The next main task for the new auto - making forces: Selling one million vehicles. Everything else is just noise.

The new players in the industry have been in the race for nearly a decade.

As each new player approaches the tenth anniversary of its establishment, they have all submitted their answers to the "ten - year examination". The first - tier players have delivered over one million vehicles, and the second - tier players are striving in the range of 500,000 - 700,000 vehicles.

From the "race for niche markets" a decade ago to the "all - out melee" this year, electric vehicles have gone through price wars and technology wars, ultimately leading to a blatant scale war.

The new players in the industry have gradually realized that only by crossing the one - million - scale threshold can they get the ticket to the next battle.

01 The Next Chapter: One Million

In a blink of an eye, the new players in the industry are no longer so "new".

Since last year, many electric vehicle players have reached their "tenth birthday" one after another. NIO, XPeng, and Li Auto have all passed their tenth anniversary of establishment. Leapmotor is about to enter its tenth year this year. Even Jia Yueting's venture into car - making dates back to a decade ago.

After the first half of this year, many car companies have successively announced their cumulative sales, giving the impression of submitting papers in the "mid - term exam".

Li Auto, the leading player, has cumulatively delivered 1.33 million vehicles; under the post announcing that XPeng's cumulative deliveries have exceeded 800,000, fans are shouting: Break through one million this year! Leapmotor, which has made a full comeback with two popular models, has also exceeded 800,000 in cumulative sales; NIO and AITO are approaching the 800,000 mark; ZEEKR and Changan Deepal have exceeded 500,000...

Looking back, the new players in the industry were playing a "self - enclosed" word game. Car companies were eager to find their own highlights in niche tracks. For example, WM Motor issued its prospectus with the title of "the number one pure - electric vehicle manufacturer in the mainstream Chinese market in 2021".

"At that time, electric vehicle players were in a 'honeymoon period' with the market," Jialin (a pseudonym), a more than ten - year electric vehicle industry insider, told Node Auto. "The market needed electric vehicles, so it provided great policy support for the replacement of fuel vehicles with electric ones, which led consumers to spontaneously start a wave of electric vehicle replacement. During this period, the difficulty level for electric vehicle players in the market was at the initial stage. We saw that a batch of low - priced and less - intelligent electric vehicles like WM Motor and Nezha were very popular in the market. Many electric vehicle factories targeted a niche track to capture a specific market first."

Now, this "honeymoon period" has ended.

As WM Motor and Nezha are moving towards bankruptcy, the remaining players have realized that niche tracks, word games, and once - popular models are useless. Only scale is the king.

He Xiaopeng said: The next key point in the new - energy vehicle market is who can produce and sell one million new - energy vehicles per year. This is just the entry ticket for the elimination round, which means those who don't reach this level will be eliminated; Li Bin said: The annual sales volume of 2 million vehicles is the survival line for car companies. If there is no hope of reaching this sales volume, I think it will be very difficult.

It's not hard to find that the automotive industry has reached the next consensus: Annual sales of one million vehicles is the ticket to the next level.

Why one million?

The price war is squeezing the profit margins of car companies. In the past three years, the average unit price of new - energy vehicles from new players has been declining year by year. The average unit price of Li Auto has dropped from 340,000 yuan in 2022 to 290,000 yuan last year; NIO's has dropped from 400,000 yuan to 300,000 yuan...

Lingling (a pseudonym), one of the first - batch NIO owners, has a deep feeling about this: "Electric vehicles were a 'tech toy' a decade ago. Consumers were curious about the products and patient. The first - batch users were not very sensitive to price." She told Node Auto. "But now, consumers' sense of boundaries between new players and traditional car companies' transformation is becoming blurred. We can see that users of XPeng MONA M03 are also comparing it with Geely. After the curiosity factor disappears, users become very rational. 'Everyone is equal in the face of price'."

It can be said that the new players in the industry are being passively or actively involved in the price war. In this trend, increasing sales volume is the only solution.

Only with a large enough scale can the cost be averaged, and only then can money be made in the price war.

There is another reason. The competition among suppliers in the automotive industry is also very obvious.

Because the speed of new electric vehicle models is extremely fast and there are too many alternatives, everyone wants faster deliveries. However, there are only a few leading suppliers in the electric vehicle industry, so everyone is competing for a priority supply position.

There are two ways for downstream companies to "entice" upstream companies. One is the payment period, and the other is scale.

Recently, many car companies in the industry have joined the "60 - day payment period" camp, which reflects from the side that car companies are shortening the payment period to compete for upstream priority resources. Scale is as effective as the payment period. It's easy to understand that large - scale wholesale is always more likely to get discounts and priority than small - scale procurement.

After the honeymoon period, when the new players in the industry are caught between the price war and supplier competition, one - million sales volume has become the "iron threshold" to enter the next stage of the competition.

02 How to Cross the "Iron Threshold"

Recognizing the threshold is the prerequisite for success, and crossing the threshold is a must for success.

The new players in the industry are consciously moving from "capturing territories" to "all - out melee".

Keep adding, keep adding, and keep adding.

Add on products. Electric vehicle companies have three major strategies: price reduction, brand expansion, and energy - replenishment diversification.

XPeng MONA M03 is a typical successful case of price reduction. With a starting price of 119,800 yuan, MONA M03 directly targets BYD's core market. The success of MONA M03 also confirms the truth in the electric vehicle industry - when the technology is immature, target high - end customers; when the technology is mature, target low - end customers.

XPeng has brought its long - standing advantage in intelligent driving to MONA M03, using a pure - vision solution to reduce technology costs and achieve higher - level intelligent driving for mid - and low - priced models. It also leads in terms of battery life. MONA M03 has two battery - life versions, with CLTC - rated ranges of 515 km and 620 km respectively. The 620 - km range version is priced at only 129,800 yuan. In comparison, models such as AION S MAX and Roewe D7 EV with a range of over 600 km are priced above 150,000 yuan.

Leading in the "pain point" of battery life and differentiating in the "itch point" of intelligent driving, the popularity of MONA M03 has enabled XPeng to successfully capture the market below 150,000 yuan.

Different from directly launching products under the original brand for price reduction, NIO has created a sub - brand matrix. The NIO brand maintains its original high - end positioning and market share. Among pure - electric models priced above 300,000 yuan, the sales of NIO ES6 and NIO ET5T in the past six months still lead among new players.

Image source: Dongchedi

On this basis, to expand its coverage, NIO has launched LeDao L60, with a starting price of 219,900 yuan, targeting Tesla Model Y. "The owner group was very lively on the day of the press conference. We are very optimistic about LeDao L60," a NIO owner told Node Auto. Later, it launched the Firefly brand, targeting BMW MINI and focusing on high - quality small cars.

"NIO was initially positioned as high - end, social, and service - oriented. So, compared with the attempt to reduce the price under the original brand, the approach of independent sub - brands can not only retain the original brand's tone but also meet the needs of product expansion," Jialin (a pseudonym) analyzed to Node Auto. "Gradually, NIO will form a product pyramid like a group, breaking through each niche track one by one."

In addition, in the past year, the boundaries between pure - electric and extended - range vehicles for new players in the industry have also become blurred. Leapmotor has released extended - range models, XPeng has announced that it will develop hybrid vehicles, and Li Auto, which has achieved success with extended - range SUVs, has started to promote pure - electric models. After Li Auto MEGA, Li Auto i8 is also about to be launched. Just a few days ago, Li Xiang posted on the social platform, recalling the entire ten - year R & D process of Li Auto i8 from prediction, project establishment to its upcoming official release. This car is also known as the "tenth - anniversary tribute of Li Auto".

Add on channels.

Leapmotor has cooperated with the Stellantis Group. With the help of the Stellantis Group's spare - parts warehouses, Leapmotor has established a faster parts - delivery system in Europe than in China, capable of delivering 95% of parts within 24 hours. According to the plan, by 2025, Leapmotor International will form a channel scale of over 550 stores, building a service system covering the world's major markets. Leapmotor plans to continuously deepen its presence in the European market and accelerate the exploration of emerging markets such as Southeast Asia and the Middle East, aiming to double its overseas sales year - on - year in 2025.

The new players in the industry, which originally "stuck to" the direct - sales model, have started to adopt a dual - model of direct sales + dealers to rapidly expand their sales network. XPeng has launched the "Jupiter Plan" to introduce dealers to open up sales channels in lower - tier cities; ZEEKR has also introduced a partner - agency model to quickly fill the gap in the sinking market.

The ultimate goal of the new players in the industry, who are constantly expanding across various aspects such as products, technology, and channels, is to break through the one - million mark.

03 Is the Winner - Takes - All Situation a Foregone Conclusion?

This year, the electric vehicle industry is showing a "winner - takes - all" situation.

In the first six months of this year, the sales of the top five new - energy vehicle manufacturers accounted for 59.2% of the overall market share, and the top ten accounted for 77.8%.

Image source: China Passenger Car Association

This is because the technology and brands of electric vehicles are gradually maturing, and there are fewer and fewer positions left in consumers' minds.

From the perspective of electric vehicle technology, especially battery technology, it has become quite mature. The improvement of battery technology can be achieved through material upgrading or structural upgrading. For example, from the now - obsolete lead - acid batteries, nickel - cadmium batteries, and lead - acid batteries to the current situation where leading battery manufacturers are simultaneously deploying sodium - ion batteries, semi - solid - state batteries, all - solid - state batteries, etc. However, material upgrading of batteries is not that easy. Each new breakthrough from R & D to mass production may take nearly a decade. So, major car companies are focusing on the structure. For example, AITO M9 uses CATL's ternary lithium batteries with high energy density and is equipped with an advanced battery management system. This combination not only improves the battery's energy density but also optimizes the battery's usage efficiency. The intelligent battery management system can precisely control the use of electricity, making every kilowatt - hour of electricity play its maximum value.

Overall, it is unlikely that new players in the industry can make a significant breakthrough through self - developed batteries in a short time.

From the perspective of brands, for luxury, look at AITO; for space, look at Li Auto; for cost - effectiveness, look at Leapmotor; for sedans, look at XPeng and Xiaomi. With the establishment of these benchmark brands, there is basically no more blue ocean to be created in the market.

In this situation, the brand that first achieves scale monopoly can gradually achieve supply - chain monopoly and technology monopoly. The better the sales, the more supplier advantages it has, the more money it can invest in R & D, and then it can feed back into sales. The winner - takes - all situation arrives.

"Last year, there was a saying in the electric vehicle industry that intelligence would be the best opportunity for latecomers to catch up," an electric vehicle industry insider recalled to Node Auto. And this year, with the slogan of "technology equalization", such opportunities are becoming fewer and fewer.

Because the scarcity of technology is the reason for a high price. Now, the installation rate of L2 - level and above assisted - driving functions in new - energy passenger vehicles has exceeded 66%, and the scarcity of technology has been greatly diluted.

Since we can't compete on scarcity, we can still compete on experience.

"End - to - end" has become the keyword for intelligent driving this year.

Huawei's HarmonyOS ADS 3.0 has used the end - to - end network for the first time in the integration of three domains: highway, urban area, and parking. XPeng and Li Auto have also installed end - to - end large - scale models on all vehicles. NOA navigation covers the full scenario from rural areas to urban areas, including toll stations, closed parks, and basements, with no breakpoints during scenario switching, and accurate spatio - temporal perception and navigation behavior.

The focus on end - to - end in intelligent driving is a sign of the maturity of the entire industry chain. High computing power is a necessary condition for achieving end - to - end. Taking NVIDIA DRIVE Thor as an example, its 2000 TOPS computing power is four times that of the previous generation, supporting multi - domain integrated computing for autonomous driving and intelligent cockpits. With the SOA software architecture, it can achieve dynamic expansion of functional modules. As the process of automotive - grade chips evolves to below 5nm and is applied on a large scale, the unit computing - power cost is decreasing at an annual rate of 35%.

When intelligent driving gradually moves towards technology upgrading and experience popularization, electric vehicles will completely become a money - burning, manpower - intensive, and high - threshold game. This year, WM Motor and Nezha are gradually on the verge of being eliminated. Next, the players who are about to face the "ten - year examination" need to submit qualified answers in terms of both scale and technology.

Conclusion

In the past decade of electric vehicle development, there have been many voices in the industry. At first, there were skeptical voices - Can electric vehicles travel far? Can the energy - replenishment problem be solved?

Then, there were excited voices - Capital was pouring in, and consumers were buying.

After that,