BYD set off another "price kill", and European, American and Japanese car companies couldn't sit still丨 The eyes of global public opinion

According to the Financial Times on March 25, Nissan, one of the Japanese auto giants, released a business plan on the same day, planning to "cut 30% of the cost of electric vehicle manufacturing" by establishing new partnerships and improving production technology to deal with the "threat from Chinese competitors".

On the same day, BYD, the world's "best-selling electric vehicle", launched the Seal Glory Edition with "price reduction without downgrading", and a new round of price war attracted great attention from foreign media. The price war in the Chinese auto market, which has lasted for nearly a year, is still in full swing, and the traditional car companies in Japan, Europe and the United States outside the eye of the storm have also felt the chill.

At present, BYD not only has red sales in first-tier cities, but also accelerates its seizure of the sinking market and squeezes the share of fuel vehicles in the Chinese market by virtue of the price advantage of "electricity is lower than oil". In the overseas market, BYD's high cost performance is also a sharp weapon.

Seal Glory Edition Source: BYD's official website

According to a Bloomberg Intelligence survey, 83% of European consumers believe that the price of a new electric vehicle is too high. Fortune magazine quoted Nisita Agarwal, an electric vehicle industry analyst at the Economist Intelligence Unit, as saying: "BYD has been more concerned about the more price-sensitive mass market...... Affordable models are attractive to buyers in the European market. ”

According to a Reuters report on the 27th, BYD plans to sell 500,000 cars overseas in 2024, which is twice the target number in 2023, and BYD's confidence in entering the overseas market is on paper.

Different from traditional price wars, low prices are not only a strategic consideration for BYD, but also a cost advantage established through the development of battery technology and the establishment of a complete supply chain. Taking the power battery, which can account for about 30% of the cost of the whole vehicle, as an example, compared with international car companies that use heavy metals, BYD uses low-cost lithium carbonate based on mature independent research and development technology, and the price of lithium carbonate has continued to fall in the past year, further expanding BYD's cost advantage.

A number of Chinese new energy vehicle companies such as BYD are also stepping up research and development, and have extensive cooperation with first-class domestic and foreign companies to create newer, better and smarter products. Brands such as BYD, Xpeng, and Li have all officially announced their cooperation with top chipmaker Nvidia to use the latest generation of Drive Thor chips, which is the next-generation in-vehicle computing chip platform designed by NVIDIA for artificial intelligence and autonomous driving applications.

In the face of the new energy wave led by Chinese car companies, Japanese automakers can no longer sit still. Reuters reported that on March 15, Honda and Nissan, old rivals of Japanese automakers, shook hands and signed a memorandum of understanding to cooperate in the field of electric vehicles. According to Nikkei Asia, Toyota launched a plan to accelerate its own "electrification" process as early as the second half of 2023, actively laying out the next generation of electric vehicle production technology, striving to reduce nearly half of the car assembly time, and achieve "production of 600,000 units" of its electric vehicle brand by 2025.

Nissan CEO Makoto Uchida and Honda CEO Toshihiro Mibe announced their partnership plans in Tokyo last Friday.

图片来源:KIMIMASA MAYAMA/SHUTTERSTOCK

On March 24, the British "Daily Telegraph" quoted Andy Palmer, a former Nissan executive and known as the "godfather of electric vehicles", saying that "Japan has fallen far behind in the field of electric vehicles, and China is now the industry pioneer". In the face of the rise of Chinese competitors, Japanese manufacturers have to actively respond to the battle.

On the other side of the Eurasian continent, when the "Explorer 1" full of BYD docked in Germany, the old European car companies also tightened their nerves. According to a report by Fortune magazine on March 21, in a 19-page open letter, Luca de Mayo, CEO of French automaker Renault, mentioned China 23 times, emphasizing that "the automotive industry, which is the backbone of the European economy, is facing an onslaught from China's electric vehicles", and suggested that the European Union launch its own "Marshall Plan" to increase the number of European brand electric vehicles.

In fact, the EU has already begun to act. In February 2023, the European Parliament officially passed a bill that will ban the sale of new petrol and diesel cars within the EU from 2035, with the aim of accelerating electrification. In October of the same year, the European Union announced the launch of a countervailing investigation into China's imports of electric vehicles, including BYD. In addition to the extensive non-tariff barriers, Chinese NEV companies still need to overcome problems and obstacles such as low brand awareness and differences in local market preferences to enter the European market, and there are still many challenges ahead.

In the face of difficulties, Chinese automakers are actively looking for a new "going global" model - building factories in Europe to achieve localized production in Europe, and in order to avoid potential trade risks and help Chinese electric vehicle brands gain more development space in Europe. At the end of January 2024, BYD announced that it had officially signed a land pre-purchase agreement with the Hungarian government for a passenger car plant, which will be completed and put into operation within three years, Lianhe Zaobao reported. According to Reuters news on March 14, SAIC, which was targeted by the European Union for launching a "countervailing investigation" along with BYD, "is evaluating whether to build a factory in Europe."

When the global auto industry enters a revolutionary change, regional trade protectionism cannot solve the problem, let alone stop the people's demand for excellent products. To borrow the beginning of a Forbes report, I advise European car companies to speed up the development of popular electric vehicles, otherwise don't blame "high-quality and low-cost Chinese electric vehicles" to seize the market.

Author丨Li Jiayi, the chief writer of Shenzhen Satellite TV Direct News