China's new energy vehicle market begins to move towards high-end, and domestic brands face the darkness before dawn

On June 5, Audi China General Manager Wei Yongxin announced that Audi will produce pure battery electric vehicles in China in 2020 or 2021. Audi said that it will launch 10 pure electric vehicle models in China in 2022, covering all levels of market segments.

Since then, the three traditional giants BBA, including Audi, have clearly announced plans to set up pure electric vehicle factories in China. Obviously, Audi is the last one.

Before Audi, there was Tesla

In mid-May, Tesla, the global leader in pure electric vehicles, announced the establishment of a company in Shanghai, which was widely regarded as Tesla's preliminary preparation for building a factory in China.

Not long ago, Tesla's global sales director Robin Ben disclosed at the shareholders' meeting the company's plan to set up the world's first overseas manufacturing plant in Shanghai, but did not give a timetable for construction.

The announcement of the plan to build a factory in China is undoubtedly good news for Tesla. After the announcement of the plan, Tesla's stock price rose by $2.87. There are three positive factors:

1. Building a factory in China can help Tesla avoid high import tariffs, thereby providing Tesla with greater room for price adjustments.

2. China's new energy vehicle industry has mature supporting facilities and its labor prices are relatively lower than those in the United States, which can further reduce production costs, lower product prices, and expand market share in China.

3. Tesla’s current financial constraints are well known to everyone, and the US media has even started a countdown for Tesla. The good news of building a factory in China may help Tesla complete the next round of financing and get through the current “darkest moment”.

Like Tesla, Audi announced its plan to produce pure electric vehicles in China, also hoping to further accelerate its layout in China.

In fact, it is not just Tesla and Audi that are stepping up their efforts to enter China's high-end new energy vehicle market. Audi's old rivals Mercedes-Benz and BMW have already taken their own steps.

BBA opens up high-end market for new energy vehicles

At the end of February this year, BMW and Great Wall Motors signed a letter of intent for cooperation, and initially reached an intention to cooperate in new energy and future technologies in the form of a joint venture to realize the localized production of MINI pure electric vehicles.

Last month, Wei Jianjun, chairman of Great Wall Motors, flew to Germany. Industry rumors circulated that he might have negotiated a joint venture with BMW.

On May 12, Mercedes-Benz and BAIC signed a strategic restructuring project in Shunyi, and the two parties will build the first domestic high-end new energy vehicle production base. In fact, as early as 2010, Mercedes-Benz and BYD had jointly invested in the establishment of the Denza new energy brand, but the performance of Denza was poor.

For traditional automobile manufacturers such as BBA, although there are essential differences between internal combustion power systems and electric vehicles, because they have rich experience in automobile production and a good market foundation, after entering the field of new energy vehicle production, their advantages in design, production and brand will surely continue.

When Tesla and BBA are all here, it means that China's new energy vehicles have truly started the high-end process, especially when Audi is going to launch 10 new pure electric cars across several price ranges in one go. At this moment, domestic new energy vehicle companies that once monopolized the market may usher in a period of darkness before dawn, because the real opponent is about to come.

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.