To prevent getting lost, the elevator goes directly to the safety island to report Liu Yadong A
Source: NetEase Technology
Author: Pu Zixu
A tall man with a haggard face, a stubble on his face, and a black suit, stepped out of the plane.
In "Journey to the West", if a child sees the Monkey King in the book in the book banging on the South Heavenly Gate, he will definitely wave his flag excitedly and shout and call Niu X.
But as everyone knows, when the monkey who fights the heavens and the earth first enters the society, he will also bow down under the tight spell of Tang Seng, rolling on the ground in pain, and blurring his eyes with anger.
What to do?
Perhaps, one of the eternal cores of "Journey to the West" is to try to tell heroes and heroes in any corner of the world that if you can't solve the problems of the two-dimensional world by brute force, you have to turn to the great wisdom in three-dimensional time and space.
So, on April 28, 2024, a Gulfstream plane crossed the Pacific Ocean, thousands of kilometers west, and quietly landed in Beijing.
A tall man with a haggard face, a stubble on his face, and a black suit, stepped out of the plane.
Apparently, this time, he was in big trouble again.
Tesla's key battle,
The problem may not be sales
On April 28, Musk returned to Beijing.
Since officially opening the road to visit China in 2014, to 2015 three intensive visits to China, in the past ten years, Musk, who has been crawling all the way and sweeping everything in the sea of science and technology stars, has now come to this eastern power for the eleventh time.
But this time, he looked tired. After decades of ups and downs in the business world, Musk, who is proficient in all the laws of business society, is in huge trouble in the spring of 2024.
This time, as soon as Musk got off the plane, he met with Ren Hongbin, president of the China Council for the Promotion of International Trade.
The two sides are already old acquaintances - last year, the two sides had an in-depth exchange of views on topics such as promoting Sino-US cooperation in the new energy industry, strengthening exchanges and cooperation between the business community of China and the United States, and holding the first China International Supply Chain Promotion Expo.
But this time, things may be different.
According to the cross information, the purpose of Musk's visit to China is very likely to point to the landing of Tesla's self-driving FSD in China. It is reported that Musk will discuss with China the launch of FSD software, and will be allowed to transfer the data collected in China to overseas to train the FSD algorithm. Since 2021, Tesla has been required by Chinese regulators to store all data collected by its Chinese fleet in Shanghai, without any data transmitted to the United States.
So, what is Musk's calculus, and what problems has Tesla encountered in China?
If you look at Tesla's sales, in the past few days, the noise of the Beijing Auto Show and Tesla's absence have become a major aspect of the interpretation problem: China is already the world's largest new energy vehicle market, and it is also the most competitive market in the world.
Previously, an internal letter from Musk kicked off Tesla's brutal layoffs of 14,000 people around the world. Although, it is Musk's prescription for a company that will inevitably be prescribed after he is "sick". But this time, the problem in front of Musk is different.
A direct trigger is the decline in Tesla's sales. In the first quarter of 2024, Tesla's global deliveries were 386,800 units, significantly lower than the previous agency's forecast of 430,000 units, down 8.3% year-on-year and 20.1% quarter-on-quarter. This is also the first time since 2020 that Tesla's deliveries have seen a quarter-on-quarter decline in declines. Reflected in the stock price, Tesla's stock price has continued to fall this year, with a cumulative decline of more than 30%.
In this regard, Reuters has previously commented that Tesla has also failed to provoke new demand in a competitive market in the case of price reduction promotions, which is a complete disaster that will have an impact on Tesla's long-term story.
Moreover, after the beginning of the spring of 2024, Tesla is surrounded by strong competitors in the Chinese market that it relies on the most, and growth is stagnant: although Tesla did not release data on its major markets such as China in the first quarter of 2024, foreign media have previously said that Tesla sold a total of 132,420 electric vehicles in the Chinese market in the first quarter of this year, with sales falling by 3.6% year-on-year.
According to the data of the Passenger Association, Tesla's wholesale sales were 220,876 units and exports were 88,456 units from January to March this year: Calculating the difference between wholesale sales and export volumes, it can be calculated that Tesla sold 132,420 vehicles in the Chinese market. In the first quarter of 2023, the Passenger Association announced Tesla's sales in China 137429 units, which also means that Tesla's sales in China fell by about 3% year-on-year.
By comparison, BYD sold 586,006 units in the domestic market in the first quarter of 2024, compared to 137452 units in second place Geely. From January to March 2024, China's NEV production and sales reached 2.115 million units and 2.09 million units, up 28.2% and 31.8% y/y, respectively.
It can be said that Tesla is gradually losing its advantage in the Chinese market, and it has not seen relief. Therefore, the key to Tesla's breakthrough lies in the launch of new models: however, Tesla in 2024 is a small product cycle, and with Musk's vacillation on the Model 2 issue, the problem is becoming confusing.
11th visit to China,
Musk wants to solve a big problem?
However, sales may not be the key to Musk's visit to China.
If the Shanghai Gigafactory supports Tesla's production capacity, and the Chinese market supports one-third of Tesla's sales, then FSD supports Tesla's stock price and future possibilities.
It can be said that the exposure of the sales problem has further forced Musk into a corner. If FSD continues to release pigeons, Musk will shake Tesla's fundamentals: that is, whether Tesla is an automobile company or a high-tech company?
Generally speaking, Toyota, the ceiling of the valuation of traditional automobile manufacturers, has reached its peak after decades of development, with more than ten times the PE and hundreds of billions of market value. However, Tesla's market value once exceeded one trillion US dollars, and the capital market obviously did not refer to this logic in its valuation.
Then, in order to continue his valuation "maybe", Musk must conquer the Chinese market FSD, which may be the key to his visit to China.
A visual example is that since the beginning of this year, Tesla's stock price has plummeted by a third. However, at the first quarter 2024 earnings conference, Musk said that the driverless taxi Robotaxi will be released in August this year, and the low-cost new car that will be shelved is also expected to be released next year. The news triggered a carnival in the capital market, and the stock price recovered rapidly.
IN THIS EARNINGS CONFERENCE, TESLA ALSO PRESENTED ITS ECOSYSTEM TO THE WORLD WITH "MORE THAN JUST VEHICLES". After his car-making business was blocked, Musk urgently needs to make efforts in other businesses, including AI, FSD and energy storage, to drive Tesla into the next period of growth.
And, again, Musk stressed to Wall Street investment banks that we should be considered an artificial intelligence (AI) or robotics company: if you look at Tesla as a car company, that's a false framework. I mean, if someone doesn't believe that Tesla is going to solve the automation problem, I don't think they should be an investor in this company.
Previously, Tesla slashed the price of its FSD software in the United States from $12,000 to $8,000, and the monthly subscription fee was also reduced to $99 from $199. Because of this, the continuously updated FSD will become the second growth point of Tesla's global market, and it will also become the core of its valuation.
Because of this, how to realize Tesla's FSD function in its largest market has become the key to Musk's learning this time. Previously, Musk replied to a user's question on the social media platform X about when Tesla will launch FSD in China, saying: "It may happen soon." ”
But the problem is that Musk, whether it is in the model or several no-shows, is being questioned by the capital market, and everyone's patience is gradually lost. Previously, Bloomberg analyst Steve Man said that institutional investors were losing patience and that the initial hype about fully autonomous driving and robo-taxis had waned and that "the pendulum has swung in the opposite direction".
According to a survey conducted by Canadian investment bank Gatun Balleng, even if they have actually experienced FSD technology this year, consumers' willingness to pay has not increased significantly. The survey results showed that only 6.3% of the 60.2% of participants who had tried FSD technology this year were willing to pay $12,000 for it, while about 80.6% were willing to pay $12,000 or less.
Raunchy Musk,
The stubble has turned white
In May last year, Musk traveled all the way west, across the Pacific Ocean, to Beijing.
In 44 hours, Musk was successively received by the leaders of the Ministry of Foreign Affairs, the Ministry of Industry and Information Technology, and the Ministry of Commerce, went to the Shanghai Super Factory late at night to encourage employees, ate roast duck with Zeng Yuqun of CATL, and took Model X to the ministry.
Four years ago, in 2020, an epidemic swept the world, and it was also in that year that Musk came to China to attend the delivery ceremony of Tesla's domestically produced Model 3. At that time, with the help of China's huge industrial chain system, Musk's Shanghai factory production capacity exploded, won a larger global market scale in one fell swoop, achieved exponential profits, and became a well-deserved electric car brother in the world.
Now, looking back on Musk's ten visits to China, every time he arrives and laughs, there is a hidden substantive task.
"What I want to say to you most is, thank you for your support, and I am very grateful for your support, and we will be able to 'make a difference' in the Chinese market in the future. ”
In early 2014, Musk posted his first Weibo post, and three months later, Musk arrived in Beijing on his private jet. This time, Musk met with Wan Gang, then Minister of Science and Technology in 2008. In fact, the two sides have a long relationship: Previously, Wan Gang had inspected the new energy vehicle industry in the United States and had in-depth exchanges with Musk. In the second year after the inspection, the Ministry of Finance and the Ministry of Science and Technology jointly issued a document to provide huge subsidies to the new energy vehicle industry, officially opening the curtain on the development of China's new energy vehicle field.
In 2015, Musk visited China three times a year: once to participate in the Boao Forum, once to meet with the Beijing government, and once to participate in the domestic launch of AutoPilot 7.0. The three visits to China have made people familiar with the seemingly "unreliable" but intelligent Iron Man on the other side of the ocean.
At the Boao Forum, Musk and Gates sat down and discussed, and at the press conference, Musk showed off the muscles of the Tesla system, gained a large number of supporters, and the topic was full of heat.
However, while intensively expressing "friendship" to China, Musk also brought his own KPIs with him at that time: in fact, after his first visit to China in 2014, Tesla had high expectations for the Greater China market. At that time, Tesla executives had predicted that Tesla's global sales in China would reach about 30% in 2014, but Tesla's sales in the Asia-Pacific region accounted for only 15% in 2014.
Embarrassingly, before Musk participated in the Boao Forum, China became the only region where Tesla still had inventory. Because of this, in 2015, Musk visited China intensively and started sales.
In 2017, it was a key turning point in Tesla's development history: Musk's visit to China was of great significance: in April of that year, the Ministry of Industry and Information Technology issued the "Medium and Long-term Development Plan for the Automobile Industry", announcing that it would relax the restrictions on foreign automakers' investment in operating production cooperatives in China.
During several previous visits to China, Musk put forward ideas for building a factory, but it was not approved. And this year, the change in the direction of China's policy wind, Musk's seemingly existing Chinese businessman-like wisdom, began to appear: in 2017, Musk no longer made a big fuss, and only after secretly meeting with the Chinese senior management to determine the matter of Tesla's Shanghai Gigafactory, Musk impatiently announced the news of the meeting on Twitter.
With this key meeting, in the following years, Tesla finally got rid of the dilemma of insufficient production capacity, ended more than ten years of losses, and finally got on the right track. And Musk also achieved the ultimate counterattack under the encirclement and suppression of Wall Street for several years, with sales and stock prices flying together, and he was fighting all the way to the bottom.
On May 10, 2018, Tesla (Shanghai) Co., Ltd. was established in Shanghai. In July, Musk flew non-stop from Thailand to Shanghai, signed an investment agreement with Lingang District, and confirmed the construction of the factory. Including land selection, factory construction investment and other funds, Musk has received preferential treatment from the local government.
On the day of the groundbreaking ceremony, Musk took the stage again and danced.
At the beginning of 2019, Tesla's Shanghai factory officially started, and Musk visited China again to visit China's top management. The leader asked Lao Ma: "What else do you expect from the Chinese government?"
Musk replied: "I hope to make Tesla's Shanghai factory a global example." I love China very much and would like to come here more often. ”
Now in 2024, Musk is coming to Beijing again:
What remains unchanged is that Musk still has a heavy responsibility on his shoulders, and he still urgently needs the big countries in the East to turn stones into gold for the development of Tesla under his command, and overcome the difficulties.
What can change is that Musk's face is now weathered and his stubble has turned white.