New Energy Vehicle Sales Fell, Battery Cost Is Urgently Needed To Be Lowered

- Oct 14, 2019-

After the new policy of subsidizing the state financial subsidies came out, Weilai Automobile, which advertised "China Tesla", said it would not raise prices. And we know that this time the slope is as high as 50%, it can be described as direct "waist." Take Weiwei ES6, the subsidy amount is 90,000 yuan in 2018, the subsidy amount in the transition period of 2019 is reduced to 54,000 yuan, and the subsidy amount is only 25,000 yuan after the transition period. This "loss" is a lot of money, is Weilai Automobile willing to pay?

It turns out that the price increase of Weilai Automobile is actually “across the sea”. Wei’s statement is that the official prices of ES8 and ES6 are unchanged. However, because the government subsidies are less than 50,000 yuan (referring to the average value added), after the new subsidy policy takes effect, the owner himself needs to pay for the 50,000 yuan. In other words, compared with the owner of the car before the new subsidy policy came into effect, the car price has risen by 50,000 yuan.

Battery China Network has to ask, "We are here, are you really ready to do this?" Anyway, the price increase in disguise is the price increase. To know that the price increase is "very serious, consumers are angry." According to some surveys, 46% of consumers are completely unable to accept the price increase of the same configuration model. 39% of consumers need other forms of compensation to consider the acceptance of the vehicle, and another 15% of consumers accept the price increase, but nearly 90% only accepts gains of less than 10%. Earlier, Xiaopeng Automobile announced a price hike, and the “angry” consumers said that “Love does not rise, and the Lord does not buy it!”

In addition to Weilai Automobile, after the introduction of the new subsidy policy, a number of car companies responded. First, GAC New Energy took the lead in issuing a notice of no price increase, and BYD also announced that it would not raise prices. The propaganda poster of GAC New Energy shows that the price of the car remains unchanged, and the company fully replenishes it; BYD said that it has the core technology reserve of the whole industry chain, which can effectively dilute the R&D and production costs.

Regarding whether the car companies will raise prices after the subsidies are reduced, Xu Haidong, assistant secretary-general of the China Association of Automobile Manufacturers, believes that the reduction of subsidies will affect the price of vehicles to some extent, but the car companies raise the price and subsidize the “loss” for consumers to pay. It is unlikely.

As the saying goes, "the person who knows the time is Junjie", the lesson of Xiaopeng's car is in front of him, and the price increase can be "no good fruit to eat." However, if you insist on not raising the price, it means that the cost of making a car will increase substantially, so how will the car companies eat? In this regard, Xu Haidong said, "It is very likely to squeeze product profits or put pressure on battery companies to reduce costs." This is in line with BYD's response.

The car companies are putting pressure on them, and the battery companies can't hold them?

As we all know, the current cost of power batteries accounts for about 40% of the cost of the entire vehicle. If the cost of the battery system can be effectively reduced, the cost of new energy vehicles will also drop. Logically, this is indeed the right path, but is this road going well? In fact, under the pressure of subsidies to retreat, car companies have also increased the pressure on the battery companies, which makes battery companies feel pressure.

Cai Yi, dean of the Guoxuan Hi-Tech Engineering Research Institute, said that the subsidies for the past two years have been declining at a rate of 30% per year, and the pressure on the entire power battery industry is very large. In the past, automakers basically linked the price of power batteries and the amount of subsidies directly to how much subsidies they could get. If the subsidies were completely retired, the price pressure on the power battery companies would be the same. growth of.

What is the cost pressure caused by the financial subsidies? At present, many battery companies are unbearable. Recently, Chengfei Integrated released its performance report. The net profit loss in 2018 was 205 million yuan, and the loss in the same period of 2017 was 108 million yuan. The Chengdu-Chengdu integration announcement stated that since March 25, 2019, the “delisting risk warning” was implemented, and the stock abbreviation was changed from “Chengfei Integration” to “*ST Integration”.

For the reason of the decline in net profit, Chengfei Integration said that the financial subsidies for the downstream new energy vehicles of the company's lithium battery business have fallen sharply, and the automakers have shifted the cost pressure to the battery manufacturers, resulting in a decline in the price of lithium battery products; the financial subsidy policy for new energy vehicles Adjustment, the company's transformation of the production line, re-declaration of the supporting models, resulting in the full release of production capacity, battery unit production costs, combined factors led to a significant decline in gross profit margin.

Battery China Network found that in addition to Chengfei integration, Jianruieng, Fengyuan, Nandu Power, and Luxiao Technology both experienced double decline in operating income and net profit in 2018; , Jianrui Wooneng, Changgao Group, and Oriental Seiko suffered a net profit loss in 2018, of which the net profit of Oriental Seiko fell by 798.16%.

"In our contact with the car companies, some car companies demanded a 40% price reduction for the 2019 power battery, which means that the car companies pushed all the pressure to reduce the cost to the battery factory." A domestic power battery company official said. Although the price of raw materials has been loosened, the price reduction of power batteries is still limited. The person in charge of a research institute in the industry said that the current price reduction of power batteries is limited, and it is estimated that it will be up to 10%.

"From the perspective of power battery, subsidies are the most stressful for core component companies. Not only the upstream materials are rising, but also the downstream terminal car companies are paying more pressure on us. We will Motors to the system to take measures to reduce the cost of the battery," said Zhong Mengguang, vice president of Shenzhen Waterma Battery Co., Ltd. It is foreseeable that the competition of new energy power battery companies will be more intense in 2019.

How far is the road to lowering the cost?

Then, how much should the cost of the battery be reduced to alleviate the pressure caused by the reduction of financial subsidies? Ouyang Minggao, a member of the Chinese Academy of Sciences and a professor at Tsinghua University, said that only when the cost of power battery cells drops to 0.1 US dollars / watt, new energy vehicles can be really promoted on a large scale. Wang Binggang, head of the National New Energy Vehicle Innovation Project Team, believes that by 2020, without electric subsidies, electric vehicles can only compete with traditional fuel vehicles when the battery cost is 0.6 yuan/kWh or less. .

Judging from the current situation, it is not difficult for many battery companies to cut prices. It is not easy for car companies to transfer costs to battery companies. If the cost cannot be reduced in a short period of time, the burden caused by the financial subsidy will not be released, and the consequences will be very serious. Chen Hong, chairman of SAIC, believes that after the financial subsidies are abolished by 2020, if there is no other policy to follow up, due to the sharp increase in vehicle purchase costs, it is likely that the Chinese new energy vehicle market will have a “shake-like” decline of about 40%. .

It seems that regardless of the price increase or price reduction of the car companies, the new subsidy policy will force the battery cost to drop, because the current battery cost is still too high, resulting in high vehicle prices, consumers are naturally difficult to accept. Before the new battery technology made a major breakthrough, how to effectively improve the quality and reduce costs, this is a big problem in front of the car companies and battery companies is a matter of life and death, how this is the way, the battery China network will continue to pay attention.