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After many years, Chery once again reported that it would hit the market. Recently, it was reported that IDG Capital is considering acquiring part of the shares of Chery Holding Group from existing shareholders for up to RMB 7 billion, and Chery Automobile, a subsidiary of Chery Holdings, is restarting its IPO and plans to complete the A-share listing by 2025.
In this regard, the reporter of the Economic Observer Network asked Chery brand insiders for verification, but has not received a reply as of press time. However, some Chery executives responded that the company was actively preparing for listing, but the rest of the information was inaccurate.
In 2023, the automotive industry will become increasingly competitive under the shadow of the year-long "first-class war". Statistics from the China Association show that in the first 11 months of this year, domestic automobile production and sales increased by 10% and 10% year-on-year respectively8% to 271110,000 and 2,69380,000 units. But at the same time, the overall industry profits fell sharply. Cui Dongshu, secretary general of the passenger association, once said that from January to August this year, the sales profit margin of the automobile industry was only 49%, a new low in recent years.
In the context of the recession of the industry, why is Chery Group preparing to go public "against the trend"?Industry analysts believe that this may be related to Chery's recent rapid growth in the automobile market. According to public sales data, from 2021 to the first 11 months of 2023, Chery Group's sales volume was 96190,000 units, 123270,000 units with 166560,000 units, a year-on-year growth rate. 8%。
However, behind the rapid growth of sales, Chery Group is also facing problems such as more dependence on overseas markets for sales and poor transformation of new energy, which will have an impact on Chery's prospects for impacting the capital market.
Sales are more dependent on overseas markets.
Although the overall sales volume of the Chery Group has grown rapidly, the sales structure of the overseas market has developed faster than the domestic market, and Chery has become increasingly dependent on the overseas market in terms of sales volume and profit. From 2021 to the first nine months of 2023, Chery Group's sales in overseas markets were 26920,000 units, 450,000 units and 6480,000 units, a year-on-year growth rate of %, accounting for 51% of total sales from 28%.7%。
It can be calculated by subtracting the sales volume in overseas markets from the total sales volume of previous years, and from 2021 to 2022, Chery Group's domestic sales volume will be 69270,000 with 78270,000 units, with an estimated sales volume of about 880,000 units in 2023, with an average annual growth rate of about 13%.
The most important thing is that Chery has done a good job in the Belt and Road Initiative, and has done a good job in exporting overseas, especially in Russia and Iran. Why do you desperately go overseas, because overseas is expensive, at least now the profits are bigger. Zhang Junyi, managing partner of Oliver Wyman, told the Economic Observer.
From the perspective of the path of more Chinese automakers to expand overseas, it is usually the first to achieve sales growth in the Chinese market, and then start to expand in overseas markets. Chery Group has become one of the few companies with "upside down" sales at home and abroad.
With the rapid growth of China's auto exports, many Chinese automakers have begun to expand into overseas markets. Several other independent automakers, such as BYD, Changan and Geely, have achieved rapid growth in their domestic markets while expanding overseas markets in recent years. Chery's strong momentum in overseas markets is a major advantage. However, for a company based in China, winning in the more competitive Chinese market can better test the comprehensive competitiveness of an enterprise.
Chery New Energy "fell behind".
In addition to the difference in domestic and foreign sales, another challenge faced by Chery Group is the slow pace of its new energy transformation. According to the data of the Passenger Association, in the first half of this year, Chery Group sold about 40,000 new energy vehicles, a decrease of 66% over the same period last year. Among them, QQ ice cream sales were 250,000 units, and 10,000 units of Little Ant were sold.
Chery has been developing in the field of new energy very early, and before 2022, Chery Group has occupied a place in the new energy market with two A00-class pure electric cars, Little Ant and QQ Ice Cream. However, due to its long-term focus on small cars, Chery's new energy market performance has had many twists and turns.
According to the data, from 2017 to 2021, the domestic sales of A00 pure electric passenger cars have experienced a "roller coaster" growth, accounting for % and 30% of the total sales of pure electric passenger cars in the country that year.
During this period, Chery Group launched Chery Little Ant and QQ Ice Cream in March 2017 and December 2021. Chery Little Ant stepped on the outlet of the A00-class pure electric passenger car market, and QQ ice cream caught up with the "last train" of the A00-class pure electric market.
However, with the consumption upgrade of the new energy market, the A00 pure electric market is shrinking rapidly. According to the data of the Passenger Association, the retail sales growth rates of domestic A00-class, A0-class, A-class, B-class and C-class pure electric market models in 2022 will be respectively. 5% vs. 2015%。Chery's lack of comprehensive planning and layout in new energy has led to its missed opportunities for market expansion.
At the 2023 Chery Technology Day held in October this year, Yin Tongyue, chairman of Chery Group, publicly reflected: "Chery 'got up early in the morning and caught up late' in terms of new energy vehicles. He said that next year "will not be as polite as before" and "next year new energy vehicles will definitely enter the head of the country".
Zhang Junyi believes that Chery New Energy cannot rely on the growth of small ants and ice cream alone, so it is also necessary to accelerate the development and upgrading of products. Car companies are going through a product transition period, and recently Chery Fengyun and Jietu Shanhai series are also being released and adjusted.
There is a risk of "internal competition" in new energy.
At present, Chery Group has launched a number of new energy brands and sequences. In the hybrid market, the Chery brand and the Jietu brand respectively released their own new energy sequences in November, namely the Chery Fengyun sequence and the Jietu Shanhai sequence, and a total of 19 new hybrid products are planned to be launched in two years.
Among them, the first production models of Chery Fengyun series, Fengyun A8 and A8 Pro, will be launched within this year. The first mass-produced model of the Jie Tu Shanhai series, the Jie Tu Shanhai L9, was officially launched on November 14.
In the pure electric vehicle market, Chery Group not only has the "new force" iCar brand, the Zhijie series in cooperation with Huawei, but also the Xingtu Star Era ES based on Chery's high-end intelligent E0X electric platform. The iCar 03, the first model of the iCar brand, will be available for pre-sale in December, the Zhijie S7 will be officially launched at the end of November, and the Xingtu Star Era ES is scheduled to be launched in mid-to-late December.
At present, most of the traditional domestic car companies adopt the strategy of multi-technology route in the layout of new energy. Brands such as BYD, Geely, GAC and "Wei Xiaoli" have all made layouts in the plug-in hybrid, mid-to-high-end pure electric market, and Chery's layout is also the same.
Chery, which is "one step slower" in terms of new energy, has intensively launched a number of brands and product series and its products in a short period of time, reflecting its eagerness to catch up in the field of new energy. However, the positioning of new energy products of Chery, Jietu, Xingtu and ICAR is not clear enough, and the products overlap, and there is a risk of "internal competition" between them.
It would be best if each product launched by Chery had its own characteristics and could compete for its own target customer market;If the products are basically the same, they will fight with themselves, which is tantamount to cannibalism. Yan Jinghui, a member of the expert committee of the China Automobile Dealers Association, said that if Chery's new energy products want to catch up, they must develop in the aspects of intelligent networking and automatic driving, and must have their own core competitiveness, and there will be more technological innovation and improvement in core components such as batteries, electronic control, and motors.