Enterprise financial report

In 2022, Q1 Weilai achieved a revenue of 9.911 billion yuan, a year-on-year increase of 24.39% From Financial report of Weilai automobile

The following is the In 2022, Q1 Weilai achieved a revenue of 9.911 billion yuan, a year-on-year increase of 24.39% From Financial report of Weilai automobile recommended by recordtrend.com. And this article belongs to the classification: Enterprise financial report.

Weilai automobile (hereinafter referred to as “Weilai”) released its first quarter financial report. According to the financial report, in the first quarter of 2022, Weilai achieved a revenue of 9.911 billion yuan, a year-on-year increase of 24.39%, but its profit was less than expected, and its net loss reached 1.783 billion yuan. In the same period of 2021, it lost 450million yuan, an increase of 295.56% year-on-year.

Weilai’s revenue consists of automobile sales and other sales. In the first quarter, automobile sales amounted to 9.2 billion yuan, a year-on-year increase of 24.8%, and other sales (automobile services and energy packages) amounted to 700million yuan, a year-on-year increase of 15.6%. The delivery of finished vehicles reached 26000, a year-on-year increase of 37.6%.

Li Bin, the founder of Weilai, said at the first quarter earnings conference: “despite the challenge of the epidemic, Weilai’s product demand is still strong. In May, new orders hit a record high, especially et7’s orders continued to perform strongly.”

Among the new forces of car making, Wei Lai’s financial report was released at the latest. On May 10, ideal automobile (hereinafter referred to as “ideal”) released its financial report. In the first quarter, its revenue was 9.562 billion yuan, a year-on-year increase of 167.49%, its net loss reached 10.9 million yuan, and its loss in the same period last year was 360million yuan, a year-on-year decrease of 96.97%. Xiaopeng automobile (hereinafter referred to as “Xiaopeng”) released its financial report on May 23. Its revenue in the first quarter was 7.455 billion yuan, a year-on-year increase of 152.59%, and its net loss was 1.701 billion yuan. Its loss in the same period last year was 787million yuan, an increase of 116.20% year-on-year.

Increased costs, fragile supply chain

The general losses of the new forces of vehicle building are closely related to the rising production costs of new energy vehicles.

The operating cost of Weilai has increased for 9 consecutive quarters, while the cost of Xiaopeng automobile and ideal automobile also showed an upward trend in 2021. Chips and power batteries are the main drivers of the cost growth of new energy vehicles. As early as last year, automobile manufacturers experienced the supply difficulty of “one core is hard to find”, and the current situation has not been improved.

At the conference call in the first quarter of 2022, when asked about the chip constraints on velai’s production capacity in the second quarter, what is the outlook for chip supply in June and the second half of the year, Li Bin replied, “when it comes to chips, there are often some uncertain shortages. We have about 1000 chips per vehicle, and the shortage may be a little different at a time. Basically speaking, in our risk list, there are generally ten or twenty chips, ten or twenty kinds of chips. This month and the next month may be different, so we have to keep solving them.”

It can be understood as “still trying to solve”.

In terms of batteries, the mainstream power batteries in China are lithium ternary and lithium iron phosphate batteries, and their main raw materials are “lithium carbonate”. Since 2022, the price of lithium materials has risen rapidly. According to Wande data, the price of lithium carbonate was 278000 yuan / ton on January 4, 2022. As of May 30, the price had reached 462500 yuan / ton, an increase of 66.36%.

When asked what Weilai’s outlook for product pricing would be if the battery cost continued to increase in the second half of the year, Li Bin said: “the high point in April has begun to go down. Of course, the price related to lithium is the most relevant one. Some lithium mines are speeding up mining and have begun to produce some output. I think the overall material cost of batteries will go down, but there are some uncertain factors about the market. This is a big direction, but there are different predictions about how much it will go.”

I hope to reduce the price, but I’m not sure.

When the price of raw materials rises, the company’s supply chain management ability is extremely important.

According to the CCTV finance and economics report, the new domestic car making forces “Wei Lai, Xiao Peng, ideal” and other car enterprises mainly rely on the import of Bosch and other German enterprises in the core parts of radar, ultrasonic sensor, chip, steering system, braking system and so on. Even in horizontal comparison, Wei Lai has less preparation than Xiao Peng in terms of supply chain management.

In the prospectus for listing in Hong Kong, Weilai disclosed that most of the auto parts are provided by a single supplier, and the company has not found a qualified alternative supplier. When an emergency occurs in the upstream and downstream of the industrial chain, Weilai may be difficult to adapt to the situation. Xiaopeng also runs the single supplier strategy, but in order to reduce the risk, it adopts the method of signing a safe supply agreement to ensure the reserve. In addition to signing the contract, ideal also further planned the list of substitute suppliers for parts supply, and set up a professional team to connect with chip suppliers as early as October 2020.

In the first quarter of 2022, the operating cost of Weilai reached RMB 8.464 billion, up 3.19% month on month, while Xiaopeng and ideal decreased by 13.12% and 10.22% month on month respectively. Affected by the increase in operating costs, Weilai’s gross profit margin in the first quarter was 14.60%, a year-on-year decrease of 25.05%, while Xiaopeng and the ideal gross profit margin were 12.22% and 22.63%, up 9.30% and 31.18% respectively year-on-year.

Price increase, difficult to increase sales

In the face of rising raw materials, car companies generally choose to raise prices.

On April 10, 2022, Weilai announced that since May 20, the starting prices of the es8, ES6 and ec6 models of Weilai automobile have been increased by 10000 yuan. Affected by the battery cost, the battery rental service and the long-term battery rental service fee have also been adjusted to 1680 yuan / month, an increase of 13.51%. The battery pack has been flexibly upgraded to the long-term battery pack on an annual basis, and the price has also been adjusted to 9800 yuan / year.

Explanation on price adjustment of Weilai automobile source: Official microblog

Before that, ideal and Xiaopeng had already raised their prices. On March 21, the new selling prices of three models of Xiaopeng automobile P7, P5 and g3i were released, with an increase of RMB 10100 to RMB 32600. On March 23, ideal auto officially announced that the national unified retail price of ideal one would be raised from RMB 338000 to RMB 349800 from April 1, 2022.

Since the price increase was announced in April, the sales volume of Weilai automobile has been decreasing. The delivery volume of Weilai automobile in April and may was only 5074 and 7024 (the delivery volume in January, February and March were 9652, 6131 and 9985 respectively). However, as for the reasons for the decline in sales, Li Bin said at the first quarter performance meeting: “since the second half of March, a new wave of epidemic has broken out in some parts of China, affecting the production and delivery of automobiles.”

The relevant suppliers of Weilai are mainly concentrated in the Yangtze River Delta region, and the core automobile manufacturing plant is also in Hefei, Anhui Province. Affected by the epidemic in Shanghai, some suppliers were forced to stop production, which affected the automobile production. Ideal and Xiaopeng were also affected. However, in May, the sales of both Xiaopeng and ideal cars exceeded 10000, of which 10125 were delivered by Xiaopeng and 11496 by ideal cars, a month on month increase of 175.88%

At the same time, the sales volume of other new energy vehicle enterprises is also growing rapidly. According to the data of the passenger Federation, the retail sales volume of new energy passenger vehicles in May this year reached 360000, an increase of 91.2% year-on-year and 26.9% month on month. BYD delivered 114943 new energy vehicles that month, exceeding 100000 for three consecutive months; The sales volume of Nezha automobile also reached 11009 in May, with a month on month increase of 24.9%; The sales volume of zero running cars reached 10069 in May, with a month on month increase of 10.8%.

Due to its positioning in the high-end market, Weilai missed many favorable policies launched by the government, while the new energy vehicle enterprises enjoying the corresponding policies further enhanced their market competitiveness.

On May 31, the Ministry of Finance and the State Administration of Taxation issued the announcement on the reduction of vehicle purchase tax on some passenger vehicles, which reduced the vehicle purchase tax by half for passenger vehicles with a displacement of 2.0 liters or less whose purchase date is from June 1 to December 31, 2022 and whose single vehicle price (excluding VAT) does not exceed 300000 yuan.

Announcement on reducing the purchase tax of some passenger vehicles

Source: Official Website of the State Administration of Taxation

In addition, 21 auto companies (excluding Weilai) have offered overweight discounts, further preferential “the other half of the purchase tax” on the purchase tax reduction policy, and also introduced insurance, warranty and other benefits.

On the same day, the Ministry of industry and information technology and other four departments also issued the notice on launching 2022 new energy vehicles to the countryside to organize a new round of new energy vehicles to the countryside. 26 automobile enterprises including FAW, SAIC, great wall and BYD, as well as a total of 70 new energy models under their control, participated in the rural activities.

Wei Lai, who once served as the “C” in the new forces of car making, is “devoid of all people”.

Research and development under performance pressure

The R & D expenses of Weilai in the first quarter of 2022 were 1.76 billion yuan, a year-on-year increase of 156%. Feng Wei, chief financial officer of Weilai, said in a conference call in the first quarter: “the major year-on-year increase in R & D expenses is mainly due to the increase in the cost of R & D personnel and the increase in the design and development cost of new products and technologies.” At the conference call in the first quarter, Li Bin said that the research and development of new products and core technologies has always been one of Weilai’s long-term strategic priorities.

R & D expenses have always been the main expenditure of the new forces of car building. In the first quarter of 2022, the R & D cost of Xiaopeng automobile was 1.221 billion yuan, a year-on-year increase of 128.22%; The R & D cost of ideal automobile was 1.374 billion yuan, a year-on-year increase of 166.80%. In 2021, the R & D expenses of Weilai, Xiaopeng and ideal are RMB 4.591 billion, RMB 4.114 billion and RMB 3.296 billion respectively, accounting for 12.7%, 19.60% and 12.20% of the total revenue.

For enterprises, investment in R & D is to prepare for longer-term development. However, the automotive industry is an industry with high investment, long cycle and continuous demand for funds. Weilai, which is listed in the three places, is not short of money in the short term, but it has also experienced the dilemma of nearly breaking the capital chain for many times. When the industry was in recession, both Xiao Peng and ideal were exposed to layoffs and involved in the R & D department. Among them, they even broke the contract. However, Wei Lai has no corresponding news for the time being and has plans to increase R & D. in terms of scientific and technological investment, Wei seems to be the more “ideal” one.

On March 25, Weilai disclosed at the performance meeting that it would increase R & D investment in 2022, and the annual R & D investment would more than double. It is expected that the size of the R & D team will reach nearly 9000 by the end of the year, and increase the R & D of underlying technology and long-term technology. When it was listed in Singapore on May 20, Li Bin stressed: “with the help of the Singapore International Economic and technological center, we will carry out in-depth cooperation with local scientific research institutions in Singapore, and further improve the global R & D and business layout of velai in the Singapore artificial intelligence and autonomous driving R & D center.”

The R & D of Weilai mainly focuses on new products, intelligent technology and automatic driving. For example, Li Bin introduced at the conference call in the first quarter: “Weilai has introduced more than 200 new functions on the nt2.0 platform, and adopted the next generation voice interaction and emotion engine technology. The interactive experience of NOMI has also been comprehensively upgraded. At the same time, the auxiliary driving system driven by Weilai’s full stack self-developed algorithm has also performed well.”

In terms of assisted driving, Weilai said that it would release the NOP plus based on the high-precision map jointly developed with partners in the third quarter to enhance the navigation assistance function and provide nad services in more scenarios through the software and hardware platform, the internal algorithm of the whole stack and the end-to-end tracking data collection and operation capability.

Recently, the most eye-catching action of Weilai in R & D is to increase the investment in battery related. Li Bin said: “so far, Weilai has more than 400 employees engaged in battery related technologies, including battery materials, battery and battery pack design, battery management system and manufacturing process. The goal is to establish and improve our comprehensive battery R & D and industrialization capabilities, so as to improve the long-term competitiveness and profitability of our products.”

Affected by the rising price of batteries, there are more and more participants in the battery field. Recently, BYD invested 13billion yuan to officially open the first production line of the production base project in Shengzhou, Shaoxing. Lian Yubo, executive vice president of BYD group, said in an interview on June 8: “BYD will provide Tesla with batteries.”

The road of scientific research and development is long and difficult, but it is also the only way for the development of domestic new energy vehicles. Although the performance of Weilai in the first quarter was average, it is hoped that Weilai will bring new surprises to the industry in terms of products.

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