The price war of cooking oil has not died down, and there has begun to appear "backlash" - relying on the rough "price for volume" strategy, car companies have won market share in the short term, but lost profits, when selling a loss has become the norm, behind the blossoming new energy vehicle market, the industry "blood loss" situation at the cost of consuming the profitability of car companies will continue.
In fact, when the "volume price" is no longer effective, "roll out" is the long-term solution.
In 2023, the fierce "involution" will "roll" the scale of China's automobile production and sales to the height of more than 30 million units for the first time, of which the total export volume of automobiles will reach 5.221 million units, and the export growth rate will be higher than the overall growth rate, jumping to become the world's largest automobile exporter. As Chinese auto brands focus more on overseas markets, many institutions predict that China's auto export sales will reach 5.5 million units in 2024.
At the ongoing 2024 Beijing Auto Show, the efforts of Chinese auto brands to accelerate globalization are more intuitive, compared with previous auto shows, the proportion of foreign faces has increased significantly, and the R&D personnel, dealers, and overseas media of major car companies have gathered together: the booths of NIO and Ideal gathered groups of businessmen who talked about export business and foreign friends who came to experience the test ride, Xiaomi and BYD attracted a lot of foreign media to take pictures, and a number of Japanese and Korean auto engineers were carefully comparing every detail with model manuals in their hands.
At the Leapmotor booth, there was also its own overseas 100-person exhibition group - representatives of Stellantis Group, General Representative of the French National Automotive Industry Council, President of the French Automobile Industry Federation, President of the French Automobile Dealers Association, and a group of 100 dealers from Europe/Asia-Pacific/South America gathered together to open up the three important links of Chinese smart electric vehicle companies going overseas such as overseas allies, industry organizations, and dealers, which became the epitome of the globalization and integration of the automobile industry at the Beijing Auto Show.
Unlike last year's Shanghai Auto Show, where Chinese auto brands used it as a window to "show their technology" to the world, this year's Beijing Auto Show is aimed at the global market, becoming a big stage for dealers and investors around the world to negotiate business. This is the epitome of the globalization and integration of automotive products, and it is also the embodiment of China's automobile industry, products and technologies being recognized overseas.
Chinese technology stands on the global stage
In 1984, Volkswagen signed a contract with SAIC Motor to establish China's first automobile joint venture, which opened the curtain on China's modern automobile industry. At that time, the joint venture model was more based on "market for technology", introducing overseas models for OEM production, and Chinese car companies ceding part of the domestic market to encourage foreign parties to transfer advanced technology and eventually establish their own automotive industry research and development system, which was also the original intention of the establishment of the joint venture model.
Forty years later, with the acceleration of the switch from fuel vehicles to new energy vehicles, the Chinese market is changing much faster than other markets in the world, and the automobile market pattern is being reshaped.
Volkswagen took a stake in Xpeng, Audi joined hands with SAIC, Leapmotor and Stellantis formed Leapmotor International, and Toyota and Pony.ai established a joint venture...... This is another moment of great significance in the history of China's automobile industry, and it also directly confirms that Chinese car companies have achieved lane change and overtaking in the international arena by virtue of the accumulation of electrification and intelligent technology.
In the eyes of industry insiders, China's auto industry has technological and cost advantages in the fields of electrification and intelligence, and at the same time, the development and iteration speed of Chinese car companies is far better than that of traditional foreign car companies.
The wave of intelligence sweeping the world is refreshing the cognition of foreign consumers, and the iteration of intelligent experience in foreign markets has given Chinese cars the opportunity to break through. As a representative of China's new EV manufacturers, Leapmotor is actively expanding overseas markets and accelerating the implementation of the globalization strategy of products and technologies based on a global vision.
In September 2023, Leapmotor kicked off its globalization strategy with its debut at the Munich Motor Show, showcasing the latest achievements of global self-development, the LEAP3.0 architecture and the first global model, the C10, in October, Stellantis Group took a stake in Leapmotor, and the two parties reached a global strategic partnership and will establish Leapmotor International, in November, Leapmotor announced the completion of the cooperation with Stellantis Group, and in March this year, all senior executives of Leapmotor International were in place.
"We will launch products on several continents around the world this year, and Europe will be the first to launch in the market of the old traditional automobile powerhouse, and blossom in the core passage, which is an advantage that many car companies do not have, and it is also Mr. Zhu Jiangming, as a mature entrepreneur, with his unique strategic insight, assessment of the situation and business innovation in his 30 years of operation, to build a unique overseas strategy for Leap in the most practical way. Wu Qiang, co-president of Leapmotor, said.
According to the plan, in the third quarter of this year, Leapmotor products will complete the EU certification, and C10 and T03 will be the first to enter the European market. In the next two years, five global products will be sold simultaneously in Europe, Asia-Pacific, the Middle East, and the Americas.
"In the future, Leaprun will have a better and greater advantage in the overseas market, and the cooperation between Leaprun and Stellantis Group is advancing very quickly, and the overseas team and senior management team are already in place, which is very good. Zhu Jiangming, founder, chairman and CEO of Leapmotor, revealed that Leapmotor has adopted an asset-light model to cooperate with Stellantis, relying on its mature overseas sales channels and after-sales service system to support Leapmotor's overseas expansion.
"We are not a trade-oriented to go to sea, but to establish a local marketing network, build a service system, including finance, insurance integration, etc., relying on more than 10,000 dealers of the Stellantis Group to help us land, hoping to develop more than 200 sales outlets this year, which can bring value-added to users, but also let users more assured to use Leap products. In Zhu Jiangming's view, this year is just the beginning, all EU certifications will be completed in the third quarter of this year, and overseas sales will really start in the fourth quarter, "Next year will be a bumper year." ”
The global self-research + ultimate price-to-price ratio leads the enterprise upward
It is worth mentioning that, unlike in the past, when car companies only exported their products overseas and sold cars through cooperation with local dealers, in addition to products, Leapmotor's external supply business based on the core components of the three electric vehicles is also an important part of its globalization strategy, and it is looking for new profit growth points through technology licensing or joint development.
Behind the external supply of technology, it is inseparable from the support of its global self-research.
Since its establishment in 2015, Leapmotor has adhered to the global self-development, and has achieved 70% of the vehicle cost of self-research and self-manufacturing capabilities, except for the purchase of battery cells, interior and exterior decorations, chassis, automotive electronics and electrical appliances for self-research and outsourcing production, all other parts are self-developed and self-produced. Leapmotor has launched leading intelligent electric technologies such as 8-in-1 electric drive, battery-packless CTC battery-chassis integration technology, centrally integrated electronic and electrical architecture, and integrated cabin, driving, driving and parking integration solution.
The global self-research has greatly improved the efficiency and output of Leaprun's capital use, and used the logic of "following consumer needs" and the strategy of "good but not expensive" to achieve the ultimate in pricing, and constantly cut the market cake, which is the core magic weapon of Leapmotor to cope with the long-term competition in the future automobile market.
In the past five years, Leapmotor has achieved self-developed and mass production of core components of the three electric vehicles and 8 vehicles, and achieved sales of 340,000 units by the end of March, ranking third among new car manufacturers in 2023.
At the Beijing Auto Show, the Leapmotor C16 made its world premiere and opened pre-sales. As the first six-seater SUV of Leapmotor, the new car integrates the comfortable space of MPV and the styling style of SUV, adopts a 2+2+2 golden space layout, integrates SA8295P chip intelligent cabin, LiDAR + Orin-X chip high-end intelligent driving, 21 Yang luxury audio, 2000Mpa high-strength steel safety body and other configurations, and the pure electric model is equipped with a global 800V silicon carbide high-voltage platform as standard, redefining the 6-seat SUV experience.
It is reported that the maximum price of the full version of the Leap C16 does not exceed 200,000 yuan, and the order exceeds 11,950 units in 24 hours, which will be launched and delivered in June.
Zhu Jiangming said that for a long time, 6-seater SUVs have been dominated by the high price range of more than 250,000 yuan, whether it is a fuel vehicle or a pure electric vehicle, the price is high, and even needs to be purchased at a higher price. In the range of less than 200,000, there is a lack of a cost-effective model on the market that truly meets the needs of consumers. The launch of the Leapmotor C16 just meets this need, and its price and configuration are very cost-effective.
Based on years of technology precipitation and experience accumulation, Leapmotor has developed a unique business model: firstly, domestic vehicle sales, Leapmotor focuses on a specific product range, that is, the price band of 100,000~200,000 yuan, and continues to launch good but inexpensive products. Under this market positioning, Leapmotor can avoid the head-on impact of new car-making forces such as Ideal and NIO, which have abundant resources, and can also compete with traditional car companies by virtue of its advanced intelligent advantages.
Secondly, the overseas market strategy, Leapmotor adheres to the asset-light model and cooperates with external car companies, including the core components of the three electric vehicles into other OEMs, and the cooperation with overseas car companies to realize the external supply of three electric parts and overseas vehicle sales.
In fact, for car companies to become an international and global brand, they are inseparable from two essential elements, one is the continuous improvement of overseas popularity, and the other is the launch of more global models, including the development of intelligent solutions customized for specific regional markets and regulatory adaptability.
Chinese car brands, including Leap, are working hard to make these two things a reality.
"In the past, Chinese companies had lessons in the process of going overseas, such as the early export of pharmaceuticals and motorcycles. To learn lessons, it is necessary for automobile companies to adhere to the attitude and requirements of high-quality development, not only the high-quality product technology, but also the competition to be high-quality and sustainable, rather than a bloody development process. Some industry insiders pointed out.
While the world's major mainstream auto shows are gradually falling into loneliness, Chinese auto brands are leading the trend of electrification and intelligent development.
The Beijing Auto Show was particularly lively, with more and more overseas auto industry associations and global dealers showing strong interest in Chinese brands, which also provided an opportunity for Leapmotor to accelerate its exploration of overseas markets and find partners.
Leading the upward development of the enterprise with global self-research and the ultimate price-to-price ratio, Leapmotor not only brings luxury equality and high quality into reality in the Chinese market, but also takes the lead in the world, creating a new sample of China's smart electric vehicle enterprise technology going overseas + brand going overseas.