When the war that swept the automobile industry is no longer extinguished, what kind of beginning will the advancement of those old car companies begin? Whether you admit it or not, the Chinese auto market in 2024 is already pointing out to the outside world in a very extreme way: this seemingly hopeless road is now getting narrower and narrower.
We don't know exactly when the public opinion environment in China became what it is now, but the cruelty of the truth is that regardless of whether the world is uneven or not, the story of traditional brands is no longer malleable in the world's largest car market.
To put it simply, when more and more Chinese consumers think that the auto industry will be restructured with China as the core, those established car companies will be very uncomfortable. In the past two years, the deteriorating market performance of global car companies such as Volkswagen, General Motors, Toyota, and Honda in China seems to be expressing to us that this scenario has gradually become a reality.
Nowadays, in the midst of the soaring trend of the automotive industry, no one wants to judge whether this sentiment is being built up for good or bad. The shock of a new brand killing all sides is always enough to get people on the hook. However, there is one thing that still needs to be seen, those Chinese car companies that have built advantages with the backing of big brands are indeed not as good as before in terms of earning power.
Throughout last year, as long as the performance of the joint venture company under its name declined significantly, the overall revenue status of the auto group fluctuated to a greater or lesser extent. With the release of the financial statements of various groups in the first quarter of this year, I dare to say that due to the pain of industry transformation, the situation of "unreduced sales and declining profits" is difficult to alleviate in a short period of time.
The pain of joint ventures has invaded the whole industry
Everyone in the industry must know how outrageous the market changes this year are and how much pressure the price war has put on companies.
When everyone is saying that the future belongs to electric vehicles, the companies that focus on fuel vehicles are tightly tied one by one, and they are not people inside and out; When disruptors like Xiaomi and Huawei are deeply involved in the competition, all the traditional car companies with a solidified system can do is to guard their own one-third of an acre and be uneasy......
In the first quarter, except for BYD, no one must be able to stand out in this stormy era. This is not only out of judgment on the entire ecological change, but also because in the eyes of the outside world, the damage caused by this mutation to those former kings is irreversible.
At the end of April, GAC Group also released its quarterly report.
This is despite the fact that it has previously given positive feedback on its shipments. During the reporting period, the Group's production and sales reached 403,000 units and 410,000 units, respectively. GAC exported 26,000 units in the first quarter, reflecting a 155.1% y/y increase.
On the whole, "single-quarter revenue was 21.346 billion yuan, a year-on-year decrease of 19.12%; net profit of 1.22 billion yuan, down 20.65% year-on-year", or inevitably exposed the unsatisfactory side of the market.
In the first quarter of this year, the overall inventory pressure of the automotive industry increased and a new round of price war was set off, which was the main reason why it was difficult for every company to maintain the past situation in the turmoil, and it naturally became the key for GAC to maintain a level in the same period in terms of revenue.
In contrast, not to mention how this market change has put everyone in the predicament of "hurting the enemy by a thousand and losing by eight hundred", for GAC, as mentioned at the beginning, the huge hostility of the terminal market to foreign brands makes it difficult for it to stick to the previous standard on the profit side.
Since last year, brands including Honda and Toyota have been subjected to abuse and attacks because of the impact of electrification on consumer trends. Then, GAC Toyota and GAC Honda, which were once the group's profit cows, are finally in trouble with "how to recover their development disadvantages" at this moment.
Over the past 20 years, under the influence of regional culture and market environment, the entire GAC joint venture business has always undertaken the natural mission of the entire group to move forward at a high speed. Making money and grasping the market is so handy. The brand moat built by the Toyota and Honda brands has served as a solid background for GAC's independent business, which continues to this day.
"There's no better opportunity for growth than in the last two decades." When China's auto market has entered a real inflection point since two years ago, this sigh has exhausted the helplessness of many people in the game, but it should also let everyone deeply understand that the future of China's auto market will be a struggle to make money without shortcuts and with real skills.
As early as last month, in the "2023 Annual Report" released by GAC Group, "In 2023, GAC Group will achieve operating income of 128.757 billion yuan, a year-on-year increase of 17.48%; net profit of 4.429 billion yuan, a year-on-year decrease of 45.08%", in fact, it has clearly informed us that even if the first quarter won a short respite, when the era of joint ventures to win has passed, if you want to fill the gap, there is still nothing more worthwhile than relying on yourself to live.
Under the changing situation, GAC needs to take on a big responsibility independently
If we want to set a tone for 2024, in addition to using "involution" to summarize all chaos, "death is like life" is almost the first impression we can give. Too many businesses are caught up in waves of destruction, lost in thought, or anxious. In the face of an unknowable future, no one knows where to go.
GAC Group is also a first-hand witness to this change, which means that when the brand image of Toyota and Honda has become more and more negative equity in China's current public opinion environment, if you want to maintain your location advantage and market position, keep up with the pace of industrial transformation, or put yourself in the multi-dimensional war set off by emerging forces, there is nothing more important than changing your style of play as soon as possible.
In the past few years when the joint venture company has been under increasing pressure, Trumpchi and Aion have indeed become the new pillars to help GAC move forward.
In the past 4 months, from the 2024 GAC Science and Technology Day to the 2024 Beijing Auto Show, GAC launched the domestic leading pictureless pure visual intelligent driving system, as well as a high-safety and large-capacity all-solid-state power battery that has achieved breakthroughs in key technologies, looking forward to achieving absolute transcendence on the technical side;
On the other hand, in line with the "Zhixing 2027" action plan, GAC officially announced that it will take the lead in product experience and travel scenarios on the basis of the existing intelligent advantages, through the upgrading of intelligent driving, intelligent cockpit and the creation of intelligent three-dimensional travel scenarios, so as to complete the self-leap.
The implication is that, based on the existing achievements, GAC seems to have bet on the treasure in the scope of its own business. The huge pressure brought about by the transformation of the industry has actually forced GAC to completely take electrification as the anchor point and increase investment in Trumpchi and Aion, so as to better adapt to the rapid upgrading of China's auto market.
According to the financial report, at present, GAC Group has comprehensively laid out the full-scene and three-dimensional travel modes from private travel to shared travel, individual travel to group travel, land travel to low-altitude travel - including its Ruqi Travel has started the commercial operation of L4 Robotaxi; Andi Technology, a joint venture with Didi, will launch its first commercial L4 autonomous driving model in 2025, and Qiji Auto's first L4 Robobus will be mass-produced by the end of this year.
Therefore, regardless of where the focus of the future development of the auto market will be, GAC's positive statement also caters to the general direction of market development.
At the same time, starting from 2024, GAC has made great progress in exports. Relying on the electric vehicle industry, the Southeast Asian market has become the first stop for GAC Aion's expansion; On April 29, GAC Passenger Vehicle and Hualishan Chensing Automobile Co., Ltd. also held a ceremony for the completion and mass production of the CKD plant in Malaysia at the Segambut plant in Kuala Lumpur, Malaysia.
Diversified development is what everyone is pursuing in this era. However, for GAC, seeing that the performance of the joint venture is not as good as before, and the public opinion of China's auto market is being led by emerging car companies to a field without a sense of boundaries, all of which seems to have become a logical means. The only thing to consider is that as the companies that dominate the trend of China's auto market are more and more inclined to non-traditional forces, can the implementation of some ideas be perfectly matched with the development of the situation?
For the grasp of the current consumers, Geely, Great Wall, BYD and other private enterprises are not vegetarian, Huawei, Xiaomi's participation makes the reshaping of the entire market pattern more complicated, which means that the old state-owned enterprises represented by GAC and SAIC, when the dividend period of joint ventures gradually fades, new plans and plans can no longer be as ethereal as "putting satellites". "Based on the present and focusing on the future" needs to be expressed concretely, not just by talking.