Recently, two major news broke out in the new energy vehicle circle, first Mercedes-Benz announced the abandonment of the 2030 full electrification plan, and then Apple also announced the termination of the Titan plan that had been planned for ten years. Going back even further, Ford and Audi have also put their established electrification strategies on hold.
The recent actions of the European and American automobile circles are no less than a sudden brake on their new energy process, which also sends a message behind it, that is, the road to electrification is not smooth sailing. So why are European and American auto giants delaying electrification? What impact will this have on China's new energy vehicle companies? Let's talk about this topic today.
European and American car companies pressed the pause button on the new energy transformation.
Apple's research and development project for electric vehicles dates back to 2014, when Apple was ambitious to build a fully autonomous vehicle at the Level 5 level, and for this purpose, Apple organized 5,000 employees to specialize in the project. I didn't think that ten years later, this car was finally abandoned.
On February 22, 2024, Mercedes-Benz announced that it will continue to produce and improve new gasoline models. It is reported that the brand plans to launch a new lineup of fuel models by 2027, so that its internal combustion engine can be strong until 2030.
Since betting on the internal combustion engine will inevitably delay its electrification goals, Mercedes-Benz expects that by 2030, its own sales of electrified models, including hybrids, will account for 50% of its total sales. In contrast, when Mercedes-Benz announced its goal of full electrification in 2021, it planned to increase the proportion of electric vehicles to 50% of its sales by 2025. A before-and-after comparison shows that Mercedes-Benz's electrification target has not only been postponed by five years, but even 50% of the electricity content has been diluted by hybrid models.
Coincidentally, in addition to Mercedes-Benz, many European and American car companies have also postponed their electrification. In July 2023, Ford announced that it would postpone its EV production target, which had previously set a target of more than 200,000 EV production annually by 2024, but this figure has been significantly reduced to 600,000 units, which is only 30% of the original level. On December 13, 2023, Audi's new CEO said that it will not maximize the production of electric vehicles in the future, and will promote gasoline-powered vehicles, plug-in hybrid models and electric models. Jaguar Land Rover also announced last year that it would extend the development cycle of pure electric models and accelerate the production of more plug-in hybrid models.
The reality is skinny.
All of the above shows that it has become a common phenomenon for European and American car companies to postpone electrification, and as for the reasons, I personally think there are two main points:
First, I really didn't make any money. Needless to say, Apple dropped $1 billion before and after, and it took 10 years to complete the bamboo basket. Ford made a small fortune in 2023, with full-year revenue of $176.2 billion, up 11% year-on-year, and a net profit of 43.2%.300 million yuan, while its electric vehicle business lost 4.7 billion yuan, slightly higher than the previous forecast (4.5 billion yuan). Mercedes-Benz did not announce the revenue of its electric vehicle business, but judging from the sales data in 2023, the annual sales of the brand's new energy vehicles are only 240,000 units, accounting for only about 10% of the total sales of Mercedes-Benz passenger cars, and there is a high probability that it will not make money.
Second, the follow-up investment is too large and uncertain. For example, if Mercedes-Benz promotes the transformation process according to the previous plan, it not only needs to invest astronomical funds, but also needs to face the uncertainty of raw material fluctuations, technological upgrades and market recognition. Many problems are like mountains in front of European and American car companies, and suspending the transformation process can only be a helpless choice.
Is it an opportunity or a trap?
At present, the new energy vehicle market has shown two extremes, on the one hand, car companies represented by Europe and the United States have suspended the research and development of new energy vehicles, and on the other hand, domestic car companies regard new energy vehicles as the main development direction in the future. This situation has led to many Chinese people feeling uneasy, is new energy vehicles just the self-pride of domestic car companies?
To figure out this problem, we must first know what new energy vehicles mean to domestic and foreign car companies! Personally, I think that for car giants like Ford and Mercedes-Benz, new energy vehicles have become their chicken ribs, which may be an exaggeration, but it is true. A closer look at Ford and Mercedes-Benz's new energy models shows that their price cuts are terrifying, with Mercedes-Benz EQE and EQC and other products cutting by more than 200,000 yuan, which is contrary to their brand positioning. Electric vehicles have not made any money here, and they have to shake the basic plate of fuel vehicles, lose their wives and soldiers, rather than this, it is better to suspend the transformation process and stabilize the basic plate first.
On the other hand, new energy vehicles are an artifact that changes the life of domestic car companies. Judging from the data released by the passenger association, in January 24, the domestic retail share of China's own brands has reached 551%, and the wholesale market share is as high as 605%, both of which hit record highs. A few years ago, it was trampled under the feet of German and Japanese, but now it is riding the dust, and China's independent brands can grow rapidly, and electrification is naturally indispensable. Secondly, the rapid expansion of the new energy market has also stimulated the development of related industries, such as new materials, chips, charging facilities, etc., from which to pick out a huge market. In addition, China's new energy vehicles have formed a fairly complete industrial chain and have the competitiveness of the others.
Uncle Che concluded. In general, the postponement of the electrification process by foreign car companies represented by Europe and the United States is the final result of many factors, and the opportunities outweigh the challenges for Chinese car companies in this market change, and we must seize the opportunity and adhere to the electrification strategy.