In addition to new cars, another series of major events during the auto show is the cooperation between foreign brands and Chinese technology companies.
Toyota Motor has a strategic partnership with Tencent to collaborate in the areas of artificial intelligence, cloud computing and big data, Nissan will collaborate with Baidu on artificial intelligence and smart car research, and more interestingly, Renault, which withdrew from the Chinese market in 2020, is looking to cooperate with Xiaomi and Li in electric vehicle manufacturers.
Some are similar to Stellantis' stake in Leap and Volkswagen's investment in Xpeng, but the difference is that Xiaomi and Ideal's current situation and capabilities are stronger than Leap and Xpeng on the surface.
Renault wants to collaborate on electrification, why?
Volkswagen's capital increase in Xpeng aims to quickly realize the intelligent process in China, and Stellantis has taken a stake in Leaprun, from the perspective of Stellantis, Leaprun's technology feeds back its global new energy vehicle layout, and from the perspective of Leaprun, the future globalization has been settled.
Renault has taken a fancy to Xiaomi and Ideal, separately, the ideal advantage in the product is the extended range SUV, more importantly, the ideal profit margin and profitability are currently the strongest among the new energy brands; Xiaomi currently only has one pure electric car, but Xiaomi's advantage lies in its strong supply chain integration capabilities.
For most European car companies, these two "skills" are indispensable, and Renault is no exception.
Renault is one of the first brands in Europe to implement electrification technology, as early as 2009, Renault in its European R&D center to show its battery swap plan called Quick Drop, in 2011, Renault has a large number of electric vehicle research and development plans, and has the idea of only making electric vehicles in the future. In 2020, with the launch of the Renault Morphoz concept, Renault also brought a new battery swap mode.
Now it seems that Renault's previous imagination has been realized by Chinese car companies, but Renault itself has withdrawn from the Chinese market.
Judging from Renault's move, the signal it released is, first, that it has its own electrification technology reserves, and has gained a foothold in the European electrification market; second, China's new energy vehicle market accounts for more than 60% of the world's market, and Renault has the idea of returning to the Chinese market through electric vehicles, after all, the annual sales of the Chinese market account for about 40% of global sales.
Entering 2024, the demand for electric vehicles in Europe will slow down, due to the decline of subsidies in various regions and the gap between consumers waiting for new subsidies, resulting in a decline in electric vehicle sales. On the other hand, Chinese EV brands want to enter Europe, but are subject to countervailing investigations. It is reported that Renault is one of the car companies that oppose Europe's anti-subsidy investigation of China's electric vehicles, but Renault also said that how to protect the position of European car companies in the European market, and at the same time better introduce Chinese electric vehicle products and technologies, is the focus of the future.
In addition, Mercedes-Benz, BMW and other leading European car companies have slowed down their electric vehicle sales plans, and the current problem in the European electric vehicle market is that European car companies want to consolidate their position, but some objective factors restrict the speed of development. Therefore, the best way at present is to take the joint venture road when foreign brands entered China in the 80s, and European car companies do not have to worry about the market being monopolized by Chinese cars, but also can quickly achieve technological development, killing two birds with one stone.
The latest development is that Zhu Jiangming, chairman of Leapmotor, said in an interview with the media at the Beijing Auto Show that 2024 will be the first year of Leapmotor going overseas, and in the second half of this year, Leapmotor will officially land in overseas markets and open 200 dealer stores around the world.
Stellantis announced in February that it would produce Leapmotor cars in Italy. In other words, the cooperation between the two sides has made substantial progress, and only half a year has passed since the establishment of cooperation between the two sides.
It is not difficult to see that the advantage of traditional European car companies lies in the global system established over the past decades, and what China's new car-making forces want is to be able to develop globally in the future, so there is a high probability of promoting cooperation and a win-win situation.
China's new energy vehicle companies, take the initiative?
Compared with the gameplay of Volkswagen and Stellantis, what Renault wants seems to be more direct. Xiaomi and Ideal are not only supply chain integration and profitability, but more importantly, China's new energy vehicle industry has formed a very mature system. What Renault wants more, or the whole system.
In several aspects, in terms of raw materials, battery raw materials, rare earths for motors, etc., China has obvious advantages. The effect is that the cost of raw materials is lower, and the cost of components is lower. The Germans protested against the Volkswagen ID. series, why the German price is three times that of China, is the best evidence of the low cost of raw materials in China.
Domestic new energy vehicles can afford to fight the price war, in addition to the low cost of raw materials, parts suppliers have made a lot of contributions. Regarding new energy auto parts, there are many suppliers in China, and the competition is more intense, which is reflected in the good quality and low price. This is also incomparable with foreign new energy parts suppliers.
- In the era of electrification, the ability of Chinese car companies to warm up in groups is also incomparable to that of foreign car companies. Taking AVATR as an example, Changan Automobile's manufacturing capabilities, Huawei's intelligent solutions, and CATL's battery solutions combine the three most needed skills for new energy vehicles.
Finally, there is the market demand. The world's largest single market for new energy vehicles is in China, and thanks to the iteration speed of China's new energy products, consumers are more "picky" about new energy vehicles. In other words, winning the Chinese market is basically equivalent to being able to play the global auto market.
Looking at China's new energy car companies alone, each has "exclusive skills", such as NIO's battery swap system, ideal, Huawei's extended range solution, Huawei's and Xiaopeng's intelligent driving, etc., there are many choices for foreign-funded car companies, and they can also be "customized" according to their needs.
All in all, China's new energy vehicle industry has been able to provide a complete set of solutions for the global auto market, which is not yet possible in a single market for new energy vehicles. Therefore, it is reasonable for foreign car companies to gather in China to seek cooperation.
Finally, Europe is facing the problems faced by China's automobile industry 40 years ago, the same is that in the development of new energy, European car companies need to invest regardless of the cost, in order to achieve the current effect of China's new energy industry, which has to rely on a large number of policy support, relying on the efforts of a single car company is far from enough.
Therefore, European car companies are just looking for a time-saving, low-cost, and safe way to quickly integrate into the development of electrification, and Chinese new energy vehicle companies are the best solution.
Epilogue:
Although it cannot fully explain that China's auto industry has reached the point of leading the world in the era of electrification, at least in terms of development speed, China is one step ahead. Now Renault, the previous Volkswagen, as well as Toyota, Nissan, etc., since Volkswagen invested in Xiaopeng, it has kicked off a new joint venture.
If Renault succeeds in the cooperation and returns to the Chinese market through this move, those brands that have withdrawn from China may see hope again.