Fuel cars are not the tears of the times

The 2024 Beijing Auto Show has undoubtedly become a shining stage for new energy vehicles, which is impressive. When many "true fragrance" new energy models have been unveiled and introduced to the market, the trend of "the same price of gasoline and electricity" has become more and more obvious, and even some electric vehicles are priced lower than fuel vehicles, which undoubtedly indicates that the countdown to the era of fuel vehicles has quietly begun. However, in the booming development of new energy vehicles, traditional car companies are still adhering to the fuel vehicle market while pursuing trends, and continue to maintain a certain amount of investment. This phenomenon is thought-provoking: although the new energy vehicle market is booming, many companies have not yet achieved profitability; while the fuel vehicle market share is shrinking, it still brings stable profits to car companies. Some analysts pointed out that for the countdown of the fuel vehicle market, it may be necessary to maintain a cautious and wait-and-see. After all, in this wave of energy revolution, the "true fragrance" performance of fuel vehicle companies cannot be ignored, and the vitality of the fuel vehicle market seems to be more tenacious than people expected.

New energy vehicles occupy the C position
  Data show that at this Beijing Auto Show, the number of new energy vehicles exhibited reached 278, which is not only reflected in the number, but also occupies an absolute C position in the degree of attention. New car-making forces such as "Wei Xiaoli" focusing on new energy vehicles have attracted huge crowds, and new energy vehicles have also become the focus on the booths of traditional mainstream car companies. Undisputed, new energy vehicles occupy the absolute center of the auto show.
  Especially in the car company executive interaction craze triggered by Lei Jun, founder, chairperson and CEO of Xiaomi Technology Co., Ltd., new energy vehicles have become the focus of attention. Mi Mengdong, general manager of the public relations department of Changan Automobile brand, said in an interview with China Automobile News: "Independent brands, especially independent new energy vehicles, have now received unprecedented attention." New energy vehicles not only have a new car penetration rate of nearly 50%, but also have an unprecedented level of attention at auto shows. Su Jun, president of J.D. Power China, even bluntly said that almost no company’s booth lacks the presence of new energy vehicles, compared with gasoline vehicles, which are bleak in the new energy vehicle craze.
  At the same time, the rise of new energy vehicles is also accompanied by the first application of various new technologies. Intelligence has become an absolute hotspot in the current automotive field. From the application of AI large models to the innovation of various intelligent driving solutions, to the continuous improvement of the computing power of vehicle chips, new energy vehicles are like a duck to water in the application of new technologies, thanks to the concept that "new energy vehicles are the best carrier of intelligence". The market favors high-tech, and the first application of black technology in new energy vehicles has further increased its popularity. The two complement each other, making it difficult to cool down the popularity of new energy vehicles.
  Behind this attention reflects the wise choice of enterprises under market demand. Data show that domestic sales of passenger cars in March were 1.812 million, an increase of 5.8% year-on-year, of which the market share of new energy vehicles has reached 32.8%. In the first half of April, the penetration rate of new energy vehicles was close to 50%. With the sharp decline in the market share of fuel vehicles and the continuous rise in sales of new energy vehicles, car companies will naturally focus on the market promotion of new energy vehicles in order to obtain better market performance, which further promotes the rise of new energy vehicles.
  In addition, some accidental factors have also added a lot to the hot topic of new energy vehicles. Lei Jun, with his outstanding performance in Internet marketing, brought Xiaomi SU7 to detonate this auto show. His appearance even overshadowed the limelight of many entertainment stars, making the new energy vehicles represented by Xiaomi Automobile the focus of the auto show, and continued to promote the rise of the popularity of new energy vehicles.
  Traditional fuel vehicles are dim
  Although there are still a certain number of traditional fuel vehicles on display at this auto show, these fuel vehicles look bleak under the dazzling light of new energy vehicles. Even if traditional car companies bring fuel vehicles to the exhibition, they rarely attract the attention of the audience. According to incomplete statistics, the booths that receive the least attention at the auto show are often those brands that adhere to fuel vehicles, such as Kia and Hyundai. Even high-end brands such as BMW and Mercedes-Benz have their traditional fuel vehicle focus distracted by the strong appearance of new energy models.
  Even if some fuel vehicles are newly launched at this auto show, they have not received the attention they deserve due to the lack of the blessing of cutting-edge technologies. In fact, the current renewal of traditional fuel vehicles is mostly limited to the update of the shape and the upgrade of the interior. Although some models also try to add intelligent functions, compared with the combination of new energy vehicles in intelligence, the intelligent technology upgrade and application of traditional fuel vehicles are obviously lagging behind.
  In order to improve the intelligence level of vehicles, these traditional fuel vehicles have to increase the proportion of electrification, further move towards gasoline-electric hybrids, and even upgrade to plug-in hybrid vehicles, so as to gradually integrate into the ranks of new energy vehicles. However, in terms of power systems, traditional fuel vehicles have rarely made breakthroughs in new technologies in recent years, and performance improvements have rarely been mentioned. In the overwhelming promotion of new technologies at auto shows, there is almost no news about the technological upgrading of traditional fuel vehicles.
  At present, the technological research and development focus of car companies has been fully shifted to electrification, intelligence and networking, and the investment in traditional fuel vehicle technology research and development has been greatly reduced, and even some companies have completely given up. In this context, the technological innovation of fuel vehicles is naturally difficult to talk about, and its dim star is inevitable.
  Fuel cars still have room to survive
  "Since its establishment, Kia has gone through a glorious 80-year journey, in which technological innovation has always been our constant pursuit. In the face of the new energy wave, Kia is determined to transform into electrification in the Chinese market, but we are well aware that the basic market of fuel vehicles is still solid, so’oil and electricity parallel ‘has become our strategic layout that is both based on the present and looking forward to the future." As Yang Honghai, Kia’s chief operating officer in China, said, the fuel vehicle market is still the source of stable profits for many car companies. Therefore, these companies continue to promote the marketization of fuel vehicles. With its stable performance, ease of use and good brand foundation, fuel vehicles still occupy a solid market share. Even in the Chinese market, fuel vehicles still account for half of the sales.
  However, despite the rising popularity of new energy vehicles, car companies’ new energy vehicle business is generally in a state of loss. Those car companies that are dominated by fuel vehicle business can maintain a good level of profitability. This is particularly evident among multinational car companies. According to the financial report, except for BYD and Tesla, other new energy vehicle companies are rarely profitable, and most car companies are even facing serious losses. Volkswagen, Toyota, BMW, Mercedes-Benz and other traditional car companies have achieved considerable results by relying on fuel vehicle business. Even in the domestic market, companies such as Great Wall, Geely, and Changan Automobile mainly rely on traditional fuel vehicles for profits, and the new energy vehicle business is still in a state of loss. In order to cope with price competition, some companies have even had to adopt a loss-making price strategy, resulting in the situation of "selling one at a loss" for new energy vehicles.
  "New energy vehicles have not yet been able to bring enough profits to enterprises, which means that fuel vehicles are still the key support for the development of enterprises, and there will naturally be room for development." Su Jun believes that profitability is the driving force of the market. In addition to new car-making forces, most traditional car companies will increase the proportion of new energy vehicles in the business, but will not completely give up traditional fuel vehicles. At this year’s Beijing Auto Show, the heads of several companies revealed that they will maintain a market share of about 30% to 40% of fuel vehicles, not only to meet export demand, but also to consider the stable sales of fuel vehicles in the domestic market. "We will not blindly pursue full electrification, but to comply with market demand. When there is a demand for fuel vehicles in the fuel vehicle market, we will not completely stop selling traditional fuel vehicles." A number of owners of self-owned brand car companies said.
  More crucially, in the international market, the demand for new energy vehicles is cooling, and fuel vehicles are still the absolute protagonists of the mainstream automobile market. "Unlike the domestic market, the development of new energy vehicles in other global automobile markets faces many uncertainties." Li Tingyu, head of the marketing office of Beijing Hyundai Brand, admitted that in the global automobile market outside China, the development of new energy vehicles has encountered bottlenecks, while traditional fuel vehicles still have huge room for development. Many multinational automakers have even begun to reassess or delay their electrification strategies, which further proves that fuel vehicles still have strong vitality.