After the MEGA crisis, why did ideals let old car owners break their defenses again?

Every Tuesday, Li Auto releases its weekly sales report, and yesterday was no exception. Ideal said that in the past week, the sales volume of the Ideal L series reached 9,061 units, continuing to maintain its top sales position among SUVs with more than 300,000 yuan.

What is different from the past is that sales are not the focus of this Tuesday. What really causes controversy is Li Auto's thoughtful and interlocking sales strategy.

While announcing weekly sales, Li Auto also released an announcement on the sequence changes of the 2024 Li Auto L-series models on Li Auto Community and other brands. According to the announcement, Ideal has renamed the original Air, Pro, and Max versions of the L7 and L8 models to Pro, Max, and Ultra respectively, and added a new Air version that removes the air suspension.

Naturally, prices have also changed. The addition of the new Air model has brought the starting price of the L8 series to 321,800 yuan, and the starting price of the L7 series is only 301,800 yuan, a decrease of 18,000 yuan from the previous price.

In 2024, when the price war in the car industry has entered a fierce stage, it is normal for car companies to adjust their selling prices. However, what is strange is that Li Auto deleted this notice soon after and then released it in the form of an announcement. Users Unable to comment. Later, an old ideal car owner said that he could not see the announcement in the community and "logged in with a new mobile phone number to refresh and see it."

This operation was really unexpected.

What’s the beauty of ideal “operation”?

Moving the time forward to January this year, Li Auto began its product update transition and launched car purchase discounts . Depending on the model version, the price reduction ranged from 35,000 to 38,000 yuan, among which the starting price of the Li Auto L7 was directly reduced to 286,900 yuan. yuan, dropping to within 300,000 yuan for the first time.

On March 1, the 2024 Ideal L series was launched as scheduled. On the basis of the same price, the Air model added new configurations including magic carpet air suspension Pro, SPA-level ten-point massage seats, etc.; the Pro model will come standard Intelligent heating and cooling refrigerator, platinum sound system and AD Max.

In other words, old car owners get huge discounts, and new car owners wait to upgrade their configurations , and both parties are happy. Ideal was also able to shout out the loud slogan "The 2024 Ideal L series implements magic carpet air suspension as standard equipment for all series."

More importantly, because the price of new cars has not been reduced, Li Auto has stabilized its "luxury" label . In the current price war, it seems to have entered the supreme state of "let others do whatever they want, and the bright moon shines on the river."

Now that the product sequence has been adjusted, we have realized that it is not that we will not reduce prices, but that Ideal has grasped the timing of price reductions more "appropriately" than other car companies.

Some people believe that this is a temporary decision that Li Auto was forced to make when MEGA's sales were hindered in an effort to achieve this year's sales target. There is some truth to this conjecture, but for the automobile manufacturing industry, which affects the entire industry, it is obviously impossible to temporarily increase demand in such a short period of time.

In fact, in January this year, the 2024 Ideal L7 that appeared in the 379th batch of new product announcement catalogs of the Ministry of Industry and Information Technology's "Road Motor Vehicle Manufacturers and Product Announcements" already has 4 models, corresponding to the updated product series: Air, Pro, Max and Ultra , the same is true for the ideal L8.

If there is anything that Ideal did not foresee in advance, I am afraid it is only the current market situation of MEGA: Ideal MEGA, which has been on the market for more than 10 days, is in an extremely embarrassing situation.

According to PowerOn, Li Auto has convened thousands of sales staff from across the country to Nanning, Guangxi for unified training before the Spring Festival this year. "Not only front-line sales, but also delivery and after-sales people must participate in the unified training."

During the three-day training, Ideal internally conducted a comprehensive static explanation, dynamic test drive, and competitive product analysis training on MEGA. The training assessment was also particularly strict, and employees who failed were even directly notified to go through the resignation procedures.

However, it was only after MEGA was actually launched that I realized that it was not difficult to make money, but it was difficult to make people pay for it.

Li Xiang and MEGA in "darkness"

Although I am in darkness, I still choose the light.

On March 11, the day before Li Auto adjusted its product lineup, Li Xiang, the founder, chairman and CEO of Li Auto, posted a message in WeChat Moments, claiming that in the past 10 days, someone had launched an organized "black public relations behavior" against Li Auto. , suspected of illegal crimes.

Going back one day, he also mentioned "Darth Vader", a well-known villain from the movie "Star Wars", in his circle of friends, saying that no matter how difficult it is, he cannot follow his footsteps and compromise with the dark forces.

This circle of friends is Li Xiang’s own response to the malicious comments, and it is also his response to the fact that MEGA’s sales are not as good as expected. According to his logic, a large part of the reason why MEGA has not become a hit is because of the constant fermentation of Inappropriate comparisons and malicious remarks.

But perhaps, there is something wrong with the MEGA product itself.

Many people have this question in their minds: Why doesn’t the ideal MEGA have an extended-range version? Isn’t it that the L series sells well because it has no battery life anxiety?

It is true that the large space and the characteristics of both gasoline and electricity have attracted a large number of fans to Li Auto, but in the final analysis, it is because Li Xiang targeted a relatively less competitive market in the early days of his business.

Li Xiang often says this: "Choice is more important than hard work." Of course, Ideal MEGA has continued Li Xiang's thinking and found a "blue ocean market" that belongs to it.

In 2019, Li Xiang took his family to Ayana for a vacation. He drove a luxury brand MPV. "I cursed while driving, mainly because it was really bad," Li Xiang said of the MPV. After coming back, Li wanted to call his colleagues and said he wanted to build an MPV. Some people object, thinking that the MPV market is very small and no one will buy it. Li wanted to say no, "We build our own cars, so we must make an MPV that we can drive."

The biggest difference between MEGA and other MPVs is that it makes what others consider an "emergency plan" a rigid need for users. In Li Xiang's eyes, "the MPV market that emphasizes the third row" is a blue ocean market.

Liu Jie, vice president of commercial affairs of Li Auto, previously said that although MEGA is an MPV, its target users are more than that.

Whether it is the 500,000-plus market segment or the MPV market, about 80% of car buyers are family users, and the higher the price range, the greater the proportion of family users. Currently, Li Auto’s household users account for 95%. Therefore, for Ideal MEGA, we will pay more attention to whether the needs of home users who purchase models of more than 500,000 yuan are well met.

For example, he said that before Alfa entered the Chinese market, there were no domestic MPV models priced at around 1 million yuan. At that time, the main sales models were the BMW 7 Series, Mercedes-Benz S-Class and Audi A8, three old executive-class sedans, as well as luxury medium and large SUVs such as BMW X5 and X7, Audi Q7, Mercedes-Benz GLE and GLS. After Alpha entered the Chinese market, it successfully raised a new demand for consumers and created a new market segment, "acquisition" users of Mercedes-Benz S-Class, BMW 7 Series and other models.

Therefore, Liu Jie believes that MEGA may not only face current Alfa users in the end, but also many people from luxury cars or SUVs.  User.

As for MEGA's price of 559,800 yuan, a large part of the reason comes from the judgment of the market.

The penetration rate of new energy for people with more than 200,000 people has exceeded 35%, nearly 40%, while the penetration rate of new energy for people with more than 500,000 people is only 11%.

In other words, in the price range of more than 500,000 yuan, MEGA has a great chance to show its talents.

In fact, Li Auto announced its MEGA sales target last year: No. 1 in sales of all passenger cars over 500,000 yuan, regardless of energy type or body type.

If this goal is aligned, the sales volume of the ideal MEGA must at least exceed that of the BMW X5 to achieve the sales target.

Throughout 2023, the cumulative sales of BMW X5 in the Chinese market reached 93,211 units, with average monthly sales of nearly 8,000 units. Its official guide price starts at 612,000 yuan. Even including terminal discounts, the naked car costs about 570,000 yuan.

Obviously, in this price range, brand power and product power are indispensable. In terms of brand, Ideal cannot be compared with BMW. At the same time, its product strength has no obvious advantage compared with competing products. "You can't see the core things" is the initial evaluation of MEGA by many consumers who enter the store.

The half-year warm-up of Ideal MEGA has undoubtedly raised the market's expectations to a very high level. People hope to see more on MEGA than just "refrigerators, color TVs and large sofas".

According to market data from car fans, after the launch of Ideal MEGA, Xpeng X9, Denza D9, Wenjie M9, Lantu Dreamer, and Jikrypton 009 all showed significant resurgence. Among them, Denza D9 is the biggest winner, with a double bumper harvest of in-store orders, with more than 1,700 new orders over the weekend, and orders doubled; Xpeng X9 has experienced a huge explosion in in-store orders, with an order increase of at least 40% compared to the steady state weekly increase. % above.

Among these competing products, the most outstanding one is undoubtedly the Xpeng X9. Its rear-wheel steering and special three-row folding form have already been introduced to consumers with the launch. At the Ideal MEGA launch conference, the only technology-related highlight was 5C charging, which doesn’t look amazing enough now.

According to data from the Ministry of Industry and Information Technology, in order to achieve the highest 520kW 5C fast charging, the CATL Kirin 5C battery pack used in Lideal MEGA largely sacrificed the energy density of the battery pack (163.3Wh/kg), ranking last among 100kWh products. The disadvantage of energy density is also reflected in the size and weight of the battery pack: MEGA's 103kWh battery pack is 41kg heavier than the Xpeng X9's 102kWh battery pack. Not only that, the former also has a higher secondary platform.

So, will the 5C fast recharge that Ideal MEGA exchanges for be worth the price? You know, the Ji Krypton 007 next door has also used a 500kW gold brick battery, and it is a lithium iron phosphate battery.

L6 The burden on the shoulders is heavier

MEGA had a bad start to its rise, but it has to find a way to achieve its annual goals. The L series, whose product sequence has been readjusted, naturally shouldered this burden. Of course, this also includes the L6 that has not been released yet and is priced at less than 300,000 yuan.

From an ideal planning perspective, high-end models will continue to make money, while mid- to low-end models will be responsible for momentum. Li Tie, CFO of Li Auto, mentioned in the fourth quarter results meeting:

The company's gross profit margin this quarter will remain at a healthy level of 20%. We have also mentioned before that the company's full-year gross profit margin will also remain around 20%. For the 2024 models of the Lideal L series and the Lideal MEGA, we believe that their launch will have a positive impact on the gross profit margin.

He also said that the launch of Ideal L6 may have a negative impact on gross profit of 20%, but as sales increase, the impact of L6's gross profit will gradually turn negative to positive. For Ideal, a car company with a cash reserve of more than 100 billion yuan, It is said that it is not difficult to give up profits on high-volume models.

What's more, by March next year, the pure electric SUV M6 will become a new growth point.

Anyone with wheels is interested and welcome to communicate. Email: [email protected]

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