AutoBeta(AutoBeta.net)03/27 Report--

On March 27th, Chery New Energy announced that thanks to the global price correction of new energy raw materials and the improvement of enterprise cost control and supply chain management, Chery New Energy will formally adjust the official guidance price of its models from 0: 00 on March 27,2023. The range of correction is as high as 9000 yuan. In terms of breakdown, the models involved in the price adjustment include Chery QQ ice cream, Chery Little Ant and Chery Unbounded Pro, of which three QQ ice cream models are reduced by 4000 yuan to 35900-45900 yuan; four small ants models are reduced by 4000-9000 yuan to 64999-94000 yuan; and five unbounded Pro models are reduced by 5000 yuan to 84900-110900 yuan.

From the point of view of the price reduction, the Chery new energy vehicles fell by as much as 9000 yuan, which is a big drop for mini models. In fact, it is not unusual for domestic car companies to cut prices. Up to now, at least 40 domestic car brands have participated in the "price war" through subsidies from manufacturers or price cuts by dealers, involving more than 100 models, with subsidies ranging from a few thousand yuan to more than 100,000 yuan.

Chery New Energy said that this price reduction is due to the global price correction of new energy raw materials and the improvement of enterprise cost control and supply chain management capabilities. The latest data show that as of March 24, the average price of battery-grade lithium carbonate was 277500 yuan / ton, down from a high of nearly 600000 yuan / ton in mid-November 2022. In addition, with the superimposed downward price of other materials, battery-end costs naturally fell. Of course, the industry generally believes that, in addition to the raw material price correction factor, Chery new energy price reduction may be based on market considerations. Data show that in 2022, Chery New Energy's annual sales increased by 112.9% to 232000 vehicles compared with the same period last year. Chery QQ ice cream and Xiao Ant are the main selling models of Chery New Energy, with sales of 97000 and 94000 vehicles respectively, up 661.3% and 22.5% respectively from the same period last year.

However, after entering 2023, the growth rate of Chery New Energy is obviously slow. According to the Federation of Carriage data, Chery's cumulative sales of new energy vehicles from January to February in 2023 were 13293, down 57.6% from the same period last year, with a market share of 1.7%, of which February sales fell 25.4% year-on-year to 7999. It is the car company with the highest decline in the list of new energy manufacturers in February, and it should be noted that most of the domestic model sales picked up in February.

At present, Chery's new energy models include QQ ice cream, small ants, boundless Pro, big ants and Erize e, but the sales of several products are very mediocre. In February 2023, for example, QQ sold 3134 ice cream, while Little Ant sold 2128, while Erize e sold 192, Unbounded Pro 72, and Big Ant only 2. Zooming in to the first two months, Chery QQ ice cream sales fell 64.3 per cent year-on-year to 5870 from January to February 2023, while Little Ant sold only 3163. For comparison, Wuling Hongguang MINI EV, a model of the same class, has accumulated sales of 46683 vehicles, which is still at the top of the list of new energy cars, although it is down 11.6% from the same period last year.

Wuling Hongguang MINIEV was the first to announce a price reduction on January 31. Before March 31, the limited time surprise price of Wuling Hongguang MINIEV was 29800 yuan, which was reduced by 3000 yuan compared with the original price. The current Wuling Hongguang MINIEV price range is 3.28-99900 yuan, which is 6100 yuan lower than the starting price of Chery QQ ice cream after the price reduction. The price advantage may further boost Wuling Hongguang MINIEV sales.

As for Chery New Energy vehicles, it is generally believed that QQ ice cream and Little Ant are important models of Chery New Energy vehicles, but the performance of the two models is mediocre at present, while the new boundless Pro car, which is highly expected, has not performed well. At present, the car market is experiencing an unprecedented "price war", this Chery new energy price reduction may also be based on market considerations, as to whether the price reduction can make Chery new energy harvest more orders? Previously, a number of industry insiders said: "the market price reduction behavior will not really affect the sustained growth of new energy vehicle sales and penetration."

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat