Why Competing on Value Beats Price Wars: What Gives the AITO New M7 Ultra Its Confidence?

AITO M7 has officially undergone a comprehensive refresh in product value.

On May 31, 2024, the AITO M7 Ultra was officially launched with prices ranging from RMB 289,800 to RMB 329,800. As the latest addition to the AITO M7 series, the AITO M7 Ultra features significant updates in exterior design, chassis refinement, sensor hardware, and comfort configurations that are clearly perceptible to consumers.

These updates demonstrate the AITO M7 Ultra's enhanced product competitiveness.

As a highly anticipated product line under Hongmengzhixing, the launch of the AITO M7 Ultra serves two purposes. On one hand, it represents a major update for the AITO M7, reflecting considerable market ambition. On the other hand, changes in its product positioning and value range fully reflect Hongmengzhixing's strategy to navigate the current rapid industry transformation and fierce market competition.

In short: creating true value through technological innovation and user-centric thinking.

Downward Transfer of Product Value from the AITO M9

Compared to the AITO M7 launched in September 2023, the AITO M7 Ultra’s most distinctive feature in its naming is the addition of the "Ultra" suffix. Consequently, the vehicle has undergone comprehensive updates across exterior design, chassis, intelligent driving, and comfort, resulting in a significant boost in overall product capability.

The most conspicuous change in the AITO M7 Ultra, compared to its predecessor, lies in its exterior design.

At the front end, the AITO M7 Ultra adopts a new family-style face. Leveraging advanced thermal management layout technology, it cleverly integrates the original large grille into a refined, compact fascia, transitioning from a "large mouth" to a "small mouth" design that echoes the range-extended version of the AITO M9. This clean and elegant front-end styling enhances the vehicle's technological feel while imparting a pure, minimalist aesthetic.

Of course, beyond the front-end design, the AITO New M7 Ultra also introduces a new Interstellar Blue exterior color, matching the flagship AITO M9. This shared palette underscores the brand's cohesive heritage and premium feel, giving consumers more choices. As for wheels, the AITO New M7 Ultra adds a new 20-inch dual seven-spoke starburst wheel design, with an optional 21-inch dual ten-spoke sport wheel package available.

In terms of chassis refinement, the AITO M7 Ultra is equipped with CDC (Continuous Damping Control) variable-damping shock absorbers. These allow for millisecond-level adjustments to damping force, ensuring stable control over pitch and body movements to maintain consistent ride comfort.

The CDC variable-damping shock absorbers on the AITO M7 Ultra offer three control modes: Comfort, Standard, and Sport. They automatically adjust damping based on real-time changes in vehicle speed and road conditions.

When it comes to intelligent driving, the AITO M7 Ultra continues to utilize Huawei’s advanced ADS 2.0 system, but with significantly enhanced LiDAR capabilities.

Specifically, the AITO M7 Ultra is equipped with a newly designed 192-channel automotive-grade LiDAR. This Huawei-developed D3 LiDAR leads in channel count, point frequency, resolution, maximum detection range, and frame rate, boasting the industry’s highest point frequency, line count, and frame rate.

Functionally, the new LiDAR on the AITO M7 Ultra offers superior precision and rapid response, enabling all-scenario and all-weather perception of dynamic and static targets, including irregular objects. It further improves the detection of small objects at long distances, making it easier and more accurate to identify them on the road. This allows for earlier target detection and braking or evasive maneuvers, thereby enhancing active safety performance.

Notably, the AITO M9, released in late 2023, also features this LiDAR.

Additionally, regarding audio, the AITO M7 Ultra is equipped with the HUAWEI Sound Star Ring Scattering Element. Located at the IP center console, it integrates light-and-shadow aesthetics, acoustic technology, and AI intelligence. It also applies Schroeder acoustic technology, serving as a central tweeter housed within the star ring scattering element.

Beyond these updates, the AITO M7 Ultra has undergone numerous improvements in front and rear seats, spatial layout, and other areas—particularly in intelligence. Thanks to Huawei’s technological accumulation in smart cockpits and intelligent driving, the AITO M7 Ultra can continuously iterate its software, delivering a better intelligent experience to users alongside its hardware.

Overall, if the AITO M9 represents the culmination of Hongmengzhixing leveraging Huawei’s various technologies, then the launch of the new AITO M7 Ultra appears more like a comprehensive rollout of key technical capabilities and product features from the AITO M9 to a broader user base.

From this perspective, with a starting price of RMB 289,800, the new AITO M7 Ultra has the potential to become a blockbuster model, offering greater product value to target users in this price segment.

The Product Iteration Logic of the New M7 Ultra

For consumers, the new AITO M7 Ultra is undoubtedly a competitively positioned product; however, from AITO’s standpoint, its market competitiveness is the result of rapid iterations over the past two-plus years.

Behind this rapid iteration lies Hongmengzhixing’s thinking on industry and market changes, as well as its own deep-seated logic at the product definition level—a logic that has remained consistent throughout.

In July 2022, the AITO M7 was officially launched with a pricing range of RMB 319,800–379,800.

At the time, the product’s release primarily capitalized on latent market demand for three-row mid-to-large SUVs. Simultaneously, it received strong support from Huawei’s HarmonyOS in terms of intelligence; the smart cockpit enables seamless connectivity across phones, smart home devices, and smartwatches, achieving vehicle-to-everything integration.

Notably, the AITO M7 introduced the industry’s first commercially available innovative AITO Zero Gravity Seat. By elevating at a 30-degree angle, it creates a seat back and cushion with exceptionally uniform pressure distribution, effectively relieving physical and mental fatigue more than traditional flat seats. This feature has become a key selling point for the AITO M7.

From today’s perspective, the AITO M7 reflects both a keen focus on user experience and Huawei’s deep empowerment of automotive products through intelligent technology. Following its delivery launch in August of that year, the AITO M7 quickly joined forces with the AITO M5 to help the AITO brand break through 10,000 units in monthly deliveries.

Furthermore, the launch and execution of the AITO M7 prompted competitors to remark that they had 'never encountered such a formidable rival.'

In September 2023, marking the inaugural year for the commercial rollout of high-level autonomous driving via mass-produced vehicles, the new AITO M7 was officially unveiled. It featured Huawei’s advanced intelligent driver assistance system (ADS) 2.0, supporting functions such as lane cruise control, Highway Navigation Guided Assist (NCA), and Urban NCA, while significantly increasing the braking speed of the Automatic Emergency Braking (AEB) system.

Considering market dynamics, the new AITO M7 also launched a five-seat variant alongside the six-seat version, incorporating updates to body stiffness and other areas. Amidst fierce market competition, the starting price of the new AITO M7 dropped to RMB 249,800.

Driven by these substantial improvements in product capability and the momentum brought by Huawei, the new AITO M7 became an instant hit upon launch. During the National Day holiday in 2023, it achieved a remarkable milestone of over 7,000 confirmed orders in a single day, cementing its status as a phenomenon-level bestseller.

Furthermore, based on the sustained market performance of the AITO M7 since its launch, it has secured more than 180,000 confirmed orders in less than nine months. By this metric, the AITO M7 can indeed be considered a national-level SUV.

Against this backdrop, the launch of the AITO M7 Ultra represents a strategic move to capitalize on existing momentum.

In fact, whether it is the 192-line LiDAR, the HUAWEI Sound star-ring scatterer, or the various intelligent configurations of the AITO M7 Ultra, these are all the latest technological achievements from Hongmengzhixing, empowering the automotive industry through Huawei’s entire technical ecosystem.

Therefore, the release of the AITO M7 Ultra is not only a concentrated product empowerment for users driven by market insights and technical capabilities, but also the result of Hongmengzhixing’s commitment to meeting the needs of a broader user base through technology-enabled value creation.

Empowering with Technology to Build Differentiation

As time moves into 2024, the new energy vehicle industry has entered a new stage of development.

On one hand, the penetration rate of new energy vehicles is rising steadily, even surpassing 50% in a single week in May. In the price segment between RMB 250,000 and 300,000, the penetration rate for new energy vehicles has reached 61%.

Against this backdrop, competition in the new energy market within the RMB 250,000 to 350,000 price range has become incredibly fierce, marked by intense market involution and aggressive price wars.

On the other hand, despite the overarching trends toward electrification and intelligence, the market above the RMB 250,000 threshold is showing severe product homogenization. Consumers appear to have many choices, but there are no fundamental differences in experience; automakers often offer convergent configurations.

In this context, the AITO New M7 Ultra stands out as a unique alternative in the market.

From the perspective of pricing itself, the AITO New M7 Ultra’s pricing does not show a significant drop compared to the AITO New M7 released last year; it remains largely flat. This indicates that the AITO New M7 Ultra does not intend to join the endless price war.

However, from the perspective of product value, the AITO New M7 Ultra offers updates comparable to a model refresh compared to the AITO M7 Max version released last year. Improvements in LiDAR, audio systems, and chassis configuration provide potential consumers with a better product experience—delivering direct sense of gain and increased product value for users.

In other words, the AITO New M7 Ultra avoids the quagmire of price wars. Instead, it chooses to compete in the market by enhancing product value, starting from user needs.

For consumers, this approach to participating in 'involution' is ultimately more beneficial.

After all, in the price range of RMB 250,000 to RMB 350,000, users care less about relentless low prices and more about whether the value delivered by the product matches its cost. In other words, what users truly want is the sense of gain derived from technology and product value.

Certainly, AITO New M7 Ultra’s ability to compete through this approach largely stems from the technical capabilities and product system support provided by Hongmengzhixing.

For instance, technically, Hongmengzhixing benefits from comprehensive technological empowerment by Huawei Intelligent Automotive Solution, particularly enjoying a 'proximity advantage' with Huawei’s autonomous driving solutions. Moreover, the core technologies equipped on the AITO New M7 Ultra, including smart cockpit chips and autonomous driving chips, are entirely self-developed and controllable.

At the same time, Hongmengzhixing can effectively leverage Huawei’s experience in product definition, user insights, and market perception from the smartphone sector. This allows it to transform numerous technologies from the Huawei ecosystem into differentiated product features that genuinely deliver value to consumers, thereby achieving a closed loop from core technology to product features to user value.

These differentiated features can appear not only on flagship models like the AITO M9 but also reach a broader consumer base through relatively lower-priced products such as the AITO New M7 Ultra. This is actually a unique advantage shared by all models under the Hongmengzhixing brand.

From this perspective, the AITO New M7 Ultra actually offers a new approach to the fiercely competitive and highly involutionary Chinese new energy vehicle market: rather than engaging in unsustainable price wars amidst endless internal competition, it is better to consider how technological innovation can provide differentiated product experiences characterized by 'having what others do not, and excelling where others exist.'

In short, this approach is summarized as: 'It is better to compete on value than on price.'

Of course, the confidence behind AITO’s new M7 Ultra in prioritizing "value over price wars" ultimately stems from Hongmengzhixing’s reliance on Huawei and its formidable technological strength. This represents one of the irreplaceable advantages Hongmengzhixing holds in the Chinese automotive market.

From an industry perspective, the launch of the AITO new M7 Ultra provides a valuable reference for Chinese automakers on how to empower products through technology, deliver value through those products, and ultimately gain recognition from a broader consumer base.

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