Tesla's Model Y, which has been "besieged" by multiple automakers since the fourth quarter, remains unyielding. As competitors struggle with limited production capacity to fulfill year-end orders, Tesla proactively reduced prices by 10,000 yuan, graciously accepting the traffic generated by various competitors and striding towards becoming the best-selling vehicle across all categories in China by 2024.

In the face of Tesla's sudden price reduction on November 25, NIO's Ledao, which was the first to attack the Model Y, was the most embarrassed. This is because it means that many impatient Ledao pre-owners, who have been waiting for their cars for a long time, now have another reason to abandon their orders and switch to competitors.

01

Falling into the same trap twice?

According to multiple sources from Yuanmeihui, many people placed a 2,000 yuan deposit and locked in their orders between the September 19 launch and the National Day holiday, but have yet to receive their vehicles. Some vehicle order pages show that delivery is expected in late December. This has made consumers who were considering purchasing a car due to trade-in subsidies feel uneasy.

"With such a tight timeline, I'm worried that the subsidies will run out before I can get my car, and I'm also worried whether I'll actually receive the car by the end of December. By then, I'll be in a rush to register and apply for subsidies..." On November 25, a Guangzhou-based Ledao pre-owner told Yuanmeihui that due to the uncertain delivery time, they were indeed considering abandoning the 2,000 yuan deposit and buying another car. The price-reduced Tesla Model Y, which is available immediately, is one of the alternatives.

At the 2024 Guangzhou Auto Show, Ledao President Ai Tiecheng officially announced the delivery results of the new car from its launch at the end of September to November 14 - 7,000 units. For comparison, Xiaomi's SU7 delivered 7,058 units in April this year, shortly after its official launch on March 28.

Regarding the delivery results that fell short of market expectations, Ledao's official explanation was that the new car is a 900V voltage platform model, and the production capacity of its components cannot be compared to that of 400V models such as Xiaomi's SU7 (standard and Pro versions).

NIO is not new to production and delivery pitfalls.

In 2022, NIO launched the new ET5, setting the price below 300,000 yuan for the first time. Coupled with the BaaS battery-as-a-service model, the entry price could drop to 230,000 yuan. With its sincere pricing, good product quality, and excellent brand strength, ET5 accumulated up to 230,000 small reservations at one point. NIO's Chairman and CEO Li Bin once stated during the third-quarter earnings call that year that over 10,000 units would be delivered in December.

But as we all know, the ET5 has rarely surpassed 10,000 units in monthly sales to date, and what was expected to be a hit has remained lukewarm. According to an exchange between Li Bin and Yu Minhong, Chairman and CEO of New Oriental, during a live stream, ET5 lost as many as 80,000 orders due to production capacity issues, equivalent to 65% of NIO's annual sales in 2022.

02

NIO needs a Wang Fengying

Now that Ledao is experiencing delivery issues again, even if the reasons for the delay are justified, it will be difficult for Ai Tiecheng and Li Bin to convince pre-owners to keep waiting, despite their assurances of delivering over 10,000 units in December this year and over 20,000 units in March 2025.

If time could be rewound, NIO's Ledao should have taken a page from its compatriot XPeng Motors.

XPeng also fell into the trap of being unable to keep up with order demand for the G6. However, this year's XPeng MONA M03 and XPeng P7+ have completely demonstrated that XPeng has also become a giant in production.

The XPeng MONA M03 delivered over 10,000 units in its first month on the market, and the XPeng P7+ set a record for the best weekly delivery volume in its history. The latter even became one of the main destinations for Ledao pre-owners who abandoned their orders. Behind this efficient delivery is XPeng Motors' drastic reform of its production and supply chain.

After Wang Fengying took up the position of XPeng Motors' President, the "Iron Lady" rectified chaos in XPeng's procurement sector, withstood public opinion pressure, and had her husband, who has experience in producing millions of vehicles annually, take charge of XPeng's production, truly bringing XPeng into the realm of automaking.

As Ledao struggles with production ramp-up, some industry voices have suggested that Li Bin could learn from XPeng by producing new vehicles in advance to achieve delivery upon launch. However, these are merely results; what NIO truly lacks is a seasoned leader like Wang Fengying, who has a sharp style and can bring about qualitative improvements in manufacturing.

After the Ledao L60, NIO will usher in a super product year in 2025. In 2025, NIO's main brand will launch NT 3.0 platform models led by the ET9. The sub-brand Ledao, targeting the mass mainstream market, will introduce two all-new SUVs; the first model of the new sub-brand Firefly will also make its debut.

Image: Ledao L60

While there will be a large number of new vehicles, most of them will be all-new models, posing a "hellish" challenge for NIO, which is not adept at production ramp-up. Nowadays, NIO cannot afford any more delivery issues. According to its third-quarter 2024 earnings report released on November 20, NIO incurred a net loss of 5.06 billion yuan during the reporting period. Although its cash reserves still exceed 40 billion yuan, the continuous losses remain concerning.

To achieve Li Bin's goal stated during the third-quarter 2024 earnings call - becoming profitable by 2026 - production is an urgent issue for NIO to address.

Some images are referenced from the internet. Please notify us for removal if there is any infringement.