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Another car company announced a price increase. BYD released a "description of model price adjustment" on its official Weibo on Jan. 21. BYD said that BYD will adjust the official prices of new energy models related to Dynasty and Ocean. The increase ranges from 1000 yuan to 7000 yuan. The price adjustment will take effect on February 1, and customers who pay a deposit before that will not be affected by the price adjustment.

Judging from the "instructions on vehicle Price Adjustment" released by BYD, the new energy models announced by BYD are its main selling models, including Dynasty and Ocean, which are the two main sales networks of BYD, among which Dynasty sells new energy models such as Qin, Han, Tang, Song and Yuan, while Ocean Network mainly sells e-series, BYD Dolphin, Song PLUS, warship series and so on.

In response to the reason for the price increase, BYD said: due to the sharp rise in raw material prices and the decline of subsidies for new energy car purchases, industry insiders speculate that BYD's price increase of 1000-7000 yuan for the main models may have a big impact on it.

In fact, a number of car companies have announced increases in model prices due to the sharp rise in raw material prices and the decline of subsidies for new energy car purchases. According to previous reports of concern to the automobile industry, on December 31, 2021, the Ministry of Finance, the Ministry of Industry and Information Technology, the Ministry of Science and Technology, and the National Development and Reform Commission jointly issued that the subsidy standard for new energy vehicles in 2022 would decline by 30% on the basis of 2021. It is clear that the subsidy for new energy vehicles will be terminated on December 31, 2022, and vehicles licensed after December 31 will no longer be subsidized. Immediately after the release of the policy, it caused widespread impact in the industry.

Perhaps affected by this, a number of car companies have also announced price increases for their models. According to statistics, since December 2021, a number of new energy vehicle brands such as Tesla, Xiaopeng Automobile, Nahan Automobile, GAC Ean, Zero and other new energy vehicle brands have successively raised the prices of some of their models.

On December 28, 2021, the price of Zero run T03 of Zero Motor Co., Ltd. increased. The price of 2022 models is 6.89-84900 yuan, while that of 2021 models is 5.98-99800 yuan. The price of 2022 minimum-equipped models is 8000 yuan higher than that of 2021 models.

On December 31, 2021, Tesla announced an increase in the prices of Model 3 and Model Y models, in which the price of Model 3 rear wheel drive version was adjusted to 265652 yuan, up 10, 000 yuan, and the price of Model Y rear wheel drive version was adjusted to 301840 yuan, up 21088 yuan.

On January 11 this year, Xiaopeng announced a price increase of several thousand yuan for all its models, of which the flagship car P7 of Xiaopeng rose 4300 to 5900 yuan, and the latest subsidized price was 22.42 to 409900 yuan; the new P5 rose 4800 to 5400 yuan, and the latest subsidized price was 16.27 to 229300 yuan; and the SUV G3i model rose 4800 to 5400 yuan, and the latest subsidized price was 15.46 to 193200 yuan.

In addition, the U part of Naha Automobile has been increased by 3000-5000 yuan, and the part of Naxi V by 2000 yuan; the price of GAC Ean LX has increased by 4000 yuan, and the new AION S Plus on the market has increased by more than 7000 yuan compared with the 2021 model.

The automobile industry is concerned that the price increases of many models have been announced in addition to the reasons for subsidizing the slope, and the fluctuation of raw material prices is also one of the key reasons for price increases by car companies.

In terms of raw materials, a number of car companies have earlier expressed concern about the rise in raw materials, and basically the entire automobile industry has been affected by rising prices of raw materials and tight battery supply. The cost of automobile power battery in 2021 is greatly affected by the price fluctuation of metal raw materials in the upper reaches of the supply chain, including cobalt, nickel, manganese, lithium and their compounds. Among them, the tight supply and demand of lithium carbonate, one of the raw materials necessary for the production of lithium batteries, has also directly led to higher prices, according to previous CCTV financial reports. The price of battery-grade lithium carbonate, the main raw material for power batteries of new energy vehicles, has staged a "triple jump" within a year, such as jumping from 50,000 yuan per ton at the beginning of last year to 274000 yuan per ton at the end of the year. The rise in raw material prices has had a great impact on the industry as a whole. People in the industry predict that the lithium carbonate market will remain tight for some time in the future, and the growth rate of industry supply is far from meeting market demand, but it is expected to ease in the second half of this year as new production capacity is put into production one after another.

Finally, back to the topic of the price increase of BYD, the official announcement of the price increase of BYD, there is widespread speculation in the industry that the price adjustment of BYD's leading models may have a wider impact. According to the latest data, the annual sales of BYD series models in 2021 are 117665, that of Tang series is 54204, that of Song series is 200870, that of Qin series is 194220, that of Yuan series is 41402, that of e series is 38350, and that of the newly launched BYD dolphin series is over 10,000 in December last year, with a cumulative sales volume of 29,598 from August to December 2021. In terms of overall sales in 2021, compared with other brands, BYD sells the largest number of new energy vehicles. For the new year's goal, BYD aims to sell 1.2 million new energy vehicles. However, in the environment of rising prices of raw materials and declining new energy subsidies, the answer will not be known until the end of 2022.

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