The loss of retail car revenue of 16.75 billion yuan in 2023 has narrowed.

　　On March 25th, Zero Run disclosed its financial report for 2023, and it was still in a loss state for the whole year, with a net loss of 4.216 billion yuan and a gross profit margin of only 0.5%, which was still far behind LI and Weilai Automobile. At present, the price war of automobile enterprises has entered a white-hot stage, and the price band competition of zero-running automobile positioning is extremely fierce. With the listing of the second brands of Tucki and Weilai, and the price reduction of products of enterprises such as (), the zero-run cars will face more intense market competition.

　　Sustained loss

　　In 2023, the revenue of zero-running cars reached 16.75 billion yuan, a year-on-year increase of 35.2%; The net loss was 4.216 billion yuan, and the net loss in 2022 was 5.11 billion yuan, which narrowed the loss. Among the new car companies, LI has turned losses into profits, with a net profit of 11.81 billion yuan in 2023.

　　From the perspective of revenue, the zero-running car is the lowest among the four new power companies in Hong Kong. In 2023, the revenues of Ideality, Weilai, Tucki and Zero Run were 123.85 billion yuan, 55.618 billion yuan, 30.68 billion yuan and 16.75 billion yuan respectively.

　　Market participants believe that "to become a new energy car company that stays at the’ poker table’, it needs at least hundreds of billions of yuan in income, and the head car company will reach trillions of yuan." Obviously, the zero-running car is still a long way from this goal.

　　In 2023, the gross profit margin of zero-run cars turned positive for the first time, with a gross profit margin of only 0.5%, which is still far behind that of LI and Weilai cars. Li Xiang, CEO of LI, once said that only when the gross profit margin of new energy vehicle enterprises exceeds 20% can they achieve stable operation.

　　It is worth noting that by the end of 2023, the restricted deposits pledged by retail cars were 3.92 billion yuan, a year-on-year increase of 55.5%. According to the financial report, the company took some financial assets, land use rights and property, plant and equipment at fair value through profit or loss as collateral to obtain loans.

　　In terms of R&D expenditure, in 2023, the R&D expenditure of zero-run vehicles was 1.92 billion yuan, a year-on-year increase of 36.1%. The zero-run car said that it was mainly due to the increase in investment in R&D activities and the increase in the number of R&D personnel.

　　Zhu Jiangming, founder, chairman and CEO of Zero Run Automobile, said: "Although there is still a long way to success, we have taken another big step forward in 2023."

　　Sales have not improved.

　　In 2023, a total of 144,200 zero-running cars were delivered, only 72% of the annual sales target of 200,000 vehicles was completed. It is reported that the sales target of zero-running cars will double in 2024, reaching 300,000 to 400,000.

　　However, in 2024, the sales of zero-running cars did not improve, and 12,277 vehicles were delivered in January, down 34% from the previous month. 6,566 vehicles were delivered in February, down 46.5% from the previous month, and 18,843 vehicles were delivered in the first two months of this year. There is a big gap between the ideal and the world of the first camp.

　　The retail car is positioned in the market of "100,000 yuan to 300,000 yuan", while the price band of mainstream models is in the market of 100,000 yuan to 200,000 yuan, and the competition is extremely fierce.

　　It is worth noting that since 2023, zero-running cars have turned to pure electric+extended-range dual-power layout. At the beginning of February 2023, Zero Run launched the first extended-range model C11, with a price of 149,800 to 185,800 yuan. At the same time, the company accelerated the expansion of the international market. Zero-run cars and overseas markets are regarded by the industry as "self-help" behavior under the fierce price war. In 2023, C11 delivered 80,700 vehicles, the scale was still small, and the company’s gross profit margin was only 0.5%.

　　After the Spring Festival, BYD took the lead in launching the "first shot" of the price war of new energy vehicles in the Year of the Loong, bringing new energy vehicles into the era of 70,000 yuan, and shouting the slogan "Electricity is lower than oil". On February 19th, BYD announced that its two plug-in hybrid models, Qin PLUS Glory Edition and Destroyer 05 Glory Edition, were listed, with a starting price of 79,800 yuan. Compared with the old models, the prices of the two new models both dropped by 20,000 yuan. With the intensification of the elimination of the new energy vehicle market, the competition in the price band of the zero-run vehicle is more intense. Whether it can break through and achieve the sales target in 2024 as scheduled can only be expected by the market performance.

　　Price war continuation

　　This year, the auto market will usher in more intense competition. Cui Dongshu, Secretary-General of the Passenger Car Association, said that the price war in the national passenger car market will remain fierce in 2024.

　　LI lowered its delivery target in the first quarter, reflecting the fierce competition in the current new energy vehicle market. On March 21st, LI lowered its delivery guideline for the first quarter. Due to the sales orders falling short of expectations, Ideal now predicts that the delivery volume of vehicles in the first quarter of 2024 will be 76,000 to 78,000, which is about 24% lower than the previously released 100,000 to 103,000 vehicles.

　　In addition, china securities journal reporter noted that Tucki and Weilai are aiming at the mainstream price band in the market and will launch new brands.

　　A few days ago, Xpeng Motors CEO He Xiaopeng revealed in the earnings conference call that during the Beijing Auto Show, Xpeng Motors will officially launch a brand-new brand for 100,000 to 150,000 yuan. The first model of the brand-new brand will be launched and delivered in the third quarter. In addition, Tucki’s main brand will deliver a brand-new model in the second half of the year.

　　Li Bin, chairman of Weilai, said recently that Weilai’s second brand was named "Ledao" and positioned as a family car. "Ledao" brand will be officially released in mid-May. It is reported that the price is 150,000 to 250,000 yuan.

　　Li Bin said that the first model of "Ledao" brand will be released in the third quarter, and mass delivery will begin in the fourth quarter. The second car under the new brand is an SUV for large families, which has entered the mold opening stage and will be introduced to the market in 2025.

　　Chen Shihua, deputy secretary-general of China Automobile Association, said in an interview with china securities journal: "If the new energy automobile market is as fierce as it was in 2023, there will be a lot of new energy automobile enterprises in 2024, which will be difficult to operate because they lose too much money."

　　Ping An Securities believes that the growth rate of head new energy vehicle enterprises will be under pressure in 2024, and the price war led by head new energy vehicle enterprises will continue, especially in the mainstream price band of 100,000 yuan to 200,000 yuan, while the battery cost provides room for further price reduction of car enterprises.