What is the self destructing Great Wall? China's top joke, full line collapse, 400 billion gone

Tech 2023-05-15 12:22:54 Source: Network

"Some people say that Great Wall Motor is now slower in new energy. They hope we can increase the speed, but it is not slow at all

"Some people say that Great Wall Motor is now slower in new energy. They hope we can increase the speed, but it is not slow at all. We are very comfortable with it."

Some time ago, Li Ruifeng, CGO chief growth officer of Great Wall Motor, said about the development of his own enterprise.

Unfortunately, within a month, Great Wall Motor handed over a shocking report card. According to the data, in the first quarter of this year, Great Wall Motor achieved an operating revenue of 29.039 billion yuan, down 13.65% year on year, net profit of 174 million yuan, down 89.34% year on year, and net loss of 217 million yuan, down 116.65% year on year.

At the same time, the sales data is bleak. In the first quarter of this year, the total sales volume of Great Wall Motor was less than 220000, a year-on-year decrease of 22.41%. In addition to the year-on-year increase in Great Wall pickup trucks, the sales of the four major brands, Haval, Weipai, Euler, and Tank, decreased by 24.58%, 76.18%, 47.37%, and 6% respectively.

In terms of sales, it is almost a complete failure, and with the market value evaporating nearly 400 billion yuan over a year, can Great Wall executives still handle it calmly? I think it's either hard spoken or blind.

1 Use extreme force towards high-end products and create 'giant stones' to hit oneself in the foot

Once upon a time, Great Wall Motor stood on the basis of cost performance. The first SUV Seifer exploded in the market at a starting price of 77800 yuan that year is the best illustration.

Later, the new generation of SUV model Haval H6 came out, which was the top selling SUV for 98 consecutive months, and promoted Great Wall Motor to become a leader in the field of fuel vehicles.

The change of industry status has made Great Wall Motor overconfident in fuel vehicles. In 2016, Wei Jianjun, the leader, said publicly that Great Wall Motor was only a follower of new energy vehicles, because his focus was on the high-end brand "WEY" (renamed "Wei" in 2021) named after his surname.

Wei Jianjun attaches great importance to this high-end brand and aims to create the "China's first luxury SUV brand". When it was established, he confidently said, "I bet my surname on Wei brand, it can only succeed and cannot fail

Thanks to the support of resources and technology, Wei Pai initially performed well, with sales reaching 86400 units in 2017 and increasing to 139500 units in the following year, showing great momentum to take over from the Harvard H6.

Unexpectedly, as the price was set higher than competitors of the same level, while the brand's influence was being cultivated and not yet strong, it was pursued by multiple forces, and Wei brand sales rapidly declined. In 2019, Weipai sold 106000 vehicles, and in 2022, it will decline to 36000 vehicles, with an annual decline of nearly 30%. At present, Weipai has become the bottom selling brand of Great Wall Motor.

The relentless use of energy not only added another "failure case" to the curse of high-end domestic fuel vehicles, but also affected the development of Great Wall Motor as a whole due to the technology tilt of Wei Brand.

A more harmful case is that Great Wall Motor has developed lemon hybrid DHT technology, which is preferentially carried on Weipai, and Haval H6, which has a broad consumer base, has been "neglected".

At this time, BYD used plug-in hybrid models to promote rapid sales growth, but Haval still did not respond in a timely manner. Great Wall Motor launched Haval H6-PHEV in September last year, but it was too late until the above industry position was occupied by Tesla ModelY and BYD Sunplus.

It is estimated that Wei Jianjun did not expect that the result of promoting high-end technology would be to create a "giant stone" that would hit his own feet, and the dream of high-end technology would not be realized, greatly affecting the development of new energy vehicles.

As we can see, Great Wall Motor can only limp when its rivals are running wildly.

2 The new energy train may not have the "seat" of the Great Wall

As for the situation of the past year and the outlook of this year, Great Wall Motor described them as "squatting" and "taking off", which seemed to be the response posture taken by the initiative, but a little analysis showed that these were forced actions.

Among them, it is already inevitable that new energy is forced to take off.

In an interview, Mu Feng, President of Great Wall Motor, said that one of the reasons why Great Wall did not pursue sales too much in 2022 was that it was adjusting its inventory structure to prepare for the transformation of new energy in 2023.

Some time ago at the Shanghai Auto Show, Great Wall Motor did frequently act in the field of new energy vehicles. Among the nearly 30 products at the auto show, there were more than 15 new energy products.

Accelerating the launch of new energy products does not mean being able to meet market demand or achieving sales. In the first quarter of this year, Great Wall Motor sold 27800 new energy vehicles, a year-on-year decrease of 22%, and the corresponding penetration rate was 12.6%, compared with 12% in the whole year of last year, the overall progress was like a snail.

Don't forget, this is the new energy sales achieved through various adjustments to inventory structure and preparations for the transformation of new energy. Moreover, the penetration rate of new energy vehicles in China will reach 25.6% in 2022, which is a big gap between Great Wall Motor and the "market".

Interestingly, in the industry, Tesla and BYD were used to compare with Great Wall Motor before, but now Geely has left Great Wall Motor behind.

In the first quarter of this year, Geely sold 64000 new energy vehicles, up 33% year on year, more than double the sales of Great Wall Motor, and the growth rate is very different. In the long run, the new energy train may not have the "seat" of the Great Wall.

Even so, Great Wall Motor executives either bombard the "new forces know the truth" or "want to teach others how to build cars". The "style" of the former overlords is revealed intentionally or unintentionally.

As long as you are not embarrassed, it is others who are embarrassed. But more importantly, Great Wall Motor does not have much sense of presence in the field of new energy vehicles.

To put it bluntly, behind the bombardment of new forces and the desire to teach others, there is a sense of powerlessness that is not enough for outsiders.

3 Advantage product self deprecating martial arts skills, Great Wall internal consumption persuading consumers to retreat

Great Wall Motor 'sense of powerlessness, the sharp decline in sales and the inability of new energy vehicles to keep up, also stems from the serious internal friction of the enterprise.

Simply put, internal friction has made Great Wall eager to launch a bunch of new products, but it has caused its advantageous products to lose their martial arts skills and engage in fights with themselves, constantly persuading consumers.

As mentioned earlier, in 2018, Wei's sales approached 140000 units, which is expected to take over from Haval. However, three models, VV7, VV6, and VV5, were launched, and these models "do not have a clear competitive gap" with each other, only deepening internal friction.

In 2021, Great Wall Motor will stop producing all "VV+digital" models, but the routine is still the same. The new round of product planning will be named after coffee names such as Mocha, Macchiato, Latte and Blue Mountain - neither reflects the positioning of Weipai's luxury cars, nor does the alternative and various names disturb the consumer's mind, which naturally cannot attract more consumers to buy.

Another new energy pure electric vehicle brand, "Euler," positioned as the world's most beloved woman, has not escaped this "bad luck".

In 2020, Great Wall renamed Euler R1 as Euler Black Cat and launched Euler White Cat. By 2021, the cumulative sales of Euler Black Cat and White Cat had reached 84100 vehicles. Who knows, Great Wall Motor announced that Euler's Black Cat and Euler's White Cat "suspended receiving orders" due to the rise of raw material prices and other reasons.

However, Great Wall Motor pressed the "pause button" for its advantageous products, and instead of accumulating experience and iterating products, it launched new products such as Ballet Cat and Lightning Cat, with the overall price rising by about 100000 yuan.

Not surprisingly, there was no cluster effect in this "car stacking", but rather, like Wei brand, it accelerated the internal consumption of products, brands, and enterprises, and sales fell unstoppably. In 2022, Euler's sales decreased by 22.98% year-on-year, with Euler's sales declining by nearly 67% year-on-year in December, marking the largest decline for the brand within the year.

Similar experiences have actually occurred in Haval, no wonder netizens pointed out, "If you fail, start a new brand, keep producing new products, and keep failing

It has to be said that such a chaotic and awkward transformation of fuel vehicle enterprises is rare in the entire automotive industry.

Perhaps for Great Wall, while valuing the transformation of new energy, it is necessary to maintain composure and product continuity, refine and consolidate its advantages, in order to face industry changes and achieve stability and prosperity.

What do you think of the collapse of the Great Wall?

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