BYD

Judging from the latest sales in June, BYD (264.400, -3.70, -1.38%) has won again.

On July 2, BYD announced that it sold a total of 250,000 vehicles in June, a year-on-year increase of 88.2%. From this point of view, the previous fanfare of the rival Great Wall Motor (25.910, -0.07, -0.27%) did not significantly affect BYD's terminal sales.

Since 2021, relying on the DM-i technology that has been gradually developed and iterated over the past 17 years, BYD has gradually occupied the market and will become the new sales champion in 2022.

If it is said that BYD was able to quickly become the leading car company in China's auto market before, it is due to the plug-in hybrid technology of DM-i for many years, which is a slow work with a lot of accumulation. After 2021, BYD will rapidly expand its production capacity, launch a radical cost reduction and price reduction strategy, and gradually eat up the fuel vehicle market, relying on a sharp fast attack.

At the China Electric Vehicles 100 Forum held in April this year, Wang Chuanfu, chairman and president of BYD, publicly stated that the market is changing every day, and BYD is now walking on thin ice. The industry is not big fish eating small fish now, it may be fast fish eating slow fish.

However, as for the plug-in mixing technology, self-owned brands regard it as a major direction of main concern, but the investment time and intensity are later than BYD.

Nowadays, the plug-in mixing technology of rivals has been catching up, and BYD itself has been reported by friends because of its low-cost strategy.

Relying on the strategy of cost reduction and price reduction, BYD, which has been soaring all the way, is also facing potential worries.

After the report letter, Great Wall and BYD are still in a tense situation.

On June 29, "Financial Stories" successively visited the Great Wall Haval store located on Huikang Road, Tianjin, and the BYD 4S store.

"The feed fuel consumption of Xiaolong Max reaches 5.5L, and the fuel consumption of BYD Song PLUS actually reaches more than 7 in the actual test. You must have heard of BYD's 'chopstick suspension', and we only use it in luxury cars. Connecting rod suspension." In the Haval 4S store, the sales staff listed the shortcomings of BYD models to "Financial Stories", and at the same time did not forget to list the relative advantages of Xiaolong. Xiaolong is a young and fashionable new energy compact model under the Haval brand. SUV.

At the BYD 4S store, tens of meters away from the Haval 4S store, the sales staff also admitted that "the suspension determines the upper limit of the car, but BYD uses the manufacturing cost in a place that is 'enough'. For a non-luxury brand like BYD , There is not much difference in driving experience between three-link and four-link, but the cost performance is much higher.”

The BYD suspension, which was used by Haval sales staff as an argument, was criticized by its opponents because BYD is equipped with the three-link suspension used by Toyota models, which is an entry-level independent suspension. It is nicknamed "chopstick suspension". Different from the four-link and five-link suspensions used in other models, the three-link suspension has a simpler structure, less difficulty in tuning, and correspondingly lower costs.

"In terms of suspension, I think BYD shouldn't learn from Toyota to use chopsticks for suspension so early. Its own brand is still in the process of gradually changing user perception through its own products, services, and technologies, and it cannot be compared with foreign brands. , must be recognized by users through better performance." A BAIC Research Institute staff said bluntly to "Financial Stories".

The open battle between Great Wall and BYD is of course not limited to stores. On May 25, Great Wall issued a report letter to BYD on its official WeChat, saying that the latter used a lower-cost normal-pressure fuel tank instead of a high-pressure fuel tank commonly used in plug-in hybrid vehicles, which may not meet emission standards.

The conflict between the two companies has now become public.

Even though Great Wall’s reporting of its competitors caused a lot of booing in the industry, it didn’t seem to affect the choice of BYD’s potential car owners.

But BYD's low-cost route has also been widely advertised.

According to a report by 36 Krypton’s auto media startup PowerOn, some industry insiders said that the cost of a high-pressure fuel tank + control valve can be about 600 yuan more than a normal pressure fuel tank. This cost difference is not uncommon in the current auto industry, which is at its extreme and fiercely bargaining. However, in order to cope with the ever-tightening emission regulations, most car companies dare not save this money.

Looking at the auto industry, Ideal, Lantu, Leapao and Geely Yinhe all said that their PHEV models use high-pressure fuel tanks.

The aforementioned BAIC Research Institute insider told "Financial Stories": "BYD Qin, Song, Han, and Tang Dynasty series models all adopt low-cost strategies, and they try their best to save costs from the design side. The fuel tank and the use of industrial-grade chips instead of car-grade chips all reflect low-cost designs.”

For plug-in hybrid models, which can be fueled or powered, and the fuel tank is left idle for a long time and cannot be burned, the high-pressure fuel tank that increases the pressure of the fuel tank has become the standard configuration of most car companies' plug-in hybrid models.

After BYD was reported, it publicly stated that the company did not use high-pressure fuel tanks because it has a special patent, and even if it uses normal-pressure fuel tanks, it can achieve emission compliance. The general mode of the patent is: in the occasions where the engine is not needed, such as the pure electric mode, the vehicle is turned off, etc., the engine is still started to burn the excess oil and gas in the atmospheric pressure fuel tank.

"I heard that the way for BYD to meet the standard is to start the engine by itself. I am a little worried about this. Is there any risk in starting the engine without knowing it?" A person who inquired about related models in the BYD 4S store in Tianjin, but did not buy it in the end. "Financial Story Hui" said.

"Car Review Network" once reported that the Qin and Song exported by BYD were both high-pressure fuel tanks, and after being reported by Great Wall on May 25, BYD's Xi'an factory quickly replaced the normal-pressure fuel tank with a high-pressure fuel tank.

Regarding whether this news is true, "Financial Stories" asked BYD for confirmation. As of press time, it has not received a reply.

Relying on its strong vertical integration capabilities, BYD is able to self-produce and sell multiple core automotive components, including chips.

But it is worth mentioning that BYD's self-produced chips are industrial-grade chips, which have lower technical requirements and costs than the car-standard chips purchased by other car companies.

For example, the service life of industry-standard chips is required to be more than 5 years, and the temperature range is -40°C~85°C, while the service life of automotive-standard chips is required to be more than 10 years, and the applicable temperature must reach 150 degrees.

"The pass rate of industrial-standard chip production lines is lower than that of automotive regulations, but automotive requirements are 100% free of problems." The aforementioned insider of the Beijing Research Institute emphasized.

The cost advantage brought by self-produced and self-sold core components, plus the plug-in hybrid technology that has been honed for 17 years has begun to show its strength. Starting in 2021, BYD will emerge in the Chinese auto market, with sales of 730,000 vehicles that year, a year-on-year increase of 75% , ranking 13th among Chinese car companies.

In 2022, BYD will usher in an explosion. The popular word-of-mouth effect of its plug-in hybrid models with low fuel consumption and high cost performance has brought about a surge in sales.

In that year, BYD's sales reached 1.86 million vehicles, a year-on-year increase of 153%, surpassing FAW-Volkswagen to become the sales champion of Chinese auto companies.

In 2023, BYD is still racing all the way. In February of this year, BYD announced that "gasoline and electricity are the same price" and lowered the starting price of its new sedan Qin PLUS DM-i 2023 Champion Edition to 99,800 yuan. After the price was further reduced, BYD successfully broke through in the sedan market where its own brands are not very good at.

Since February this year, BYD Qin has replaced Nissan Sylphy as the champion of car sales.

In the past, self-owned brands have been relying on more configurations and lower prices to compete with joint venture brands. However, due to the high fuel consumption of self-owned brand fuel vehicles and the increase in overall use costs, they have not been able to really challenge joint venture brands.

This situation has been broken by BYD's DM-i technology. The fuel consumption per 100 kilometers of the car Qin using this plug-in hybrid technology is only 3.8L, and the fuel consumption of Nissan Sylphy, which is also known for its low fuel consumption, is 6.1L.

At the same time, the price of BYD's plug-in hybrid series models is also quite attractive. The starting price of the 21 Qin was 105,800 at that time. Previously, the price of plug-in hybrid models launched by Japanese brands exceeded 200,000 yuan. BYD is the first car company in China to reduce the price of plug-in hybrid models to below 150,000 yuan.

Compared with BYD plug-in hybrid models, other fuel vehicles that once dominated the sales rankings no longer have a comprehensive cost advantage, and sales are gradually declining.

Nissan Sylphy and Haval H6 are typical representatives among them. It is BYD Qin and BYD Song that replaced them as the sales champions in the market segment.

BYD, whose sales have been rising all the way, has also been "popular and popular" in recent years, and negative turmoil has continued.

The most striking negative news is that BYD's proud blade battery spontaneously ignited. "Auto Industry Concern" once revealed that on November 15, 2022, a new BYD seal spontaneously ignited on a road in Wancheng District, Nanyang City, Henan Province.

According to "Golden Horn Finance" report, on April 3 this year, at the Cenxi East Exit of Baomao Expressway, a 2022 BYD Han DM-i spontaneously ignited, and the driver named Yang Qinglan was burnt to death.

After the above-mentioned incident happened, BYD responded in a report on the accident published on April 11: "BYD has sent a professional team to the scene to investigate and will actively cooperate with relevant departments to deal with it."

However, according to the interview and investigation of "Golden Horn Finance", as of April 20, BYD has not contacted the family of the dead driver, nor has it provided the traffic police with relevant data on the accident vehicle.

"Financial Stories" inquired about the latest investigation results of the spontaneous combustion accident, and BYD did not reply.

Starting PowerOn suspects that since last year, battery thermal runaway incidents have occurred frequently 1-2 times a month, which is related to BYD's cost reduction strategy.

BYD engineers once told PowerOn that the company had seen risk points in the early thermal diffusion design scheme and suggested adding mica materials, but the battery team believed that this might increase the cost by 20-30 yuan, and it was not adopted in the end. It was not until thermal runaway incidents frequently occurred that BYD urgently improved the design.

Even though today's joint venture car companies are slow in electrification and their products are not competitive, joint venture brands that have built cars for a long time can still use the safety of their electric vehicles as a major publicity point.

Take the LEAF launched by Nissan in 2011 as an example. Before the launch of Tesla Model 3 in 2019, this car was the best-selling electric car in the world, with a cumulative sales of 400,000 by 2019.

To this day, Nissan still regards the Leaf's "accumulative driving of 21 billion kilometers, zero major battery accidents" as a major selling point.

A BYD car owner once broke out on the "Auto Home" forum that BYD should pay attention to tightening the screws of the wheel lining after picking up the car. Eighty percent of the screws here are loose and need to be tightened by hand, otherwise it will be lost. risk. However, the above revelations may only be isolated cases.

"Nissan's batteries need to be soaked in seawater for 14 days, and the battery must not rust and seawater cannot enter. Even the tires on our cars have to do more than 30 test items. I feel that the market is now in a fast-paced state. Consumption Those who have also been affected.” A Dongfeng Nissan related person told “Financial Stories”.

In recent years, many independent brands have devoted themselves to the research of plug-in hybrid models. Because the plug-in hybrid vehicle has the advantages of saving fuel and being able to use oil and electricity without worrying about battery life, it is an ideal transition product in the process of new energy. Among them, BYD quickly launched models and lowered prices, which led to a sudden surge in sales.

In fact, in terms of hybrid technology, Great Wall, Geely, and Chery are all catching up, and the gap with BYD is not too big.

The Hi-4 of Great Wall, the DHT adopted by Geely and Chery, and the DM-i of BYD are all series-parallel structures that can be powered by oil and electricity, realizing low-speed electric drive and high-speed engine intervention.

However, since the three car companies other than BYD have adopted multi-speed gearboxes, they have better performance and fuel economy at high speeds than BYD using single-speed gearboxes.

"Although BYD is at the head of the field of hybrid vehicles, it is not a few streets away from its opponents. Everyone has been tracking hybrid technology over the years. Even though their sales were not high at the time, research in this field has not stopped. Now everyone's technology has basically caught up, the technical route is unified, and the product performance is also tending to be the same." The aforementioned BAIC Research Institute insider asserted.

Just recently, Great Wall and Geely launched plug-in hybrid models Xiaolong MAX and Galaxy L7, respectively, to compete with BYD's popular SUV-Song PLUS.

In order to be able to open up the market, Great Wall has also given a sincere price-performance ratio to Xiaolong MAX and Geely to Galaxy L7.

The starting price of Xiaolong MAX is 159,800, but all series are equipped with four-wheel drive as standard; the starting price of Galaxy L7 is 138,700, equipped with a 1.5T engine. In contrast, the price of BYD Song starts at 154,800, and the price of the four-wheel drive version reaches 207,800, and the engine is only 1.5L.

The opponent's counterattack is no less than BYD's aggressive price cuts to grab the market.

Taking Haval Xiaolong MAX as an example, "Financial Stories" learned that in order to boost the sales of this car, Great Wall gave this new car a discount of 6,000 yuan on the basis of a rather favorable price.

In addition, Haval terminal sales staff can get a commission of more than 1,000 yuan for each sale of a Xiaolong MAX, which is much higher than the 500 yuan commission for selling pure fuel bicycles.

During this offline visit, the sales staff of BYD 4S store revealed to "Financial Stories" that in order to defeat BYD Song, the Haval Xiaolong series is still in the stage of losing money and making money, and is not making money.

Regarding whether this statement is true, some people from Great Wall did not make a clear statement, but only claimed that Great Wall Motors implemented a competitive pricing strategy based on sales volume.

According to BYD's official data, in June this year, Song's sales reached 16,000 units, which is not at this year's high level, while sales of this model reached 27,000 units in April this year.

Song sales are not as good as in the past, but the benchmark models are growing rapidly. On July 1 and July 3, Great Wall and Geely released the results of their new plug-in hybrid SUVs respectively. The Haval Xiaolong series produced its 10,000th unit on the 45th day after its launch, and sold 6,098 units in June. The Geely Galaxy L7 was the 10,000th vehicle produced within 33 days after its launch.

Although the current achievements of Great Wall and Geely are not enough to challenge BYD Song. However, compared with their old models in the past, the market performance of Great Wall and Geely in the field of plug-in hybrids has improved significantly.

Take Haval’s plug-in hybrid model, the H6 New Energy, which went on sale in October last year. According to the data provided by the automotive consulting company so car, the highest monthly sales of this model so far is only 1,097 units. The highest monthly sales of Geely Emgrand L Hi·P launched in June last year was only 2,437 units. Now, the sales gap between the new models of the two brands and BYD Song is narrowing.

A car owner who planned to buy a plug-in hybrid model made repeated comparisons, but finally did not place an order for BYD Song. He told "Financial Stories": "In the past, there were relatively few models of plug-in hybrid models worth more than 100,000 yuan. Now there are more choices. I want to look again."

In the plug-in hybrid market in the past, only BYD could provide models with attractive product strength and price, and its sales were top notch.

Today, more and more independent brands are entering the market. Late-entry opponents are prepared. In terms of product

design, they try to improve and optimize the inadequacies in the configuration of BYD models; in terms of publicity, they actively build momentum and try to follow up with BYD's low-cost strategy.

Although BYD's sales are still top notch, the aggressiveness of the besiegers cannot make it take it lightly - the iron throne,

the brand of flowing water, it is not easy to win constantly.