On June 17th, Wang Xing successfully became the “strongest delivery man” of Li Auto and this time he helped his father.
Wang Xing posted on Fanfou saying, “My father came to Beijing to visit relatives. After experiencing his own Li ONE, he took the initiative to say that he would replace his Mercedes-Benz S with Li ONE when he returns to Longyan.”
This is not the first time that Wang Xing has publicly praised Li Auto. On May 29th, Wang Xing finally got his own Li ONE and after receiving the car, he also said that it can replace his previous Volvo XC90 and Tesla Model S.
In fact, as one of the leaders in the Internet industry, Wang Xing’s attention to smart electric vehicles even exceeds that of many industry insiders. Recently, Wang Xing’s comments on the automotive industry have also increased significantly. We have listed some of Wang Xing’s golden sentences. On June 11th, Wang Xing wrote on Fanfou:
- 1973 was a watershed year in the history of the automotive industry, and around 2023 may also be.
- Electric cars are easier to drive than gasoline cars, and Li ONE is easier to drive than NIO.
On June 17th, Wang Xing wrote on Fanfou again:
- The automobile industry is facing unprecedented changes, and in the next few years, the depreciation speed of used gasoline cars will far exceed that in the past, which will become apparent in three to five years.
Although he is not in the automotive industry circle, he is well-informed about industry news, which shows Wang Xing’s concern for the automobile industry. He has also expressed in public occasions many times that he is optimistic about smart electric vehicles and has made a judgment that “the No.1 electric car will probably be in China instead of the United States.”
This man who dominates the internet has become the biggest “automobile commentator” in the automotive industry. So why does Wang Xing pay so much attention to the Chinese automobile industry? Is it just because he is a Li Auto investor?
Based on these questions, let’s take a look at what the automotive industry looks like in Wang Xing’s eyes.
Why do the bigwigs choose to believe in Li Auto, NIO, and XPeng?
First of all, the view is that “these three will be the most likely new forces in the future to survive in the car making industry.”
Now, not only the automotive industry is lively, but the keen senses of the venture capital circle are also always paying attention to them. On the evening of June 6, XPeng Motors CEO He XPeng posted a Weibo saying, “Three miserable guys, recalling hardships and seeking change,” and the accompanying photo was him with NIO CEO Li Bin and Li Auto CEO Li Xiang.The Chairman of Kunlun Weyi, Zhou Yahui, forwarded a photo of him with two others and stated, “Tell CEO Xing (Wang Xing of Meituan), that if Ideanomics and XPeng Motors listed on the U.S. stock market, Kunlun Capital will not buy below 20 million U.S. dollars to show support.“
Earlier this year in January, Wang Xing expressed his belief on Fanfou that the domestic automobile industry will ultimately only have “3+3+3+3” companies left. Three state-owned enterprises, FAW, Dongfeng, and Changan; three local government-owned enterprises, SAIC, GAC, and BAIC; three private enterprises, Geely, Great Wall, and BYD; and three new forces in the automobile industry, Ideanomics, NIO, and XPeng.
In other words, according to Wang Xing, there will only be three new automobile companies left. Based on his prediction, we can consider the possibility of the three companies from the following two points:
First, the sales of the products from the three new automobile companies are beginning to ramp up, and the head effect is beginning to gather.
NIO and Ideanomics are both focused on luxury brands priced above 300,000 yuan, and XPeng’s second model, P7, is also making upward breakthroughs, with a price range of around 300,000 yuan.
In this price range, according to the insurance data from January to April 2020, NIO ranked first with 6,951 cars sold. On June 4th, NIO published their delivery data for May 2020.
The data showed that the NIO brand delivered 3,436 new cars in May, setting a monthly delivery record. As of May, the cumulative delivery volume of the NIO brand has reached 42,342 units.
Meanwhile, Ideanomics, although the latest to deliver, sold 5,783 cars insured from January to April, ranking second. As of April 29th, the cumulative delivery of new cars in April 2020 exceeded 2,600 units, an increase of nearly 80\% over the delivery volume of 1,447 units in March of this year.
Since the delivery of the Ideanomics ONE from December 2019, the cumulative number of delivered users has exceeded 10,000 units. It took Ideanomics less than seven months to achieve this goal.
XPeng Motors officially announced that the cumulative total of XPeng G3’s insured from January to April this year reached 3,564 units, of which 34.59\% was in April. The single-month insured amount for the G3 reached 1,233 units, an increase of 27.5\% compared to the same period last year.Until the end of April, XPeng Motors had delivered 20222 new cars, but it should be noted that the sales volume for May have not been released yet, and the orders for P7 have not been counted. According to insiders at XPeng, the pre-sale performance of P7 has exceeded expectations, therefore we can expect a surge in sales growth when P7 starts delivery in July-August.
In fact, the cumulative sales volume of WM Motor has already reached 27692, which is higher than that of XPeng and Li Auto. However, why does Wang Xing not have a good impression of WM Motor? This is determined by the underlying logic of the respective companies.
Secondly, autonomous driving is the underlying logic of the future automotive industry. If we look back at the development of the automotive history, cars have always been used as a convenient means of transportation. Even with electric cars, the inherent functions and attributes of “cars” have not changed. However, when we add “intelligence” to the car, the entire logic of using cars will be completely overturned.
Autonomous driving technology is one of the truly transformative technologies that can change the way humans travel, and it is also the most probable technology that humans can achieve at the technical level. Therefore, the car is just a hardware carrier, while the real test lies in the underlying understanding and route selection of the respective car companies.
Wang Xing, Li Xiang, XPeng’s He XPeng, and Li Auto’s Li Bin are all from an internet background, and the thinking of the internet is “break and restructure”. Simply being a “car-making” company is not their initial intention. So, it is actually very easy to find the similarity between these three companies, which is “all vigorously striving to achieve true autonomous driving”.
CEO Li Xiang of Li Auto has expressed publicly more than once that “the purchase decision brought about by the future automotive hardware will gradually become smaller, and intelligent driving is the key factor affecting the experience”.
In order to achieve the goal of autonomous driving, NIO officially announced in April this year that it will push the NoP automatic assisted navigation driving system to users who choose NIO Pilot within the year. On April 27th, XPeng announced at the P7 launch event that the XPilot 3.0 version of the assisted driving system with NGP fully automatic high-speed navigation pilot assistance system will be available in the fourth quarter of this year.
The autonomous driving route planning of Li Auto also shows that it will achieve the NoA full automatic assisted navigation driving system around 2021-2022.Translate the following Markdown Chinese text into English Markdown text in a professional way, while retaining the HTML tags inside Markdown, and only output the result.
Here are some unfamiliar terms NoA/NGP/NoP, briefly explaining that the functions implemented by these three words are the same, only the names given by the three car companies are different. The automatic assisted navigation driving system is actually based on L2 assisted driving, and the vehicle can actively change lanes and switch highways according to the navigation route set by themselves.
The key is that this feature is regarded as the core foundation for achieving fully automatic driving. Therefore, the goals of the three companies are very clear, all aiming to obtain tickets to the era of automatic driving. And WM Motor is more like doing the “car” product.
From a phased perspective, the sales of the three companies are continuously increasing, so there is reason why capital is gathering towards the head. In the long run, the goals of the three companies all involve infinite imagination of “autonomous driving”, and the most core is that all three are moving towards this direction to land. Their efforts are to achieve the best assistive driving system at this stage from the functional level of the product.
Why Wang Xing loves ideals?
First of all, Wang Xing spent money. Wang Xing personally participated in the C-round financing of Ideal Auto, with an investment amount of up to 2 billion RMB, which is why Wang Xing strongly supports Ideal Auto.
As for why he invested in Ideal Auto, there are several aspects to consider.
The first is that the second-generation Internet entrepreneurs share understanding.
Wang Xing and Li Xiang (CEO of Ideal Auto) are representatives of second-generation Internet entrepreneurs and have achieved great success. Therefore, their dialogue will be simpler, and their values will be more similar.
The first-generation Internet people led by Jack Ma did business by using the Internet to lay the foundation for various industries in China, and the company’s vision was also related to social values.
On the other hand, Wang Xing, Li Xiang, and Zhang Yiming (CEO of ByteDance) are engaged in businesses that improve the operational efficiency of specific sectors through specific things they do. ByteDance solves information dissemination efficiency, Meituan solves life efficiency, and Ideals solve travel efficiency. They do not elaborate too much on the big values of “national interests”, but they have the driving force for promoting the development of the industry.
The second is the unique new energy technology route adopted by Ideal Auto.
Ideal Auto is a range-extended electric car. Because it has a fuel range extender, it can not only travel purely electrically, but also eliminates range anxiety. Ideal ONE optimizes the electric drive system, in conjunction with three energy supply modes (fast charging, slow charging, and fuel supply), which solves range anxiety and charging problems from multiple perspectives.
The advantage of this is that the driving experience is no different from that of pure electric vehicles, and after optimization, the whole NVH control is even better. Moreover, the range is basically the same as that of gasoline-powered cars, as long as they can refuel, they can generate electricity.
Another advantage is that extended-range electric vehicles can quickly be popularized in the market. At the current stage, the infrastructure for supplementary power is not yet complete, and consumers are not necessarily concerned about the range of the vehicle, but rather the availability of supplementary power, which ideal can perfectly solve.
In the process of the automotive industry transitioning to pure electric power, ideal will be the best interim product. When pure electric becomes mainstream, ideal will only need to remove the range extender to become fully electric.
Delivering more than 10,000 vehicles in just 7 months is the best proof.
Thirdly, it strengthens Meituan’s “Travel” strategy discourse.
In 2016, Meituan began researching unmanned delivery vehicles for specific scenarios. In 2017, Meituan launched the online ride-hailing function on its APP. In 2018, Meituan introduced unmanned delivery vehicles in specific scenarios. Meituan’s delivery service is naturally related to means of transportation such as electric vehicles.
For example, in January 2019, Meituan already announced a strategic agreement with Faurecia, chip giant NVIDIA, and Italian car design company Icona to develop Meituan’s unmanned delivery vehicles.
It is evident that Meituan values and has ambitions in the field of mobile travel.
New energy vehicles are closely related to autonomous driving and intelligent networking. In the long run, after autonomous driving technology matures and becomes popular, Meituan’s travel service chain may be able to achieve a closed loop, thereby improving cycling time and saving operating costs.
In the future, automobiles may become the largest traffic entry point, and after autonomous driving is realized, it is crucial for Meituan as a “life” service provider to enter consumers’ lives, and ideal may be one of the entrances. Therefore, this is a reason why both Wang Xing and Meituan must choose to work with ideal cars.
2023 is the turning point in automotive innovation
Many automakers have already set 2023 as the year of full electrification. The Hainan Province has announced plans to ban gasoline vehicles by 2030. To quote Wang Xing himself in the automotive industry: “2020 is the best and worst year in the next ten years.” Let’s take a look at some of the electric vehicle plans by automakers.- General: Starting in 2023, we will expand our lineup of electric vehicle products to 20 models.
- Volkswagen plans to achieve global sales of 3 million electric vehicles by 2023.
- In 2022, Daimler will launch more than 10 electric vehicles, and Mercedes-Benz will have at least one electrified model in every series.
- BMW: We will introduce more than 25 new energy vehicle models by around 2023, and most of them will be pure electric.
- Ford: Starting in 2023, we will provide European consumers with new electric products based on the Volkswagen MEB platform.
- Toyota: We have already imported more than 10 EV models by 2020 and plan to electrify all of our vehicle models by 2025.
Under the guidance of policies, various automakers have started the transition to electrification. Although the new energy vehicle industry currently faces the issue of subsidy reduction, national policies are still favorable before 2023 to achieve the industry’s popularization goals.
Aside from policies, breakthroughs in technology are also crucial. With the release of pure electric vehicle models by major automakers, battery density and range continue to increase, while safety performance also improves.
By 2023, as Wang Xing said, electric vehicle technology will reach a new watershed and reach a higher level.
“Wang Xing’s support for EVs is actually an insight into the trend, and his support for Li Auto is the optimal choice during the stage of comprehensive electrification.,” said Li Auto’s investor Wang Xing.
That’s why Wang Xing said that among the 12 surviving automakers in the first round, Li Auto can smoothly enter the second round, but the third round is uncertain and requires effort.
In conclusion, the “survival theory” of the automotive market is a topic that has been discussed for a long time. Wang Xing, as an investor in Li Auto, publicly supports the company, which may have publicity concerns.
However, in the longer term, Wang Xing actually played a role in “breaking the circle” of new energy vehicles, and he is known as the “best commentator” in the automotive industry who broke the internet’s perception of cars as a traditional manufacturing industry and the technology and digital circles’ perception of cars as transportation equipment.Before this, Luo Yonghao expressed on Weibo that the Ideal ONE is the best electric car that can be bought for less than 5 million yuan, which triggered a lot of ridicule. However, the problem behind this is that the ideal car that takes into account range, electric drive, and assisted driving experiences or satisfies Luo Yonghao’s personal needs, may indeed be the Ideal ONE.
In fact, this Weibo post reflects a phenomenon: the lack of choices is the real problem that exists in this market, and Ideal is just giving the market a comprehensive choice.
As a successful entrepreneur, Wang Xing undoubtedly has a strong ability to think comprehensively. His comments and opinions can greatly promote the development and popularity of the new energy vehicle industry in a positive way.
And pushing and solving social operation efficiency may be the essence of their entrepreneurship’s attention to the automotive industry.
Li Shufu from Geely also stated earlier that in the future, China will only have 2-3 companies left, and whether they will be Ideal, NIO or XPeng, it’s hard to say, but of course, they are all absolute seed players.
From the photo of He XPeng, Li Bin and Li Xiang, their determined yet slightly tired expression can be seen. The first team members are still struggling to move forward, so it can be imagined how difficult the situation is for other new automakers.
Recently, Wang Xing has also expressed his understanding of new car manufacturers:
- Have produced more than 10,000 cars cumulatively, which is achieved by the current top five: NIO, XPeng, Ideal, WM, and (Unity) NETA;
- Delivered more than 10,000 cars in a single quarter. NIO is expected to achieve this in the second quarter, and Ideal is estimated to have to wait until the fourth quarter;
- Deliver more than 10,000 cars in a single month. Let’s see if any company can do this next year.
For the entire new energy car industry, pure electric cars also face many difficulties.
- Service: charging supporting facilities;
- Technology: especially the “three electrical” batteries, independent chips, and assisted driving;
- Market: market share;
- People’s cognition of the transition from traditional fuel vehicles to pure electric vehicles;
- The dominant strategic right of the future market for pure electric vehicles.
As for who will survive, it is difficult to make a conclusion now. According to the “New Energy Vehicle Industry Development Plan” released by the Ministry of Industry and Information Technology, new energy vehicle sales in China should account for 25% of new car sales by 2025, reaching an estimated 7.5 million units. To promote this cause, more “commentators” like Wang Xing are needed.
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.