The 2024 China Auto Industry Annual Report unveils a stark reality: an annual revenue of 100 billion yuan stands as a definitive dividing line. Companies like BYD and Lixiang, which are profitable, firmly stand above this threshold, while those struggling to make ends meet are halted at its doorstep. The scale effect, an immutable law of the industrial era, is increasingly asserting its dominant influence amidst the new energy wave.

The Double-Edged Sword of Scale: The Cornerstone of Survival and the Pitfall of Profitability

The economic crux of the scale effect lies in the declining marginal cost. When sales volume breaches critical junctures – industry consensus dictates that an annual sales volume of 300,000 units marks the onset of profitability, 500,000 units reveals cost advantages, and 1 million units forges enduring competitiveness – companies can secure a breather in the fiercely competitive market.

Lixiang Motors' escalating sales volume has directly contributed to a substantial decrease in per-vehicle costs, while Zero Run also turned a positive net profit due to scale in the fourth quarter. BYD further solidified its supply chain bargaining power with plans for 3 million smart vehicles, introducing high-level autonomous driving to the 70,000 yuan Haiou model, thereby upending the notion that "smart driving equals high price".

However, scale expansion is not a panacea. Despite hitting a revenue peak, NIO's net loss continues to widen, plunging it into the paradox of "diseconomies of scale." Xiaopeng, on the other hand, narrowed its losses by boosting sales through low-priced models but still grappled with improving its gross margin. As the industry-wide R&D investment growth rate (36.8%) far outpaces the net profit growth rate (9.7%), the widening gap between scale expansion and profitability becomes a menacing sword – a larger size might actually hasten the loss of blood.

Undercurrents in the Industrial Chain: A Tense Link in the Feast of Scale

The scale advantage of leading automakers is fostering a potent ripple effect throughout the industrial chain. A concerning trend is the general lengthening of mainstream automakers' accounts payable cycle. By stretching payment terms, scale giants indirectly squeeze the supply chain, alleviating their own cash flow pressures but jeopardizing small and medium-sized suppliers.

Nevertheless, policymakers have taken note of this risk, with six departments jointly issuing a document mandating core enterprises to safeguard the accounts receivable rights of small and medium-sized enterprises. Since June 10, 17 automakers, including FAW, BAIC Group, Great Wall Motors, and Lixiang Motors, have successively pledged to shorten supplier payment periods to no more than 60 days. As price wars coerce the entire industry into a dire choice between "perish if you don't comply" and "suffer grievous harm if you do," the costs of scale expansion are beginning to show cracks.

The Second Half Race: Redefining the Essence of Scale

Entering the second half of the competition, the automotive industry's scale logic is undergoing a profound transformation. Sales volume is not merely a "threshold"; other forms of "scale" are gradually emerging as life-or-death talismans. For instance, data has become a battlefield where all strategists must engage. BYD's daily collection of 12 million kilometers of real road condition data serves as a moat for its algorithm iteration, extending its scale advantage from the production line to the data pool.

Furthermore, the status of traditional Tier 1 suppliers is waning, and OEMs are reshaping the supply chain through in-house R&D (e.g., BYD's chips/lidar), holding (Fudi Battery), or strategic investment (Xiaomi × Hesai), converting scale discourse power into technological dominance.

Final Thoughts

The scale effect remains an indelible truth in the automotive industry, but the second-half competition transcends mere numerical accumulation. As the extensive model of "trading price for volume" reaches its limit, the true test lies in how to harness scale – striking a delicate balance between cost and innovation, expansion and profitability, industrial chain control, and ecological win-win scenarios. Scale determines whether a company can sit at the table, but the profound reconstruction of technology, data, and value chains will dictate who ultimately emerges victorious. What are your thoughts on this? Welcome to follow "Auto Territory Without Boundaries" and share your insights in the comments section below.