It is really no problem that Qianbao electric vehicle strategy is a big leap forward and car prices are aggressively "fully electricized".

The automotive industry is entering an unprecedented phase of confusion. In this phase, drastic changes brought about by new technologies, new ideas, new players, and new fusions have strongly impacted traditional car manufacturing. Although automobile manufacturing is called an aircraft carrier-class enterprise, although they have a long industrial chain, these can not be changed in a short time, but they have unprecedented anxiety and anxiety. They are urgently making changes and even lean over some “small companies”. This is a stage that requires change, but what changes are needed? The Economic Observer newspaper summarized the six new changes that emerged at this year's Beijing Auto Show and explored the reasons and future directions behind these changes. The auto industry seems to be in the fog. Is this fog a contingent or a necessary transition period?

At the Beijing Auto Show this year, new energy is undoubtedly the biggest focus. At this year's auto show, a total of 1022 vehicles participated in the exhibition, and 174 new energy vehicles were modeled, but all were heavily exhibited. Of these 174 vehicles, 124 were from Chinese car companies. BYD, Changan, and Hanton have all released the latest strategies for new energy, and Great Wall Motor has released its new energy brand, Euler, and two new concept cars R1/R2 have been released. And almost all mainstream companies are bringing or concept cars or new energy models to be put into production.

Even Japanese cars, which are called conservative and have a low willingness to use electric vehicles, have begun to act. “The year 2018 is the first year of electric vehicles.” Honda Honda China Minister Mizuno Hideo said that in 2025, Honda’s electric vehicle sales in China will account for more than 40% of the total fleet. “The inflection point and the outbreak point of new energy will come right away.” Li Yunfei, vice general manager of BYD Sales Co., said during the auto show.

However, many real problems have also made the ambitious new energy companies full of anxiety. “The three major policies (high subsidies, limited licence restrictions, and direct intervention from governments in some areas) have promoted the rapid growth of new energy vehicles for four consecutive years, but I believe that the policy-driven market will soon encounter bottlenecks in its development.” Xu Changming, deputy director of the National Information Center, pointed out earlier. This year, the foreign capital ratio of new energy vehicles will be abolished, and subsidies for new energy vehicles will be completely eliminated in the following year. Who will be the first “naked swimmer” after the new energy subsidies are withdrawn?

Xu Changming expects that, depending on the policy, the next step in development will surely encounter a bottleneck. This bottleneck will probably be at the level of 100-1.3 million vehicles. Among them, the development of the private consumer market and logistics vehicles will be the key to whether or not the bottleneck can be overcome. The window period for the development of electric vehicles is only about two years. Whether it is a newly established company or a traditional car company, they are faced with a large amount of investment recovery, otherwise they will be eliminated. Some companies even believe that the life and death of new construction companies is 100,000.

Fully enter the electrification tide

The electrification of Chinese car companies that are trying to implement “turning overtaking” by means of electrification is particularly rapid. As a representative company of electric vehicles in China, under the “Electric Future” strategy, BYD’s new generation of Tang, Qin Pro, Song MAX DM, and Yuan EV 360 are making their debut at the Beijing Auto Show. It also released the latest technology platform "e-platform" and "DiLink smart ecosystem" in the world. BYD's ambition is "to reshape the industry pattern and human travel mode."

Changan Automobile, on the other hand, fully promotes its "Shangri-La Plan." Zhang Baolin, chairman of Changan Automobile, said at the current auto show that it will complete the establishment of three special platforms for new energy sources by 2020. Specific to the sales target, by the year 2025, 1.16 million new energy models will be sold and the Chinese brand will be the first. By 2025, it will begin to completely stop the sales of traditional fuel vehicles and realize the full spectrum of new energy vehicles. It is reported that Changan will establish an independent new energy automotive technology company in the future and build a "Shangri-la alliance" with its partners.

Geely is not far behind, Geely Automobile Group president and CEO An Zhihui declared during the auto show that Geely should "fully enter the era of new energy." Geely plans that by 2020, 90% of the company's sales are new energy vehicles. In addition, Geely has already laid down heavily in the field of electric vehicle operation services. For instance, Cao Cao’s special car has now provided electric car taxi services in more than 20 cities in China. "We must ensure the commercial viability of the next generation of scientific and technological achievements."

The Beijing Automotive Group, on the other hand, announced that in 2025, it will develop into a number one in China in new energy vehicles. At the end of April, Beiqi New Energy settled on the backdoor listing and Beiqi will accelerate its new energy. According to the previous plan, by 2020, Beijing Automotive Group will take the lead in the Beijing area to completely stop sales of its own brand of traditional fuel passenger cars; by 2025, it will achieve new energy in the country. Chery also said that it will stop selling fuel vehicles in 2020 and start comprehensive new energy, especially electric.

In addition to Chinese companies, foreign car companies also exhibited new and different energy vehicle development routes in China. Xuanyi Pure Electric, which will be listed in the second half of this year, is Nissan’s first electric model to be launched in China, while Nissan’s chief performance officer and Nissan China’s management committee chairman Jose Munoz told the Economic Observer "In the next five years, Nissan will launch 20 electric models to the Chinese market to create a new era for electric vehicles."

In addition, BMW officially announced the iX3 concept car at the Beijing Auto Show, which will be mass-produced by 2020. In the next few years, BMW will release a number of i-series models. Mercedes-Benz plans to launch 10 models of pure electric vehicles in the future to 2022. These models will be gradually introduced into China, and the proportion of localization of electric vehicles in the future will reach 70%. Audi has three new energy products, namely the A6L e-tron, Q7 e-tron, and A3 e-tron. The first electric car will be introduced into the Chinese market this year, and will also produce five new energy products in the country. Including pure electric. Audi will establish a new energy business unit, which will be complemented by a "360-degree charge" strategy.

Among the new vehicle builders, the pure electric vehicle brands such as Weilai, Xiaopeng, Weima, and Singularity will also write their determination to “celebrate the new forces”. In fact, the unstoppable trend of motorization is related to the gradual dilution of “mileage anxiety”. On the one hand, the storage of 200 kilometers has almost become standard. The Tengshi 500, which was listed on the auto show, claimed to have reached 500 kilometers of long life. On the other hand, charging facilities have also been improved.

The risks and opportunities of betting electric

Due to policy orientation, most of the development of new energy vehicles in China is pure electric vehicles and plug-in hybrid vehicles, of which pure electric vehicles are the main ones. However, it is still unclear which route the new energy vehicles will accept in the future. Dr. Dieter Zetsche, chairman of the Board of Directors of Daimler AG and chairman of the Mercedes-Benz Passenger Vehicle Group, said in an interview with the Economic Observer reporter that the company will have reserves on various technical routes. It is precisely because we do not know which route will become the mainstream of the market in the future.

Although the market is growing faster, the growth of pure electric vehicle users is not obvious. In 2017, a total of 777,000 new energy vehicles were sold in China, of which 174,000 were plug-in vehicles and 603,000 were pure electric vehicles. “According to last year’s volume, electric vehicle users accounted for only 1.5%-2% of new users that year. This figure is still very small, indicating that the new energy cake is not large enough.” SHEN Qidian CEO Shen Haisong was interviewed by reporters The market pointed to by China's new energy vehicles is still relatively small, and it is concentrated in cities that restrict the purchase. The growth of private users is still very slow.

For motorized attendees, competition from capital, talent, technology, and market pressure cannot be evaded. In 2018, the foreign capital ratio of new energy vehicles was removed. In the view of the industry, as soon as next year, the self-owned brand new energy business will face foreign competition. Currently, Volkswagen is targeting the Chinese market and plans to achieve sales of 400,000 new energy vehicles by 2020 and 1.5 million new energy vehicles by 2025.

However, more and more incoming new energy participants and new energy production capacity to be put into production have caused concern about the overcapacity of electric vehicles and the disorderly competition. Xiaohong Automobile vice chairman and president Gu Hongdi admits that there is no technical fortress for building electric cars today. “Batteries and motors can be bought outside, and there won't be a big difference.” And BYTON President and co-founder of Baiteng wear Ray said bluntly, “Some companies will soon be eliminated, but I hope more will succeed.”

In January 2018, Wan Gang, the then Minister of the Ministry of Science and Technology, stated that “in the future, new energy vehicles should be measured from the perspective of comprehensiveness and multi-objectives, and the comprehensive best is to be judged.” Obviously, high-level views on pure electric power have taken place. Some subtle changes. Wang Binggang, head of the national 863 “Energy-saving and new energy vehicle” major project supervision and advisory expert group, pointed out that although the electric vehicle is a clean car, but China's electricity objectively has some pollution, so the Chinese electric car is not clean, this is still Questionable. Starting last year, the state's subsidy policy began to consciously encourage fuel-cell vehicles, etc., to achieve multi-track progress.

With the increase of electric vehicles, whether the domestic recycling system for end-of-life batteries is perfect is also a problem for car companies. The data shows that the country has more than 1.7 million electric vehicles. Regardless of environmental protection or economic considerations, battery recycling is a problem that new energy companies must face. This year is the peak period of battery scrap. Some companies told the Economic Observer reporter that “I had given up electric vehicles a few years ago and gave up because the battery recycling did not know how to deal with it and I feel confused.” But he also pointed out that under the background of the country’s vigorous development of new energy vehicles, Solutions to these problems may be resolved.

Apart from immediate concern, there are also far-reaching concerns. The problems that lie ahead of all new energy companies must not be evaded.