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Chengda Keep Production and Keep the Same Price

April 26, 2022

We have been talking about the cold winter of the auto market for many years. Affected by the epidemic in Shanghai, the domestic auto market has entered the coldest season. The sharp rise in raw materials, the shortage of chips, and the epidemic have caused many car companies to stop work and production. According to the data of the China Passenger Car Association, the sales volume of passenger cars in the narrow sense fell by 10.5% year-on-year in March, and the data in April was undoubtedly worse.


The OEMs in Shanghai and Changchun, which are at the center of the epidemic, were forced to suspend production due to epidemic prevention requirements. However, many car companies have also been implicated in the supply of chips and parts factories in Shanghai and have to suspend production, which has greatly affected the entire domestic auto market. The butterfly effect of "one stroke and one move all over the body" due to the epidemic.


Dominant performance: the price increase has a wide range


Since the end of last year, due to the rise in raw materials, pure electric vehicle companies have announced price increases one after another, but they refuse to complete statistics. More than 20 new energy vehicle companies have announced price increases, and they have designed more than 40 models.



Among them, Tesla is undoubtedly one of the most sensitive car companies to the price of raw materials, which may be related to its strategy. Musk said before that Tesla's strategy is to give all profits to consumers, hoping to exchange volume for lower prices. Cost, and ultimately continued to reduce prices, benefiting users, in order to seize the market, after several rounds of price adjustment, Model 3 canceled the front-wheel drive version, the cheapest rear-wheel drive version price came to 279,900.

Among the new forces, Li Auto and Xiaopeng announced price increases successively at the end of March. Even Weilai Automobile, which announced in March that it would not increase its price, broke its promise. Recently, it also announced that Weilai would increase its price by 10,000 yuan. In the face of doubts , Li Bin had no choice but to respond with "a last resort".



Even the Hongguang MINIEV, which used to be a 30,000-level car, has increased its price. Wuling Nano and Baojun KiWi EV series have increased prices by between 4,000 yuan and 8,000 yuan. This month, Hongguang MINIEV launched the GAMEBOY version, which attracts male users and also increases the configuration.


Of course, it is not only pure electric models that are affected by raw materials. Mercedes-Benz and BMW have also announced price increases for some models. However, according to our interviews with dealerships, their price increases are not obvious, and they are limited to most of the imported models that are in short supply.


The epidemic has already been shut down on a large scale, and the overseas energy situation is urgent, and the prices of automotive metal raw materials, chips, etc. remain high. These environments are doomed to a real Mercury retrograde in the history of this year.

Concealed mentality: deal with positive response, do not lie flat and rotten


A few days ago, following a 10.5% year-on-year decline in passenger cars in the narrow sense in March, the Passenger Car Association expects that the impact of the epidemic on the auto market in April will be further deepened. To sum up, retail sales of passenger cars in the narrow sense in April are expected to be 1.1 million units, a year-on-year increase of 1.1 million. It fell 31.9%, continuing the previous downward trend.



According to the current development of the epidemic, the cold winter of the automobile industry is far from over. Shanghai, Jilin, Shenyang and other places, as the epicentre of the epidemic, gathered leading car companies such as SAIC, FAW-Volkswagen, FAW-Toyota, Tesla, etc., accounting for 20% of the country's total car production. In particular, as the two most important car companies in Shanghai, SAIC and Tesla have been affected by the severe epidemic shutdown. Currently, both SAIC and Tesla have resumed closed-loop production on April 19.


Ideal, Weilai and other car companies also said that due to the epidemic, the production capacity of the factory has been greatly affected, and the delivery date of Weilai ET7 has been repeatedly delayed, while Ideal said that it is actively restoring production capacity and controlling the delay period of new car delivery within three weeks. It is also an explanation for the user. At the same time, Li Xiang, the founder of Ideal, also expressed his concern about the existence of the fifth-, fourth-, and third-tier component suppliers who had never needed to manage and worry before in the epidemic. Said to assist the second-tier suppliers to help them.



For example, it was reported a few days ago that GAC Honda, GAC Toyota, Dongfeng Nissan and other OEMs have all stopped, semi-suspended and reduced production in some production lines due to the supply of parts and components. And we found on multiple complaint platforms that consumers have complained about the delayed delivery of the brand one after another. Among them, there are many popular car companies such as Nezha and BYD. Most of these consumers' demands hope that the manufacturer will deliver as soon as possible instead of returning it.


The shrinking of production capacity is also quickly projected to the end market. During our visits to dealers, we found that the current auto market is obviously cold. The main reason is that dealerships generally have insufficient inventory, and there are no discounts for terminals. The general price increase in the new energy market also makes consumers think that it is not a good time to buy a car. .


It is worth mentioning that the Duojia dealership told us that the market is not popular due to reasons such as production capacity and price, but there is still demand from buyers, so they think that for dealerships, the focus of the current and even the next few months All of them are to collect customer sentiment. When the social situation in cities such as Shanghai and Geely is cleared, as well as the stability of the international situation, plus the traditional peak season of gold, nine silver and ten times, the need will be released in a concentrated manner.


At last


The surface of the lake was quiet, and the bottom of the lake was surging. The current market seems unusually calm and lifeless, but in fact, competition has not stopped. In extraordinary times, stable reputation, product development, production capacity reserves, spare parts supply, etc. all test the capabilities of car companies, brands and OEMs. If you want to take the opportunity to lie flat and rotten, when the market recovers, you must be the first to eliminate that one.