Do Mercedes-Benz and NIO have a future?

At the end of July, Volkswagen spent 700 million (approximately RMB 5 billion) to acquire 4.99% of Xpeng Motors' shares and formally reached a technical framework agreement. In the future, the two parties will jointly launch two B-class pure electric vehicles based on the Xpeng G9 car model.

The news of the marriage between Volkswagen and Xpeng is like a "blockbuster", causing ripples in the new power car circle. In the past, I only heard about "exchanging space for time" and "using heavy capital to bring in technology." Direct technology exports like Xiaopeng's are really rare in the history of the domestic automobile industry.

However, the "bipolar reversal" story has a chance to continue. It may no longer be an exception for traditional luxury car companies to seek cooperation with new domestic car companies. Mercedes-Benz is also one of the potential partners.

Earlier, it was reported that Weilai had held cooperation negotiations with Mercedes-Benz. Although both parties denied the negotiation, two people with direct knowledge revealed that the negotiation was indeed true. The two parties had discussed a potential cooperative relationship. However, this time the negotiation was still at a very preliminary exploration stage, and the scope of the discussion did not go into depth. There is still considerable resistance even within Mercedes-Benz regarding the specific type of technology or the amount of investment.

▲Li Bin met and negotiated with Mercedes-Benz CEO Kallenson. Picture from: Reddit

Cooperation talks are at a stalemate. Do Mercedes-Benz and NIO have a future?

Technical capital, fatigue and dilemma

In fact, if the cooperation between the two parties can take place, it will be a mutually beneficial transaction to a large extent.

Before that, we need to understand what Mercedes-Benz is seeking in cooperation? We once mentioned in the article "Mercedes-Benz also wants to be a rival to Tesla, and the popular GLC needs to be electrified" that the Mercedes-Benz EQ series has fallen into a strange circle. The more high-end models sell better, the more entry-level models sell. On the contrary, the response to the model has been mediocre. Regardless of the high-end demand in the European and American markets, the Mercedes-Benz EQ series of electric vehicles actually have no sales appeal.

▲Mercedes-Benz EQC Picture from: Auto Express

From the perspective of sales structure, the role of the EQ series in "temporary job grabbing" makes it difficult for Mercedes-Benz to avoid the problem of poor influence of pure electric models. When it comes to discontinuation, Mercedes-Benz responded quickly to the weak performance of the EQ series. It is reported that Mercedes-Benz will completely abandon the EQ series models before the end of 2024 and switch to a new MMA pure electric platform, which will be named "EQ" in the future. of Mercedes-Benz models may no longer exist.

For Mercedes-Benz, after getting rid of the EQ series, how to reduce the sense of separation between pure electric models and fuel models while maintaining the brand's tonality, and increase its voice in the pure electric market is the next proposition.

▲ Mercedes-Benz CEO Kallenius Picture from: REUTERS

NIO will be a good choice for cooperation. Starting from the brand tone that Mercedes-Benz values, Weilai has long adhered to the model strategy of "raise high and fight high". In April 2021, Li Bin announced to the outside world that the average sales price of Weilai cars has reached 437,000 yuan. This number is even It is higher than the average selling price of BMW and Audi models. Taking into account aspects such as average price, scale and brand building, there are actually not many new domestic car companies left for Mercedes-Benz to choose from. NIO can be said to be the most suitable pure electric brand among them.

Of course, high-end is just NIO’s brand background. Behind the strategy of “raise high and strike high” is NIO’s own technical capital. Meeting the brand's tonality is only the most basic requirement. Mercedes-Benz also wants to get more pure electric technology support from the cooperation. This is not difficult for NIO, which is actively turning to self-research.

In mid-September, at NIO’s NIO IN press conference, Li Bin talked about NIO’s full-stack technology framework. NIO's overall technology ecological layout is quite grand, including chips and vehicle-mounted intelligent hardware, batteries, electric drives, operating systems, mobile Internet, intelligent driving and other key technology fields. The technical layout on NIO IN is more like NIO. Let’s use self-developed technology to “brighten the sword”.

Driven by the concept of exchanging R&D for long-term gross profits, Li Bin emphasized the importance of self-research for NIO and announced NIO's recent self-research results. In April this year, Weilai successfully developed its first self-developed lidar main control chip NX6031 and will enter mass production in October. This chip named "Yang Jian" is considered to be the best lidar main control chip in the industry. One of the chips; going deep into the underlying operating system of the vehicle, NIO has also made achievements. The new achievement Tianshu SkyOS is the first underlying operating system released by a car company. Tianshu SkyOS involves the entire vehicle control, including the entire vehicle system, assisted driving, Smart cockpits and mobile internet independently solve real-time safety issues in different "domains" of cars.

▲NIO’s full technology stack

In addition, Li Bin rarely revealed the progress of NIO's self-developed batteries. At the press conference, Li Bin showed a real picture of NIO's 4680 battery pack. As early as February this year, NIO disclosed that NIO's battery R&D team has exceeded 800 people, and its annual R&D investment is estimated to exceed 1 billion yuan. Although the mass production plan of large batteries has been repeatedly postponed, as NIO and Honeycomb begin to explore a new cooperation model, NIO's self-developed battery project is still stumbling forward, and the launch of new large batteries is only a matter of time.

From the perspective of the full-stack technology layout, Weilai’s self-research concentration can be said to be quite profound. To put it more vulgarly, from the perspective of pursuing the sharing of pure electric technology, NIO has "something" that Mercedes-Benz wants.

▲ Picture from Weibo

A grand and redundant technical layout often requires sufficient funds as a price. NIO's financial resources are not too strong, so it is urgent to seek funding for cooperation.

Weilai, which firmly believes in "long-termism", is indeed faced with unsightly financial report figures. NIO's net loss in the second quarter was 6.056 billion yuan, a year-on-year expansion of 119.6% and a month-on-month expansion of 27.8%. In the first half of the year alone, NIO's net loss reached 10.9 billion yuan. It is worth mentioning that after the end of the second quarter, NIO’s cash reserves on its books were 31.5 billion yuan, a decrease of nearly 6.3 billion yuan compared with the previous quarter. Nio, which was willing to invest heavily in expansion, began to fall into the dilemma of cyclical shortage of funds again.

An insider close to the negotiations between the two parties revealed that the recently released NIO Phone by Weilai may affect the confidence of both parties in reaching future cooperation. From crossovers from cars to smartphones, many market analysts are not optimistic about NIO's actions. They believe that such crossover behavior will make NIO's already weak financial situation even thinner, and will also affect NIO's financial situation. brought crisis, especially in June when Weilai was forced to engage in a price war.

The market's concerns are not unfounded. But in a crisis, if there is "danger", there should also be "opportunity". The release of NIO Phone may not be a rash act of patting the head. In a sense, NIO’s “driver connectivity” coincides with Mercedes-Benz’s technical lines.

At this year's Munich Auto Show, chip manufacturer Qualcomm participated in the exhibition in a special manner. Qualcomm has launched its concept model to demonstrate the latest infotainment capabilities that the Snapdragon platform can achieve in the car. The pure electric CLA concept model launched by Mercedes-Benz earlier has Qualcomm's help in the MBUX car operating system behind it. This also shows Mercedes-Benz's ambitions for future in-vehicle interconnection. NIO Phone takes the route of "driver interconnection" and closes the ecological closed loop of its own brand, which may bring new thinking to Mercedes-Benz's in-vehicle ecosystem.

▲Customized system for Qualcomm concept car

If the cooperation between Mercedes-Benz and NIO can take place, it will be a win-win situation of mutual benefit. On the one hand, while maintaining the brand style, Mercedes-Benz can obtain the sharing of pure electric technology to supplement its weak parts; on the other hand, NIO can also use Mercedes-Benz's funds have overcome the painful capital shortage cycle and leveraged the brand effect (especially in the European market) on the way to the "westward expansion".

best carrier

The cooperation between NIO and Mercedes-Benz does not necessarily have to be realized on the NIO brand.

I would like to make an interesting and bold conjecture here. The two parties have completed a "marriage" in the sub-brand Alpine, and cooperation from the bottom up starting with mass-produced models may have better results.

According to channel news two months ago, Weilai internally plans to break the red line of "dual motors" and adopt a single motor configuration on the sub-brand Alpine model, and explore the pure electric model market of 200,000 yuan. Giving up dual motors on the Alpine is a very smart approach. Controlling the cost of the model is the premise, but the current situation of the entire pure electric market is the background. At present, the pure electric penetration rate in the domestic high-end market of more than 300,000 yuan has been lower than 20% for a long time. Only by narrowing costs and retaining competitiveness in the 200,000 pure electric market can we better undertake the task of "increasing volume".

Mercedes-Benz wants to continue to expand its voice in the pure electric market, and Alps may be the "best carrier" for cooperation between the two parties.

▲ Alpine road test drive

Of course, the 200,000 pure electric market, which has sunk into a "sea of ​​blood", cannot avoid direct competition with Tesla, the pure electric leader. The marriage between Mercedes-Benz and Alpine, with the concept of "200,000 Mercedes-Benz", may be able to capture a considerable market share in the head-to-head competition of Model Y/3.

After all, with the three-pointed star, the 150,000-dollar Mercedes-Benz A-Class has become a hot commodity.

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