Author: Chen Jianli
On March 1st, the launch event for a new car by Zero Run Automotive ignited the new energy vehicle market. The newly released C11 Extended Edition has decreased its presale price by RMB 10,000 compared to the previous release. Other new car models such as C11 Electric Edition, C01, and T03 also have different degrees of price reduction. Taking the Zero Run C01 base model as an example, the new car has a high reduction rate of up to RMB 44,000, which can be described as a butcher’s knife slashing at the old car owners.
However, as they say, there is no such thing as a free lunch. There must be a reason for such a significant price reduction. After a detailed comparison of the old and new car models, I discovered some underlying rules.
Taking the 2023 Zero Run C01 base model with a price reduction of RMB 44,000 as an example, compared to the lowest configuration of the 2022 model (Rear-wheel Drive Standard Range version), although the driving hardware (battery capacity and motor) remains the same, the configuration and materials of the vehicle have changed significantly.
The new C01 base model has adjusted the entire vehicle seat belt reminder from unfastened to only reminding the front seat, while cancelling several features such as lane-keeping assistance, opening door warning, rear collision warning, reversing car collision warning, front radar, car side blind spot warning imaging, transparent undercarriage, automatic parking, automatic lane change assistance, Bluetooth key, electric door handle, active grille, driving recorder, wireless charging for mobile phone, heated seats, driver’s seat angle memory, rear cup holder, rear multimedia control, rear charging interface, ambient light, front soundproof glass, rearview mirror heating / automatic flipping during reversing, and zone air conditioning. In addition, the full-speed adaptive cruise control is replaced by regular adaptive cruise control, and the steering wheel is changed from leather to imitation leather. Although some of the configurations are unnecessary, those who only want to buy the lowest configuration of the old car model may feel a psychological imbalance in terms of the price.
The entry-level model (500 Comfort Edition) of the Zero Run C11 pure electric version did not exist in the old version. Compared with the lowest-equipped luxury version of the old version, the price has decreased by 30,000 yuan, and the core battery capacity has decreased. It has decreased from 78.54kWh of the luxury version of the old version to 69.2kWh. However, the official CLTC cruising range has only decreased by 8km. How was this achieved?
The reason is that the decrease in curb weight reduces energy consumption. Even if the battery capacity is reduced, lower energy consumption can effectively increase the cruising range. Behind the decrease in curb weight, in addition to the reduction in battery capacity and volume, there are also factors of configuration adjustments, which is what people call “downgrading“.
Including all models of C01 and C11, there are different levels of configuration adjustments, which are actually to reduce costs and selling prices. I think it is a good thing for consumers who hold currency to buy cars.
In addition, the price-performance ratio of the extended-range version of the Zero Run C11 entry-level model is still acceptable. With less than 150,000 yuan, you can buy a “hybrid fuel and electric” five-seat SUV with not low configuration, which is a good choice for a commuting car.
The price reduction strategy of the new model of LINGPAO is aimed to lower the threshold of the selling price by removing “non-essential” configurations from low-end models, which is based on the market feedback. On the other hand, it reflects the fierce competition in the new energy market, especially for LINGPAO, a non-first-tier new force brand. Although it has laid a solid foundation in the early stage, it needs to adopt more methods to seize shares in the face of competition from more brands. Even the low-price strategy can help the brand maintain stability and continuity.
I do not know how the old car owners feel or think about LINGPAO’s official price reduction. However, since they have chosen a new force brand, they may have already anticipated similar situations.
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email email@example.com.