Compete upwards on product quality, downwards on price.

This week's automotive buzz is once again captured by HarmonyOS Auto.

HarmonyOS Auto's current most expensive model, the Zenjie S800, has finally unveiled its mysterious veil. Although only the exterior design has been announced, the expected price range of 1 to 1.5 million yuan has quickly propelled it to trending topics. Honestly, for such a million-yuan product, Electric Car News doesn't have high expectations for sales figures but hopes to see innovations in design and technology.

Now, HarmonyOS Auto has released the order data for the Zenjie S800, which received 2,108 orders within 48 hours of opening pre-orders. Calculating at a deposit of 20,000 yuan per order, Zenjie Auto has already collected over 40 million yuan.

Source: HarmonyOS Auto

Yu Chengdong once said, "The Zenjie S800 is a product far superior to Maybach and Rolls-Royce." The number 2,108 may not seem significant, but for a million-yuan product, this achievement is unprecedented. Forty million yuan is insignificant to Huawei, but such a strong intention to order a million-yuan luxury car is still quite "exaggerated".

Some bloggers directly compared the pre-orders of Zenjie with the sales of Rolls-Royce: Rolls-Royce sold just over 1,600 cars in mainland China last year, and the two-day pre-order volume for the Zenjie S800 exceeded Rolls-Royce's annual sales.

Source: Electric Car News Production

With only the exterior design announced, the Zenjie S800 has achieved such high results, indicating a high level of trust in HarmonyOS Auto and Huawei among the audience. However, Electric Car News noticed that while some netizens recognized this achievement for this newly launched million-yuan executive sedan, many others proposed a different perspective.

Three major doubts from netizens, not unreasonable

After the announcement of the Zenjie S800's performance, several car reviewers shared it consecutively. Since there was no official embellishment, there were indeed many doubts expressed in the commentators' sections. After sorting through the information, Electric Car News found that netizens' doubts mainly focused on the following three points:

Is there a possibility of cancellation in these pre-orders?

When will these pre-orders be fulfilled?

Comparing the Zenjie S800 with Rolls-Royce and Bentley is unreasonable because their prices do not match the models under these brands.

Below, we will conduct a rational analysis of each point.

Based on the term "pre-orders," Electric Car News already roughly understands that these orders are just "small reservations," meaning that if subsequent users do not want the car, they can return the 20,000 yuan deposit before locking the order. This was confirmed by Electric Car News through the brand's official customer service.

Screenshot: Chat record between Electric Car News editor and Zenjie customer service

It must be acknowledged that among the 2,108 users who have pre-ordered the Zenjie S800, a small portion may have done so just to "show off."

Electric Car News recalls that Xiaomi's SU7 received a whopping 88,898 pre-orders within 24 hours of its launch. This achievement was indeed impressive, but soon after, voices emerged online accusing Xiaomi of deceptive advertising, claiming that the 5,000 yuan deposit could not be refunded after placing an order. In fact, Xiaomi had already reminded customers on the delivery page that they could "actively lock the order or it would be automatically locked after 7 days of paying the deposit," and the deposit could be refunded before locking the order. It can be basically determined that users who were concerned about the non-refundable 5,000 yuan deposit were not interested in buying the car in the first place and accidentally locked the order themselves.

Screenshot: Xiaomi Car APP

Since both deposits can be refunded, there is no fundamental difference between a 5,000 yuan deposit and a 20,000 yuan deposit. Therefore, there is certainly some water in the 2,108 pre-orders.

Looking at the second point of doubt, why do netizens care about when the over 2,100 pre-orders will be fulfilled? The reason is simple. Rolls-Royce sold just over 1,600 cars in the Chinese mainland market last year, but if it takes two years for Zenjie to fully produce the 2,108 S800 cars, then the conclusion that "Zenjie's sales figures are better than Rolls-Royce's" would not hold.

To answer this question is actually not difficult. A rough answer can be obtained by looking at the factory's production capacity. Recently, JAC Motors announced that it will invest over 20 billion yuan in research and development over the next five years. To ensure the delivery of Zenjie cars, a smart factory specifically built for them has been completed, with a planned annual production capacity of 200,000 vehicles, equivalent to a monthly production capacity of 16,700 vehicles.

For JAC Motors, fulfilling these 2,108 pre-orders for the Zenjie S800 is indeed a piece of cake. After all, unlike Western luxury cars that emphasize "handcrafted luxury," the Zenjie S800 embraces the concept of Chinese luxury driven by technology. It will utilize intelligent manufacturing where necessary, so production capacity is not an issue.

Source: Electric Car News Production

Regarding the doubt that "comparing the Zenjie S800 with Rolls-Royce and Bentley is unreasonable," Electric Car News believes that this statement by netizens is indeed reasonable. Bentley models are priced above 2.5 million yuan, and Rolls-Royce models are priced above 5 million yuan. Just because the official says that the new car's product capabilities are comparable to higher-priced brand models, it does not mean that a sales comparison in the market is objective.

If we only look at the sales of million-yuan luxury cars, Porsche Cayenne, Mercedes-Benz S-Class, and Porsche Panamera sold over 10,000 units per month in the first three quarters, while Maybach S-Class, BMW 7 Series, and Audi A8 sold over 7,000 units. Converted, the monthly sales of these million-yuan sedans would be around 1,000 units. Whether the Zenjie S800 can reach this level is the key to measuring whether the product is recognized.

Clever Zenjie: Compete upwards on product quality, downwards on price

According to data released in the "2024 McKinsey China Automotive Consumer Insights," the proportion of consumers choosing high-end cars has increased from 10% in 2016 to 23% in 2023. Among consumers choosing high-end cars, the penetration rate of new energy vehicles has reached 37%, an increase of 12 percentage points from 2022.

Screenshot: "2024 McKinsey China Automotive Consumer Insights"

It is not difficult to see that although the million-yuan sedan market where the Zenjie S800 resides is not mainstream, the audience for high-end products is gradually increasing. The fundamental market for the Zenjie S800 in the future is actually stable.

In addition, have you noticed that the three flagship products under HarmonyOS Auto, the Zenjie S800, Xiangjie S9, and Wenjie M9, actually adopt a similar market strategy? They benchmark their product capabilities against higher-positioned models from traditional luxury brands but price them similarly to their entry-level models, allowing users to directly perceive that "although the products are flagship, they offer excellent value for money."

The Xiangjie S9 benchmarks the Mercedes-Benz S-Class, BMW 7 Series, and Audi A8L but is priced similarly to the Mercedes-Benz E-Class, BMW 5 Series, and Audi A6L. The Wenjie M9 is hailed as "the best SUV under 10 million yuan" but has a price range that highly overlaps with SUVs like the Mercedes-Benz GLC and Toyota Prado. It is not difficult to see that although the Zenjie S800 benchmarks Rolls-Royce, its true competitors are the Mercedes-Benz S-Class, BMW 7 Series, and Audi A8L, which are priced similarly.

If the monthly sales of the Zenjie S800 are similar to those of the Mercedes-Benz S-Class, surpassing Bentley and Rolls-Royce will certainly not be a problem. The key is whether the monthly sales of the Zenjie S800 have the opportunity to exceed those of the Mercedes-Benz S-Class and BMW 7 Series, in other words, whether it can seize more market share from these competitors.

What exactly supports the Zenjie S800's price tag of over 1 million yuan?

As a million-yuan product, if the Zenjie S800 wants to capture users who are leaving traditional luxury brands, the first priority is to justify its million-yuan price tag.

Source: Electric Car News Production

The reason why the Mercedes-Benz S-Class, BMW 7 Series, and Audi A8L can command million-yuan prices is that, on the one hand, their mechanical quality and configuration are sufficient, and on the other hand, the brands can tell a good brand story and culture while providing top-notch premium services, allowing users to experience extraordinary spiritual value.

For the Zenjie S800, the brand story and culture still need to be explored. After all, Huawei and JAC have little experience in the ultra-luxury segment, and there are currently no successful cases of a technology-driven ultra-luxury brand logic. It can even be said that the technology industry has never had a true ultra-luxury brand (perhaps Vertu phones can barely count as one).

Therefore, the strength of the Zenjie S800 product itself and premium services will be important breakthrough points, especially product strength.

Based on currently available information, the Zenjie S800 features a unique starlight design on its exterior and is equipped with configurations such as L3 autonomous driving and a triple-screen cockpit that are "unique to it."

These configurations will become the Zenjie S800's differentiating advantages. But frankly, most of these configurations can also be found on the Wenjie M9. To attract more potential consumers, it is necessary to continue to introduce highlight configurations that surpass flagship products like the Wenjie M9 and Xiangjie S9; otherwise, it will be difficult to justify a market price of over 1 million yuan. In this regard, Electric Car News, which has been closely following the development of smart cars, will also pay close attention and look forward to the official launch of the Zenjie S800 to reveal the answer.

Final Thoughts

Xiang Xingchu, Chairman and General Manager of JAC Motors, said, "We have allocated all quality resources to Zenjie and are promoting all Zenjie projects as top-priority engineering efforts."

Source: Electric Car News Production

In addition to Zenjie, JAC Motors' new energy sector also includes commercial vehicle areas pursuing a "pure electric + hybrid + hydrogen fuel" technology route, passenger vehicle areas targeting the small pure electric vehicle and MPV market segments, and new energy pickup truck areas.

Since the factory's annual production capacity reaches 200,000 vehicles, Electric Car News hopes that JAC Motors can plan the division of production capacity well. The Zhijie S7 lost many customers due to production issues in the early stages of its launch. Although sales have now increased, it did experience a period of downturn.

Ensuring product quality, delivery, and after-sales service without errors and not repeating past mistakes are essential tasks for Zenjie next year.

(Cover image source: Electric Car News Production)

Source: Leitech