AutoBeta(AutoBeta.net)05/19 Report--

On May 17, Zero announced its first-quarter results. Total revenue from zero-running cars in the first quarter was 3.486 billion yuan, an increase of 141.7 percent over the same period last year, according to financial data.

For revenue growth, officials say it is mainly due to the gradual recognition of products in the market and the increase in sales brought about by a richer product matrix. Total revenue grew year-on-year, but fell 33.9% compared with the fourth quarter of last year. The decline was mainly due to changes and upgrades to the entire range of models in the first quarter, adjustments to the production and sales of existing models and the seasonal impact of the Lunar New year holiday, officials said.

In terms of sales, the cumulative sales of zero-running cars in the first quarter was 33410, an increase of 217.9% over the same period last year.

It is worth mentioning that although the total revenue and sales of zero-running cars increased significantly in the first quarter compared with the same period last year, zero-running cars still did not get rid of the situation of losses. The data show that the net loss of zero-running cars in the first quarter was 1.013 billion yuan. In terms of gross profit margin, the gross profit margin of zero-running cars fell to-1.4% in the first quarter from 6.7% in the fourth quarter of last year. As of March 31, 2024, the net cash consumption of the zero car camp was 1.181 billion yuan, and the balance of the company's cash and cash equivalents, restricted cash, financial assets at fair value included in profit and loss and bank time deposits was 17.584 billion yuan.

Judging from the first-quarter results released by Zero cars, it is not bad. In terms of revenue and sales alone, the figures are growing. Of course, the most important data must be the gross profit margin, but the decline in the gross margin of zero-running cars has something to do with the current price war launched by car companies. Since 2024, many car companies have joined the price war, and zero-running cars are no exception. In January, Zero launched a time-limited car purchase discount for its C11, C01, T03 and other models, with a discount range of up to 17000 yuan. If the follow-up zero-running cars want to maintain their strength in the fierce market competition, how to find the balance between price and profit is the key. After all, long-term losses are not conducive to the development of zero-running cars.

According to the official plan, the goal of zero-running cars in 2024 is to achieve a gross profit margin of 5 to 10 per cent and a sales target of 250000 to 300000 vehicles in 2024. In order to achieve the goal, officials launched a new model this year. On March 2, Zero run C10, a new model of Zero run Automobile, launched a total of seven models with a positioning of medium-sized SUV, with a price range of 12.88 yuan to 168800 yuan, including 12.88 yuan to 168800 yuan for the pure electric version and 13.58 yuan to 165800 yuan for the extended-range model. Officials also revealed plans to launch five A-class SUV by the end of this year. With the arrival of new models and official updates on family products, zero-running car sales will be boosted.

At the same time, the recent cooperation between Zero Motor and Stellantis Group has also ushered in substantial and significant progress.

On May 14, Zero announced the establishment of a Leapmotor International B.V. (Zero International) joint venture with Stellantis Group. The establishment of the new company has also accelerated the pace of zero-running cars out to sea. According to officials, sales in the European market will begin in September this year, and the number of sales networks in Europe is planned to expand to 200 by the end of 2024. From the fourth quarter, it will enter the markets of India, Asia-Pacific, Middle East, Africa and South America. In terms of models, Zero International will launch at least one new model in each of the next three years. Some people in the industry pointed out that the choice of zero-running cars to cooperate with Stellantis Group is conducive to the establishment of zero-running cars in overseas production bases, and at the same time, it is also conducive to the development of overseas sales markets, increase sales and expand the scale of enterprises.

However, at present, there are many domestic car companies that are accelerating the expansion of overseas markets. Zero-running cars will also face certain challenges if they want to gain more market share.

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