ideal auto "laid foundation" in the second quarter: long-term r&d investment achieved remarkable results
2024-09-07
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during the 2024 chengdu auto show, ideal auto announced that the new generation of ideal intelligent driving based on end-to-end and vlm visual language model officially started recruiting 10,000 people for experience groups. at the same time, ideal auto delivered a total of 48,122 vehicles in august, a year-on-year increase of 37.8%.
this is the result of ideal auto's flexible response. after experiencing pressure in march, ideal auto made comprehensive adjustments in april, from organizational structure to sales strategy. on the evening of august 28, ideal auto's second quarter performance report showed that the company's revenue reached 31.7 billion yuan, setting a new record for the same period, an increase of 10.6% year-on-year. it helped ideal auto achieve profitability for seven consecutive quarters, with an adjusted net profit of 1.5 billion yuan.
ideal auto revenue statistics
"in the second quarter, despite the complex and changing market environment, we focused on user value and operational efficiency. our sales performance remained strong, with gross profit margin maintained at a healthy level of 19.5%. as the production capacity of ideal l6 reaches a stable state and in conjunction with the implementation of various cost-cutting and efficiency-enhancing measures, we are confident that ideal auto's operating performance will further improve in the second half of the year," said li xiang, chairman and ceo of ideal auto, in a performance call.
ideal auto's performance in the second quarter was also recognized by the market. ping an securities research report mentioned that ideal auto experienced several adjustments in the first half of the year, but with the increase in sales in the second half of the year and the optimization of expenses, the company's profitability is expected to improve significantly in the second half of the year. ideal auto has strong product definition capabilities, high market response sensitivity, stable and mature supply chain, and high control of marketing channels. we are optimistic about the company's future growth space.
continuous investment in r&d and intelligent driving drive sales growth
self-developed core technologies are an important cornerstone for the long-term development of an enterprise. ideal auto has invested 3 billion yuan in technology research and development for three consecutive quarters. in july, ideal auto pushed two important updates, ota 6.0 and ota 6.1, for the ideal mega and ideal l series models, achieving a comprehensive evolution of intelligent driving, intelligent space and intelligent electric product capabilities.
in july 2024, ideal auto officially launched the map-free noa to 240,000 ideal ad max users, which can be used in all cities with navigation coverage, and can be used in all cities without prior information, thus comprehensively improving the user experience. so far, the user intelligent driving penetration rate has exceeded 99%, and the cumulative mileage of the full-scenario noa has exceeded 1.11 billion kilometers.
at the same time, ideal auto officially released a new autonomous driving technology architecture based on end-to-end models, vlm visual language models and world models at the summer intelligent driving conference. at the end of july, the new autonomous driving technology architecture had been pushed to thousands of test users. during the chengdu auto show, ideal auto announced that the new generation of ideal intelligent driving based on end-to-end and vlm visual language models officially started recruiting 10,000 people for experience groups.
"starting from end-to-end + vlm, the threshold for intelligent driving research and development has been established. because starting from this generation, we will truly use artificial intelligence to do intelligent driving, and artificial intelligence requires a large amount of data and computing power. it will increase the advantages of companies with high-end intelligent driving vehicle ownership and sufficient r&d investment in intelligent driving, and actually promote sales growth. the sales increase will in turn bring about an increase in ownership and r&d investment. this is a continuous positive snowball process." ma donghui, president and chief engineer of ideal auto, introduced in the earnings call.
ping an securities' research report also mentioned that due to the company's accelerated iteration in the field of intelligent driving, the proportion of orders for the ad max version of the company's current models has increased significantly. as the intelligent driving solution turns to "end-to-end", data volume and computing power investment will become the main barriers, and ideal auto's intelligent driving iteration speed is relatively fast.
"the market has been worried that l6 and industry price wars will lower ideal auto's overall gross profit margin, but a significant decline in gross profit margin has not occurred. this is mainly because ideal started a new round of cost reduction in the second quarter, and the bom cost dropped significantly; the conversion rate increased, and the economies of scale of depreciation and amortization are also one of the important reasons for the stable gross profit margin." guotai junan securities research report said.
ideal auto is accumulating energy for the next explosion. in march, li xiang released an internal letter reviewing the situation, believing that the fundamental reason was the rhythm problem of ideal mega and the desire to focus too much on sales. "imperial mega was mistakenly operated from stage 0 to 1 (commercial verification period) as stage 1 to 10 (high-speed development period)."
ideal has accelerated the expansion of its charging network. as of september 1, there are 752 ideal supercharging stations and 3,528 ideal charging piles across the country. among them, the number of high-speed ideal supercharging stations exceeds 497. at the same time, the number of urban supercharging stations has exceeded 255, and the cumulative number of online preferred supercharging stations exceeds 857.
ideal supercharging station
ideal auto adjusted its sales network structure in a targeted manner. by opening new center stores and replacing and upgrading mall stores, ideal auto gradually increased the proportion of center stores and improved sales efficiency according to local conditions. as of the second quarter, the proportion of ideal auto center stores had reached 31%, and the total number of store booths increased by 13% month-on-month.
"efficient sales operations are an important factor in promoting sustained sales growth, and this is what we are currently doing. next, we will further optimize the store layout, while strengthening our ability to acquire online leads, open the horn of our sales growth, and improve the efficiency of sales operations." zou liangjun, senior vice president of sales and service of ideal auto, introduced in the earnings call.
ideal l6 continues the l series product strength, and high sales boost revenue growth
competition in the auto industry has intensified this year. xin guobin, vice minister of the ministry of industry and information technology, said at the 2024 china automotive forum that my country's auto sales in the first half of the year reached 14.047 million units, a year-on-year increase of 6.1%, playing an important role in supporting the steady growth of the industrial economy. however, the development of the auto industry still faces some problems and challenges, including intensified competition in new technologies, insufficient domestic consumer demand, and extremely fierce market competition.
ideal auto also predicted this early. on april 18, ideal auto officially released the five-seat family suv, the ideal l6, which is ideal auto's first model priced below 300,000 yuan.
ideal l6
"the launch of ideal l6 is based on the real needs of consumers. whether it is ideal one or l series, the price of ideal auto products is more than 300,000 yuan, and the body length is more than 5 meters. many friends hope that we will launch a smaller and more affordable suv. we spent more than 3 years on research and development to create ideal l6." li xiang introduced at the new car launch conference.
at that time, ping an securities research report mentioned that l6 is the fourth model of ideal l series, and it is also the smallest and cheapest model in the l series. l6 continues the design style of the l series and focuses on the young family market. compared with the previous l series, l6 faces a broader market. the l series is the company's sales and profit base in 2024. the launch of l6 will further boost the sales volume of the company's l series and consolidate the company's sales base.
ideal l6 has lived up to expectations and continued the l series product strength and market positioning. after the ideal l6 was launched in april, orders exceeded 10,000 in 72 hours, and sales exceeded 10,000 in the first full month of delivery. 102 days after the launch, the cumulative delivery of ideal l6 exceeded 60,000. since june, the delivery volume of ideal l6 has exceeded 20,000 for two consecutive months.
combined with the previously released 2024 ideal l7, ideal l8 and ideal l9, ideal auto fully released its sales potential in the second quarter. in the second quarter, ideal auto delivered a total of 108,581 new cars, a year-on-year increase of 25.5%. in july, a total of 51,000 new cars were delivered, a year-on-year increase of 49.4%; on august 21, ideal auto's cumulative delivery volume exceeded 900,000 vehicles.
in the market above 300,000 yuan, ideal auto's market position as the preferred luxury brand for families remains solid. so far, the cumulative deliveries of ideal l9 and ideal l7 have exceeded 200,000 units, and the cumulative deliveries of ideal l8 have exceeded 150,000 units. ideal l9 is still one of the first choices for users of full-size suvs.
high sales volume boosted the company's revenue growth. ideal auto's vehicle sales revenue in the second quarter of 2024 was 30.3 billion yuan, an increase of 8.4% year-on-year and 25.0% month-on-month. the company's total revenue was 31.7 billion yuan, an increase of 10.6% year-on-year and 23.6% month-on-month.
under the background of industry pressure, ideal auto's gross profit margin remained stable overall. in the second quarter of 2024, the company's gross profit was 6.2 billion yuan, a month-on-month increase of 16.9%.
"last quarter, the vehicle gross profit margin guidance we gave was 18%, and it actually reached 18.7%. the increase came from changes in the product mix and the increase in delivery volume. with the optimization of economies of scale and adjustments to sales policies, ideal's vehicle gross profit margin is expected to rebound in the third quarter to more than 19%, and the overall gross profit margin is expected to return to more than 20%." li tie, cfo of ideal auto, said in an earnings call that, provided that the overall pv market remains healthy in the second half of 2024, the company is confident that it will achieve full-year deliveries of 500,000 vehicles.
debon securities believes that the impressive sales volume is based on deep cultivation of user needs. by carefully studying the needs of family users, the brand's user stickiness is enhanced by developing smart driving, smart space, efficient endurance and body safety functions that better meet the expectations of family users. treat the organization as a product and use the growth of the organization to support the growth of the product. ideal auto adopts the ipd r&d process + matrix organizational structure to ensure efficient collaboration among departments, improve the overall efficiency of the enterprise and the work enthusiasm of employees, which will become a strong support for the overall sales and performance growth.
ideal auto maintained its momentum in the third quarter, with the company's deliveries reaching 51,000 and 48,000 vehicles in july and august, up 49.4% and 37.8% year-on-year. looking ahead to the third quarter, ideal auto expects quarterly deliveries to reach 145,000 to 155,000 vehicles, up 38.0% to 47.5% year-on-year; total revenue is expected to reach 39.4 billion to 42.2 billion yuan, up 13.7% to 21.6% year-on-year. according to the guidance, ideal auto will maintain 50,000 deliveries in september and achieve a milestone of one million cumulative deliveries in october, becoming the first chinese emerging power brand to reach the one million mark.
ideal auto delivery statistics
proofread by zhao lin
