AutoBeta(AutoBeta.net)02/21 Report--

BAIC New Energy received 370 million yuan in government subsidies at the beginning of this year, and now the company has received another 1.05 billion yuan in central subsidies for promotion and application.

Beijing New Energy Automobile Co., Ltd., a subsidiary, recently received 1.05357 billion yuan in central subsidies for the promotion and application of new energy vehicles in 2016 and 2017, which was transferred by the Beijing Municipal Bureau of Finance, BAIC Blue Valley announced today. The subsidy received this time will directly offset the new energy subsidy receivable of the subsidiary, will not affect the profits and losses of the current period, and will have a positive impact on the cash flow of the subsidiary and the reduction of capital occupation.

BAIC New Energy sold more than 158000 vehicles in 2018, ranking first in pure electric vehicle sales in China for six consecutive years, but BAIC new energy sales have declined since the beginning of this year. BAIC New Energy produced 142 vehicles in January, down 98.17 per cent from a year earlier, and sold 4512 vehicles, down 43.66 per cent from a year earlier.

According to the third-quarter report released by BAIC Blue Valley last year, BAIC Blue Valley's revenue from January to September 2018 was 9.787 billion yuan, up 63.21% from the same period last year, while the net profit belonging to shareholders of listed companies was 130 million yuan, up 56.13% from the same period last year.

In terms of R & D investment, the audit report of BAIC New Energy in 2017 and January-June 2018 shows that BAIC New Energy achieved revenue of 11.4 billion yuan in 2017 and invested only 15 million yuan in R & D, accounting for 0.15% of revenue. BAIC New Energy revenue from January to June 2018 was 5.6 billion yuan, while investment in R & D was only 4 million yuan. By comparison, BYD had 27000 R & D staff in 2017, with a total investment of 6.266 billion yuan.

At present, the cost of electric vehicles remains high, and most of the profits of car companies come from various government subsidies, and with the decline of subsidies, domestic new energy vehicle companies will also face more and more pressure for survival. Recently, Lian Qingfeng, deputy secretary of the BAIC New Energy Party Committee, also said that "the 'knockout stage' of the new energy vehicle industry has started ahead of schedule, and it is expected that 80% of the new energy vehicle enterprises will be eliminated in the future, while the surviving enterprises." Will usher in a broader market and richer resources. "

Lian Qingfeng believes that new energy vehicle companies will face three major challenges: first, the subsidy decline will intensify in advance, but within three or five years, it will be difficult for new energy vehicles to compete with fuel vehicles in terms of cost; second, competition will intensify. The transformation and development of independent brand traditional car enterprises, multinational car enterprises and new car-building forces compete with each other, and the new energy vehicle industry has changed from a blue sea to a red sea. Third, while striving to "survive", we should also constantly improve the level of technology, increase investment in research and development, and build core competitiveness to win the future, so we are facing tremendous operational pressure.

In the field of electric vehicles, increasing R & D efforts is the way out in the foreseeable future, but judging from BAIC's new energy R & D expenditure in previous years, its investment is still far from enough.

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