AutoBeta(AutoBeta.net)03/06 Report--

Prior to the US stock market trading on March 5, Ulai announced its financial results for 2023. According to the financial report, the total revenue of Weilai in 2023 was 55.62 billion yuan, an increase of 12.9% over the same period last year, a record high, of which automobile sales were 49.2573 billion yuan, an increase of 8.2% over the same period last year. The net loss for the whole year was 20.72 billion yuan, an increase of 43.5% over the same period last year, making it the second highest loss year in the history of Lulai. During the reporting period, the gross profit margin of Xilai was 5.5%, compared with 10.4% for the same period, 9.5% for cars and 13.7% for the same period.

Selling one car at a loss is a difficult problem that Weilai has to face. In the past year, Weilai delivered a total of 160000 new cars, an increase of 30.7% over the same period last year, setting an all-time high for a single quarter. Unfortunately, for every new car sold in Weilai, it loses about 115000 yuan on average, which is 60, 000 more than in 2023, but thanks to 6 billion. It is understood that the sales target set by Weilai in 2023 is 250000 vehicles, which is also the target set by Weilai to break even, but the actual annual delivery completion rate is only 64%.

As of December 31, 2023, Lailai held about 57.3 billion yuan in cash and cash equivalents, thanks to two rounds of strategic investments totaling $3.3 billion by Abu Dhabi investment firm CYVN in the second half of last year. In the past year, Weilai has received two investment funds from Abu Dhabi CYVN Holdings, with a cumulative income of 21.16 billion yuan. But Weilai still has a lot of bills to pay. By the end of 2023, trade payments and bills payable by Weilai were about 29.77 billion yuan, mainly owed by suppliers; another loan of 9.82 billion yuan had to be repaid within one year; that is to say, from the perspective of cash reserves, Weilai did have a lot of money, but if the relevant debts were paid off, there was only 17.71 billion yuan left, only enough for Weilai to lose money for a year. However, Weilai had previously said it expected to break even in 2024.

After the earnings meeting, Xilai opened at $5.145 per share and finally closed at $5.480, up 2.81%. Although the share price rose, it was not a bright earnings report, with revenue hitting a record high and losses expanding at the same time.

While seeking external blood transfusion, while tightening the belt to live.

In November 2023, Li Bin, CEO of Xilai, released a full-staff letter from "organizational Optimization and two-year priorities", confirming a 10% layoff and saying that "this is a difficult decision that has to be made." Layoffs are not a bad thing for Weilai, especially in the context of huge losses, reducing costs and increasing efficiency has become an inevitable choice. According to public financial reports, from 2018 to 2022, the net profits of Weilai Home were-23.328 billion yuan,-11.413 billion yuan,-5.611 billion yuan,-10.572 billion yuan and-14.559 billion yuan respectively, plus 20.72 billion yuan in 2023, resulting in a cumulative loss of 836.2 billion yuan. Ideal cars in the same period have made a profit.

At the same time, Weilai is also expanding its influence.

After announcing the layoffs, Weilai successively announced that it had reached a power exchange cooperation with Changan, Geely, Jianghuai and Chery to form a "power exchange alliance". Every year, in order to build a power station, it needs to pay a huge amount of money, resulting in sustained losses. The addition of Changan, Geely and other car companies means that this market is finally recognized by the market, which can help share the supply chain costs and operating costs in the future. It is no wonder that Li Bin could not restrain his smile when he signed contracts with Li Shufu and Zhu Huarong to make the change of power stations more profitable.

In addition, through Weilai Automotive Technology (Anhui) Co., Ltd., it has transferred the inventory, fixed assets and projects under construction of the three factories of Jianghuai Automobile Company at the price of 3.158 billion yuan, as well as the structures and equipment of Xinqiao factory of passenger car company. this means that Weilai can build cars independently, no longer rely on Jianghuai Automobile to achieve mass production and sales, and all its latest models have been changed. From the previous "Jianghuai Automobile" to "Weilai". For Xilai, it will have a more say when negotiating with partners in the future, while for car owners, their awareness and favor of the brand will be enhanced after buying Ulay models.

Entering 2024, the competition in the new energy vehicle industry is fierce, especially after the Spring Festival of the year of the Dragon, after BYD took the lead in opening the price reduction promotion and chanting the slogan "electricity is lower than oil", more than 10 car brands participated in the market price cut. although most brands will not have an impact on the Lulai market, the market pressure has been conveyed to all manufacturers. It is understood that there will be no new car launch in 2024, and nine models have been released, including ES8, ES6, ES7, EC6, EC7, ET5/ET5T, ET7 and ET9, priced at 30-800000 yuan, of which ET5, the highest price, will be delivered in the first quarter of 2025, while the first model of the second brand "Alps" will be released in the fourth quarter, and the new brand will be aimed at 20-300000 yuan for the Volkswagen brand market. Fill the gap in the Weilai brand market, but there are only three new cars in the whole life cycle. Therefore, Weilai wants to break even in 2024, according to the delivery target of 250000 vehicles, Weilai still depends on the main brand.

Li Bin said on the earnings call that there will be more than 100,000 yuan of models on the market in the future. Of course, for Weilai, the focus of development in 2024 is still the mass production and listing of the "Alps" brand, and at the same time, it is also necessary to ensure the market increment of the Weilai brand. as for what measures Weilai will take to deal with market competition, can the Alps brand reverse the current dilemma, tighten its belts and sell more cars at the same time to get rid of the current situation of losing one?

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