From PPT to offline, new car-making forces have become a bottomless pit for funds. How long can Internet car-making last?

Recently, it was reported that NIO has submitted listing documents to the US stock exchange, intending to raise $2 billion. NIO's money burning speed is very alarming: in the four years since its establishment, it has raised about 15 billion yuan, which is equivalent to Tesla's 10 years of money. NIO's listing in the United States should be to raise funds for the company's further development.

I only hear the sound of money being burned, but no cars are coming off the assembly line

There are many new car-making forces like Weilai that are burning money. Xiaopeng, Singularity, Weimar and other Internet car-making companies are constantly burning money to build cars. Various capitals have also invested heavily, and the Internet car manufacturing industry is thriving.

Xiaopeng Motors has raised more than 5 billion yuan, Singularity Motors has raised 17 billion yuan, and WM Motors has raised 20 billion yuan. But so far, no Internet car-making company has delivered products in batches, and consumers can only see some sample cars or even fancy PPTs.

Even for NIO, its so-called delivery is just handing over 10 cars to its own employees, which is not mass production. What is more worrying is that among the new car-making forces, only WM Motor has obtained the production qualification.

Why do Internet car companies spend so much money, but the mass delivery date of their products is still delayed again and again? This requires talking about the production process of the car.

In the traditional automotive industry, it usually takes about five years for a car to be designed, developed and delivered to users. In the first two years, car companies mainly complete the design and development of products. After development is completed, car companies also need to conduct repeated testing and verification.

From design to testing, a lot of money is required to support it.

Automobile testing is very tedious, often requiring hundreds of prototypes to undergo various experiments. And these hundreds of prototypes cost real money. Automobile testing experiments also cost a lot of money. For example, a car wind tunnel test costs about one million RMB a day. Only after the various functions of the car have been verified and there are no problems can it be officially mass-produced.

In contrast, most of the current Internet car-making companies have been established for less than 5 years, and many of them are starting from scratch and lack experience in car manufacturing. These companies are engaged in new energy vehicles, and the time for research and development, testing and production is very tight. Most projects are hastily launched, so it is not surprising that product delivery dates are frequently postponed.

Although the amount of financing for new car-making forces is already exaggerated in the eyes of other Internet industries, this money is not enough to even get an entry ticket to build a new energy vehicle company.

Internet thinking has failed in the automotive manufacturing industry

The rapid development of China's Internet industry has really stimulated the ambitions of Chinese capital. China's counterattack in the home appliance and mobile phone industries has also given these Internet car-making companies more confidence. All of them dare to benchmark Tesla, shouting that they can overthrow traditional car companies within a few years and realize the Chinese dream of making cars.

There are rumors that Huawei is considering entering the automotive manufacturing industry, but Ren Zhengfei has not yet given the nod. Many senior executives of Huawei have long been eager to try their hand in the automotive industry, but now Huawei is promoting a more cautious Internet of Vehicles.

In fact, it is no longer a new thing for cross-border giants to enter the automotive industry.

Both Apple and Google have launched their own car-making plans. Apple's car-making process can be said to be a step-by-step process. It once approached BMW and Mercedes-Benz, but after encountering setbacks, it turned to cooperate with Volkswagen. The difficulties in car-making directly shifted Apple's ambition from making complete cars to autonomous car software.

Google was wiser from the beginning, focusing on autonomous driving rather than the entire vehicle. Currently, Apple's autonomous driving technology lags far behind Google. Apple's unrealistic ambitions at the beginning are probably one of the reasons.

Many people think that since China can make mobile phones, it won’t be too difficult to make cars, which obviously underestimates the difficulty of the automotive industry.

The mobile phone industry has high technology content, rapid product iteration, and fierce competition. The fact that domestic mobile phones can achieve today's results does show that China's manufacturing industry has made great progress. However, the difficulty of making a successful mobile phone is not at the same level as that of making a successful car.

An important difference between mobile phone manufacturing and automobile manufacturing is that mobile phones do not have high safety requirements and are more tolerant of quality defects. The worst case of a mobile phone is a battery explosion, and other performance failures will at most cause customer dissatisfaction.

But for cars, safety is the most basic requirement. No one wants to ride in a car with a 99% pass rate. A 1% failure rate is a fatal blow to car companies.

In 2016, the Guangdong Provincial Quality Supervision Bureau found that 36.7% of mobile phones failed to meet the standards in a random inspection of 120 batches of mobile phones. On average, Chinese people change their mobile phones every 22 months. Cars are durable goods with a design life of several decades, which puts forward high stability and high safety requirements for car manufacturers, and they must also be easy to maintain. This whole process is reflected in the manufacturing process as a series of tests and inspections.

New car manufacturers challenge traditional car companies? Wait!

A mobile phone has 3,000 parts, while a car has an average of more than 30,000 parts. The industrial chain of cars is much more complicated than that of mobile phones.

Automobiles are the most complex products among existing large-scale civilian products. An automobile company often has thousands of suppliers. Any problem in any link may affect the overall quality of the car. All these make the industrial chain management of the automobile industry very complicated and pose great challenges to the stable delivery of products.

The automobile industry is still an industry that relies heavily on technology accumulation. BBA are all century-old brands, which have accumulated their advantages today. Tesla, the benchmark of the new energy vehicle industry, has continued to experience twists and turns after more than a decade of trials and tribulations. It is indeed a bit rash for an Internet car-making company that has only been established for a few years to clamor to subvert traditional car companies.

There is no doubt that Internet car companies will bring all kinds of new ideas to the automotive industry. However, it is impossible to build reliable cars just by playing with concepts and Internet entrepreneurial models. If a car cannot even guarantee basic safety, stability and comfort, no matter how many innovations and gimmicks it has, it will not be able to gain a foothold in the market.

The automobile industry has a long production cycle, requires a very high amount of capital, and relies on long-term technology accumulation and the high degree of cooperation of the entire industry. Considering these, the current financing scale of Internet car companies is far from enough. As Internet car companies continue to postpone delivery deadlines and fail to obtain production qualifications, whether capital can continue to follow up and how long Internet car manufacturing can last are also imminent and realistic issues.

Consumers applaud the new force of Internet car manufacturing, but they also want to say, wait!

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.