Shulou(Shulou.com)11/24 Report--

With the Q3 earnings report released by Ideal Automobile on December 9, the third quarter earnings report of "Wei Xiaoli" of the head camp of new energy car-making forces has been released. Although the revenues of all three companies have increased, the losses have further expanded, and it seems that there is still a long way to go before reaching balance.

01. The higher the revenue, the greater the loss. On this side, the total revenue in the third quarter was 9.34 billion yuan, up 20.2% year-on-year and 7.0% month-on-month. Among them, automobile sales amounted to 9.05 billion yuan, up 22.5% year-on-year and 6.6% month-on-month.

However, ideal in the third quarter ushered in the company's highest quarterly loss ever: 1.65 billion yuan. The net loss in the same period last year was only 21.5 million yuan, and the net loss in the second quarter of this year was 640 million yuan, an increase of 156.7% in Q3. Accumulated losses in the first three quarters of this year reached 2.298 billion yuan, far exceeding 322 million yuan for the whole year last year. In addition, the ideal Q3 gross margin was only 12.7%, down sharply from 23.3% in the same period last year and 21.5% in the second quarter of this year.

Li Xiang, CEO of Ideal Automobile, once wrote,"Strive to achieve a monthly income of more than 10 billion yuan by 2022. It is also time to say goodbye to seven consecutive years of loss-making operation." "However, from the current point of view, this is currently destined to be impossible to complete.

For the large losses and poor gross margin performance in the third quarter, Ideal Auto said it was mainly related to the sharp decline in Ideal ONE orders. Li Xiang said at the Q3 earnings conference,"The 803 million yuan loss caused by the ideal ONE accelerated exit from the market is mainly the loss of raw material supply." The listing of L9 and the early listing of L8 accelerated the exit of Ideal ONE, which the company had not anticipated and failed to accurately predict raw material demand. "

In terms of R & D expenses, the ideal third quarter reached 1.8 billion yuan, an increase of 103.1% year-on-year, compared with 1.53 billion yuan in the second quarter of this year, which is mainly used for the research and development of new cars in the future. Ideally, pure electric vehicles will be launched next year, and it is expected that the R & D investment for the whole year next year will be between 10 billion and 12 billion.

Weilai's revenue in the third quarter was the highest among the three automobile enterprises, reaching 13 billion yuan, up 32.6% year-on-year and 26.3% month-on-month, a single-quarter high.

The gross profit of Weilai in the third quarter was 1.7351 billion yuan, with a month-on-month growth of 29.5%; the gross profit margin was 13.3%; the gross profit margin of vehicle sales was 16.4%, down from the same period last year; the net loss was 4.1108 billion yuan, which was expanded compared with the same period last year, mainly due to the increase of battery price.

Li Bin, founder, chairman and CEO of Weilai, said on the Q3 earnings conference call that the current price of lithium carbonate remains at a relatively high level, which is expected to have an impact on Q4 gross profit, but it is also expected that the price of lithium carbonate and battery will not rise again, so he is confident to keep Q4 gross profit stable.

At the same time, Li Bin also said that Wei Lai's long-term gross profit margin at 25% is not a big problem. "Weilai's R & D efficiency is very high, assuming that battery prices fall back to normal, rational levels, 25% gross profit margin is not a big problem. In the long run, with vertical integration and our investment in batteries and chips, it is very important for us to achieve 25%-30% gross profit in the long run. "Li Bin predicts that Weilai will achieve break-even in the fourth quarter of 2023.

In terms of R & D, Weilai's R & D expenditure in the third quarter was 2.94 billion yuan, a single-quarter high. Wei Lai said that it is mainly around batteries, chips and other research and development investment, but also including personnel, testing and other aspects of expenditure increase. Li Bin said: "In terms of R & D expenses, the layout of the whole R & D and the development of our work are basically finalized. Overall, in the next period of time, the R & D expenditure will remain at about RMB 3 billion per quarter, and the systematic efficiency of R & D will continue to be improved.

Xiaopeng Automobile has encountered some difficulties recently, with total revenue of 6.82 billion yuan in the third quarter, up 19.3% year-on-year and down 8.2% from the second quarter. Among them, automobile sales revenue was 6.24 billion yuan, up 14.3% year-on-year and down 10.1% month-on-month.

In the third quarter, Xiaopeng suffered a net loss of 2.38 billion yuan, compared with a net loss of 1.59 billion yuan in the same period in 2021 and a net loss of 2.7 billion yuan in the second quarter of 2022. This is Xiaopeng car since the listing, the most serious loss of a financial report. In addition, Q3 gross margin was 13.5%, down 0.9 percentage points year-on-year from 14.4% in the same period last year and 10.9% in the second quarter of 2022.

In terms of R & D, Xiaopeng Automobile's R & D expenditure in the third quarter was 1.5 billion yuan, up 18.5% year-on-year and 18.5% month-on-month. The increase was mainly due to the increase in R & D personnel, resulting in an increase in employee compensation, and an increase in expenditure to support the development of new models.

In addition, it is worth mentioning that although Xiaopeng is not the highest in terms of absolute value of R & D expenses, the proportion of R & D investment is very high. According to Zhejiang Shang Securities Research News, among the five automobile enterprises including BYD, Tesla and Wei Xiaoli, Xiaopeng R & D accounted for the highest revenue ratio, reaching 19.6%.

02. The sales volume is not up to standard. Since the new force manufacturers have grown from scratch, the cost investment in R & D and manufacturing in the early stage is huge, so it is impossible to avoid losing money in the short term. But if you want to break even or even make a profit, sales are very important for car companies.

At the beginning of the year, all three companies also set sales targets for 2022, and as the end of the year approaches, we might as well see how they achieve their goals for this year.

A total of 15,034 new cars were delivered in November, setting a record for delivery in a single month; 112,013 vehicles have been delivered from January to November this year.

The ideal target set for itself at the beginning of the year was 200,000 vehicles, but in May it was considered difficult to achieve this target, which was lowered to 170,000 vehicles. At present, only 65.9% of the overall target has been achieved.

The ideal sales guidance for the fourth quarter is 45,000 to 48,000 units. At present, 25,000 units have been delivered in October and November. Even if 120,000 units exceed the target for the fourth quarter, there is still a big gap from the sales volume of 170,000 units for the whole year.

Weilai has set a sales target of 150,000 vehicles for 2022. Weilai delivered 14178 new vehicles in November, also setting a record monthly delivery volume, up 30.3% year-on-year; from January to November this year, Weilai accumulated sales volume of 106671 vehicles, up 31.8% year-on-year.

Weilai's fourth-quarter delivery guidance is 43,000 - 48,000 vehicles, which requires sales of at least 18,000 vehicles in December to complete, which is almost impossible based on current trends.

In the previous 11 months of sales calculation, the completion rate of the current sales target is 71.1%, and it is expected that about 80% of the target will be completed in the whole year, and KPI has not been completed either.

At the beginning of the year, Xiaopeng Automobile announced its sales target for 2022 to ensure 250,000 vehicles, impacting 300,000 vehicles, and later set a target of 200,000 vehicles. Xiaopeng delivered 5811 vehicles in November and only 5101 vehicles in October. The sales volume has hovered around 5000 vehicles for two consecutive months, and has failed to break ten thousand for four consecutive months.

1-11 In January, Xiaopeng Automobile delivered 109465 vehicles accumulatively, and only 54.7% of the target has been achieved at present. Xiaopeng is expected to deliver 20,000 - 21,000 vehicles in the fourth quarter, and it is expected that the delivery volume in December is expected to pick up sharply and return to the level of 10,000 units. Even if sales exceeded 10,000 in December, sales for the whole year still did not reach 60%.

In contrast, Nezha Automobile has delivered 144,278 vehicles in the first 11 months of this year, 96.2% of the target of 150,000 vehicles at the beginning of the year has been achieved, and the target of 150,000 vehicles has been properly exceeded throughout the year, making it the brand with the highest sales volume among the new forces at present. The cumulative sales volume of GAC Ai 'an from January to November was 241149 vehicles, doubling the sales volume of the whole year ahead of schedule. BYD's cumulative sales of new energy vehicles from January to November this year have reached 1.628 million, an increase of 219.38% over the same period last year.

03. Internal organization adjustment and reorganization set out at the same time as the release of the financial report, Ideal and Xiaopeng both made some adjustments to the internal organizational structure.

Ideal Auto announced a new personnel appointment at the same time as the Q3 earnings report. Effective January 1, 2023, Executive Director and President Shen Yanan will step down from the Board of Directors and join the Ideal Vehicle Process Change Committee. The supply team managed by Shen Yanan (including supply chain, manufacturing and quality) will be managed by Ma Donghui, and the commercial team (including sales, service and charging network) will be directly managed by CEO Li Xiang.

At the same time, it is ideal to fully launch the matrix organization upgrade, and add five horizontal entity departments on the basis of the original two horizontal entity departments (strategy department and product department) to support the company's comprehensive matrix organization upgrade and process operation. These five departments are: Commercial Department, Supply Department, Process Department, Organization Department and Finance Department.

Li Xiang, founder and chairman of Ideal Automobile, responded to the company's senior personnel changes by saying that the personnel adjustment of Ideal Automobile aims to upgrade the matrix organizational model. Since last year, Ideal Auto has been observing and studying top trillion-dollar revenue companies, and companies have found that these companies share common characteristics, and when their revenue reaches tens of billions, they tend to upgrade to matrix organizational models. Next, the ideal car will also move towards the goal of 100 billion revenue scale.

Earlier in October, Xiaopeng Automobile also made internal organizational restructuring. Set up five virtual committees to open communication channels for each business line of the company and improve collaboration efficiency. These include the Strategy Committee, the Production Planning Committee, the Technical Planning Committee, the Production and Marketing Balance Committee and the OTA Committee. He Xiaopeng himself will serve as the director of the first three committees. In addition, Xiaopeng Automobile has also established three virtual product matrix organizations: E, F and H platform product matrix, and the responsible persons of these three matrix frequency platforms will report directly to He Xiaopeng.

It can be seen from this series of adjustments that the essence of this adjustment is to let He Xiaopeng himself participate in more key decisions, and at the same time cooperate with all cross-department organizations to ensure that market and user feedback can finally be transmitted to product planning and decision-making, so as to establish a complete set of product full-service closed loop.

In addition to poor sales performance, the trigger for Xiaopeng Automobile to make such a big adjustment is the emergency price adjustment of Xiaopeng G9 two days after its listing. Xiaopeng G9, which went on sale on September 21, was highly anticipated internally. He Xiaopeng himself confidently declared that Xiaopeng G9 was "the best SUV within 500,000 yuan." However, after its listing, its complex configuration and matching logic of each model caused strong doubts from the market and consumers. Xiaopeng Automobile had to make emergency adjustments within 48 hours, and at the same time, it also reduced the price by 20,000 yuan in disguised form to recover the user's reputation and trust.

In addition, Li Pengcheng, CEO Assistant of Xiaopeng Automobile, has recently left his post. Before that, he served as General Manager of Brand Public Relations, responsible for brand strategy, public relations communication, social marketing, brand creativity and other aspects of Xiaopeng Automobile. According to sources, Xiaopeng G9 listing performance is poor, triggered internal dissatisfaction with brand leaders.

For automobile enterprises, only when the sales volume reaches a certain magnitude can scale effect be achieved to reduce costs and realize profits as soon as possible. However, from the current point of view, the competition in the new energy vehicle market in 2023 is bound to be more intense. Although "Wei Xiaoli" has certain first-mover advantages, now the domestic traditional automobile enterprises have made full efforts and have the tendency of post-production. In the face of strong pressure, let's wait and see whether "Wei Xiaoli" can continue to lead the competition of new energy vehicles.

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