Weilai will never become the second Tesla

Weilai will never become the second Tesla

Among the car companies, Tesla and NIO, known as cutting-edge technology companies, are walking one to the left and the other to the right.

Tesla is now desperately pushing down costs and prices to popularize its production in order to obtain marginal production benefits. It is believed that he is trying to transform into a mediocre traditional car company. The advantage is that it will gain more and more recognition from the capital market. NIO is still working on stacking technology. Although it is very similar to Tesla four or five years ago, Wall Street considers it extremely dangerous.

Wei Lai closely follows Tesla

Wei Lai closely follows Tesla

Many investors believe that new energy vehicles are an emerging industry, and in the long run, the production capacity of the electric vehicle industry has room for growth. 2020 is undoubtedly the year of winter for the global automotive industry, but Tesla has ushered in a bright moment under such a dilemma, and continues to lead the field of new energy vehicles.

The financial report shows that in the first quarter of 2020, Tesla’s car delivery reached 16,700, which is almost equivalent to the sum of all other new Chinese car-making forces. The automotive business revenue reached US$5.1 billion, a year-on-year increase of 38%. It is the only company in the global new energy automotive industry that has bucked the trend.

In addition to the high-gloss Tesla, Wall Street analysts also continue to pay attention to China’s new car-making forces.

On March 2, US Eastern Time, the domestically produced NIO announced its fourth quarter 2020 financial report. Numerous overseas media, including the Wall Street Journal and Barron Weekly, are racing to report on the financial analysis of NIO. The media that has always used the word “stingy” praised it as the “Chinese version of Tesla”, and even compared it with Tesla’s various data and business models, and some analysts said that Weilai was five years ago. Tesla.

Compared with the value of Tesla 5 years ago, the delivery volume of Weilai Automobile in 2020 is still more “beatable.” Tesla delivered 17,400 vehicles in the fourth quarter of 2015, which was in line with expectations. The total annual delivery volume was 50.58 million. Weilai Automobile delivered 17,353 vehicles in the fourth quarter of 2020, and the total delivery volume for the year was 43,700.

Weilai Tesla one to the left and the other to the right

In terms of the business model adopted, Tesla has already implemented mass production on a large scale, while Weilai seems to be still following the old road of “high-end luxury and niche” at the beginning of Tesla.

In January 2021, Tesla will localize the third model in the Shanghai Super Factory, which means that a cheaper compact hatchback will sweep the two major markets in China and Europe. The launch of new models that are more affordable than Model 3 is of great significance to Tesla, which enables it to compete with Volkswagen ID.3 and Peugeot e-208 hatchbacks.

Tesla’s “prices close to the people” actually had early warnings. According to German media reports, in November 2020, Musk emphasized in conversations with investors and analysts: “If we can’t make people affordable, then our mission will fail.” He added: “Currently What bothers me most is that our car prices are not yet affordable enough for the people. This is a problem that we urgently need to solve.”

In order to save manufacturing costs, Musk adopted an aluminum casting machine called the “revolutionary machine for car body construction” in the German factory, which greatly simplified the process of assembling the integrated body frame. This machine can be said to be large-scale The first invention in the production industry,

In addition to streamlining the manufacturing process, Tesla also reduced the performance and endurance of the Model 3 power system. Even so, the slowest Model 3 can still achieve 0 to 60 mph in 5.3 seconds.

Tesla is busy reducing costs here, taking the route of being close to the people, and benchmarking Volkswagen, BYD and other market mainstays, but over there Weilai Automobile still holds high the banner of niche luxury.

Li Bin, the founder of Weilai, said: Tesla’s goal is to become a Volkswagen Ford, while Weilai sticks to its high-end positioning. Weilai Electric will sell the same price for how much BMW, Mercedes-Benz and Audi petrol cars are sold.

Can Wei Lai be tough on Tesla?

In the financial report, we can see that Tesla has gradually freed from the high-end luxury route, found its own viable business model, and achieved mass production. It is said by the industry that it has embarked on the road of maximizing investment capacity.

Analysts pointed out that Tesla can be called the “Apple” of the automotive industry. If Jobs brought Apple’s much-anticipated innovation, then his successor, Cook, brought Apple to a “down-to-earth” life. Cook formulated a business route that is more in line with the mass market for Apple, and only then has a market value of more than one trillion US dollars. Without Cook, there may not be today’s Apple. It is Cook’s ability to make Apple stable.

Musk is clearly aware of this, and Tesla is implementing an increasingly “grounded” business model. Tesla came out in 2006. At first, Musk treated Tesla’s products as luxury goods, and went high-end from products to concepts. This is contrary to the practice of many automakers promoting cars in a civilian way. However, Tesla has established an authority in the industry with sophisticated technology and unique concepts, and created an extraordinary brand influence.

Tesla has established strong brand and business barriers from vehicle manufacturing, operating systems, autonomous driving to core chips. At present, Tesla is not only satisfied with the high-end route of luxury and niche, its competitive strategy has changed to adopt a broad differentiation strategy through market segmentation of high-end buyers and low-priced buyers in the auto industry. In this model, Tesla stands out from the competition. Coupled with increasing R&D investment every year and developing a highly innovative and unique ecosystem, the rate of return is leading the way in the field of new energy vehicles. At present, this is a new force in car manufacturing. No one can do it.

In addition, Tesla provides a variety of products and services all over the world, from high-end electric cars Model S, Model 3, Model Y, SUV version of Model Y, and equipped with different cruising range, from 250 miles to 370 miles Both have different battery performance and customizable seats and storage space. This is the same as Apple’s electronic products are equipped with different product models and storage space according to the price.

In order to make Tesla more affordable, Musk has made great efforts to save battery costs. In August 2016, Musk merged SolarCit, a US company that specializes in the development of household photovoltaic power generation projects, with Tesla Inc. through research and development to reduce the cost of materials on the battery and increase the market penetration rate of products with lower prices.

In addition, Tesla will also cooperate with CATL, CATL will provide Tesla with lithium iron phosphate (LFP) batteries with lower raw material prices. This cooperation is expected to reduce Tesla’s production costs again, increase profit margins and lower sales prices. Undoubtedly, this cooperation will provide Tesla with a decisive competitive advantage in the industry.

Weilai will never be the second Tesla

Tesla has suffered losses for fifteen consecutive years, and only achieved profitability in 2018. Coincidentally, NIO has been losing money since its establishment in 2014. Although the total revenue in 2020 has increased by RMB 16.258 billion, a year-on-year increase of 107.8%, the net loss is still huge, at RMB 5.304 billion.

According to the analysis of professionals, the current situation of Weilai losing a sum of money from selling a car still continues. Up to now, Weilai still has a loss of 53,000 yuan for every car sold. Only Weilai knows the sadness of this.

Traditional automakers will adopt a model, start low-price marketing, and then develop high-end products. But in recent years, new forces in car-making have taken a completely different path. Such as broadly differentiated routes, market segmentation, and people-friendly routes.

In this regard, Tesla not only did a good job, but also made new play based on its own characteristics. On the one hand, Tesla retains high-end products and maintains its own brand effect; on the other hand, it has established factories all over the world and reduced costs as much as possible to achieve mass production of low-end products and expand sales. , Improve profit margins. Although this has returned to the sales model of traditional car companies, this return is simple and effective in terms of driving sales, increasing valuation, and return on equity.

Industry insiders pointed out that for NIO, which has been advocating benchmarking Mercedes-Benz and BMW, and taking the luxury style, it is still in the “first stage” of Tesla, that is, the stage of burning money to build brands. However, after this stage, it will usher in a cruel survival stage. It is necessary to “apply according to their aptitude” in accordance with their own corporate characteristics. This stage is also a stage that is extremely difficult to imitate. If Weilai still fails to find its own unique business model in a short period of time, it will not only face survival difficulties, but will also be abandoned by the capital market.