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text | han yongchang tianzhe

editor | li qin

“bmw and mercedes-benz are getting harder and harder to sell.” a former guanghui auto salesman told 36kr that last year his stores made a profit of 12 million yuan, but starting from this year, almost all stores in his area have lost about 1 million yuan in a single month.

he said that the daily customer flow of his stores is only one-third of last year. internally, the sales decline is attributed to the impact of new energy vehicles and the difficulty of old customers accepting the new styles after the replacement of some bmw models.

under the impact of china's own brands and new car-making forces, the sales of traditional luxury brands such as bba (mercedes-benz, bmw, audi) and joint venture car companies in the chinese market have become increasingly weak.

in the first half of this year, the sales of porsche and saic-gm fell by more than 30% year-on-year; honda intends to reduce the production capacity of its chinese factories this year and even close its production lines.

range-extended models such as wenjie and ideal are targeting the market of luxury car brands such as bba, and they are trying their best. the plug-in hybrid models of traditional car companies such as byd have become the main replacement for joint venture models.

a person close to byd told 36kr: “byd’s 2025 new cars are targeting japanese and german models.”

in the wave of new energy, chinese car companies relied on pure electric vehicles to rise to prominence in the early stage. now they are relying on hybrid models to compete with international car companies.

many companies focusing on pure electric vehicles, such as xpeng, zhiji, jikrypton, aion, and xiaomi, have begun planning the development of plug-in hybrid products with large batteries.

in 2023, domestic plug-in hybrid vehicle sales will increase by 82.5% year-on-year, and pure electric vehicles will increase by 20.8%. the former is almost four times the sales growth rate of the latter. under such circumstances, joint venture car brands are even more eager to make changes.

a large number of high-end foreign car brands have pinned their sales hopes on the launch of large-battery hybrid models. a person close to volvo executives told 36kr that the company plans to launch a long-range hybrid model to cater to domestic market demand, with "a range of at least 200 kilometers in pure electric mode."

toyota motor president tsuneharu sato also announced this year that it will develop a plug-in hybrid model with a pure electric range of at least 200 kilometers, while the current pure electric range of toyota hybrid models is about 100 kilometers.

in addition, the domestic teams of luxury car brands such as jaguar land rover and mercedes-benz have also recommended their headquarters this year to launch extended-range models with large batteries for the chinese market. "(large-battery extended-range vehicles) meet market demand and meet the development threshold." it’s low and easy to use.”

over the past 20 years, multinational auto companies have been major players in china's auto market. as the auto market has changed, the products and technologies of joint venture auto companies have gradually lost their sales magic. under the premise that costs and smart technologies are difficult to catch up quickly, the focus on large-battery hybrid vehicles is one of the few "prescriptions" they can use to save sales in the chinese market.

"supply chain evolution, maturing large battery hybrid vehicles"

plug-in hybrid vehicles can be driven by either electric motors or direct-drive engines, while the engines of range-extended vehicles are only responsible for powering the generator and do not directly drive the wheels.

but no matter what kind of driving force is used, considering the economy, driving smoothness, etc., there are more and more pure electric driving conditions of vehicles.

in the past three years, li auto's pure electric cruising range has increased by 34%; leapmotor has released data that the ratio of more than 20,000 extended-range users using pure electric mode to fuel mode is 92:8.

the same is true even for plug-in hybrid vehicles whose engines can participate in direct drive. yang dongsheng, president of byd new technology institute, once shared that the pure electric drive state of byd dm-i super hybrid can reach more than 80%.

under this trend, the batteries in hybrid vehicles are becoming larger and larger, increasing to about 40 kilowatt-hours and going straight to 60 kilowatt-hours of power. the charging speed of often 40 minutes has become the experience bottleneck of large-battery hybrid vehicles.

however, power battery companies have once again sensed the market trend and have successively launched hybrid fast-charging batteries. catl this year exhibited the "shenxing super hybrid battery", which has a pure electric range of 300 kilometers and supports 3c rate fast charging, which meets the current needs of large-power hybrid models.

honeycomb energy has even released an 800v hybrid ternary dragon scale battery, which can reach a charging rate of up to 4.2c. this product will be sop in 2025.

in other words, the fast charging capability that will be gradually installed on pure electric models in 2023 is now ready for hybrid models.

of course, in addition to the battery, the core component that determines the cruising range of a hybrid vehicle is the engine.

the battery determines the pure electric range of hybrid vehicles, and the engine is the key to energy conversion efficiency. the higher the thermal efficiency, the lower the fuel consumption under the same power output.

in order to pursue lower fuel consumption, hybrid vehicles are equipped with a special engine that absorbs a small amount of air and prolongs the combustion time, thereby burning gasoline more fully and improving combustion efficiency and thermal efficiency. compared with the engine of a fuel vehicle, a hybrid-specific engine can improve thermal efficiency even more.

however, in the supply chain, car companies’ own engines are rarely purchased by peer car companies. the reason is simple. purchasing components such as engines means exposing the chassis structure and even product development plans to opponents.

for new car companies such as ideal and leapmo that lack experience in engine research and development, choosing the extended-range route is a shortcut to bypass engine technical barriers and achieve long battery life in pure electric mode.

the hybrid engine must not only be able to directly drive the vehicle, but also provide different power outputs under different working conditions. it must be able to maintain high efficiency over a wide range of speeds and loads.

in contrast, the design of the extended-range engine focuses on efficiently generating electricity under specific working conditions, rather than providing power under various working conditions, so its mechanical design and control logic are relatively simple.

under this premise, dongan power, a subsidiary of changan automobile, has emerged as a dark horse in range extenders and has begun to supply engines for range extenders of more than a dozen car companies such as dongfeng lantu, leapmotor, and nezha. 36kr previously reported that xpeng motors’ range extender is also designated for dongan power. the latter's 2023 annual report shows that its range-extended engine market share ranks first in the country for three consecutive years.

whether it is extended range or plug-in hybrid, they are all moving forward on the road to large electric power, and they have become a new fulcrum for car companies to expand sales.

"hybrid vehicles with large batteries are a more acceptable car replacement option for a large number of pure fuel vehicle owners. because in terms of experience, almost all are upgrades and no downgrades." a senior industry observer told 36kr.

xpeng motors r&d executive jiang wen also told 36kr that from internal data, the penetration rate of pure electric vehicles is very fast in some areas, but china has a vast territory and there are many areas where the penetration rate of pure electric vehicles has been slow to increase. "at this time, extended range would be a more suitable product solution."

of course, the development of high-power hybrid models cannot be achieved overnight with battery and engine technology. more changes need to be made in the vehicle architecture.

"hybrid power with a large battery can activate the whole body"

the expansion of battery capacity means a corresponding increase in battery volume. in the limited body space, a small change in the vehicle structure will have an impact on the whole body.

hybrid models are equipped with exhaust pipes, and the compressed space in the car results in a relatively narrow shape of the battery pack. if the battery pack is increased, it may cause the battery pack to occupy the space in the car cabin and limit the driver's leg space.

therefore, car companies and battery companies are trying their best to adapt the shape of the battery pack to the vehicle model. there are more and more dagger batteries in the industry, which can effectively avoid the exhaust pipe, while achieving higher integration and greater power.

however, developing a new battery pack for high-power hybrid vehicles requires a long project cycle, such as the same winter and summer tests as the entire vehicle, as well as more vibration, drop and other experiments, which is difficult to accomplish overnight.

a technology platform suitable for large-battery hybrid vehicles also needs to be compatible with the layout of multiple key components such as engines and drive motors. this also means that in the limited interior space of the car, the integration of components must be further improved.

for example, the biggest change in byd's fifth-generation dm system is the seven-in-one power domain control. integrating multiple components can free up more space, and the fewer components, the higher the conduction efficiency and the lower the energy loss, which is more in line with consumer needs.

therefore, if you want to increase the power of a hybrid model, almost all components related to the battery must be modified. if you want to meet the requirements of car regulations, any changes must undergo a large number of tests to verify their stability.

such new changes not only require new product development and planning, but also have a greater impact on organizational culture and supply chain management. this is a very big challenge for multinational car companies.

a domestic supplier told 36kr: “when trying new technologies, we first support new forces, then develop independent brands, and finally joint ventures. because joint ventures to develop a new product require the approval of the overseas headquarters first. decision making is too slow.”

"luxury car brands, few bargaining chips"

the decision-making time of overseas headquarters has become a rope restricting multinational car companies. this also means that the development of large-battery hybrid models is not only a technical issue, but also a struggle between chinese and foreign companies.

a volvo person told 36kr that although geely holding group has become the largest shareholder of volvo group, the decision-making power of model development is still in the hands of volvo's swedish team.

if volvo adopts geely's technology platform, there will be considerable resistance. any demand raised by the chinese team must be approved by the swedish team.

but fortunately, both parties have capital links, so even if there is a game, they can reach a consensus faster. volvo has begun to adopt geely's technology platform to accelerate the development of large-battery hybrid models. for other luxury car brands such as mercedes-benz and bmw, their overseas headquarters teams need to develop hybrid technology platforms to feed back into the country, and the decision-making process is even more difficult.

"it is not easy for global car brands to enter the chinese market. in the final analysis, it is slow for foreigners to accept new technologies or products in the chinese car market, such as smart driving, smart cockpits, etc." the aforementioned person told 36kr that most global cars enterprises develop new models for the global market, and it is difficult to customize development only for the chinese market.

however, some chinese people from luxury car brands said that although it is slow, consumer demand will always be seen. "just like many domestic car companies only launched extended-range vehicles this year, building awareness requires a process."

market sales are a powerful tool to convince the other party. four years ago, volkswagen repeatedly believed that plug-in hybrids were a transitional technology route. last year, the year-on-year growth of plug-in hybrid models in china and the united states reached 84.7% and 54% respectively, which prompted volkswagen to announce this year that it would increase its focus on plug-in hybrids. the development and investment intensity of hybrid vehicles.

however, in such a fiercely competitive market, the window of opportunity is fleeting, and joint venture car companies need to follow up quickly to achieve market results.

an executive from a joint venture car company told 36kr that it will be difficult for joint venture car companies to catch up with the current cost competition, efficiency competition, and intelligence competition for a while. the launch of hybrid technology with large batteries is one of the few products they have at the micro level. there are not many opportunities. "after all, companies like bba still have a foundation for brand recognition. it just depends on who can recognize the product opportunity of large-battery hybrids."

the space left for multinational car companies is indeed narrowing rapidly, and measures to make up for shortcomings are urgent.

jia jianxu, general manager of saic-volkswagen, once said: "there are only two years left for the joint venture car company. saic-volkswagen must make a u-turn quickly, otherwise we will either 'go big' or 'go home.'"

this should be a reflection of the survival of all multinational car companies.