Source: Gingko Finance
Following Tesla's announcement of a price cut of 14,000 across the board, Li Auto also announced on the 22nd that all its models except L6 would be reduced by 18,000 for the Pro version of L7 and L8, 20,000 for Max and Ultra, 20,000 for L9, and 30,000 for MEGA.
As for the cancellation of the Air version, which was just added last month, the ideal side said that it would leave the price band below 300,000 yuan for the L6.
Starting at 249,800 yuan, the Ideal L6 was officially released last week, with almost exactly the same exterior and interior as the L series 7, 8 and 9, with a compressor refrigerator still crammed into a shorter body and relatively reduced interior space. The ideal L6 further continues the successful elements of the past L series, and with the price of 250,000 yuan, the L6 is cost-effective.
After the release of the L6, Meituan Wang Xing said, "MEGA is a bit like a car made for the ideal CEO himself, and the L6 is the car made by the ideal employees for themselves." He believes that among all the models of Ideal, the L6 will be the one that Ideal's employees buy the most.
According to the official data given by Ideal, the L6 will exceed 10,000 units within 72 hours of its launch. For this product, which is "less than 300,000 yuan and the Porsche Cayenne, with similar size, similar performance, larger space and more intelligent products", the first sales order volume accounts for nearly 80% of the entire brand.
After experiencing the disadvantage of MEGA and the upgrading and adjustment of the ideal organizational structure, Li Xiang, the "king of Weibo", who used to be tireless on social platforms to promote his own products, has not posted for a long time. At a time when the bosses of car companies are going down one after another to promote on social platforms through live broadcasts and other tricks, Li Xiang's silence is also a true portrayal of Li Auto's choice of a more pragmatic, cautious and stable strategy.
From L6 to the starting price of the ideal product line to 250,000 yuan, to the price reduction of the whole series, it is undoubtedly a manifestation of the ideal after reviewing and reflecting on the problems in March, "change when you know your mistakes". No longer paying too much attention to sales and competition, focusing on user value and seeking truth from facts is the solution proposed by Li Xiang. In the face of more fierce competition in 2024, the importance of L6 to the ideal is self-evident, and after the pure electric form did not bring significant increments to the ideal as expected, it has become more and more important to return to and keep the basic disk of extended range.
It's just that, under the influence of a series of negative events at the beginning of the year, how much sales can the ideal brand potential energy bring to the L6 launch and product price reduction this time?
Price reduction to ensure sales
The three models of the L series achieved a total sales volume of 376,000, a revenue of 123.85 billion yuan and a net profit of 11.81 billion yuan last year, making Ideal the first car company among the new car companies to complete the profit target and reach more than 100 billion cash reserves, and 2023 is an extremely successful year for the ideal established for nearly ten years.
Range extender, product planning and positioning, and new media full-coverage marketing, the ideal "three-board axe" advantages are fully revealed, and it is difficult for other new forces or traditional car companies to match their strategy formulation and execution. From the second half of 2023, with the successive launch of the new M7 and M9 in Wenjie, the position of the ideal to occupy the top sales list for the whole year began to falter, and it basically did not return to the first place until the end of the year.
According to the data of Bitauto.com, in the first quarter of this year, the sales volume of new energy brands exceeded the ideal 85,900 units with a result of 86,600 units, ranking first among new power car companies. With the blessing of Huawei's brand and technology, the strong position of Wenjie in the new energy vehicle market has made it impossible for Ideal to "pamper and be pampered", whether it is in the form of extended range or the product positioning and audience segmentation of the three models, the product lines of Wenjie and Ideal are overlapping.
In the first quarter of this year, the sales of the ideal L7, 8 and 9 models were 34,509, 22,398 and 24,722 respectively, while the sales of the new M7 were 74,939.
Under the pressure of competitors' sales and the sales of the new product MEGA, Li also lowered its Q1 delivery guidance from 100,000-103,000 units to 76,000-78,000 units at the end of last month. In the previous Q4 2023 earnings call, Ideal had said that the sales target for 2024 is 800,000, a significant increase of 112.8% compared with the sales of 376,000 in 2023, highlighting Ideal's confidence in future market competition in the face of success in 2023. From the downward revision of the delivery guidance to the lower-than-expected sales in the final quarter, it is certain that it will be more difficult for Ideal to achieve the target of 800,000 units.
At the beginning of the second quarter and before the May Day holiday, the official price reduction was the first official price reduction of the whole product line since the establishment of Li Auto, which was a "self-help" for Li Auto to quickly adjust its strategy in the face of the current unfavorable situation and difficult situation. Ideal on L6 will be within 250,000 prices and in addition to air suspension, color TV, lidar, ternary lithium battery in addition to the ideal series of standard configuration to users, is the ideal through L6 to break through the bottleneck of sales, return to products, adjust strategy, return to the main battlefield of extended range "ship".
Brand potential is no more
Whether it is the launch of L6 or the price reduction of L series and MEGA, it is the embodiment of Ideal's anxiety about sales in the face of the competition of various car companies with stronger product power and more direct marketing methods.
Last year, L7, 8, 9 three models can support the ideal annual sales target, in addition to the refrigerator, color TV, large sofa and extended range form, ideal from ONE to the shaping of the brand image and positioning also helped a lot. With the concept of "car and home", it is precisely aimed at white-collar families and elites with many children, and uses three models to give the same type of people with different needs, with Li Xiang himself and the ideal KOC on social platforms, the product advantages are infinitely amplified, and with the price of more than 300,000 yuan, followed by the establishment of the high-end image of the brand.
Last year, topics such as "BBA car owners replace ideals" appeared on social platforms one after another, which is the embodiment of the potential energy of the ideal brand again and again.
Perhaps the success in 2023 was too rapid and beyond expectations, and the ideal was a bit "reckless" in the formulation of strategies and product planning in 2024, but in Li Xiang's mind at that time, all this could be achieved. Therefore, at the MEGA press conference, Li Xiang shouted the slogan of "regardless of model, regardless of energy form, more than 500,000 sales champion" for this pure electric MPV priced at 560,000 yuan, compared with the expected data of 8000 monthly sales, it is still a good result to be stable at 1000 monthly sales.
Ideal: From the beginning of the year to the listing of MEGA, the huge amount of marketing publicity was invested, and the results were gradually reversed after the listing of MEGA. Whether it is the malicious smear of MEGA on the Internet, or the rational analysis of the ideal MEGA strategy by the media, it is moving in the opposite direction of the ideal expectation, resulting in the collapse of this key model that was supposed to start the ideal pure electric strategy, which seriously damaged the brand image of the ideal and affected the basic disk of the ideal L series.
From the withdrawal of the MEGA show car in the third and fourth cities and below markets, to the reformulation of the launch and launch strategy around the L6, Ideal intends to rearrange the L-series product matrix and strategy, but the current market is not as favorable to Ideal as in 2023.
Direct competition between Xiaomi and Huawei
The new M5 has just been released in Beijing, with a starting price of 249,800 and L6, and the new M5 is equipped with LiDAR and Huawei ADS2.0 high-end intelligent driving assistance as standard, which is not available in the ideal L6.
Under the impact of the new M7 and M9 on the ideal L series, the new M5 will inevitably launch a greater challenge to the ideal L6, which is undoubtedly a severe test for the ideal after losing the brand potential energy.
Looking at the current domestic automobile market, in addition to Huawei's Hongmeng Zhixing models, the biggest focus comes from Xiaomi SU7. Since the end of last year, XiaomiSU7Technology Conference, the popularity of Xiaomi cars has only increased, relying on more than ten years of consumer electronics market accumulation under the strong user stickiness and market breadth blessing, Xiaomi SU7 is indeed the most popular "fried chicken" in the development of new energy vehicles for many years.
One has a strong brand effect and technology research and development strength, and the other has a wide range of audiences and markets and huge traffic, and the ideal in 2024 will face a year of strategic rollout and product explosion after the technology manufacturers enter the field of car manufacturing. Not only that, the new energy brands incubated by traditional car companies are also disrupting the market pattern with their profound technical background and excellent sales channels of car companies, such as ZEEKR, Zhiji, Denza, etc., and the current situation of the ideal is "the enemy on the back".
According to the statistics of Weibo @ new channel Li Batian, when users enter the store to learn about L6, the comparison models are Xiaomi SU7, Wenjie M5, Zeekrypton 001, Weilai ES6, Model Y, it is obvious that L6's competitors are not weak today, there are Zeekrypton 001, which has performed well in the market this year, Model Y, the long-term new energy model sales champion, and new models from Xiaomi and Huawei.
Ideal's achievements last year have made other car companies learn and follow suit at the product and business level.
First of all, the form of extended range is no longer ideal and unique;Secondly, the refrigerator color TV sofa has become the standard configuration of SUVs, and even C-class sedans are following suit;In addition, in simplifying product SKUs and making audience segmentation more accurate, it has gradually been used by more car companies;Finally, Internet marketing, car company bosses are becoming more and more active on social platforms, communicating with more users through live broadcast and sharing, while narrowing the distance with users, it can also allow personal IP to be infinitely amplified and diffracted to products and brands.
This used to be the ideal "unique secret", but after a series of "black swans" in March, the ideal in the internal adjustment and reflection also gave other car companies time to catch up, when car companies have such capabilities and advantages, the space left for the ideal has become more crowded. As the first new power car company to enter profitability and 100 billion cash reserves, Ideal may need to consider more countermeasures to face the cruel competition after the L6 is launched and the product price is reduced.