Introduction

Introduction

Aiming at gasoline-powered vehicles, they pulled the trigger without mercy.

Author: Cui Liwen

Responsible Editor: Du Yuxin

Editor: He Zengrong

Recently, there have been many complaints in the Chinese auto market.

Everyone's criticism has pointed directly at new energy vehicles, which continue to flourish at an extremely fast pace this year. Some automakers' executives have complained bitterly, calling for so-called "equal rights for gasoline and electric vehicles"; while some media professionals have made sharp comments, criticizing some plug-in hybrid products for having "fuel tanks" that are even more exaggerated than gasoline-powered vehicles.

As an observer, I want to say about the above two views, "Analyzing and dismantling from different perspectives, although each has its own reasons, one thing is undoubted: the wave of electric transformation will only become more intense. In this process, any controversies, setbacks, or even chaos that arise will only be temporary stops on the road to the broad avenue of new energy vehicles."

And just this week, according to Bloomberg, Chinese automakers continue to create milestone moments, with sales in the global market last year surpassing those of American automakers for the first time, and the competitive landscape is quietly changing.

Specifically, according to statistics from relevant research institutions, self-owned brands represented by BYD sold a total of 13.4 million new vehicles, successfully surpassing the 11.9 million sold by American brands represented by Ford and Chevrolet.

Although Japanese brands maintain an absolute lead with a total of 23.6 million new vehicles sold, we have every reason to believe that Chinese automakers will continue to catch up at an extremely fast pace. Ultimately, capturing the "sales champion" may only be a matter of time.

The ferocious offensive of new energy vehicles is the absolute confidence in making such a judgment.

Of course, words are not enough. As this year's terrifying race schedule approaches its halfway point, the following sections attempt to expand on some of my personal judgments.

This prosperous era, as everyone wishes

"I think the monthly retail penetration rate of new energy vehicles will exceed 50%."

At the beginning of the year, BYD Chairman Wang Chuanfu made a judgment that sparked intense discussions across the Chinese auto market. In the eyes of many skeptics, his prediction was somewhat too optimistic.

After all, based on the sales share at that time, the inherent share of traditional gasoline-powered vehicles was still deeply rooted, and new energy vehicles still had a long way to go before truly "destroying cities and seizing forts".

Correspondingly, in the eyes of some supporters, even if they can break through the 50% mark, they still need continuous momentum and precipitation, and it is highly probable that they will touch the finish line in the fourth quarter.

But no one could have predicted that the plot would change so quickly.

Taking the past May as an example, combined with the terminal results announced by the China Passenger Car Association, the retail sales of new energy vehicles reached 804,000 units, an increase of 38.5% year-on-year and 18.7% month-on-month.

The retail penetration rate of new energy vehicles has reached a record high of 47.0%, an impressive increase of 14 percentage points compared to the 33% penetration rate in the same period last year. Among them, the retail penetration rate of self-owned brand new energy vehicles exceeded 70%, reaching 71.2%.

Faced with such results, it can be said without hesitation: "Looking at Chinese automakers, traditional gasoline-powered vehicles have completely become a minority."

Moreover, taking the period from May 13 to May 19 as an example, according to relevant statistics, the number of new energy vehicles insured in a single week reached 68,000, and the insurance penetration rate of new energy vehicles has already surpassed the 50% mark, reaching 50.2%.

Obviously, the glaring numbers don't lie.

And according to the current trend, the evolution of the Chinese auto market's "electrification" will even far exceed Wang Chuanfu's judgment at the beginning of this section. In the ongoing June, it is increasingly likely that the retail penetration rate of new energy vehicles will exceed 50%.

Looking back at the development of new energy vehicles in the Chinese auto market, it took a decade from 2005 to 2015 for the retail penetration rate to exceed 1%. And from 2016 to 2019, it took more than three years of hard work to raise the retail penetration rate to just 5%.

Soon, in 2020, the national level set a goal of exceeding 50% in the retail penetration rate of new energy vehicles by 2035. It is reassuring that with four years of hard work to lay a solid foundation, it is highly possible to deliver a high-scoring answer 10 years ahead of schedule.

"This prosperous era is as everyone wishes."

It's not made up, such a sigh comes from an employee of a self-owned brand. In his eyes, although the Chinese auto market this year is rolling to suffocation, he is still very willing to be a witness in the process of new energy vehicle changes, especially compared to those industries that are fading into the sunset, at least he still has endless things to do and doesn't have to worry too much about the risk of unemployment.

In addition, we have rationally and clearly observed that although the explosion of new energy vehicles has gradually transitioned from policy-driven to both product and market-driven, the national level is still "escorting" it.

In May, the State Council issued the "Action Plan for Energy Conservation and Carbon Reduction from 2024 to 2025," which emphasized gradually eliminating restrictions on the purchase of new energy vehicles in various localities.

In the same month, the Ministry of Industry and Information Technology and four other departments jointly issued the "Notice on Carrying Out the 2024 New Energy Vehicle Rural Promotion Activity," with a specific time frame from May to December 2024, selecting a total of 99 new energy vehicle models to participate.

With the endorsement of various measures, new energy vehicles are bound to usher in greater qualitative changes brought about by quantitative changes, and the corresponding monthly retail penetration rate exceeding 50% will also become the norm.

From Price War to Mindset Battle

"I still choose the Galaxy L7."

"Why not consider the gasoline car we talked about before?"

"After experiencing it carefully, after the 4S store discounts, the prices of the two SUVs are similar. The Galaxy L7 can run nearly 90 kilometers in pure electric mode. After the test drive, its power performance is better, it has high configuration and spacious space, and its fuel consumption is also lower when the battery is low. It can also save some car usage costs in the future."

"Indeed, it's unrefutable."

The opening dialogue of this section took place between me and an elder in Lanzhou. Recently retired from a state-owned enterprise, he originally thought he would sneer at "green license plates," preferring joint venture brands in his bones, but ultimately somewhat unexpectedly bought a self-owned brand plug-in hybrid SUV.

As for the most superficial reason, it is concentrated in: "The comprehensive product strength of new energy vehicles has achieved multi-dimensional surpassing."

Taking advantage of the situation, looking deeper, if last year and this year's article protagonists attracted a large part of terminal consumers' attention and focus by starting a "price war," then this year, with the continuous strengthening of their own capabilities and accumulation, the simple and brutal "price war" has quietly turned into a "mindset battle."

So, how should we understand the latter?

Put simply, it is to use various means to thoroughly "brainwash" potential customers, making them unable to refute the idea that "buying gasoline-powered vehicles has fallen behind the entire era, and embracing new energy vehicles is the general trend."

For example, BYD's traffic-packed press conference in May.

First, it brought the concept of "the world's highest engine thermal efficiency of 46.06%, the world's lowest fuel consumption of 2.9L per 100 kilometers when the battery is depleted, and the world's longest comprehensive range of 2,100 kilometers" of the fifth-generation DM technology onto the stage for elaborate explanation.

Then it quickly let everyone experience the power of this system through the excellent carriers of the Qin L DM-i and Seal 06 DM-i, starting at 99,800 yuan.

Combined with the determination to deliver both vehicles immediately upon launch, as well as the unwavering support from Wang Chuanfu and several other executives, including the full-throttle marketing approach at the channel end.

A "combination punch" almost rubbed similar competitors like Toyota Corolla, Nissan Sylphy, and Volkswagen Lavida into the ground. And BYD's "mindset battle" is worth many automakers taking a good look back.

For example, this year we always say that Lei Jun has ignited the trend of "CEO live streaming," sparking a wave of "CEO vehicle delivery." More and more competitors are following suit.

But what everyone should understand is that as the helmsman of a company worth tens of billions of dollars, the reason why he is so personally involved in doing these jobs that don't belong to him is actually engaging in a "mindset battle" as well.

Let those who buy Xiaomi SU7 feel a sense of familiarity and dignity, feeling that even if they are being exploited, they are willing to do so.

For example, NIO CEO Li Bin.

This year, having put aside his burdens and embraced traffic, he has slowly regained a lot of popularity through short videos and live streams. More importantly, he has shown the outside world the hope of this new force in automaking "surviving".

Coupled with the promotion of the BaaS new policy's rollback and the confidence provided by the battery swap model to external customers, the "mindset battle" initiated by Li Bin has allowed NIO's delivery volume in May to rebound to over 20,000 units.

In any case, by elaborating on individual cases, the central idea I ultimately want to express is still the same sentence as before: "Buying gasoline-powered vehicles has fallen behind the entire era, and embracing new energy vehicles is the general trend."

Of course, how to fight a good "mindset battle" is undoubtedly a "big learning." Those who excel will reap huge dividends; those who fail will pay a painful price.

And right now, emotionally and rationally, internally and externally, new energy vehicles have aimed their guns at gasoline-powered vehicles and pulled the trigger without mercy.

Whether the latter survives or dies depends entirely on fate...