BYD's target for 2024 is 3.6 million units! Wang Chuanfu: Completely defeat the joint venture car!
In 2024, in Wang Chuanfu's view, it will be a turning point for China's auto industry and BYD.
On March 27, 2024, BYD held the 2023 annual financial report investor communication meeting. At the meeting, Wang Chuanfu, chairman of BYD, gave a detailed interpretation of BYD's strategic plan for 2024 and analyzed and predicted the future competitive trend of China's auto market.
In 2023, BYD will sell more than 3 million vehicles, a year-on-year increase of 61.2%, ranking first in global new energy vehicle sales, with a cumulative annual revenue of 602.315 billion yuan, a year-on-year increase of 42.04%, and a net profit attributable to the parent company of 30.041 billion yuan, a year-on-year increase of 80.72%.
On the basis of both scale and profit hitting a record high, Wang Chuanfu put forward new guidance for BYD's strategic layout in 2024 at the communication meeting.
In 2024, it will increase by more than 20%!
In Wang Chuanfu's view, 2024 is the starting point for the knockout round of China's auto market. Taking 2024 as a starting point, "the next three years will be a decisive battle (for the automotive industry), just like the fields of home appliances, solar energy, and mobile phones back then, the competition is very fierce, (because) supply exceeds demand." ”
According to the data of the China Passenger Car Association, in 2023, the cumulative capacity utilization rate of the top 20 light vehicle brands in the domestic market will be less than 50%, and only the capacity utilization rate of BYD, Chery, and Changan will exceed 70%. Most car brands are facing a "crisis" of overcapacity, and from the macro market, this will be a signal for the knockout round.
For BYD, to get through this three-year knockout game, Wang Chuanfu put forward three "countermeasures" - scale, cost, and technology. Among them, scale and sales volume are the first guidelines, "Who will stay? I believe that scale is the most important thing." Wang Chuanfu set the tone at the meeting.
On the basis of sales exceeding 3 million units in 2023, Wang Chuanfu has set a new goal of "at least 20% growth" for BYD - annual sales of more than 3.6 million units. Compared with the year-on-year growth rate of more than 60% and the net increase of 1.2 million units in 2023, BYD's sales plan for 2024 (20% year-on-year growth and net increase of 600,000 units) has weakened significantly.
Behind this is Wang Chuanfu's new thinking on the direction of China's auto market.
The reason behind BYD's low increment
Why is Wang Chuanfu's sales target for BYD in 2024 so low?
Internally, BYD's production capacity has a ceiling, and externally, other domestic brands are accelerating the transition to new energy.
Since February this year, BYD has continued to launch a number of Glory Edition models, focusing on "electricity is lower than oil". Wang Chuanfu revealed at the meeting that the launch of the Glory version of the model has been "fruitful" - at present, BYD Qin PLUS, Destroyer 05 and other models have gained a significant increase in market share, and the transfer of traditional joint venture cars and fuel vehicles is very obvious, and BYD's sales are expected to reach 300,000 units in March. However, in the terminal market, BYD Qin PLUS DM-i and Destroyer 05 have been out of stock, Wang Chuanfu bluntly said that BYD's current production capacity supply is still insufficient.
In 2023, BYD's production capacity plan is about 3.5 million vehicles, and the capacity utilization rate will reach 88.3%; in 2024, BYD has not announced a specific plan for building factories and expanding production capacity, and on this basis, the annual sales of 3.6 million vehicles are actually the best level that BYD can achieve at present.
From the perspective of external competition, Wang Chuanfu believes: "Domestic counterparts, I think they have accelerated the transformation of new energy vehicles and electrification in the past two years, especially this year. ”
Since 2024, Dongfeng, Changan, Geely, Chery and other car companies have intensively launched a variety of new energy models, and sales have risen fiercely. In this context, BYD's core goal in 2024 is still to maintain stability, and on the basis of stabilizing the market, BYD will work with its own brands that have transformed to new energy to seize the territory of fuel vehicles and joint venture vehicles.
"I believe that the main opportunity for the Chinese brand represented by BYD is how to quickly convert fuel vehicles into new energy vehicles, and how to quickly transform the joint venture brand cars into our Chinese brand cars. ”
Reducing the share of the joint venture to 10%
On the basis of such thinking, Wang Chuanfu issued a "retreat timetable" for the joint venture brand - "I estimate that in the next 3-5 years, the joint venture brand will reduce from 40% to 10%, freeing up 30% of the market space." ”
Since 2023, the market share of joint venture vehicles has continued to decline. According to the data of the China Passenger Car Association, in 2023, the market share of China's independent passenger car brands will be 52%, reaching a record high of 58.2% at the end of December 2023, accounting for nearly 60%.
Behind this is the strong rise of China's own brand new energy vehicles. Wang Chuanfu believes: "To expand the scale of new energy vehicles, we can only convert the stock of traditional fuel vehicles and traditional joint venture brands. "The withdrawal of fuel vehicles with joint venture brands as the core will bring 30% of the new market, which is the future opportunity for Chinese brands.
And how to divide the 30% of the cake, Wang Chuanfu has his own ideas - "Not all Chinese brands can survive, and most of them will die." The group left behind may be those that really have cost advantages, scale advantages, and technical advantages, and these can really stay. ”
In addition, enterprises also need to have the ability to respond quickly to the market, have precise strategic direction and core technology. At the meeting, Wang Chuanfu did not disclose which companies can survive in the end, but also said: "Like Chang'an and Geely, I think we all have space, and if we share 30% of the share, I believe we have the opportunity to become bigger." ”
From the perspective of the macro market, Wang Chuanfu's positioning of BYD is the leader of China's new energy automobile industry, and together with many independent brands, it is Wang Chuanfu's big plan for BYD in the next three to five years.
At the micro level, how can BYD continue to lead?
International, intelligent and high-end three-line development
Create new growth for BYD
For BYD's own development plan, Wang Chuanfu put forward three new directions: internationalization, intelligence and high-end.
In 2023, BYD exported more than 240,000 units, accounting for about 12.5% of annual sales. However, it brought 160.222 billion yuan of overseas revenue to BYD, accounting for 26.6% of the total revenue. Wang Chuanfu made it clear: "Whether it is the growth rate of sales, the contribution to the company's gross profit, or the future development direction, (exports) have provided good support for the company." ”
Facing 2024, BYD will make great strides towards a larger international market, with an annual export target of 500,000 units and 1 million units in 2025.
In the field of intelligence, on April 1, the new Denza N7 will be officially released, and BYD City NOA will be the first to be launched. In the second half of 2024, BYD will launch a number of new models equipped with urban NOA, making full efforts in the field of intelligent driving.
"BYD's intelligence, we have to have what others have, and then we want to make more BYD characteristics (functions), improve the user experience, and there are not too many security risks, which is our future development direction." ”
In addition, in terms of high-end brand building, BYD will also make full efforts in 2024.
At present, the monthly sales volume of Yangwang brand has remained at 1,000-1,500 units, while Denza has maintained a monthly sales performance of 10,000 units. For the better development of high-end brands, accelerating intelligent transformation is one thing, and the research and development of batteries is the top priority, Wang Chuanfu revealed: "BYD will launch various high-energy density (batteries) and innovative technology systems like solid-state batteries in the future to meet the needs of high-end brands for batteries." ”
For BYD, 2024 is also a turning point. After experiencing the first half of the new energy struggle, BYD will achieve new growth in the international, intelligent and high-end track, which is the cornerstone of BYD's qualitative development in 2024.
From the perspective of macro goals, starting from 2024, BYD will become the leader of Chinese brand new energy vehicles, and attack the market of fuel vehicles and joint venture vehicles together with other independent brands.
In 2024, in Wang Chuanfu's view, it will be a turning point for both China's auto industry and BYD.
Will BYD finally be able to achieve its goal?
Fangde Auto will continue to pay attention.