Source丨Entrepreneurship Bang (ID: ichuangyebang)
Author丨Pan Lei
Editor丨Sea waist
Source丨Midjourney
"I don't do hybrids. I'm going to knock on pure electricity and change it."
On the eve of this year's Mid-Autumn Festival, Li Bin, founder, chairman and CEO of NIO, replied to the question of "when will the hybrid be launched" raised by netizens in a live broadcast.
"Because the battery swapping experience is really good, it can help users save time, it is as convenient and cost-effective as refueling, and it can also do battery maintenance, extend battery life· · · · · ·"
But Li Bin emphasized that he is not saying that hybrids are meaningless, others must have a reason for doing hybrids, and everyone must have their own reasons for buying hybrids, "but I don't do it." I will go all out to do the power supply county county, battery replacement county county, charging county county."
His live broadcast was quite meaningful, and the location was Xinjiang, which covers an area of more than 1.66 million square kilometers and has a population of only about 25 million.
Most people have the impression that this is similar to the Northeast, which is a nightmare for electric vehicles.
Regarding the original intention of going to Xinjiang to conduct a live broadcast, Li Bin said in the previous trailer that he did not object to being considered to be close to the "Elder Jinchi" in the well-known triple-A game "Black Myth: Wukong", "just enough to go to Xinjiang to do a 'Journey to the West'".
At present, NIO has 138 charging piles and 3 battery swap stations in Xinjiang.
Li Bin's plan is that when refueling is as convenient as refueling, the sales of pure electric vehicles will naturally go up. "It's a chicken-and-egg problem."
But at the same time that he went to Xinjiang to promote the "county and county pass", other hybrid and range extension friends were making a lot of money.
BYD has sold nearly 2.4 million hybrid vehicles in the past two years, and Ideal has delivered more than 500,000 new cars in the same period, and both companies have made money.
Leap, known as the "Little Ideal" because it follows the ideal range extension route, delivered more than 30,000 new vehicles in August, a year-on-year increase of 113% second only to Cialis.
The development of "small ideals" has obviously inspired the entire industry.
The latest trend is that almost all new car manufacturers have begun to chase the route of range extension technology.
Xpeng, AVATAR, Zeekr, Aion, and Zhiji all plan to launch extended-range models.
The newly exposed Xiaomi car product roadmap also includes extended-range SUVs.
This makes Li Bin almost the "only two" lone brave in the field of pure electric vehicles - the other is Tesla.
The range of new forces gathered
Just a "pacifier"
"China's own brands, car companies that are still insisting on multi-gear PHEVs, will switch to the technical route of range extender in the next one or two years. This judgment can be verified in 2025."
At the beginning of November 2023, Li Xiang, the founder of Li Auto, expressed his views on the development trend of range extender through social media.
He later added that both the Great Wall and Geely systems will switch to extended-range routes.
But Li Xiang's claim was refuted by Geely and Great Wall Motors.
Yang Xueliang, senior vice president of Geely Holding Group, said that the three-speed PHEV solution meets both performance and fuel consumption...... It truly covers all user usage scenarios. "We don't waver in pushing the three-speed PHEV."
Yang Xueliang even hinted that whether you can engage in multi-gear is related to technology, "whether to choose range extension or multi-gear plug-in hybrid, it is related to whether the company's R&D strength can support (multi-gear PHEV)."
Liu Yanzhao, general manager of Great Wall Motor's TANK brand, also said that the efficiency of the multi-gear hybrid solution has an absolute advantage, "this is not only a matter of cost of use, but (TANK) pursues the best efficiency of full-scene coverage."
It is worth mentioning that Great Wall and Geely are both "traditional car companies", that is, these car companies have experienced the era of fuel vehicles.
Completely different from these traditional car companies' views on range extension, other new power brands other than NIO are competing to launch range extension models.
Among them, it may be Xiaopeng Motors.
Over the past decade, Xpeng has been a big believer in the pure electric camp.
However, the latest news shows that Xpeng is developing a large SUV with a range-extender technical route based on the G9 model to expand the market of more than 200,000 yuan.
If this new car is successfully landed, Xpeng will have two major product series: pure electric and extended range.
The range extender is said to be unveiled in the second half of next year.
This is basically consistent with the time point of Li Xiang's judgment.
In addition, there have been some changes in the state of range extension technology, including increasing the pure electric range, and focusing on optimizing the shortcomings such as high energy consumption, relatively poor power output and NVH performance in the feeding state.
To a large extent, this has changed the pain point of "electric dragon, no electric bug" of the range extender vehicle.
Taking AVATAR's "Kunlun Range Extender" as an example, it is said that it is equipped with a battery pack with a maximum capacity of more than 50kWh and a pure electric range of more than 300 kilometers, basically meeting the needs of both daily travel and hiking.
This makes the range extender closer and closer to a pure electric car in terms of daily experience.
According to Hu Chengtai, vice president of AVATR Technology, the future trend of range extenders is "large batteries and small fuel tanks".
He said that the large battery can bring a pure electric experience, and the small fuel tank not only solves the anxiety of battery life, but also solves the problem of low fuel tank utilization of range extenders.
There is another factor related to hybrid vehicles such as range extension, that is, the popular overseas expansion of car companies.
According to a report released by the European Automobile Manufacturers Association (ACEA) in April this year, about 150,000 new public charging piles for electric vehicles were added in the EU last year, with a cumulative total of more than 630,000.
This amount is basically a drop in the bucket compared to China.
According to data released by the Ministry of Industry and Information Technology at the beginning of this year, by the end of 2023, the cumulative number of charging infrastructure in mainland China reached 8.596 million units, an increase of 65% year-on-year.
Last year alone, 929,000 new public charging piles were added.
This is still in Europe, where the automotive industry is developed, and the charging infrastructure is even worse elsewhere.
In this case, car companies want to "go overseas" to sell cars, and hybrids, including range extensions, do not need to rely on charging facilities, and their energy supplement advantages begin to be highlighted.
According to data released by ACEA at the end of August, electric vehicles accounted for 12.1% of the EU car market from January to July this year, compared with 13.5% in the same period last year; The market share of hybrid vehicles increased from 25.5% to 32%.
However, judging from Li Bin's statement, he is still not optimistic about the long-term logic of hybrid energy supplementation.
"Whether it is a range extender or other hybrids, it is similar to the 'pacifier' after the child is weaned, it is meaningful during the transition period (from fuel vehicles to pure electric vehicles), but it does not mean that it is always meaningful", he said, "With my Li Bin's personality, I will not do (range extension or plug-in hybrid)".
Tesla is not giving up on battery swapping
But it didn't work out
"It's understandable that plug-in hybrids and extended range are selling well now", Li Bin said in a live broadcast in Xinjiang, "If my charging piles and battery swap stations are distributed enough, everyone will have more reasons to buy my car and pure electric vehicles."
Li Bin believes that when there are more and more battery swap stations (currently more than 2,500 battery swap stations and 23,009 charging piles), users can "power up" like refueling, sales will no longer be a problem.
After the launch of the second brand Ledao L60, Li Bin was asked about the battery replacement logic, and he gave an explanation again.
"I spent three years to understand and study battery swapping, not to study successful cases, but to fail cases", Li Bin said, some people said that Tesla wanted to give up back then, "he didn't call it giving up, but didn't do it."
According to the information revealed by Li Bin on other occasions, he has been thinking about battery replacement since 2012.
In other words, he first figured out the energy supplement method of battery replacement, and then began to officially build a car.
"Someone persuaded me to do a range extension, I did the math and found that it was not cost-effective."
Li Bin said at the end of last year that the cost of a range extender on a high-end car can be 25,000 or 30,000 yuan, "If it is 500,000 cars, then I can go to 5,000 battery swap stations for this money."
Li Bin believes that this is his different perspective on range extension, that is, the cost of range extension routes is high and the disadvantages are obvious.
Later, Li Bin once again explained the problem of "not cost-effective" range extension on an occasion on the same stage as Lei Jun, the founder of Xiaomi.
The difference is that he calculated the cost of the range extender as 15,000 yuan in this discussion.
"Even if it is a cheap range extender (on the market), plus a whole system, it will cost 15,000 more (for the cost of the whole vehicle)," he said, adding that 1 million vehicles (the money for the range extender) is 15 billion, "and with this money, I can build 10,000 battery swap stations."
Li Bin went on to say that there are many benefits to battery swap stations, such as energy storage.
But if the car uses a range extender, the pure electric car, which was originally 40 kWh and can run 300 kilometers, will only be able to run 200 kilometers (the range extender adds additional load). "If it's 50 kilowatt-hours of electricity, it's the difference between 400 kilometers and 300 kilometers. You're always going to have 100 kilometers less."
As a result, the battery usage rate of the extended-range vehicle is lower than that of the pure electric vehicle.
"I firmly believe that the battery swap is right," Li Bin said, and the core of the matter lies in the fact that less than half of China's urban households can install charging piles for cars priced at hundreds of thousands or 200,000 yuan.
Correspondingly, the battery swap mode does not need to frequently find a charging pile to charge, and there is no need to worry about not being able to install a charging pile at home.
Li Bin thinks that in this case, it is embarrassing to drive a range extender.
"If you want to save money on gas, you need to charge it all the time, and if you drive this car as a gas car, it will be very nonsensical."
He revealed a phenomenon, that is, before users buy a range-extended car, they all think about "oil and electricity", but when they actually use the car, they basically "charge everywhere".
Li Bin said that at the same time, both systems of the range extender need to be maintained for a long time, which increases the cost.
Later, when he was asked about the topic of range extension, he directly said that whether it is range extension or other hybrids, "You go and ask his users what to buy in the next car?" How many people will continue to buy range extenders or other plug-in hybrids? ”
According to the information he revealed on other live broadcast occasions, NIO has done some research, and for those users who have bought a range extender car and used it for more than half a year, the vast majority of people's feedback is that they want to buy pure electric for the next car. "Because the best experience of the range extender is still in the pure electric state."
For users, if they really develop the habit of using the tram, of course, they want to exchange the money for the part of the range extender system for electricity.
But he did not disclose the percentage of users in these surveys who will buy pure electric vehicles for their next car.
However, it is clear that these research results support his insistence on pure electric technology, which is more in line with "first principles".
Regarding the topic of increasing the sales of range extenders, Li Bin responded that when he started to build cars, he sold the most oil cars, "but I didn't make oil cars either."
"I insist on making rechargeable, replaceable and upgradable (energy replenishment system)."
During the live broadcast in Xinjiang, Li Bin also mentioned that pure electric vehicles can cover more scenes.
"97% of NIO users choose 75kWh batteries, and only 3% choose 100kWh batteries," Li Bin said, adding that 75 kWh of electricity is enough for daily use, and 100 kWh or even 150 kWh battery packs can be selected by swapping batteries for long-distance travel, "How much resource does this save for the society?" ”
He said that mileage anxiety is a layer of window paper, which will break when you poke it, and it will be thinner than paper depending on whether you are willing to poke it or not.
Before NIO's battery swap stations reached their current scale, the ratio of users choosing two battery packs was about 1:1.
Therefore, although other brands are chasing the increase range, he is going to engage in pure electricity, and he has also engaged in power-up "county and county pass".
"When Tesla does a range extension, I'll think about it (whether to do a range extension)."
Aircraft lease engines
The logic is the same as that of electric car rental
"Mid-to-high-end pure electric users are in great need of stable and deterministic charging conditions."
At the "2024 Chongqing Automobile Forum" in early June, Li Xiang said that in the mid-to-high-end pure electric market of more than 200,000 yuan, the best sellers are Tesla and Weilai, Tesla has a supercharging station, and Weilai has a battery swap station, "(energy replenishment system) is a necessary condition."
Li Bin himself said something similar.
At the end of last year, he said in a conversation that NIO's battery swap is similar to what Tesla did in North America (referring to supercharging stations), and "if you can't beat it, join him."
At least in terms of pure electric routes, NIO is becoming the "Tesla of China".
This may be one of the purposes for Li Bin to go to Xinjiang to broadcast live.
He wants to engage in two "county-to-county connections" - before June 30, 2025, except for Hong Kong and Taiwan, all county-level administrative districts in the country must have NIO's charging piles, which is called "power-up county and county passes".
By the end of 2025, more than 2,800 counties across the country will have NIO's battery swap stations.
Li Bin also mentioned in the live broadcast that the benefit of battery replacement is that users do not need to worry about battery after-sales problems.
"As an electrochemical, power batteries actually have a lifespan," Li Bin said, adding that most manufacturers' warranty for batteries is generally 8 years or 160,000 kilometers. "Whether it's a pure electric vehicle, an extended range, or a hybrid car, what happens when the battery life expires?"
He said that in the past 8 years, China has nearly 20 million new energy vehicles, and the battery warranty period of these cars will expire in the next 8 years, "A battery pack costs more than 60,000 yuan to buy, and it has to be 1.2 trillion, who pays for this money?" ”
NIO's battery swap can solve this problem.
"NIO owners don't need to worry about battery after-sales problems, because we are a (battery swap) pool, and we will constantly update the battery to keep it healthy, and unhealthy batteries will be eliminated."
In addition, Li Bin said that he is very simple in battery swapping, that is, commercially sustainable.
"Although the whole network taught me to be a CEO, I am a person who has made money, so wouldn't I consider it commercially sustainable? I'm not a fool," Li Bin said, of course he will settle accounts, but not for a quarter or a year.
"A business that makes money on day one is not necessarily a good business." He said that Amazon Cloud Services has lost money for more than 20 years, Tesla has lost money for 16 years, "We have lost money for more than 9 years." That's the true picture of the automotive industry – there's no such thing as a quick win, no fluke."
After 5 or 10 years, other hotels have opened to make money, and this building is still being built. "So what does it matter? I'm not trying to build a 10-story building, I'm going to build 100 floors."
Li Bin also gave an example that when the life of the car and the life of the power battery are not synchronized, the battery swap that decouples the car from the battery is the only solution.
"It's similar to the business model of airplanes and engines. Power batteries account for 30%-40% of the cost of electric vehicles, and the proportion of engines in the cost of aircraft is also about the same", Li Bin said, the engine and fuselage life are also not synchronized, so it is necessary to maintain and maintain separately, "the engine is generally leased separately."
According to his statement, the logic of leasing engines for aircraft is consistent with the logic of renting electricity for NIO.
If you "travel" back to a few years ago
Range extension may be considered
There may be another reason for NIO's insistence on battery swapping, and that is that the battery swap model is driving significant growth in NIO's sales.
From May to August, NIO's deliveries exceeded 20,000 units for four consecutive months.
In the first eight months of this year, NIO delivered a total of 128,100 new vehicles, a year-on-year increase of 35.77%.
This delivery volume is not enough for NIO to maintain its previous position at the top of the new forces, and even lag behind the previously unknown Leap, but it can still ensure that it stays in the first echelon.
But NIO's biggest gain is that the battery swap model is driving up deliveries.
In mid-March this year, NIO adjusted its BaaS battery leasing policy, reducing the monthly battery rental fee and significantly lowering the threshold for users to purchase a car.
Taking the standard endurance version as an example, the price of the car can be reduced by 70,000 yuan if you choose the battery rental plan, and the price of the long-range version can be reduced by 128,000 yuan.
For some models, purchase tax exemption is also available (the opening ticket price is less than 339,000 yuan).
This adjustment directly boosted NIO's sales.
In April, NIO sold 15,260 units, a month-on-month increase of more than three percent, reaching 20,544 units in May, and remained above 20,000 units for four consecutive months.
According to public information, eighty percent of users choose the battery leasing model to buy a car.
The battery swap mode not only allowed NIO to avoid the price war, but also stimulated sales to rise all the way.
The just-released Ledao L60 also follows a similar logic.
The starting price of the new model starts at 206,900 yuan, but the battery rental price starts at only 149,900 yuan.
Li Bin said in the live broadcast that the significance of the battery swap station for NIO is not only at the financial and brand level, but also at the sales level. "We have eight or nine hundred (battery swap) stations in the Yangtze River Delta, Jiangsu, Zhejiang and Shanghai together account for half of the national sales, it can be seen that the density of the battery swap station has a very strong network effect, once it really becomes a network, for the improvement of our market share, the role is geometric."
The increase in sales since April seems to be verifying Li Bin's "Jiangsu, Zhejiang and Shanghai model".
This allowed him to quickly launch the "Electrification County County Pass" in August.
In a conversation at the end of last year, Li Bin said that if 60% of the country's cars were to use NIO to swap batteries, he would wake up laughing when he slept.
However, he also said on other occasions that if he "travels" back to a few years ago, he will indeed feel that it (hybrid such as range extension) is valuable in this (transitional) stage, "but if you look at it today, pure electric is undoubtedly in line with the long-term trend."
He insisted that "rechargeable, swappable and upgradeable" was a better "extended range" solution.
"I want to make it a little bit harder for myself"
According to Li Bin, he has had the idea of changing batteries since 2012.
That sounds incredible.
But his experience may provide some insight.
After inspecting the "county-to-county communication", Li Bin and Yu Minhong had a "fireside night chat" at the foot of Muztag Peak.
Yu Minhong revealed that in 2012, he and Li Bin built a "Xuanzang Road" in the Gobi Desert, which was about 120 kilometers long and took three or four days to complete.
In this crossing, Li Bin was the first to complete the entire journey, and in order to increase the difficulty, he also stuffed five bricks into his backpack and carried it all the way.
This shocked Yu Minhong.
"I got to know Li Bin again," Mr. Yu said, adding that he had always thought of him as a rich "son-in-law."
However, Li Bin downplayed this. "I'm actually going to make it a little bit harder, [actually] it's not that hard."
When asked by Yu Minhong about NIO's huge investment in the layout of battery swap stations across the country, Li Bin believes that he chose the most unusual one among the many "opening methods" related to entrepreneurship.
In the first round of financing, 300 million US dollars, Li Bin paid 150 million himself. "I don't have a founding stake either, I'm paying real money."
Li Bin said that he took out all his previous accumulation.
This has earned him a "reputation" among investors.
So in the past 9 years, although NIO has been engaged in battery swapping stations and lost money in various ways, this "word of mouth" has supported him to continue to obtain new financing from investors.
He also referred to Hefei's famous investment in NIO in 2019, and "inadvertently" revealed the return Hefei received - "5 times to give them back a lot of money".
According to public information, Hefei invested 7 billion yuan in NIO at that time.
This means that Hefei's investment of 7 billion yuan later became 35 billion yuan.
Li Bin said that the reason why he was able to get so much US dollars in financing (more than $19 billion) was that he was able to demonstrate "the ability to deliver in stages".
"From the time I took the first investment to the present, I delivered it in stages, in fact, we didn't have any major problems, I said what kind of goals we wanted to achieve at any point in time, and we did it."
This also includes investment in battery swap stations.
"If I lose money, I lose money," Li Bin said, "and I'll tell you why I lost money." I invested 14 billion yuan in R&D last year, and now I invest 30 or 4 billion yuan every quarter.
"So there are always investors who believe in your underlying logic, long-term thinking, and long-term competitiveness," Li said, which is why it has been much easier for NIO to raise funds in the dollar market, "and we raised $3 billion last year."
Then Yu Minhong threw out a sharp question - "A car company boss told me that in the future, Chinese automobile companies will develop gasoline-electric hybrid vehicles, because pure electric vehicles will indeed bring inconvenience when they encounter (poor) weather conditions, you must also know these statements, right?" Are you still making electric cars? ”
Li Bin's reply is that he will definitely insist on doing pure electricity.
He specifically explained that you can't use a small probability event (weather conditions that cause the train to not be able to go, etc.) to deduce the logic of the whole thing, that will definitely go wrong.
"The reason why the electric car is the ultimate solution is very simple, because it is really in line with the trend of intelligence, the lowest cost of use, and in line with the direction of sustainable development," he said, adding that pure electric is the right thing to do, both in terms of personal and social interests. "Why don't you stick to the right thing?"
He said that if there is a problem in the process (of pure electric), it would be good to solve it, "such as inconvenient charging, then we will deploy charging piles and power up the county and county."
"NIO is doing the 'difficult but right thing'," Li Bin said, and only in this way will it last for a long time, "and will form a moat for the enterprise." I also have a creed in life called 'turn passivity into initiative, turn disadvantage into advantage.'"
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