nezha, Zeekr, Geely, GAC Trumpchi, etc., as well as joint venture brands such as FAW Toyota, FAW-Volkswagen, GAC Toyota, SAIC-Volkswagen, SAIC-GM, and SAIC-GM-Wuling have also officially announced relevant preferential activities. According to the reporter's incomplete statistics, there are nearly 20 brands that officially announced price reductions and promotions in December alone.
Under the "involution" of the industry, fuel vehicles are forced to reduce prices
In addition to new energy vehicles, traditional gasoline vehicles also have price reductions at the end of the year. According to the preferential policies for car purchases released by SAIC Volkswagen on December 4, from now until December 31, 2023, the purchase of Tourang, Lavida, Tuyue, Passat, Tiguan L and other models can enjoy comprehensive preferential policies, with a maximum comprehensive discount of 58,000 yuan. FAW-Volkswagen officially announced on December 1 a limited-time car purchase promotion in December, and the participating models include Bora, Suteng, Magotan , Tanying, Tange and Tanyue.
Some sales consultants also admitted to reporters that traditional fuel vehicles were also deeply affected by the "price war". "Three years ago, some Lexus models had to increase the price to 150,000 yuan before they could land, and now the discount of 50,000 or 60,000 yuan may not be sold, it must be because of poor sales, which is basically caused by the 'price war' in recent years. ”
The "road lightning" Lexus ES, which used to increase the price to pick up the car, has recently given a preferential range of 50,000 yuan at sales terminals in many places, and the starting price has dropped from 296,900 to 246,900, and some areas can even be further discounted. From price increases to price reductions, Lexus has fallen from the "cloud" in just a few years.
In fact, the "price war" of car companies almost runs through 2023, at the beginning of 2023, Tesla launched the first round of price war, and car companies have chosen to "follow the brand";
According to data from the China Association of Automobile Manufacturers (hereinafter referred to as the "China Association of Automobile Manufacturers"), in the first 11 months of 2023, Continental's automobile production and sales reached 27.111 million units and 26.938 million units, respectively, an increase of 10% and 10.8% year-on-year, respectively, and both production and sales reached a record high in the same period in history. However, after deducting the export figure of 4.412 million units, the growth of domestic automobile sales was weak.
With the "price war" impacting sales, the China Association of Automobile Manufacturers expects that China's auto market will usher in a perfect end in 2023. Recently, the China Association of Automobile Manufacturers released data that the total sales of automobiles in 2023 may reach 30 million, a year-on-year increase of 11.7%, and a record high. According to the analysis of the China Automobile Association, policy stimulus, promotional efforts, and corporate finishing sprints are all favorable factors.
It is worth noting that with the "involution" differentiation of the industry, many car companies are still far from achieving the annual sales target. Nezha Automobile's cumulative delivery volume in the first 11 months was 122,400 units, and the annual sales target was 250,000 units, with a completion rate of 48.96%. Xpeng delivered about 121,500 vehicles in the first 11 months of 2023, more than last year's full-year deliveries, but it is still far from its annual sales target of 200,000 units, while NIO delivered about 142,000 vehicles in the first 11 months, but its sales target is 250,000 units.
How to get out of the "price war" circle?
At the 2023 Guangzhou Auto Show, Li Yunfei, general manager of BYD's brand and public relations department, said: "We are passively reducing prices, and after the price is lowered, everyone loses money and we make small profits." If the sales volume of each month is less than a certain size, it will bring losses, so we must scale, and to ensure the scale, we must have sales. ”
For BYD, what is more important is not to reduce prices, but to gradually move towards the high-end market. As the core of BYD's future profit growth, high-end is a must for BYD.
As a veteran of home appliances transformed from a home appliance company to a new energy vehicle, Huang Hongsheng, the founder of Skyworth Automobile, has a deeper understanding of the "price war". Huang Hongsheng has experienced three rounds of industry waves. "The first round was in 1998, Changhong fought a price war, and the TV was cut in half from 3000 yuan to 1500 yuan, which made 150 color factories fall. The second round is the impact of Internet TV,LETV at that time17000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000 Huang Hongsheng said.
The transformation of traditional fuel vehicles to new energy vehicles was called the third round of industry war by Huang Hongsheng. In Huang Hongsheng's view, the reason why enterprises develop to the point of life and death is caused by overcapacity and oversupply, and the market economy will definitely experience the process of growth, recession, transformation and re-growth. Huang Hongsheng said: "Those enterprises that have core technology and independent research and development, have the ability to integrate the industrial chain, and can reduce costs have sufficient advantages, and if they have the ability to go global, such enterprises will have strong competitiveness." ”
The impact of the "price war" in the automotive industry is also quite far-reaching. According to Liu Chunsheng, an associate professor at the Central University of Finance and Economics, the "price war" has led to a decline in product prices, thereby compressing the profit margins of car companies and dealers.
Xie Xiaowen, an expert member of the New Technology Promotion Branch of the China Communications and Transportation Association, pointed out that the "price war" competition has first accelerated the reshuffle of the automobile industry, prompted enterprises to strengthen R&D and innovation, and enhance product competitiveness; secondly, intensified market competition, enterprises need to adjust their strategies and seek differentiated development; in addition, it cannot be ignored that it has caused greater pressure on small and medium-sized enterprises, which may lead to the withdrawal of some enterprises from the market.
In the face of the continuous situation of "price war" in the automotive industry, some experts said that they should jump out of the "price war" circle and return the automobile market to its commercial nature.
Song Xiangqing, deputy dean of the Institute of Government Management of Beijing Normal University and director of the Industrial Economy Research Center, said that first, we must jump out of the current "price war" circle, return to the development law of car companies + dealers themselves, and ask how to do better; Refine and classify the target market, implement precision marketing, and return to the essence of business.
(Editor: Zhao Yi Proofreader: Yan Jingning)