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

Every car sold is losing money.

Author | Truman Wang Lei

Tesla, in an electric two-wheeler, is bankrupt.

Just recently, Bloomberg reported that VanMoof, a luxury electric bicycle (E-Bike) company that sells for as little as 2000 euros, has been officially declared bankrupt by an Amsterdam court.

Subsequently, VanMoof's internal CEO letter was also exposed by the media, saying that we had to file for bankruptcy.

We founded VanMoof 14 years ago with the crazy idea of changing the world. The only reason we can make great progress is you: hundreds of dedicated and loyal employees have helped us accomplish our mission to make the city a better place. We thank each and every one of you, but it is a pity that we will not be able to accomplish this mission together.

Four days before the bankruptcy declaration, local media in the Netherlands reported that VanMoof had been protected by the court from creditors. The court then appointed two managers to manage the company and declared a two-month cooling-off period during which creditors were not allowed to seize assets from the company.

At present, VanMoof's legal entities outside the Netherlands have not entered bankruptcy proceedings, but the future is still unclear.

Source: VanMoof has long been regarded as the Tesla of electric bicycles and attracted many big investors because of its high price and the craftsmanship of hiding batteries in the car body.

Why did such an online celebrity new energy company come to this point?

01. The more you sell, the worse you lose. Like other bankrupt companies, VanMoof's defeat is not sudden.

In January of this year, VanMoof was reported to be facing financial difficulties. An article in the Dutch local media Het Financieele Dagblad (FD) warned investors that every bike it sold was losing money.

"if there is no more capital injection, the company VanMoof will be in danger within two months."

In the FD report, VanMoof investors revealed more pessimistic news: "at the beginning of 2023, VanMoof still has two months of cash flow, but less than a month, as if only 15 days."

Source: VanMoof Why does VanMoof lose money on every bike it sells?

Since its establishment in 2009, VanMoof has become a star enterprise in E-Bike because it has done a lot of innovation at the product level, the integration of intelligent integration is very high, including the marketing level and the cost of supporting various services is also very high.

In order to open the market quickly, VanMoof promised that even the cheapest products it sold would be maintained for up to three years, which caused the after-sales cost of VanMoof products to be higher than the selling price.

Source: VanMoofFD reported that the after-sales cost of VanMoof maintenance reached a staggering 8 million euros by the end of 2021, while VanMoof lost 11.9 million euros in 2021 alone, up from 6.7 million euros a year ago.

In addition, VanMoof electric bicycles usually use proprietary customized parts of the body. Although it provides VanMoof with product power advantages, it is also very complex in customization and maintenance of proprietary components, resulting in a very long maintenance cycle.

This is even worse for VanMoof, which is already struggling with cash flow.

Source: the VanMoofE-bike industry is already a heavy capital investment industry, but when demand falls, it is easy to have financial problems. Unfortunately, the largest market of VanMoof, the United States market, has been in a state of destocking since last year, and the demand is far less than expected.

Shortly after the FD report was released, an internal memo from VanMoof appeared on Reddit, guaranteeing that VanMoof would not go bankrupt. Although the memo was full of typos and had not been confirmed, the financial crisis of VanMoof gradually disappeared from people's attention.

But facts have proved that no matter how perfect the means are, they can't cover up the real problems.

Just five months after FD's warning letter, VanMoof stopped accepting orders for all new e-bikes and accessories on its website.

Visitors to the VanMoof website will find a pop-up window that reads: we have temporarily suspended sales to catch up with the production and delivery of existing orders. Please rest assured that this will not affect the maintenance.

Source: after VanMoof suspended orders, VanMoof later said that at first it was just a technical issue, but it produced unexpected benefits: both SX4 and SA5 proved to be very popular product lines, and the proactive suspension of sales will give us an opportunity to catch up with the delivery and production of existing orders.

In the e-bike industry, this is a very unusual move because E-Bike and asset-heavy industries such as cars continue to take orders even when inventory is low, which can lead to months of delays, but at least it means that consumers still have demand.

So, what caused the sudden suspension of VanMoof sales worldwide? in the unofficial VanMoof forum, many people thought it had something to do with the company's potential financial problems.

Now that VanMoof has been declared bankrupt by the court, it has not been a day or two for the company to have a financial crisis.

Tesla VanMoof of electric bicycles was founded in the Netherlands in 2009. the founders are brothers, Taco Carlier and Ties Carlier,Taco are industrial designers, and Ties is an automation technical engineer, each performing their respective duties, thus VanMoof was born in Amsterdam, the capital of the Netherlands.

However, VanMoof first designed not electric bicycles, but pure bicycles.

In 2014, VanMoof began to formally design e-bikes. Unlike our common e-bikes, VanMoof focuses on simplicity and technology.

They took the lead in hiding the battery in the body frame, making it invisible to people at first glance, and hoped to follow in the footsteps of Tesla, from the design of the vehicle to production and sales to after-sale.

Since it is "Tesla of electric bicycles", the price should naturally be closer to Tesla. According to the official website of VanMoof, there are six models, S3, X3, S4, X4, S5 and A5, which sell for up to 3498 euros, or about 28000 yuan.

Source: VanMoof's cheapest 3 series, S3 and X3, are permanently sold out, although cheap, they still sell for as much as 2000 euros, which translates to at least 16000 yuan.

Is it worth spending so much money on an electric bike?

VanMoof's CMO Jonathan Hum said: "VanMoof's design philosophy has always been based on an indisputable fact: the fun of riding a bike lies in simplicity."

The VanMoof S3 and X3 series of e-bikes are a combination of cutting-edge technology, when 4500 were sold within 24 hours of launch.

For example, the X3 and S3 have motors paired with the electronic shift system, hydraulic brakes, integrated lights and some intelligent functions, as well as an integrated motion detector that combines alarms, GPS chips and mobile data connections.

Source: in addition to the simple design, another major feature of VanMoofVanMoof products is anti-theft.

VanMoof's electric bikes have a Kick Lock system that allows riders to secure the rear wheels and activate the on-board alarm system by tapping their toes. Equivalent to locking the vehicle directly, you can see the intelligent location tracking alarm on the mobile phone App, and the vehicle location will be located through the GPS.

Source: VanMoofVanMoof has also developed its own anti-theft smart bike module with an almost invisible invisible lock built into the frame that can be used just by pulling it out.

The lock is associated with the application on the owner's smartphone and can also be locked to the vehicle through the phone, which will be unlocked automatically if you are near the vehicle.

Once it is tampered with or stolen, the wheel locks and activates the anti-theft device, and combined with an integrated alarm system and deactivation mode, the stolen VanMoof can hardly ride, let alone sell it.

Source: VanMoof in addition, VanMoof also pioneered automatic electronic gearshift and silent motors up to 25 km / h. They have electric motors paired with the electronic shift system, have four gears, do not need to shift gears, and all you need to do is jump on the bike and step on the pedals.

The unique design and product performance of VanMoof not only triggered a "two revolutions" in Europe, but also attracted the attention of capital.

The biggest financing came from Hillhouse, which announced that it had completed a $128 million round C financing for VanMoof in 2021, the largest single financing in the history of the E-bike industry. Hillhouse's investment also made VanMoof the world's largest e-bike company.

Source: VanMoof is also involved in the investment by Gillian Tans, the former CEO of the world-famous OTA leader Booking.com, the US investment fund Norwest Venture Partners, the British venture capitalist FelixCapital, venture capital firms Balderton Capital and Triple Point Capital, and so on.

According to Crunchbase, an American investment data firm, VanMoof has raised five rounds of financing since 2017, totaling $189 million (1.36 billion yuan).

Source: Crunchbase, but the highlights always come and go quickly.

According to foreign media, since 2023, due to the extremely unstable supply chain of spare parts and quality problems, VanMoof, like many new energy vehicles, has fallen into a vicious circle of "the more you sell, the worse you lose." more and more users complain that their vehicles spend more time repairing in stores than on the road.

The two-wheeled electric car market is going through a period of rapid development, especially under the stimulation of the epidemic, the sales speed of bicycles began to climb on a large scale. In Germany alone, 200000 expensive bikes were sold in 2010, but nearly 2 million were sold in 2022, according to ZIV, a German two-wheeler industry association.

It is undeniable that the competition in the market is also fierce. On the one hand, there are classic bicycle manufacturers who offer both traditional bicycles and electric bikes. On the other side, there are many professional players like VanMoof who specialize in providing electric bikes.

In order to highlight the differentiation, some e-bikes even bring ChatGPT to new equipment.

For example, Urtopia has launched a new type of electric bike with built-in GPS, anti-theft lock system and built-in cycling safety device. The bike is also equipped with a digital voice interface to make it easy for riders to use ChatGPT.

The industry has enough internal volume, we must do a good job in the long-term development of differentiation, otherwise no matter how outstanding it is, it may become cannon fodder.

This article is from the official account of Wechat: Chaodian Lab (ID:SuperEV-Lab), author: Truman Wang Lei

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