AutoBeta(AutoBeta.net)07/22 Report--

On July 21, Dongfeng Motor announced that the new brand Dongfeng Nano will be officially launched in the second half of the year, which will fill the gap in the layout of the brand in the field of small pure electricity and inject new vitality into the small pure electricity market.

It is understood that Dongchuang Zilian (Wuhan) New Energy Technology Co., Ltd. changed its name to Dongfeng Automobile Nanotechnology Co., Ltd at the beginning of this year, which means that Dongfeng Nano focuses on the positioning of the small pure electric racetrack. It also shows that Dongfeng Nano officially opened the road of independent brand operation as Dongfeng Automobile Secondary Plate.

The Dongfeng Technology Center has created a new energy architecture platform for Dongfeng Nano, and the first model of the platform will be available this year, officials said. According to the plan, after 2024, Dongfeng Nano will launch one or two models a year, further helping Dongfeng Company to achieve its strategic goal of "1 million independent passenger cars and 1 million new energy vehicles in 2025".

It is understood that Dongfeng EV new energy models include nano-EX1 and nano-BOX models, of which nano-BOX price range of 4.87-74700 yuan, CLTC operating mileage of 201/331/351km respectively. Data show that the cumulative retail sales of Dongfeng Nano BOX in the first half of the year was 11954 vehicles, ranking 12th in the small SUV market. The top three models in this market segment are all independent models, namely Geely colorful Yue, Lingke 06 and Changan CS35 PLUS, but compared with the above models, Dongfeng Nano BOX has the lowest starting price.

Dongfeng Company is one of the four major automobile groups in China, and it is also one of the automobile enterprises with the most complete industrial chain and the richest product camp in China's automobile industry, with outstanding scale advantages, leading industry status and high brand recognition. The overall strength should not be underestimated. The data show that, as one of the automobile groups with the most complete industrial chain in China, the main products of "Dongfeng system" include commercial vehicles and passenger vehicles, and "Dongfeng system" has a leading position in the commercial vehicle market. Joint venture brands maintain strong market competitiveness by virtue of technology and brand advantages, but the only drawback is that revenue and profits of Dongfeng Company have both dropped in 2022 compared with the same period last year.

According to the financial report, Dongfeng Motor Group's annual revenue in 2022 was 92.663 billion yuan, down 18.1 percent from the same period last year, of which the sales revenue from the passenger car business was about 46.732 billion yuan, up 43.6 percent from the same period last year. The net profit from its parent was 10.265 billion yuan, down about 9.8 percent from the same period last year. Dongfeng Motor said that it was mainly affected by the continued downturn in the commercial vehicle market, excess capacity in the domestic market, rising oil prices and other factors, the overall demand slowed down, and the gross profit of the group's commercial vehicle business decreased by 4.796 billion yuan.

In terms of sales, Dongfeng car sales in the first half of the year totaled 945500, down 23.39% from the same period last year, of which passenger car sales were 769700, down 27.4% from the same period last year. According to the official website, Dongfeng passenger car brands include independent brands Dongfeng Lantu, Dongfeng Fengshen, Dongfeng New Energy, Dongfeng popular, joint venture brands Dongfeng Nissan, Dongfeng Honda and DPCA. Among them, the joint venture brand is the main source of Dongfeng automobile sales, with Dongfeng Nissan down-28.02%, Dongfeng Honda down 32.80% and DPCA down 21.56% in the first half of the year.

The decline of joint venture brands forces Dongfeng Motor to seriously think about the breakthrough in the context of new energy. In April this year, Dongfeng Motor proposed a "three-year action of transformation and upgrading" to the electrification process. According to Dongfeng Group, by 2024, Dongfeng's main independent brands will be 100% electric; by 2025, the annual sales of its own brands and joint venture brands will each reach 2 million. At that time, the sales of new energy vehicles of independent brands account for 50% of independent brands and 70% of independent passenger car brands.

However, combined with Dongfeng Motor's new energy performance in 2023, the strategy still has a long way to go. In the first half of the year, Dongfeng Automobile sales of new energy passenger vehicles were 107700, down 7.8% from the same period last year. Lantu Automobile is a weapon for the "Dongfeng system" to cut into the high-end new energy track. It seems that the "Dongfeng system" complements the high-end territory, but in fact it has become an "encumbrance". The cumulative sales in the first half of the year were only 15031, an increase of 118.54% over the same period last year.

In addition to Lantu, Dongfeng Motor also launched its second high-end electric car brand, Mengshi, in August 2022, the first product to match the electric Hummer, and focused on the high-end off-road market. It is understood that from 2023 onwards, the fierce will put no less than one new model on the market every year, but from its market positioning, it is expected to be difficult to provide quantitative support.

Now, Dongfeng Motor will launch a new electric car brand, focusing on the small pure electricity market, and the competition in this market is particularly fierce at the moment. For example, BYD dolphin / seagull, Wuling colorful fruit, Nezha V, Ola good cat and other models are all hot models in the market. Dongfeng Nano needs to think about how to compete with these predecessors. Of course, the advantage of Dongfeng Nano may lie in the price. The price of Nano BOX starts from 48700 yuan, and this price can only buy minicars. Generally speaking, the price of small cars is basically more than 60, 000 yuan. Price for quantity may also be one way.

In the environment of fierce competition, Dongfeng should reduce its dependence on joint venture brands as soon as possible and catch up with the opportunity of the rapid development of domestic new energy to achieve transformation and breakthrough.

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