AutoBeta(AutoBeta.net)11/23 Report--

On November 22, Li Yunfei, general manager of BYD Group Brand and Public Relations, sent an urgent response that the online information about BYD's investment and cooperation with Lulai was seriously false. Please do not believe the rumors and do not spread the rumors. At the same time, Ma Lin, assistant vice president of automobile brand and communication, also refuted the rumors on Weibo. "the company is doing well, with cash flow turning positive in the third quarter, gross profit increased in October, and sales of Ledao models are expected to exceed 10,000 in December," Ma said. Thanks to friends' concern and support, we continue to power up. " In addition, Ma Lin also released screenshots of a Wechat chat with Li Yunfei, general manager of BYD Group Brand and Public Relations. It mentioned that if it is the BYD employees who spread the false news, they hope that they can clarify and apologize; if it is not the BYD employees, Weilai and BYD will jointly report to the police.

Earlier, there was a suspected WeChat moments post posted by BYD employees, saying that BYD would work with Weilai Group to set up BYD Automotive Group, in which BYD owns 51% and Ulai holds 49%. At the same time, Bifutur Automotive Group acquired Xilai Motor for 16.5 billion, and BYD supported it by providing capital and technology. After the acquisition, the Bifui Group directly controls Lai Motor, but it is still operated independently by the Lai Group. The acquisition aims to achieve the integration of resources and complementary advantages, and BYD's Yi Sifang Yi San Fang Technology to enhance the competitiveness of Lulai in the new energy vehicle market. Through technical coordination, production and supply chain optimization, market expansion and other measures to help Lai Automobile to consolidate its high-end position, it is expected to create greater value and promote the development of the new energy vehicle industry.

To put it simply, BYD partnered with Weilai to set up the BYD Automobile Group, in which BYD also has a controlling shareholding. Secondly, with the financial support of BYD, BYD acquired Weilai Automobile for 16.5 billion yuan, but it still operates independently after the acquisition. The end result is that both BYD and Weilai refuted the rumors.

In fact, this news seems more or less outrageous. Although BYD said that it absolutely has the strength to acquire Wei Wei, 16.5 billion is equivalent to half a year's profit, but what is the significance of such an acquisition? after the acquisition, it is necessary to ensure the independence of Lulai Motors, not to mention the completely different positioning of the two companies. In addition, Weilai has been touting itself as an independent "entrepreneur" and unwilling to be at the mercy of external capital. However, although BYD has no possibility of acquiring Weilai, cooperation can be expected.

As for the cause of the heated debate, the high probability is also related to the current situation of Weilai. On November 21, Weilai released its third-quarter results, showing that during the reporting period, the net loss of Weilai expanded to 5.06 billion yuan compared with 4.557 billion yuan in the same period, and the net loss in the first three quarters was 15.53 billion yuan, the same as that in the same period. Previous data show that the cumulative loss from 2018 to 2023 has reached 86.63 billion yuan, and the cumulative loss over the past seven years has reached 102.16 billion yuan. In other words, although the global sales volume of Weilai is growing steadily, the business pressure is still very great in order to make a profit.

By contrast, BYD has become the largest automaker in China, not only in terms of market size, revenue or profits, but also at a domestic first-class level. According to the financial report, BYD achieved operating income of 502.25 billion yuan in the first three quarters, an increase of 18.9% over the same period last year, and net profit of 25.24 billion yuan, an increase of 18.1% over the same period last year. Such strong profitability also makes BYD more confident in cooperation with other companies, such as Huawei and Toyota, to achieve resource sharing and in-depth cooperation in technology and supply chain. Of course, BYD also has difficulties, its market size mainly depends on the BYD brand, the momentum of the high-end market, looking up or lack of market awareness.

In the view of "Automotive Industry concern", the probability of BYD acquiring Lulai is basically 0%. First of all, the product positioning of the two sides is different, and Li Bin will not agree that his brand will be acquired before the enterprise encounters a major business crisis. the probability of Lailai being acquired is still very slim. However, it does not rule out that BYD and Weilai have further cooperation, combining BYD's supply chain advantages and technical support, while BYD uses its high-end positioning to create a new product line, which is beneficial to both sides.

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