The price reduction of Tesla was proactive, but the new forces that subsequently cut prices were passive.
Just now, Tesla said that it accepted orders twice as fast as its productivity in January, which also means that Tesla's price cuts were very successful. The 229,900 Model 3 and the 259,900 Model Y are a powerful black hole in the field of electric vehicles, sucking away many potential users in this market.
For users who have originally considered Tesla, they can buy a larger Model Y with the budget of the past Model 3, and consumption upgrades have accelerated their decision-making on Tesla. The Model 3, which is already cheaper than Dolphin, Han, , Xpeng P7, and NIO ET5, is destined to become a generation of street cars.
As I just said, Tesla's price cuts are proactive. After calculating gross profit margin, FSD installed capacity, upcoming model changes, 4680 new technology and other comprehensive reasons, Tesla chose to launch a new round of price cuts in early 2023.
This price cut caused a shock in the market. In less than half a month, brands such as Zhongwenjie, , Xpeng, and also quickly initiated price cuts. However, unlike Tesla's surge in orders, the price cuts of new forces did not have the desired effect.
explains one thing, price reduction requires capital.
01 Financial Capital
Tesla has always been the vane that drives industry prices. In fact, a large number of new forces do not want to reduce prices, but it is obvious that Tesla's price reduction speed exceeds their imagination.
For Li Bin , Ideal, He Xiaopeng , they never imagined that a giant catfish like Tesla could stir up such a terrible market. A high-cost electric car in the hands of Tesla could actually be priced lower than that of a fuel car.
Today, when the 3 Series sells for 300,000 yuan, the Model 3, which is covered with precious metals, , and chips, only costs 230,000. The core foundation of
is that Tesla itself has a strong cash reserve. As the world's highest market value company, Tesla's current market value is still twice that of Toyota , and its comprehensive gross profit from single vehicles also exceeds Toyota.
can make money and has high gross profit, which is the core fundamental reason for Tesla's price reduction.
02 Why can technical capital
make money? This is a technical job.
In terms of production, Tesla implements minimalism , taking Occam's razor theory to the extreme. Simply put, it is, "Don't add entities if unnecessary." Therefore, in terms of design, Tesla has never pursued angular design, including the interior, which is a large screen. In fact, it is not for a sense of technology, but to improve production efficiency.
Fewer parts bring many advantages. For example, the procurement process is simpler, there are fewer suppliers, and suppliers can better control quality. For enterprises, production efficiency is higher, management costs are lower, warehousing costs are lower, and factory land is less. These are the most direct advantages.
You can see that Tesla’s low price is really not about cutting corners, but that a series of subsequent costs are very low. Low cost means high gross profit margin.
In addition to the ease of management, Tesla has also made many innovations in technology.
For example, the body-in-white is actually made of one-piece die-casting. A large car body is made of two parts, and the front and rear halves are directly spliced together. At the same time, traditional fuel vehicles often have several kilometers of wiring harness, The wiring harness of Tesla Model Y is less than 300 meters, and the wiring harness installation and procurement costs are also very low.
For another example, all kinds of high-cost chips are produced by ourselves, and the motors and BMS are designed and produced by ourselves. Moreover, there is only one model, with only 3 and Y models in high volume. The low-cost advantage behind the large sales is very obvious.
This kind of thing cannot be learned from the new forces that pile up car models. Tesla's success is not only its own strength, but also driven by the strong momentum behind Silicon Valley , Wall Street , and the chip industry and software industry in the North American market.
In fact, behind the success of a Tesla, there may be countless Teslas in other industries driving it.
03 Brand capital
Brand is also capital, which is the key to the market's subtle recognition.
Just like when we buy a fuel car, I don’t think the E-Class is much more powerful than the S90 or XFL. However, with the brand appeal of Mercedes-Benz , the E-Class is 100,000 yuan more expensive than the XFL, and its sales volume is completely crushed.
Don’t think that brands have no value. Building brand value requires companies to spend a lot of money and technology to operate.
Tesla's brand value has remained unchanged in "car accidents" one after another, which has verified the reliability of its brand value from the side. New domestic forces are constantly trying to benchmark Tesla's practices, which has further verified the status of many companies targeting Tesla.
Take a step back and look at the entire market. With a budget of 250,000, Tesla has become an unavoidable choice. Even fans of BYD will use Seal to compare Model 3 and come to a conclusion that it is stronger than Tesla.
Obviously, whether you buy Tesla or not, its brand value is a key label that dominates the market.
So when we reconsider this issue, Tesla’s price cuts have a huge impact on the entire market. It seems to be telling new forces that if they want to truly win the price war, they must decisively cut prices on the basis of high gross profits, and use strong technology and brand value to guide users, in order to achieve true success.
