Will Weilai cut prices and follow up the new forces of joint venture ＂anti-volume＂？ Losing money by selling cars makes costs out of control.
Take Hyundai Motor, which tends to be marginalized in China market, as an example. In 2022, its sales volume in China (including Kia) was about 340,000, down 30% year-on-year, but its sales volume in the global market reached 6.83 million, ranking third in the world after Toyota and Volkswagen. In terms of operation, Hyundai Motor’s performance report shows that its revenue in the first quarter of 2023 reached 37.78 trillion won (about 211 billion yuan), a year-on-year increase of 24.7%; Operating profit was 3.59 trillion won (about 20 billion yuan), up 86.3% year-on-year; The net profit reached 3.31 trillion won (about 18.5 billion yuan), which doubled the profit compared with the previous year.
It is the scale advantage brought by globalization that makes YANG Honghai, chief operating officer of KIA China, confident about the competition in the domestic market. At the 15th China Automotive Blue Book Forum, Yang Honghai said, "I (Hyundai Kia) earned $2.1 billion globally in the first quarter of this year, which can afford the China market. Do your local enterprises have the financial strength to play? You first ‘ Burn ’ If I die, I can wait to come in and grab the market later. "
"Let ‘ Enemy ’ Let’s try it first. I have money and technology in my pocket. I haven’t given up this market. It is also a strategy to come in and clean up you at the right time. " Yang Honghai added.
Although Yang Honghai didn’t further explain what "the right time" is, it should be noted that mainstream joint venture brands are accelerating to adapt to the new trends in the China market with visible progress, both in product positioning and market strategy. More crucially, the "soft power" such as the global market experience and sustainable profitability of mainstream joint venture brands will become the strategic depth of their opportunity to counterattack, and "make friends with time" in the competition of new energy vehicles in the race against time.
However, most of the new car-making forces have not been able to hand over satisfactory answers on sustainable profitability. Take Xpeng Motors as an example, its net loss in the first quarter was 2.34 billion yuan, a year-on-year increase of 37.6%. To this end, Xpeng Motors is rapidly pushing forward the cost reduction strategy, and has formulated a technical plan to achieve the goal of 25% cost reduction by the end of next year. And new power brands such as Weimar and Aichi may no longer have the opportunity to adjust.
"At the moment, the tram is particularly involuted, and everyone will compare the lowest price. Cost control is the focus of work that every enterprise must face, and the advantages of scale will help us do a good job in cost control. At the same time, we will pay attention to the price changes in the raw material market. As a joint venture brand, we should focus on our own ability. At present, we have certain advantages in the fields of research and development, manufacturing and supply chain. " The above-mentioned Buick staff said.
In view of the cost advantage and profitability brought by the global market, winning numbers, where the mainstream joint venture brands are fighting for their money, has become a new point of view in the competition of electric vehicle market.