The Internet celebrity's favorite Rolls-Royce, descended a suite

City Boundary

2024-07-01 14:38The official account of the city boundary

If the outside world is immune to the news of price reductions of luxury cars such as Porsche and BBA, then ultra-luxury brands like Rolls-Royce began to cut prices by more than 1 million, which netizens never expected. Although the price of Cullinan's new car after the discount is as low as 5.8 million, which is just a fun sight for many people, everyone is curious, why does Rolls-Royce, which is favored by the rich, also insist on reducing prices?

Author: Liu Dongxue, Huang Shuo

Edited by Tian Yanlin

Operation|Liu Shan

It's time to buy Rolls-Royce

Rolls-Royce, known as the "top of the pyramid of the automobile industry", also needs to rely on price reduction to sell in China?

Recently, an entry about "Rolls-Royce dealers cut prices by 1.11 million" appeared on Weibo hot search. According to media reports, "some ultra-luxury brand dealers reported that the cash discount of the current 5-seater Rolls-Royce Cullinan was 1.11 million yuan, and the price of the new car was as low as 5.8 million yuan after the discount." But even so, there are still very few customers who come to inquire about the new car. ”

As soon as the news came out, netizens exploded instantly, thinking that the discounts of Porsche and BBA were exaggerated enough, but I didn't expect that this top British luxury car brand would bend over now?

Soon, the media called the Rolls-Royce dealer, but got a similar negative response from the other party, "The discount spread on the Internet is million, and there is no such thing." Our sales have always been quite stable, it (Cullinan) has so much production capacity in the world, 4,000 units a year in the world, 1,000 units a year in China, so many cars must be sold. ”

The two completely different statements confuse netizens. Although some people joked that even if the price of Rolls-Royce dropped, it still couldn't afford it. But this price reduction can buy a three-bedroom apartment in a new first-tier city, and everyone wants to know whether it is the best time to copy Rolls-Royce.

At present, Rolls-Royce has 4 models on sale in the Chinese market, namely Gust (official guide price of 5.03 million ~ 5.77 million yuan), Phantom (8.47 million ~ 9.86 million yuan), Cullinan (6.91 million ~ 7.45 million yuan) and Shining (5.75 million yuan).

In order to explore the reality of price reduction, "City Boundary" recently visited an official Rolls-Royce dealer in Beijing. The sales staff said that the current terminal price does have a discount of more than 1 million yuan, "but the premise is that the total price of the vehicle after selection or customization needs to reach about 9 million yuan in order to enjoy such a large concession." ”

According to the sales staff, it will take about half a year from the order selection, customization to delivery, whether it is to choose the current car or customization, as long as the final total price is high enough, 4 Rolls-Royce models can get a price discount of more than one million yuan.

Taking the ultra-luxury SUV Cullinan, which is the favorite of Internet celebrities, as an example, the price of the naked car after the discount of the standard version model is about 6.5 million yuan, and the price of the Black Badge version is about 7.5 million yuan.

The lowest-priced model of Rolls-Royce - Gust, the discount depends on the specific selection and customization. If it is a mild and moderate option, it can only be cheaper than hundreds of thousands to hundreds of thousands of yuan.

A sales person in Shanghai also said that some Cullinan cars with optional configurations do have a discount of more than 1 million yuan. "It can be understood that the part of adding money and matching is basically reduced."

Compared with Rolls-Royce's official channels, car dealers engaged in parallel import business (i.e., cars purchased by traders from overseas markets and sold in the Chinese market without the authorization of the brand manufacturer) are given greater terminal discounts.

According to sources, the almost fully equipped Cullinan Black Badge version is now down by 3 million, and it only takes more than 6 million yuan to get it, and the price of the standard version is only more than 5 million.

Despite the facts, no one dared to believe that Rolls-Royce had offered a price that was close to "crashing".

Compared with well-known luxury car brands such as Mercedes-Benz, BMW and Audi, Rolls-Royce, as a top luxury brand, is that on the basis of high specifications and high prices, it also has a very high degree of customization services. Almost every Rolls-Royce can be tailored to the needs of the owner, and the actual price is not capped. The price of a foreign limited edition or high-end model can even exceed 100 million yuan.

According to official data from Rolls-Royce, in 2022, car owners around the world paid an average of about 500,000 euros (about 3.89 million yuan) for customized services. In 2023, it will increase on this basis, and all of its 6,032 vehicles sold in China will be customized versions.

It is this scarcity that has created Rolls-Royce's position at the top of the pyramid of the automotive industry, and it has also made the wealthy keen to show their strength through customization. Hence the saying that "no two Rolls-Royces are the same in the world".

In fact, until 2023, Cullinan only has a discount of hundreds of thousands of yuan, and the above-mentioned Shanghai sales said, "This year's market has completely changed."

What happened to influencer favorites?

The change came unexpectedly, but it was also reasonable.

"Luxury brands cut prices to compete for the right to speak and maintain market share, but the ultra-luxury brands themselves have no competitors, and the price cuts are just to sell cars better." A boss engaged in the second-hand luxury car business told "City Boundary": "Customer personalized options are originally incremental profits. ”

The implication is that even if the price is reduced, Rolls-Royce is still profitable. It's just a matter of earning more and earning less.

In 2023, Rolls-Royce reaped strong market realisation globally. This year, Rolls-Royce sold 6,032 cars worldwide, reaching the peak of its 119-year history.

In the Middle East, Asia Pacific and Europe, Rolls-Royce delivered record volumes and saw sales growth in most markets. Specifically, the United States remains Rolls-Royce's largest single market in the world, and the Greater China market maintains its position as the world's second largest market.

Although Rolls-Royce did not release specific sales data for the Chinese market, according to the statistics of the domestic automotive Internet platform Yiche.com, in 2023, except for the pure electric model Shining that will only start delivery in the fourth quarter of the same year, the sales of other models of Rolls-Royce will decline to varying degrees. Among them, Cullinan sold 741 vehicles, a year-on-year decrease of 4.8%; Gust sold 411 vehicles, a year-on-year decrease of 18.9%; Phantom sales of 91 units, a year-on-year decrease of 9%; Phantom sales were 53 units, a year-on-year decrease of 41.1%; Yaoying sold 15 vehicles, a year-on-year decrease of 53.1%.

That's when the changes began.

Since the beginning of this year, Rolls-Royce's sales in China have been declining. According to the data on the number of new cars insured by the car portal "Online Car Market", Rolls-Royce sold only 57 units in China in May, down 53.3% month-on-month, of which Cullinan and Shining sold 30 and 4 units respectively. In addition, according to the statistics of "Sang Zhiwei", a member of the expert committee of the China Automobile Dealers Association certified by Weibo, in January ~ May this year, Rolls-Royce sold 377 vehicles in China, a year-on-year decrease of 32.6%.

What the hell happened to Rolls-Royce?

A luxury car salesman told "City Boundary" that in the past, it was relatively easy to sell cars, and customers placed orders with emotional factors, so they basically did not bargain much. But now, high-end user consumption also tends to be rational, even the rich have begun to care about practicality, thinking about cost performance and scarcity, and the decision-making cycle has been lengthened.

In addition to this reason, some industry insiders believe that the current sales performance of Rolls-Royce is also affected by the discontinuation of some models.

Following the discontinuation of the Phantom and Dawn in the first half of 2023, the entry-level model of the Rolls-Royce brand, Gust, which was born in 2010, was also exposed to rumors of discontinuation this year. According to foreign media sources, the BMW Group is reorganizing the Rolls-Royce product line, and Ghost is among them, and the facelifted Rolls-Royce Gust, which is being tested, will be the last update of this model.

In the context of carbon neutrality, the EU strictly limits the carbon emissions of car manufacturers. Although there is no one-size-fits-all regulations, and models with higher carbon emissions are still allowed to continue to be sold, in order to encourage the transformation of the entire automotive industry chain, there is a certain fee for exceeding the standard.

The calculation of the specific costs is the difference between the average emissions of all vehicles and the average "individual target value" during the annual compliance cycle, multiplied by the number of cars registered and sold by the company in the EU in that year, which is the total excess emissions, and multiplied by the unit price of 95 euros/g CO2.

This is not a small amount for the BMW Group. Seeing that policies, regulations and users are becoming more and more unfriendly to large-displacement engines, in 2022, after the launch of the last batch of BMW 7 Series top-of-the-line M760 models equipped with V12 engines in the US market, BMW announced that it would officially stop production of V12 engines.

BMW's V12 engine can be traced back to the third-generation BMW 7 Series in 1987, and before the production was discontinued, BMW had mass-produced four V12 engines: N73, N74, M70 and M73. As part of the BMW Group, the Rolls-Royce Phantom, Gust, Cullinan and Mirage are equipped with N74 engines. However, at that time, the decision to discontinue production did not have an impact on Rolls-Royce, which was equipped with the N74 series V-12 engine.

However, at the end of 2023, the BMW Group said that in the next 10 years, Rolls-Royce will become a pure electric brand. This has made the outside world sweat on its existing models with V12 engines.

You must know that whether it was the original production of V12 engines or the current discontinuation of V12 engines, the original intention was to cater to market demand. Now the BMW Group's decision is also based on the consideration of the future market, although the top management also knows that its first pure electric car Shining did not sell well after its launch in the fourth quarter of last year, but the pace of electrification of the brand has not stopped.

Rolls-Royce can only bite the bullet to deal with the challenges from the Chinese market.

The only way left for luxury cars to reduce prices?

It's just that many luxury brands, including Rolls-Royce, didn't expect that although their total share of the traditional luxury market exceeded 7 percent, entering 2024, the first battle they have to fight in the Chinese market is actually a price war.

If the outside world is immune to the news of price cuts for luxury cars such as Porsche and BBA, then ultra-luxury brands like Rolls-Royce have also joined the battle, which is something that everyone never expected. But can this path really be sustainable?

Although the price war was not provoked by BBA, its discount strength was even greater. In 2023, the weighted discount rates of BBA (Mercedes-Benz, BMW, and Audi) in the Chinese market will be 12.6%, 17.66%, and 20.84%, respectively, and the discount strength of the latter two is higher than the industry average of 12.66%.

In the beginning, the price-for-volume strategy worked. Taking BBA as an example, in 2023, the BMW Group delivered 825,000 new vehicles in the Chinese market, a year-on-year increase of 4.2%. Mercedes-Benz delivered around 765,000 new vehicles to Chinese customers in 2023, roughly the same as in 2022. Audi sold 729,000 vehicles in China in 2023, up 13.5% year-on-year. In terms of electric vehicles, all three have also doubled.

Not only BBA, but the entire traditional luxury market will grow significantly in 2023, driven by price cuts. According to the data of the Passenger Association, in January ~ December last year, the cumulative sales of luxury brands (referring to Mercedes-Benz, BMW, Audi, Cadillac, Jaguar, Land Rover, Volvo, Infiniti, Acura, Tesla) were 2975004, a year-on-year increase of 10.1%, exceeding the overall market growth rate, and the market share increased by 0.5 percentage points compared with 2022 to 13.7%.

But this year, for traditional luxury brands, the effect of price cuts has become minimal.

The current BMW 5 Series dropped by 8 or 90,000 yuan, and the entry-level model was won by 370,000 yuan; The price reduction of the whole series of 7 series is 200,000 yuan; The original price of the pure electric BMW i3 is 353,900 yuan, and the current price is 185,000 yuan.

The entry-level model of Audi A4L, the 40 TFSI fashion and dynamic type, has been reduced by 120,000 yuan, almost 62% off; The official guide price of the Mercedes-Benz EQE is more than 530,000 yuan, and the current price is also about 370,000 yuan......

The discounts are stronger, but it's harder to sell cars quickly.

According to the statistics of "Sang Zhiwei", in the first five months of this year, domestic luxury car sales fell by 4.8% year-on-year, 68,753 fewer than the same period last year, and the growth rate was not only lower than the 5.7% of the overall market, but also far behind the 19.6% growth rate of independent brands.

Among the 33 brands surveyed by industry insiders, they include BMW, Mercedes-Benz, Volvo, etc., which are familiar to the public, as well as ultra-luxury brands such as McLaren and Rolls-Royce. Among them, less than 30% of brands achieved year-on-year growth, while Aston Martin, Maserati, McLaren, and Smart saw sales halved.

In contrast, in the first five months of this year, the sales of China's new car-making forces NIO, Li and Cialis increased by 51%, 32.5% and 342.35% year-on-year respectively.

The decline in sales of ultra-luxury brands is due to the common factor of consumption downgrade, but traditional luxury brands and Chinese luxury brands are at the same time.

In the era of fuel vehicles, traditional luxury brands have their own labels and brand values. In the era of electric intelligence, new forces are breaking down the barriers that were once exclusive to traditional luxury brands from all dimensions.

The electric motor makes the acceleration performance of new energy vehicles open, and the definition of luxury by Chinese brands is no longer limited to traditional, and the perfect new energy vehicle industry chain gives Chinese brands the advantages of high efficiency and low cost...... Similar things have made the luxury car market switch offensively and defensively, and traditional luxury brands can only passively follow.

The above-mentioned luxury car second-hand dealers believe that traditional luxury brands still have their own advantages, and the Chinese market is large enough that no one brand can eat all the market. Although Chinese brands have made significant progress in the mid-to-high-end market, the impact on traditional luxury brands is still limited in the market of more than 500,000 yuan and millions.

In fact, these luxury brands also know that the most important thing is to maintain their competitiveness in the high-end market, not to consume the brand value infinitely with price reductions.

For example, in 2022, Mercedes-Benz announced a strategic adjustment of "focusing on luxury"; Last year, the domestically produced BMW 1 Series and X2 were discontinued; Although Audi has not announced a plan to discontinue the production of the A3 entry-level model, the top management remains cautious about the development of the product, and its other two entry-level sedans, the A1 and Q2, may not have new versions.

The Chinese brand's upward offensive is phased, which gives traditional luxury brands time to adjust.

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