The Recent Price Hike of Electric Cars Is Not Under Control by Manufacturers
The increase in price is a certainty. If you want to buy a car, it’s the right time to buy the one I’m going to buy next week!
Do you remember the “chip shortage” issue that started at the end of 2020? Starting from the consumer electronics industry, this supply chain problem is impacted greatly by the hoarding of merchants and the virtual currency mining boom. For a moment, products that were launched two years ago were suddenly priced higher. While it appeared that only the consumer electronics industry was affected, the trend spread to the automotive industry half a year later. A series of natural disasters and subsequent export restrictions in some countries have caused considerable damage to the automotive industry.
Since the consumer electronics industry was affected earlier, they have been better prepared. Consumer electronics brands, with their fast pace of updating and upgrading and a relatively flat supply chain, decided to reserve production capacity with suppliers in advance at the end of 2020. At that time, the automotive manufacturers were still convinced that the industry’s lean production through “Just In Time,” “Zero Inventory Management,” and clearly defined supplier systems guaranteed cost control efficiency. However, this led to the discovery, during the chip shortage, that chip manufacturers, who were second or third tier suppliers to the automotive industry, had long given away most of their production capacity to the consumer electronics industry. Hence, the “chip shortage” had a significant impact on the automotive industry.
Nevertheless, the “chip shortage” wave only represents the tip of the iceberg, as the rise in the price of raw materials is the real headache for automakers. After all, if there is still a shortage of chips, automakers can put the limited chips on more profitable car models, reduce production of low-profit models that only achieve sales volumes, and achieve profitability by averaging the overall investment. Last year, some European car companies even achieved profits for the first time in several years through such measures as reducing production. In contrast, missing parts can be delivered later, and customers can be called back to the store for installation. However, the rising cost of raw materials will not give you a chance to breathe, as the actual rise in costs will affect the overall cost of the vehicle.
Among them, the rising cost of battery raw materials, especially important for electric vehicles, is the most absurd symptom of all headaches;
The cost changes of battery raw materials in the past few years, and the surge in 2021 has almost offset the decline in the past few years. Source: Benchmark Mineral Intelligence. In recent years, when the price of pure electric new cars has been lower year by year, the example that everyone likes to cite is the predicted curve of the decline in battery costs. Everyone believes that demand popularization will eventually level investment and cost will eventually decline. However, the mineral resources behind the batteries are limited and controlled by a few people. With demand growth, will the supply side increase prices? As the largest cost of electric vehicles, the dramatic increase in raw material costs naturally means that manufacturers cannot support it for too long through charity. The CEO of Ideal Cars, Li, released a message on Weibo a few days ago, saying: “For those that have not raised prices, most of them are because the magnitude of the price increase has not been negotiated, and they will generally raise prices as soon as the negotiation is completed.”
As for Tesla, with two rises and two falls in five days, it is just that this company is more open than others. After all, when the price dropped every three or five times before, Tesla also did not follow the convention.
I am not very concerned about Tesla’s price increase. I only care about whether my electric horse can be delivered next week.
There has always been an album in my phone, which records the expenses of each refueling. Although I am not used to keeping accounts, this fixed expense every month cannot be avoided, after all, I am a middle-aged man who drives a 2.3T Mustang for 60 kilometers every day to and from work. I endorse the repeated rise in oil prices, oh no, I mean I suffer from the unbearable pain.
I was lucky enough to have ordered a Mustang Mach-E electric vehicle (EV) at the end of last year. As someone who was previously driving a gas-powered vehicle, I naturally had high demands for the driving experience and handling of a car. Additionally, I also had high space requirements when transitioning from a two-door to a four-door vehicle. The Mustang Mach-E satisfied both of these requirements perfectly.
Why am I promoting EVs? Because the Mach-E hasn’t increased in price yet! (Oh, but the extended-range all-wheel-drive version has actually increased by 7,500 yuan compared to last year. The rest is probably due to the unresolved issues mentioned earlier by Li Xiang).
According to my colleagues, the delivery period has now stabilized and customers can expect their car to be delivered within 6-8 weeks after placing an order. So if you’re in a hurry and don’t want to pay for the rising cost of raw materials, why not join the Mach-E family?
Recap: What Makes the Mach-E So Great!
Oh, by the way, I’ve actually promoted the Mach-E on Zhihu before. When it was first released in North America and when it was released in China last year, I promoted it both times. Since I’m back again, let’s do a quick recap.
The Mach-E, which has not yet increased in price (including the Fleet Edition which increased earlier this year), is significantly cheaper than the corresponding Tesla Model Y in each version. The GT version is 48,000 yuan cheaper than the YP version, and the extended-range all-wheel-drive version of the Mach-E is 28,500 yuan cheaper than the same version of the Model Y. Even the most expensive Mach-E version, the extended-range rear-wheel-drive luxury version, is 7,000 yuan cheaper than the standard extended-range rear-wheel-drive Model Y.
And all the acceleration of the electric horse Mach-E in the series is faster than that of the Tesla Model Y (ranging from 0.05 seconds to 0.7 seconds), and the long-range rear-wheel-drive version of the electric horse Mach-E has a cheaper price and longer range than the Tesla Model Y’s standard rear-wheel-drive version, and the range of the natural rear-wheel drive version is also cheaper;
Also, the electric horse Mach-E’s three versions of Unlimited Luxury, Unlimited, and Leap World currently offered in rear-wheel drive provide more options than the Model Y’s standard rear-wheel drive, and for those who want more configuration options (matrix headlights, BO sound system, etc.), the Unlimited Long Range Rear-Wheel-Drive Luxury Edition for 309,900 yuan can be chosen, while those who only want a long-range of CLTC619km can choose the Unlimited Long-Range Rear-Wheel-Drive Edition for 282,000 yuan, and those who want a simple and spacious pure electric new car can choose the Leap World Standard-Range Rear-Wheel-Drive for 265,000 yuan.
In terms of space, the electric horse Mach-E’s front trunk space size was successfully guessed during development by using the Model 3 as a benchmark car to guess the size of the Model Y’s front trunk space, resulting in a larger front trunk space than the Model Y, while also adding waterproof and water guide hole designs from the perspective of user experience. As for the trunk, the Model Y has a deeper trunk than the electric horse Mach-E because it offers a basic three-row version in North America that is almost impossible to sit in, which is almost equal when combined with the front trunk space.
In addition to the appropriate price, performance, and range, the electric horse Mach-E also has a level of interactive and assisted driving features that can compete with industry leaders. It cannot be said that the two aspects have breakthroughs of new forces but can be said to be one of the fastest speeds in line with foreign brands;
Considering the retained 10.2-inch instrument screen and the 15.5-inch center control screen with a hardware knob for interactive safety and convenience, the Chinese version of the electric horse Mach-E introduced Ford China’s SYNC + system for the domestic market, with popular natural voice interaction function.The BlueCruise intelligent adaptive cruise control function with driver state monitoring was recently praised by foreign media as a safer and more user-friendly driving assistance function compared to steering wheel monitoring. Currently, the Jianghuang Luxury Edition, Zhui Feng, and GT versions included in the purchase policy offer a free trial period of 90 days. You will know how good it is once you try it.
We have recommended the electric horse many times on Zhihu. It has sufficient endurance, abundant power, surprising space, advanced driver assistance technology, and a voice assistant that is also considered top-notch in the industry. Don’t hesitate, place your order now!
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.