Profitable Ice and Fire
As to whether the development of new energy vehicles can achieve profitability, new energy vehicle companies in the torrent of the times are writing their own answers with personal experience.
In October of this year, Dyson suddenly announced the termination of the car-building plan, giving the reason that "the project is not commercially viable." Before announcing this decision, Dyson has been involved in the car manufacturing industry for four years and has continuously invested 18 billion yuan. Its first electric car was originally expected to be launched in 2021. Dyson believes that building a car is not difficult, and it is difficult to find a suitable profit model. Some analysts pointed out that "Dyson's electric vehicles are expensive according to their cost estimates, so it is difficult to find suitable and sufficient consumer groups." Coincidentally, Wei Lai, who is still "struggling" on the car, encountered The same problem as Dyson-weak profitability. Weilai Li Bin announced personally that as of June this year, Weilai had lost about 22 billion yuan. Affected by this, Weilai's stock price fell below 2 US dollars, and its subsidiaries are now included in the operating abnormal directory.
A few years ago, Li Bin, who just got involved in the automotive industry, roughly estimated 20 billion yuan to build a car. However, in the past few years, Weilai, who has burned 22 billion yuan, is still dying of the user experience and still cannot find a "can The road to sustainable development. " From the perspective of the business model of car sales profit only, Weilai seems to have fallen into a profitable dead end. From the batch delivery so far, Weilai has delivered a total of 26215 vehicles. If it is calculated at a loss of 22 billion, it is equivalent to a loss of 839,200 for every car sold by Weilai. Of course, the circuit board factory feels that this "bicycle loss" figure does not have reference significance, but it can also reflect the current dilemma of Weilai from one side.
Automobile is an industry with high requirements for scale. At the moment Weilai's sales have not reached a certain scale, there is still a long way to go to achieve profitability.
And the problem of profit is not only for new car manufacturing companies. Under the recent subsidy subsidence, traditional car companies have faced increasingly declining revenue figures. The latest third-quarter financial report shows that the first-tier enterprises of autonomous new energy, including BAIC New Energy, BYD, and SAIC Group, have all lowered their profitability due to subsidies. The JAC, which is more dependent on subsidies, is even more worried about its current status. The third quarter financial report released by BAIC Blue Valley showed that the net profit attributable to shareholders of listed companies of BAIC New Energy changed from profit to loss, and the net loss in the third quarter was 367 million yuan. In addition, due to the large decline in the subsidy of new energy subsidies, BAIC Blue Valley predicts that [annual net profits may cause losses"; similarly affected by the subsidy decline, BYD `s net profit attributable to shareholders of listed companies in the third quarter of 120 million yuan, a year-on-year decrease of 88.58%. BAIC New Energy and BYD are active practitioners in the early exploration of China's new energy development. However, as subsidies receded, both companies were not directly affected by subsidies' decline in either sales or profits. This also directly shows that in the market-oriented operation, even traditional car companies are difficult to achieve corporate profits through car sales, and they must find new business models for the survival of the new energy market.
However, in the cruel market competition, there are relative winners.
From the perspective of profitability, the profit of domestically produced Tesla among new energy vehicle companies is expected. Tesla's third quarter financial report showed that its net profit attributable to ordinary shareholders was $ 143 million, a 54% decrease compared to the same period last year. This is Tesla's fifth profit since its establishment. As soon as the news came out, Tesla's stock price rose sharply. At present, Tesla has achieved domestic production in Shanghai, laying a solid foundation for Tesla to further profit in the future. According to Morgan Stanley analysts, given the labor cost of the Shanghai project is only one-tenth of Tesla's California plant and other cost-cutting measures, Tesla's China car sales margin can reach 30% Around the same margin as the luxury brand Porsche. In addition to Tesla, Mercedes-Benz, which has just launched its first electric product in China, EQC, has also shown sufficient confidence in the profitability of electric vehicles.
Duan Jianjun, chief operating officer of sales and marketing of Beijing Mercedes-Benz Sales & Service Co., Ltd., said in an interview: "It is still profitable to sell electric vehicles, and we are also confident that we can make electric vehicles well and satisfy our customers." Mercedes-Benz's confidence in selling electric vehicles comes from its market channels and brand premium capabilities accumulated by its century-old brand. The PCB factory believes that the advantages of mature car companies in attacking electrification are that their mature channels, brand recognition and bicycle bargaining space have all become bonus points for their profits, so they are full of confidence in the profitability of car sales. Daimler's financial report for the third quarter shows that Daimler's net profit attributable to shareholders of Daimler Group was 1.719 billion euros, and the corresponding third-quarter car sales increased by 6% year-on-year to 839,326 units, which means that every time Daimler sells Out of a car, an average of 15820 yuan can be obtained. This level of profitability has brought confidence to Daimler's current business model of relying on new energy bicycles for profit.
The "original sin" of new energy vehicle companies
From a macro perspective, there are still few car companies such as Tesla and Daimler who are confident in the profitability of electric vehicles. Most car companies are struggling with the loss caused by subsidy declines. Tesla and Daimler both follow the high-end electrification route. After a fierce nightmare of fifteen years of technological breakthroughs and successive years of losses, they have now finally achieved their success; a century-old luxury brand endorsement and profit Support, profitability is naturally not difficult for them. However, most of the new energy vehicle companies in the Chinese automotive market are products supported by new energy subsidies. They rely on subsidies for their natural development, and will naturally lose their "motive force" because of subsidies' decline. After the official implementation of the new subsidy policy this year, the new energy market has experienced a decline for four consecutive months. In addition to the natural choices made by the consumer market, car companies' intention to control sales is also one of the reasons. After subsidies subsided, the prices of autonomous new energy vehicles that had no brand premium capability rose, and car companies could only maintain their "original prices" at their own expense. If only as an emergency rescue strategy is acceptable, but long-term self-financing will inevitably damage the profitability of car companies.
The root cause of the difficulties in profitability of new energy vehicle companies is directly related to the characteristics of new energy vehicles.
As we all know, most of the current cost of new energy vehicles is above the power battery. Some data point out that batteries accounted for 48% of the cost of electric vehicles in 2016. This number cannot be verified at present, but referring to the financial statements of leading battery companies, you can also understand the nature of the huge profits of power batteries. In March 2017, Ningde Times landed on A-shares and achieved a revenue of 19.996 billion yuan and a net profit of 3.972 billion yuan that year. As of the first three quarters of this year, Ningde Times has been creating revenue records, and its net profit in the first three quarters of this year has reached 3.092 billion yuan-3.568 billion yuan. The profit level of the Ningde era is in sharp contrast to the financial reports of car companies that have lost money because of subsidy subsidence. It is for this reason that independent brands and new-vehicle companies are struggling with profitability.
Where is the profitable spring
So, do new energy vehicle companies rely on life for profit? Through the above analysis, there are three paths ahead of them. The first is to take the road of Tesla's technological breakthrough, the second is to take the road of luxury brand premium, and the third is to control the cost of new energy. It should be pointed out that Tesla's current profitability is based on multiple difficulties such as encountering doubts, laying factories, hell of production capacity, and risk of being shorted for more than ten consecutive years. And Tesla has the first-mover advantage, and it does have a subversive action in technological innovation. Someone in the industry had previously disassembled and estimated the cost price of Model 3 of Tesla `s model. He believes that the material and logistics cost of Model 3 is about 18,000 US dollars and the labor cost is 10,000 US dollars. The total cost was US $ 28,000, or approximately RMB 196,000. The Tesla Model 3 is priced at 355,800 yuan after domestic production. Under the condition that the labor cost of manufacturing in China is reduced, for every Model 3 sold, Tesla may have a profit of about 200,000. This provided ample imagination for Tesla's subsequent profit.
For luxury brands such as Daimler and Audi, strong group support has allowed them to develop electric vehicles. The considerable brand premium has also given luxury brands confidence in making a decision. They can also make money by selling electric vehicles.
The path left to independent brands and new car companies seems to be the only way to control costs. This is the common voice of almost all new energy companies now. Under the influence of various factors in the market, the selling price of power battery companies represented by the Ningde era has declined, which is directly reflected in the financial report. Looking closely, although the net profit of the first three quarters of Ningde Times still rose, the gross profit margin in the third quarter decreased year-on-year. Data show that Ningde Times achieved a net profit of 1.174-14.468 billion yuan in the third quarter, a decrease of 0% -20% year-on-year, and a non-net profit of 10.3--12.88 billion yuan, a decrease of 0% -20% year-on-year. Regarding the decline in the gross profit margin and the increase in expenses in the third quarter of Ningde Times, the Xinye Securities Electric team said that the company's comprehensive gross profit margin of the company's products was about 29.3%, a year-on-year decline of 2.33%. The decline of 4% was mainly due to the decline in battery prices. Among them, the prices of ternary lithium batteries and lithium iron phosphate batteries fell by 14% and 17% year-on-year respectively.
The decline in power battery prices is not only the expectations of car companies, but also a mainstream trend. It is predicted that by 2030, the cost of batteries in electric vehicles will drop to about 18%. Such battery cost will be more conducive to the market-oriented development of new energy vehicles. Major auto companies have already realized the need to master the initiative of new energy batteries. At present, the establishment of joint ventures between new energy vehicle companies and battery manufacturers such as Ningde Times, Panasonic, and LG has become mainstream. In addition, many new energy vehicle companies are also trying to explore more new energy vehicle business models. The new powerhouse companies headed by Weilai started to make a fuss about customer service, hoping to establish a new competitive advantage and profit model. However, Weilai's "unconditional" service to users needs to be maintained with a large amount of capital, which has been questioned by the outside world about its profitability.
Many independent new energy companies that are restricted by subsidized subsidy policies are also looking for more complicated profit models.
Zheng Zheng, general manager of Geely New Energy Sales Company, previously stated publicly that the profit model of new energy is not specifically to make money by selling cars. Under this recognition, Geometry Automotive believes that first of all, it is necessary to serve users well. After serving users well, it will bring more customers. With good service, you can make sales. In the exploration, BAIC New Energy has taken another path to promote profitable growth. In 2017, BAIC New Energy launched a power exchange model for the private market for the first time. BAIC New Energy believes that in the long run, the profit model of power swap is definite. Whether it is to start battery cost control, Weilai's customer service regardless of cost, or BAIC New Energy's vehicle-electric separation model, it will eventually need to wait for market inspection. Circuit board manufacturers believe that to achieve profitability, we must have the courage to survive.