Edited by Asiautos Auto Part
Chinese products, known as the "new three things", "new energy vehicles, lithium batteries, and photovoltaic products", have shown rapid growth in the export market in recent years. According to the latest data, the total export value of the "new three" products will reach an astonishing 1.06 trillion yuan in 2023, not only breaking through the trillion yuan mark for the first time, but also achieving a year-on-year increase of 29.9%. This leap forward not only demonstrates the strong strength of China's manufacturing industry, but also sets a new benchmark for China in the global new energy field.
With advanced battery technology, intelligent driving systems, a complete local supply chain and first-mover advantages, China's new energy vehicle exports have grown rapidly, successfully surpassing the one million mark. According to data released by the China Association of Automobile Manufacturers, in 2023, new energy vehicles will be exported to 1.203 million units, a year-on-year increase of 77.6%, surpassing traditional fuel vehicles, accounting for 24.5% of total vehicle exports.
Looking forward to 2024, it is expected that China's new energy vehicle industry will continue to maintain a strong momentum of "going overseas", and a "battle to break the army" led by technological innovation is gaining momentum, and solid-state battery technology, 800V ultra-fast charging technology, and autonomous driving technology upgrades have become the focus of industry attention. In addition, uncertain risks such as trade frictions, technical barriers, and extremely cold weather should still be vigilant.
In 2024, China's new energy vehicles will break through the situation and take advantage of the momentum.
Go to sea, what to roll?
In addition to price competition, self-built channels and factories are the focus.
Entering 2024, the performance of China's new energy vehicle industry in the global market is becoming more and more eye-catching. Liu Xuexiao, co-founder of Jiashipai, told the IT Times that with the surge in exports, it is expected that a "double-volume" war around price and channel construction will be launched in 2024.
In terms of price, Chinese automakers have shown strong competitiveness. An industry source in the field of new energy told the "IT Times" reporter, "Due to the high profit margin of the export market, the profit of exporting a new energy vehicle can often be worth the domestic sales of nearly three of the same car." "It's this tantalizing prospect that has made major car companies look to overseas markets.
Domestic giants such as BYD, Geely, Chery, and Changan have elevated exports to a core strategic position. Companies are well aware that in overseas markets, price is often one of the most sensitive factors for consumers. In the future, automakers will reduce the price of export models by optimizing production costs and improving production efficiency, so as to occupy a favorable position in the global new energy vehicle market.
In addition to the price war, channel construction has also become another major focus of overseas competition for Chinese automakers. "At present, it is mainly based on parallel exports, and dealers rely on their own channel resources to carry out scattered sales in overseas markets. However, the drawbacks of this model have gradually emerged: the majority of channel profits are taken away by dealers, and it is difficult for car companies to control overseas markets. Liu Xuexiao said.
How to break the game? Chinese automakers have begun to actively lay their own overseas production and sales channels, and extend their sales and service networks directly to overseas markets by establishing a complete 4S model or dealer model. Taking BYD as an example, it has entered nearly 60 countries in the global market, including Germany, Australia and Japan, and after taking root, it will go deeper, and BYD will start the expansion of its own channels. On January 31, BYD signed a pre-purchase agreement with Hungary for land for a passenger car plant, marking a new breakthrough in its localization in Europe, and earlier on, it has already selected sites to build factories in Thailand, Uzbekistan and other regions. It is not difficult to see that the establishment of its own factory will lay a more stable foundation for the construction of BYD's own production and sales channels.
Speed and scale are the core of channel construction, and the internationalization pace of "BYD" is more firm.
Where to go to sea?
Southeast Asia and Latin America are the main ones, while Africa or the blue ocean
In 2023, it is not uncommon for Chinese brand cars to gallop on the wide road in Southeast Asia, Australia, Latin America and Europe. Previously, EqualOcean analyst Chen Zhiheng told the "IT Times" reporter that Southeast Asia is currently the largest market for China's new energy vehicles to go overseas, and new energy pure electric or hybrid models such as BYD, Great Wall, MG, and GAC Aion have emerged.
"In 2024, new energy going overseas still needs to conquer these international markets. The first is to export new energy vehicles to major European non-mainstream automobile countries; the second is to supply Russia through Central Asian countries; The third is to establish local factories in ASEAN countries for overseas assembly and sales. For the place where new energy will go to sea in 2024, Liu Xuexiao made a bold prediction. Chen Zhiheng also told the "IT Times" reporter that Africa may be a blue ocean, waiting for Chinese brands to "swing their swords".
The advantages of low cost and large-scale manufacturing are still the reassurance for domestic brands to enter the international market. For markets lacking local industrial chains such as South America, Southeast Asia, and Northern Europe, China's new energy vehicles have almost no threshold at all, and they can enter smoothly as long as they comply with local regulations.
It is worth noting that consumers in the South American and ASEAN markets have been affected by the pricing of fuel vehicles in Europe, the United States and Japan, and with the deepening of Chinese car companies, the market has gradually introduced EV, PHEV products and DHT technology, so that the market can share Chinese technical standards. Some industry experts pointed out that Chinese car companies will bring new technological advantages to this type of market, and may form new industrial chain standards. Once the standard is established, Chinese automakers are expected to gain greater profit margins and market dominance.
However, a number of industry insiders said that the United States market is still a gap that domestic brands are difficult to cross. "United States industry is strictly restricted, high barriers are set for Chinese new energy brands, and even the use of materials from Chinese suppliers in the battery supply chain is not allowed to enjoy federal subsidies." Some car companies are looking for ways to circumvent the restrictions, such as Polestar, which Korea production and then export to United States, and Geely-controlled Volvo, which plans to build a new factory in the United States, mentioned in the industry.
What are the crises of going to sea?
Differences in demand The criteria are different
It is undeniable that while exports are soaring, China's new energy vehicles still face multiple challenges in the global market. "The crisis is mainly reflected in three aspects: differences in demand, different technical standards in different countries, and insufficient infrastructure construction." Liu Xuexiao thinks.
The first is demand differentiation. In traditional auto manufacturing powerhouses such as Europe and the United States, it is difficult for Chinese brands to fully meet the local market demand. For example, Chinese consumers prefer large, comfortable models, while the European market prefers smaller, sportier vehicles, which makes it difficult for Chinese automakers to open the European market.
Secondly, there are also differences in the standards of new energy technologies in different countries, including charging ports and safety standards. Chinese automakers need to design new products in a targeted manner, which undoubtedly increases R&D costs and time pressures. At the same time, due to the lack of development experience of some standards, the project schedule may be uncontrollable, further increasing the challenge.
In addition, the lack of overseas new energy infrastructure construction also limits the export share of new energy vehicles. The above-mentioned industry insiders pointed out that PHEV (plug-in hybrid electric vehicle) models, for example, are popular in the Chinese market because of their long range and energy-saving advantages. However, in overseas cold regions, the experience of using PHEV models is not as good as that of HEV (hybrid electric vehicle) models due to the lack of charging facilities and energy replenishment experience, and the cost of batteries also increases the burden. "Therefore, the significance of selling PHEV models in overseas markets is not obvious."
The challenges of battery life in severe cold areas cannot be ignored by car companies. At present, the use of PHEV, extended-range hybrid and other technical routes is one of the ways to solve the anxiety of new energy range; There are also car companies that choose the solid-state battery technology route, "but there is still at least one or two generations of models before mass production is expected." "The industry is more unanimous that in the next 5 to 8 years, PHEVs may be one of the main technical routes for new energy vehicle companies to solve the challenges of battery life in severe cold regions.
In 2024, the overseas of new energy vehicles will be a year with more opportunities than challenges. Based on low prices and production capacity advantages, the rapid establishment of its own production and sales channels is the guarantee, and the technical advantages and innovation are word of mouth, China's new energy vehicles are facing a rare historical opportunity in going to sea.
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