Recently, news about the significant price cuts on BBA (Mercedes-Benz, BMW, Audi) electric vehicles has been everywhere. It's quite surprising because, 20 years ago, owning a Mercedes-Benz, BMW, or Audi practically guaranteed you wouldn't have trouble finding a spouse.
Now, in a market dominated by new energy vehicles, BBA's electric vehicles are surprisingly not selling well.
Mercedes-Benz's best-selling electric vehicle now is the EQE, which had its best sales month last year barely crossing a thousand units. This is significantly less compared to domestic new energy competitors. BMW's leading electric vehicle is the i3. with monthly sales recently exceeding 6000 units. However, this is under the premise of a significant price reduction of 100.000 yuan. As for Audi's flagship Q4 e-tron, there have been several months where it sold just over 2000 units.
A detailed analysis reveals two main reasons for this harsh reality:
First, after decades of experience, Chinese consumers have become very knowledgeable about cars. They no longer see BBA as synonymous with luxury and comfort that must be purchased. Additionally, many self-media evaluations are quite professional and have a substantial impact. The average person can judge the quality as soon as they get in the car. Therefore, although the BBA brand is strong, it's difficult to directly translate this brand strength into their products.
Second, BBA's electric vehicle products lack competitiveness. For example, the BMW iX3 has been analyzed by many car bloggers. Its maximum range is only 550 km, the maximum power is just 210 kW, it takes 45 minutes to fully charge, it only has a single motor across the series, no all-wheel-drive system, no genuine leather seats, and even a 360-degree panoramic view needs to be optional. Compared to similarly priced or even cheaper domestic cars like NIO or Zeekr, its competitiveness is obviously lacking. Moreover, in the 5G era, Chinese new energy vehicles have basically reached 5G levels in terms of intelligence, while BBA is still in the 3G era, making the overall smart experience less appealing.
Discussing why our domestic new energy vehicles can achieve overtaking in corners, it's because they follow a development logic like this: First, focus on R&D to improve product performance, accept a certain period of losses, attract users through product performance and service, then achieve economies of scale as sales grow, and cover previous losses with additional industry revenue.
In contrast, BBA's approach to new energy cannot follow the path of domestic new energy vehicles.
First, large companies are slow to change direction. New energy vehicles disrupt the century-old automotive industry, changing people's car usage habits and experiences, and disrupting the market structure. BBA's strength lies in fuel cars, and most of their income also comes from fuel cars globally. This makes it unlikely for them to decisively develop new energy vehicles.
Second, their global presence is too extensive. BBA is a typical global brand. Faced with the huge Chinese market, they must meet new consumer demands. However, will they overhaul themselves for the Chinese market? It's unrealistic. Therefore, they have been slow and hesitant in the electric vehicle sector.
Third, Chinese competitors are too formidable. In terms of technology and manufacturing, Chinese new energy vehicles have been leading the way for years. BBA has no significant technological advantage, making it difficult to produce a hit product. For instance, NIO's battery swapping, with over 2300 swap stations, has addressed a critical issue for new energy vehicles: range anxiety.
Previously, there was news that in Shanghai, BBA's overall sales, including fuel cars, have lagged behind NIO for six consecutive months. This reflects a trend where BBA's decline in new energy vehicles has also affected their fuel cars during the transition to electric vehicles.
Is BBA really done for? Not necessarily. BBA's century-old heritage is no joke. In China, mentioning BBA still carries a lot of clout. To see BBA regain its glory in China, they need to at least achieve the following three points:
1. Grant more autonomy to Chinese teams in technology R&D, manufacturing, and marketing, and employ more local talents who understand the Chinese market. Companies like BYD and NIO are very adept at talent acquisition, focusing on integrating local and international talents, regardless of their origin.
2. Temporarily set aside their century-old experience. Frankly speaking, in the new energy sector, the German market is just a fraction of the Chinese market. Replicating the German experience in the Chinese market is unreliable.
3. Fully embrace electrification, establishing their electric vehicle base and production lines in China, and compete aggressively. Like Tesla, they should establish their main base in the Chinese market to gain affinity.
