Written by | Eldon's Ring of Law
Edit | Routing Agency
Last week, the market raised that "invisible hand" again.
However, this pair of hands seems to regulate not the public consumption decisions of the current period, but the emotions of market participants.
On the road to price increases, the first step is oil prices.
Since 2022, the retail price of refined oil products in China has experienced five consecutive increases. If you take into account the price adjustment from 24:00 on December 31, 2021, it has experienced "six consecutive increases".
Among them, the oil price increase on March 3 made the domestic No. 92 gasoline enter the "8 yuan era", and the national average price reached 8.01 yuan / liter; the 95 gasoline entered the "8.5 yuan era", and the national average price was 8.52 yuan / liter.
On Friday, those numbers were quickly refreshed again.
As of March 18, the price of Domestic No. 92 gasoline per liter was raised again by 0.59 yuan to 8.60 yuan; the price per liter of No. 95 gasoline exceeded 9 yuan to 9.14 yuan.
The rising price of oil has also made the dispute over whether to choose a fuel vehicle or choose an electric vehicle more cost-effective, once again.
The "oil and electricity dispute" has resumed
The pace of this round of gasoline price adjustments is so fast that, except for driving the car to the gas station a day in advance to queue up to fill the fuel tank in the epidemic prevention and risk control gap, the public does not seem to have time to adjust larger consumption decisions based on this news – such as buying a car.
However, in the automobile production and marketing industry, the rise in oil prices has added new arguments to the long-standing "oil and electricity dispute".
Shen Hui, founder and CEO of WM Motor, said through social media on March 9, "No. 95 gasoline will exceed 9 yuan / liter... According to the calculation of 100,000 kilometers in 5 years, the electricity consumption of smart pure electric vehicles can save about 80,000 yuan compared with the fuel cost of fuel vehicles, which is almost equal to four LV or Hermès entry-level bags."
For fuel vehicles, Shen Hui's ridicule seems reasonable.
Taking the family car with a fuel tank capacity of 50 liters as an example, referring to the current price of No. 92 and No. 95 gasoline, the price of filling a tank of fuel is 430 yuan and 457 yuan respectively. Compared with the latest round of price adjustments, it rose by 29.5 yuan and 31 yuan respectively.
According to the calculation of ordinary car owners driving 50 kilometers per day, for a fuel vehicle with a fuel consumption of 8-10 liters per 100 kilometers, the monthly fuel consumption cost may increase by 70.8 yuan and 93 yuan, and the cumulative fuel expenditure for the whole year will reach 12,384 yuan and 16,452 yuan respectively.
In contrast, electric vehicles have significant advantages in terms of vehicle costs.
Take, for example, an average user who drives 18,000 kilometers a year. Based on the energy consumption of mainstream electric vehicles of 15 kWh per 100 kilometers, and the average sales price of 0.611 yuan per kWh (China power grid data), the annual energy consumption cost is 1,649.7 yuan.
Even if charged through a public charging pile (including service fees), at a price of 1.5 yuan / kWh, its annual energy consumption cost is only 4,050 yuan. Compared with the fuel cost of fuel vehicles, there are obvious advantages.
Therefore, after many rounds of oil prices, there are endless remarks on social media that share Shen Hui's views.
"No. 95 is full and ruined", "Dear tram owner, I admit that I spoke a little loudly before"... In the Internet world, the ridicule of the cost of fuel vehicles has reached its peak in recent years.
For a time, the "oil and electricity dispute" that has been maintained for a long time seems to end with the victory of pure electric vehicles.
Cost pressures from upstream
Unfortunately, the good times did not last long.
WM Motors announced a price increase on Saturday (March 19). Product price increases ranged from $7,000 to $26,000.
In fact, in the past week, a total of 8 new energy vehicle manufacturers have announced an increase in the price of their products.
In addition to WM, this round of price increases also includes 5 emerging Chinese car brands such as BYD, Xiaopeng, Nezha, Zero Run, and Euler, as well as overseas electric vehicle brands such as Tesla and Lucid.
If we turn back the timeline slightly, we will find that since march, the number of new energy vehicle companies that have announced price increases is close to 20, involving nearly 40 models.
Tabulation: Routing agency
In this round of price increase ceremony, Tesla won the "Best Physical Fitness Award" with the ultra-high frequency of "3 times a week", while zero run relied on the highest single price increase of 30,000 yuan to lift the "Hercules" trophy.
The latest official price of Tesla Model 3 and Model Y has experienced 3 increases from a week ago
Cost pressure from the upstream of the industrial chain is believed to be the main reason why new energy vehicle manufacturers started this round of price adjustment.
On Monday (March 21), the Financial Associated Press quoted an informed source working in a new energy automobile company as saying that since the second half of 2021, CATL has raised the price of power battery products twice, and the cumulative price increase has reached 20,000 yuan.
"We can't afford to see the price of raw materials such as batteries rise, and the price of our new energy vehicles has quietly risen twice in recent months." The above-mentioned person revealed.
The Ningde era later confirmed the above rumors.
As the core component of new energy vehicles, the purchase price of power batteries is on the rise.
Analysts say the cost of raw materials, including nickel and lithium carbonate, is rising.
"After the nickel price has undergone violent stretching and a sharp decline, it is difficult for the market to have stable expectations for it, so it will hoard goods within an acceptable range, and such operations will push up the nickel metal transaction price in the short term." Han Kuihua, an analyst at Jing tin Consulting, said.
Since March, due to the russian-Ukrainian conflict, The price of nickel metal has always been at a high level due to the conflict between Russia and Ukraine, and the pressure of nickel to empty.
The price of Lun nickel has experienced sharp rises and shocks in 10 days, and has been jokingly called "demon nickel"
Chen Xin, professor of accounting and doctoral supervisor of Shanghai Advanced School of Finance of Shanghai Jiaotong University, said that the current external dependence of China's nickel metal is as high as 80%, and the sharp rise in LME futures prices has led to the inversion of nickel prices at home and abroad, spot trading has stagnated, nickel processing enterprises have been forced to reduce production or stop production, which will also adversely affect downstream stainless steel enterprises and power battery companies.
On the other hand, the average price of the battery-grade lithium phosphate market has exceeded 500,000 yuan per ton, up to 530,000 yuan per ton.
Industry data shows that for pure electric vehicles, when the price of lithium carbonate rises to 300,000 yuan / ton, the cost of each pure electric vehicle rises by about 8,000 yuan; and when the price of lithium carbonate rises to 400,000 yuan / ton, the cost of each electric vehicle rises by about 11,000 yuan.
Han Kuihua said that under the current format, automakers choose to raise the price of new energy products, which can be seen as a hedge against upstream cost pressures.
"It's an approach that can hedge the impact in the shortest possible time." He said, "However, in the long run, the establishment of a more controllable battery supply chain will form a safer guarantee." ”
As if to confirm the above judgment, Volkswagen Group China announced on Monday (March 21) that it has signed a memorandum of understanding on strategic cooperation with Huayou Cobalt and Tsingshan Group to set up a joint venture with the latter in Indonesia and Guangxi to optimize their battery costs.
According to Volkswagen China, the planned tripartite Indonesian joint venture, after full production, the total raw material capacity can meet the supply of nickel and cobalt raw materials required for the production of 160 GWh power batteries. The Guangxi joint venture company to be established with Huayou Cobalt will specialize in the refining of nickel and cobalt sulfates, precursor processing and cathode material production.
Low-emission models are good for the window period or extended
Industry observers generally believe that the impact of this round of refined oil prices on fuel vehicle sales is difficult to be seen in the short term.
"This is the same as the time lag between the fluctuation of international oil prices and the adjustment of domestic refined oil prices, and the rise in oil prices will not have an immediate impact on the sales of fuel vehicles, and it is difficult for us to assess this in the short term." Han Kuihua said.
Over a longer period of time, the continuous rise in fuel prices is bound to play a role in promoting the growth of the new energy market, especially pure electric vehicles.
But this does not mean that new energy vehicle manufacturers can sit back and relax.
Han Kuihua reminded that the upward price of fuel may cause a reaction to the entire industrial chain in terms of cost.
"For example, the rise in logistics costs will lead to a corresponding increase in the operating costs of various industrial sectors, which will then be passed on to downstream enterprises through the output of products and services, and ultimately reflected in the consumer terminal." He said.
This is basically in line with the judgment of international institutions.
The International Energy Agency has previously said that while higher oil prices could accelerate the energy transition, it could also drag down the economy, especially in emerging and developing countries.
JPMorgan noted that higher fuel prices could trigger cost inflation in the global economy. If oil prices rise to $150 a barrel, annualized growth in global GDP will fall to 0.9 percent in the first half of this year, while inflation will more than double to 7.2 percent.
In today's price of fuel, raw materials, batteries, and new energy vehicles, a new trend in the industry that is more likely to occur may be that the commercial window period for low-emission models may be extended.
"Low Emission Vehicle" (LEV) is the international automotive industry's collective name for vehicles such as oil-electric hybrid (HEV), plug-in hybrid (PHEV), and extended-range hybrid (EREV).
With the exception of pure electric zero-emission models, all three electric models are classified as low-emission models (LEV).
In the past two years, with the rapid rise in the market penetration rate of pure electric vehicles, low-emission models represented by PHEV are at the crossroads of their own market prospects after fully enjoying the policy dividends in the early days of the popularization of new energy vehicles in China, due to the decline of subsidies and preferential policies, the emergence of more pure electric alternative models and other factors.
For example, in first-tier cities like Shanghai, the issuance of free new energy licenses for plug-in hybrid and extended-range hybrid models will be terminated from January 1, 2023.
The decline of this right-of-way preferential policy is believed to inhibit similar rigid demand in the local market. Therefore, there is a view that the favorable window period for low-emission models in the local market is about to narrow.
ET-i uses policy changes for product marketing, and although it is suspected of stimulating consumer anxiety, it is indeed telling the truth
However, in the drastic changes in the current round of auto market due to rising oil prices and upstream costs, the impact of low-emission models is relatively low.
This is mainly reflected in the following two aspects.
First, from the perspective of vehicle architecture, vehicles that use plug-in hybrid and extended-range hybrids, although they still need to carry batteries, require less battery capacity, so the sensitivity to battery costs is lower than that of pure electric models.
Second, in actual work, whether it is a plug-in hybrid or an extended-range hybrid model, the fuel-saving effect brought by the motor drive is still obvious, so it can objectively reduce the driver's travel cost. Especially the extended range electric model, its engine is not directly involved in the drive, only responsible for working with the generator, in the form of a range extender to power the motor, the fuel saving effect is more significant.
As of press time, the extended-range car manufacturers represented by the ideal have not announced price increase information, and the price increase of hybrid models such as BYD Tang DM-i is also smaller than that of pure electric vehicles.
"From the perspective of market pressure resistance, the low-emission models that were previously questioned also reflect certain advantages and the value of continuing existence." Han Kuihua said.
Write at the end:
As Herbert Diess, CEO of Volkswagen Group, has said, the technical path to energy conservation and emission reduction in automobiles is not single – although he is personally a fanatical promoter of pure electric vehicles and believes that pure electric is by far the most effective solution to reduce emissions.
Therefore, while entering the pure electric vehicle market on a large scale, the group has not abandoned other power forms, including internal combustion engines and plug-in hybrids.
This has obvious benefits for an automaker with a global presence and a highly competitive environment.
Whether it is to improve the thermal efficiency of the internal combustion engine, provide a small displacement engine, improve the lightweight of the body, optimize aerodynamic performance, or develop hybrid, pure electric and even fuel cell products, in the process of electrification transformation of the automotive industry, winning a battle for the technical path will not be more meaningful than helping enterprises to develop in the longer term.
For a mature automobile manufacturer, under the framework of green and low carbon, the establishment of a more complete product lineage of driving methods may be able to truly change when the industry experiences shocks.
-END-