Lei begins the episode with his experience so far at CES including updates on the BMW & Volkswagen unveils and the media events he attended.
Tu and Lei speculate that due to the huge number of LiDAR companies in the space, there will be consolidation in the near future. They will not ALL be winners.
Tu jumps on his soapbox to complain about how he thinks SDV - software-defined vehicle is a terrible acronym that's being thrown out nowadays to describe the connected vehicle.
Tu and Lei close the show with a recap of the final sales numbers for China for 2022.
Lei begins the episode with his experience so far at CES including updates on the BMW & Volkswagen unveils and the media events he attended.
Tu and Lei speculate that due to the huge number of LiDAR companies in the space, there will be consolidation in the near future. They will not ALL be winners.
Tu jumps on his soapbox to complain about how he thinks SDV - software-defined vehicle is a terrible acronym that's being thrown out nowadays to describe the connected vehicle.
Tu and Lei close the show with a recap of the final sales numbers for China for 2022.
CEM #99 Transcript
Recorded 1/5/23
Tu Le:
Hi everyone and welcome to China EVs & More where my co-host Lei Xing and I will go over the week's most important and interesting news coming out of the China, EV, AV and mobility sectors. What Lei and I discuss today is based on our opinions and should not be taken as investment advice. If you enjoy this room, please help us get the word out to other enthusiasts, and course tune in again next week.
My name is Tu Le, I am the managing director at Sino Auto Insights, a global management consultancy that helps organizations bring innovative and tech-focused products and services to the transportation and mobility sectors. I write a free weekly newsletter that we pull many of our discussion topics from. You can sign up for it at sinoautoinsights.com, which I encourage you all to do. A Vegas Lei. Can you introduce yourself please?
Lei Xing:
A Vegas, CES, walking tired Lei. This is your co-host Lei Xing, former chief editor of China Auto Review and this is episode #99 and first episode of 2023. Happy New Year!
Tu Le:
Happy New Year!
Lei Xing:
Happy New Year. And, I’m in Vegas. I'm at CES 2023, the most influential tech event. It’s good to be back. I was last here in 2020, right before the pandemic. And it was a soggy day. We had a rather huge rain today.
Tu Le:
Really!
Lei Xing:
So my feet and shoes are still wet because you know, when you wear, you have to wear these sneakers for walking. And I just came back, so they're still wet and…
Tu Le:
This is Vegas, in the middle of a desert? I've never…
Lei Xing:
Yes, but…
Tu Le:
I guess wintertime.
Lei Xing:
It was pretty heavy by Vegas standards. I like to say, this CES is getting off to a colorful start.
Tu Le:
Sure.
Lei Xing:
Pun intended. And when I say colorful, I'm talking about the BMW keynote. You may, well it was pretty late last night, so you probably saw some of the news.
Tu Le:
Yeah I dunked on it.
Lei Xing:
Yeah, the color changing, right? And all the i Vision Dee, which stands for Digital Emotional Experience. But I thought that was like one of the greatest shows that were put on. I mean, like BMW, they know how to put on show. They had the Governor, the Terminator. So they probably paid big money.
Tu Le:
He did those super bowl commercials, right?
Lei Xing:
Yeah. They had K.I.T.T, they had Herbie, those two cars on the stage and all involved in this kind of movie and storytelling. So I thought that was a pretty nice show that was put on. I mean it's different than, I mean I was at the Stellantis keynote this afternoon and that was just the old, CEO talking, right? But I guess it's hard to summarize because I arrived on the 2nd, then starting on the 3rd, there were already events. So on the 3rd, I checked out some of the innovations from Valeo, the French tier-1 supplier, then the Volkswagen ID.7 Camouflage or whatever you want to call it.
Tu Le:
Do we know why they did that?
Lei Xing:
It’s to show digitalization. But once you saw the color changing of BMW, then you're like that the ID.7 was nothing, right? It was like, compared to the E-ink.
Tu Le:
Yeah, it just, they, the Volkswagen ID. series cars just come off flat.
Lei Xing:
Right. I think I just saw some issues with some of the medias that were driving the ID.4. So they had a trip from LA to Vegas, I think on the 3rd some of the media, and I think I saw some problems being tweeted, stuff like that, right? But here's the first China factor. So the ID.7 is a global car in the ID. family. It's going to be produced later this year at both of the China JVs, as well as in Europe and the U.S.
Tu Le:
So it's going to be ID. Buzz, ID.7 Buzz, and ID.7 CROZZ.?
Lei Xing:
No, it's ID.7 CROZZ and ID.7 X, that's probably what's going to happen.
Tu Le:
That's “cha bu duo,” right?
Lei Xing:
Yeah, so basically, they put about 40 layers of this electroluminescent paint on it. Some can, are inductive, some are not. So it creates that kind of camouflage effect. It's just to show kind of how you want to digitalize.
Tu Le:
And for those wondering, the ID.7 is about the same size as a Passat. So it's about the same size as a model S or a Lucid Air. So it's the large sedan for Volkswagen.
Lei Xing:
The previous iteration was the ID.AERO which had its global debut in China, so it will be a little bit different than the ID.AERO. But this version before the ID.7 name came out, was the ID.AERO B and actually I already saw it in LA, but there was an embargo. So now they released it. And the official…
Tu Le:
Who's the host, or the presenter?
Lei Xing:
There was no presenter, because this thing they had this event out in the desert in Boulder City. But it was too wet. You know how San Francisco had the storm. This couple of days, yesterday and today. I think that's how it affected today's weather, so they just moved that reveal just to the LVCC which is the CES venue. So there was not official CEO coming out and presenting it, it was just shown right there. Yeah, so I guess it's probably going to be one of the last in the ID. family before the next kind of the generation kick in.
Tu Le:
Yea this is going to be the last of effectively what you're saying is going to be the last of the MEB platform vehicles, right?
Lei Xing:
I believe so. That's that. And then basically they were outside, they had this cube, Volkswagen, which was next to the usual suspects, the Googles, Here, Valeo, FORVIA. FORVIA is a new company, we'll talk about it later, FORVIA combining Hella and Faurecia, right? And then the outside, the usual, also Waymo. I got to see their, all their vehicles, including the ZEEKR M-Vision Waymo Edition, they showed it again after debuting that in LA, which I had seen before. So that was on the 3rd and yesterday was the first press day, which basically, I tweeted that the list of companies that were having press conferences, mostly the tier-1s, and some other tech companies, but I said there's not many on that list that don't have some kind of automotive related business.
Tu Le:
For sure, this is the premiere automotive event in the world now, I think, so.
Lei Xing:
Yeah, and there's not many companies on that list that are not, as much as they're about software, as they're about hardware. You had companies like Bosch, ZF, Valeo, FORVIA, HOLON, we'll also talk about it a little bit. Luminar. I want to talk about Luminar because I had a front row seat. And watching, my first time in person seeing the Rising Auto R7. Here's a little good anecdote: sitting next to me was two attendees, Americans, and they were talking, chatting and they're like, look that R, is that a Rivian? I was like, I immediately I told him, no, that's a Chinese car. They were like, oh that, this is, this looks nice. I said yeah it's from SAIC Motor. Yeah so that was an interesting anecdote. And you said we need more work.
Tu Le:
I think this will be our breakthrough year.
Lei Xing:
So that was interesting. So I sat in the front row and Austin came out. I mean he's just this kid and he talked about updating Luminar on their achievements. So basically Rising Auto R7. And I think they signed some new, what do you call it, deal wins. And they probably are going to announce that later and they bought CivilMaps and that he wants to kind of do something about mapping the physical world through that acquisition.
Tu Le:
Well, he's not going to be able to do it in China. That's for sure.
Lei Xing:
Yeah, so I talked to him and I said, you know this is still optional, right? And he said, yes. And I talked to other LiDAR people, and they are having second thoughts about how much they have really delivered, because they just started production, right, on these LiDARs. So it's probably in the hundreds of units, not in the thousands yet. But, it was cool…
Tu Le:
Let me say one thing about the LiDAR space. Before you know it, let's say, prior to 2030, LIDAR will be commoditized.
Lei Xing:
Oh, before that.
Tu Le:
I believe so, too.
Lei Xing:
In fact, at the Valeo press conference, I asked the CEO, Chrsitophe Périllat, I think is his name, about kind of his expectations and he said the market will be in the millions of units within 3, 4, 5 years, not 10 years. We're looking at 2023, then 3, 4, 5 years, right? We can do the math. And based on the number of LiDAR companies and including the Chinese LiDAR companies, I’m counting at least ten, including four LiDAR companies from China.
Tu Le:
There's going to be consolidation within the next 3 years for sure.
Lei Xing:
Yeah, so RoboSense, Innovusion, Hesai and Z Vision, and their primary, I think they're all launching this blind spot or sideview LiDARs. It’s becoming a thing in China as well. A smaller, not the watch tower bump, small LiDARs. So that's on the LiDAR space. And I think the common themes from the tier-1s, one is the software, second is the zonal domain controllers. So getting away from the ECUs and combining all the functionality into two or three of these controllers in the vehicle to reduce complexity, right? Software I mentioned, and one of the big things is shuttles. This is becoming, I think, hot again. And we mentioned HOLON. HOLON is the kind of the autonomous shuttle company spun off from Benteler. And Benteler showed couple of years ago with Bosch, a platform 2.0 chassis that actually was, when Evergrande signed that 60-company deal like 3 years ago, that was what they signed up for. And now I think the suppliers including ZF, right? They announced their latest shuttle, HOLON, and some others.
Tu Le:
MIH is what Evergrande wanted to be, basically.
Lei Xing:
So I think there's this need and there's a company in the U.S.scalled Beep which is working with ZF, working with HOLON, and also Mobileye. Mobileye is actually providing, we can talk about Mobileye. This autonomous shuttle seems to be getting a lot of tractions, but only they're going to be operating in certain ODD right? But there's something called the segregated roadways, there is something called mixed traffic. This is like a huge bet from this Benteler, right? Starting up their own mover, people mover company.
Tu Le:
Here's the reality Lei, these tier-1s, none of them can write software. So I actually hate at the SDV, software defined vehicle. I hate that term.
Lei Xing:
So I checked out some of the demos that Conti and Valeo showed, and Valeo had this kind of the mockup of a car with all their sensors, right? The LiDARs, the cameras, radars. I think that everybody, they talked a lot about software that you know, we do our own software.
Tu Le:
But this is the thing Lei, think of manufacturing hell, from a physical manufacturing standpoint, right? Building a prototype or one off is no problem. Making this software work across hundreds of thousands of units, millions of units is a whole different ball game.
Lei Xing:
Yes.
Tu Le:
And then not only that, but to fix the bugs, monitor, fix, and maintain the software in real time. None of these companies have this type of experience, right? This is what I'm talking about where it's like these tier-1s. They're moving faster than the OEMs, that's for sure. But the tech companies are the professionals at this, right? And what the OEMs are doing is actually boxing them out because CarPlay is going to be optional in most vehicles, Auto Android, Amazon Auto. So guess what, do you think that the technology companies that live in software are going to be better than the car companies and the tier-1s? Of course, they are. Whether or not they get access to these vehicles. That's going to be the major issue, right? That’s how I see it.
Lei Xing:
Yes, I think I agree with you, but at least the trends that are being shown at CES is pretty clear.
Tu Le:
Yeah, but to us, it's like déjà vu, though, right? Because we saw this to 2 to 3 years ago.
Lei Xing:
From Stellantis, from BMW, from the titer-1s, I think I've heard SDV mentioned, I don't know how many times…
Tu Le:
That's terrible term. Because it's not, to me, it's oversimplified because it's not a software. It's hardware and software integrated to create a compelling user experience, right? You can't have the experience without the hardware working with the software. So what the challenge is, is that they might be writing a lot of their software or a lot of their code. But there are still going to be some bolt-ons. And there increases the complexity because let's say, for instance, in Europe, they have a preference for certain types of sensors. And then in China, they have other types of sensors. That's different software that needs to integrate into the hardware and the software or the hardware that's different in China and Europe. And so there's likely not going to be a global platform for most of these OEMs, right?
Lei Xing:
Yeah. Anyway, so switching gears a little bit. One headline was we were in another chat group was this Europe doesn't know how to make a small EV, affordable small EV, so the price difference was at least 10,000 Euros. So a similar EV made in China versus EU and this was actually mentioned by FORVIA CEO in their press conference. And so you know, what, before you get, it's right off the bat, right? China's factor is talked about, is mentioned.
Tu Le:
But what is not being said, because we shouldn't just say it's cheaper. They're actually better, right?
Lei Xing:
Cheaper and better, right? Exactly.
Tu Le:
Because it's not just a cheaper thing. If we look at the ID.4 versus a BYD Tang or Han, or ATTO 3, the software is just better, right? And the vehicle is just better. So to only say it's cheaper, doesn't tell the full story. In my opinion.
Lei Xing:
Exactly. Then I actually, I asked him a question to confirm he was talking about BEVs, which he did. I did say that Dacia Springo is under 20,000 Euros, and that's made in China. Spring. I keep on saying Springo, but Dacia Spring. So I think it was the second bestselling BEV in France in 2022.
Tu Le:
You know the funny thing is Lei, I wrote this, I’m drafting the newsletter and, I wrote that there's 1.8 million EVs sold in Europe between January and November, of that 20, or 11% were from Chinese manufacturers. A big portion of that is from European brands that are built in China.
Lei Xing:
Like Dacia right?
Tu Le:
And MG and stuff like that, right? So it's right under their noses and they don't even know it. So that number is only going to get bigger. So.
Lei Xing:
Yeah, and then we talked about BMW and right before BMW was the Sony press conference. They unveiled AFEELA, but I think a lot of people dunked on it, including yourself.
Tu Le:
I laughed at the name, right?
Lei Xing:
And it looks like it was a mesh up of some cars. But the interesting thing is, what I heard was this, the pre-orders are starting early 2025 and delivery starting 2026. By the way, we're now in 2023. The most number I've heard the last couple of days is the number 2026, including Stellantis, the Peugeot Inception Concept is previewing the next generation of EVs from Peugeot hat'll start to launch in 2026. And this is exclusive. So after the keynote, I went up to Carlos Tavares and I asked him, do you still plan to produce these EVs in China? And he said, I think it was a diplomatic answer. He said, we're still discussing. It's under discussions.
Tu Le:
So not likely, I think he's closed the door on production in China. So.
Lei Xing:
Yeah, that Ram pickup is trying to out pickup all the other electric pickups.
Tu Le:
I'm in like, I thought it was actually pretty nice I think…
Lei Xing:
Yeah, there was some new stuff, the automatic following, this kind of “i-robot” home charging bot.
Tu Le:
I think Giles said it's brutiful. What was the reception? Did it get a lot of positive reviews?
Lei Xing:
No, actually when the Ram CEO went up and talked this, when it came out, it was huge applause, huge applause. So I think that tells you the kind of demand on this electric pickup. And this is 2023. We're still looking forward to the Cybertruck, right? Supposed to be a big volume. And we're still not done. So today this morning, WeRide is here. I, last time I tried out a WeRride it was like generation one or something or two in 2019 in Guangzhou, their headquarters. And I didn't meet their CEO Tony Han, and this year, this morning, he was there. So I met him, and he's one of the Baidu graduates, by the way, and they're showing this the SS 5.1 suite. And I asked one of the tech guys, and he said they have this annual iteration, so one year will be 1.0 next year 2, 3, 4, 5. So 5.1 is, I guess, the next generation kind of the stack setup. They're all using Hesai LiDARs, Hesai right now I think they're the exclusive LiDAR provider. And I took a spin on the streets. It's Level 3, so basically, I tried for 15 minutes and no disengagements.
Tu Le:
But there was a safety driver, right?
Lei Xing:
Yes sat in the safety seat, so they're just showing this Level 3 capabilities. They've been testing this in San Jose. And now they're just trying to show this in Vegas.
Tu Le:
For those that are wondering WeRide is one of China's autonomous vehicle, leading autonomous vehicle companies. They're based in Guangzhou. Lei got a chance to ride in it and I had the opportunity to go down, I actually met Li Jiang who's the COO I believe now, and got to ride in one for about 40 minutes around Guangzhou in 2019 before the pandemic. So I'd love to be able to ride one in China where there running Level 4 pilots.
Lei Xing:
So this is another China factor, actually a Chinese robotaxi, self-driving startup, whatever you want to call them, is here at CES and not the first time they're here, they were actually here last year at the Hesai booth. But now they have their own kind of the demo in the one of the lots, right? And then funny thing was, right after that was the Mobileye, Dr., not Dr. but professor Shashua’s annual kind of the update. And me and Tony, he wanted to go. So we went together and on the way bumped into Austin Russell, the ceo of Luminar. So they bumped fists and they knew each other from a while ago. So it's kind of interesting to see that. And then Mobileye is basically another huge, huge China factor. So I went by the Mobileye booth, what was showing there was the NIO ES8 robotaxi and the ZEEKR 001. Again, my first time seeing ZEEKR production vehicles. So it, for me, it's like, right, seeing these Chinese EVs that we've been talking about on the show for so long the first time is always exciting, right? And guess who was there. The CEO of ZEEKR, An Conghui, his English name's Andy. I told him ZEEKR last year, last episode we talked was one of the surprise EV brands of the year. He told me it'll be even better this year.
Tu Le:
Of course he's going to say that.
Lei Xing:
No, I mean you're right.
Tu Le:
The good thing is a good friend of the show Yilei Sun was there.
Lei Xing:
It was so funny. It's like, oh who are you like, can we add your WeChat? And then he looked at my badge and it's like, oh….
Tu Le:
So you’ve never met him.
Lei Xing:
No, I never met him. See, so this is why CES is so like, I like it so much because you get to see these people that you know are going to be here. Some people that you didn't know, but you bump into them like Andy, right? I mean they, from right? They were at the Mobileye event. They were, sat in the front row and listening to Professor Shashua. I think he being a founder listening to his update. I don't think there's anyone else that can explain kind of the ADAS and autonomous driving better than him. I think he used simple, easy to understand explanations. And the first thing he said was you know, six or seven years ago, all these OEMs were kind of afraid that because of this self-driving, these robotaxis, nobody is going to buy cars anymore? He said now nobody worries about that because of the recent kind of the understanding. And now knowing it's more practical to have these more advanced ADAS features, rather than we're going to see these robotaxis taking…
Tu Le:
For the time being right?
Lei Xing:
Yeah, and then he explained, I think what was interesting was, forget about L2, L3, L4 termination. He used this hands on, eyes on, hands off, eyes off explanation. And SuperVision would be something called a eys on, but hands off. So you don't have to go into understanding whatever L2, L3, he said, L2 and L3 is for engineers. Their approach is to have these new kind of terminology to define their own roadmap on what they wanted to achieve. And he showed some massive numbers, right? Their incoming revenue bookings and all right. And then the announcement that Mobileye is going to do SuperVision on three additional brands from Geely Group this year. So the ZEEKR we knew earlier this week that they sold over 70,000 units. All of them, all of those 001s are equipped with other SuperVision。
Tu Le:
And the improved Qualcomm Snapdragon.
Lei Xing:
Yeah, so that was interesting to hear.
Tu Le:
Geely has really, I think, taken a risk by hitching its wagon exclusively to Mobileye.
Lei Xing:
Yeah, and then I had some time to walk the show a little bit. The first booth I stopped by was Cepton. And I said hi to our guest Dr. Jun Pei, he was there. And they showed this new, their updated LiDAR. And then next to Cepton was RoboSense, they showed their also blind spot LiDAR.
Tu Le:
Were they all bunched together all the LiDAR companies?
Lei Xing:
No, so RoboSense was next to Cepton basically. And then after that, I went to Hesai for a little bit. And I got this Hesai. You remember, they just produced their 100,000th LiDAR, right? And 60,000 of those are the Fal, no not the Falcon, right?
Tu Le:
That I’m not sure.
Lei Xing:
Or the AT128s, I might be mixing up Falcon from Innovusion, right? It's too much. I got this little gift. It's a portable charger, but in a shape of a LiDAR.
Tu Le:
Nice!
Lei Xing:
Yeah so I I'm attending these events. And the majority of them are from my old PR contacts in China. So they kind of knew I was here and say, please go visit and check out our stuff. And then after that, what else? But I’m not going to be exhaustive on all the things, but I think CES it was clear that people we're back, they were looking for these in-person interactions, looking to see, Chinese, a lot of Chinese companies, a lot of Chinese factors as we talked about, people from China even from these tier-1s, people who work at these international tier-1s in China. They were here. I met some of them.
Tu Le:
What kind of told me how important the show is was when you told me that Tony Han was there, and then you told me that Andy, An Conghui was there, because they're not going to every single event in the, around the world, right? They knew to come to CES because it was that important. The market is that important.
Lei Xing:
This makes me think of last night’s Yang Wang stream. I watched a little bit of it. And what I got was this confidence, this total confidence that we, as Chinese companies, we can lead these kind of technological innovations or products. And I sensed a lot of confidence here from these Chinese companies, despite the China U.S., the geopolitical environment. That's what I sensed.
Tu Le:
I look at it this way, Lei. I look at it like the Chinese companies, the leadership are very confident in their products and their companies and their teams. And I think that they are more or less not trying to worry about the diplomatic side of it, right? Because they believe and have confidence in the competitors, the global competitiveness of their products. So I think that kind of that shines through, and I feel that number one, they don't really want to acknowledge the challenges on the diplomatic side. But I do think that the PCAOB, the auditing thing that goes a long way towards mending a few fences, but ultimately, the Inflation Reduction Act and how tight they're going to manage that U.S. government is going to manage that while the Europeans, the Japanese, the Koreans, the U.S. legacy automakers, all put pressure on them to water it down, or at least push out the extreme requirements to later time frame. So the one thing that I will say about the difference between the EV side in China versus the United States. There's so much capital in China that you could see these hundreds of EV companies pop up out of nowhere. In the United States, there's not that type of capital. So I think we're going to see many more asset light companies that need a Foxconn that need a Magna Steyr to really, really enter the market. And so I think that's going to be the huge differences between new EV brands coming from the United States versus what we've seen and what we know about from China.
Lei Xing:
So some more anecdotes. This morning, I was walking to the monorail station, and I bumped into a VP from Horizon Robotics.
Tu Le:
Nice!
Lei Xing:
We met in Tianjin a few years ago. They are not exhibiting officially. They have this hospitality suite that every year I think they have that. So just kind of show their products to potential interested customers or parties. I mean that's why I said CES is connect, experience and surprise. That's the surprise part of it. You never know who you meet or bump into. So yeah, I think a lot of people came over from China, not only automotive. And then BYD right? Even BYD they were supposed to be here, but they still had announcement of that NVIDIA Geforce. They're not showing anything though, but it's just an announcement. What else, oh, Mercedes, right? I told you they're building their own charging network. This was announced today, I think.
Tu Le:
And I told you that I made that kind of statement or I urged the OEMs to really take ownership of the charging experience. And it makes sense that Mercedes would do it.
Lei Xing:
Electrify America, right? That's, right? Facing some complaints. So companies like CARIAD, Mercedes, I mean I probably am going to try to drop by tomorrow. Also Innoviz, I want to say hi to Omer, which was one of our earlier guests.
Tu Le:
Yes because we've never met most of our guests, right?
Lei Xing:
That it's all been online, right? So this is why like this is so good. I met so many people from even these suppliers, the events I attended before, the former president of Valeo China. He is now the top communications guy and we met, right? And Conti CEO, we talked a little bit and they're all saying, planning to go to Shanghai because they haven't been back in 3 years.
Tu Le:
Yeah, that's, I already told a bunch of people that Shanghai is going to be a huge, huge auto show.
Lei Xing:
Yeah, so it's this kind of eagerness, right? To be back in action.
Tu Le:
Because they want to see all the changes in the 3 years that they have been back, right?
Lei Xing:
Yeah. I guess also it's just walking around and then on a Monorail, you just start these conversations with people and I started educating them about the China EV factor. So that's an interesting part because they did and they always open their eyes up and they're like, oh, wow.
Tu Le:
Hey, we are at 10:45, we will open the room up, but I don't really have.
Lei Xing:
And I'm still not done, not done meaning I still have things to see tomorrow and the day after. Different people to talk to. Should we mention some of the upcoming MAX episode guests?
Tu Le:
Yeah, we can, sure!
Lei Xing:
We probably should make an announcement. So Junwei Bao, the founder and CEO of Innovusion, which supplies NIO their generation 2.0 platform vehicles. I'll be talking to him, will be recording an interview. He and Tony Han of WeRide are both Baidu alumnus, so for those that don't know Baidu is the kind of the what you call it.
Tu Le:
Google.
Lei Xing;
The training ground for all of these Chinese AV startups. And then I'll be talking to Jack Cheng, CEO of MIH on the 7th. And then two other ones. So CEO of HOLON, his name is Marco. I interviewed him when he was at Benteler, I think Shanghai 2017. And he remembers me. And one of the partners, Pininfarina, the CEO is Silvio Angori. I've interviewed him in various locations many times. He's agreeed to kind of talk about, because they are the designer and Pininfarina has a huge China business, but I'm not sure how big it is now. So it will be interesting to again, see his perspective. So these are and then we'll get to talk to Tony eventually. We spoke English a little bit, it should be no problem. So w have some good guests lined up for our MAX episodes. Other than that, that's my CES kind of the 3-day recap.
Tu Le:
So before, let me and Gary give me one second, before we pull him up, I wanted to update about a couple of things.
Lei Xing:
Tesla. That's the biggest news now of today.
Tu Le:
So Tesla has reduced the price of the made in China Model 3 and Model Y between RMB20,000 and RMB38,000 so between three, $3,500 and $6000. So significant price cuts.
Lei Xing:
It's from RMB20,000 to RMB48,000.
Tu Le:
Yeah, 48, sorry, not 38.
Lei Xing:
That's my, I’m looking at this price comparison.
Tu Le:
So just for a sense of US Dollars, we're talking about 6.8, so about seven, $1 buys me about RMB7 just FYI. And then MIH announced that NVIDIA tie up, right? So they're going to go exclusive within NVIDIA. WM has been taken to court to freeze some assets by some, I want to say, suppliers or some partners. So they're in a heap of trouble. The only other thing that I wanted to mention was the letter that Li Bin sent to his team. Because I've been talking about throughout this entire year or last year about the product seems to be fine. The marketing and the positioning seemed to be fine. They just have not been able to manage operations very well. And that letter basically said that they need to clean that up in 2023. So he sees the same things we do.
Lei Xing:
Yeah and the Tesla Model 3 cheapest is now, the RWD below RMB230,000.
Tu Le:
That's unbelievable.
Lei Xing:
I think I've said that before on the show that it was going to be dropped to below RMB230,000 and it has happened.
Tu Le:
So five days into the New Year, basically. So. I just…
Lei Xing:
And then Yang Wang basically is, I mean, I think that was probably one of the, we are only 5 days into 2023, but I got to say it's, when that truck, not truck, but that SUV came up sideways, crab walk, right? The wheels came up sideways, that was the entrance of the year. I think.
Tu Le:
Yes. They are, both designs are to me very Chinese but…
Lei Xing:
And the RMB, both are RMB1 million models. There's that easter egg of the…
Tu Le:
Give or take $150,000.
Lei Xing:
U9, that's again what I talk about that this kind of confidence that the Chinese brand was showing to be upscale, to be premium to be…
Tu Le:
But this is the challenge with ultra premium, right? Because most of the ultra premium brands that we know of globally have been in the market for a number of years, right? And have built that trust and have built that reputation. So we, even Cadillac with its CELESTIQ, that is going to take a lot of effort for GM and Cadillac to really get that vehicle to sell in a decent volume, right? So I look forward to some of the innovations on the retail side for BYD with the Yang Wang.
Lei Xing:
So quickly just on the, we're seeing some of the final sales numbers for 2022, right? BYD nearly 1.9 million, some of the Chinese smart EV startups. I think it was sigh of relief, especially for Xpeng, right? And I think there was like 15, 16 companies, including BYD already over 3 million units. The latest prediction is 730,000 from CPCA for December. So like we said, right, closest to 7 million, it's a foregone conclusion.
Tu Le:
I think it's going to head around 6.7…
Lei Xing:
I said 6.8, so. And yeah, so like these things 3 years ago, so Sony who would have thought Sony will be making a car, right? Nobody thought. Xiaomi just announced they're doing developing two cars, so the prices are going to be under RMB300,000. They are, I think there are still facing some issues, challenges, but I think these were reported from that LatePost article.
Tu Le:
The first product is rumored to be a Model S style sedan.
Lei Xing:
Yeah, I mean it's great to see Chinese products, EV products here for the first time, for me. And just to know that nobody would have thought this before the pandemic that they will be making their way through various ways, right?
Tu Le:
But you definitely notice, if you are China follower, you definitely notice they are trying to stay under the radar, right? They're not really pounding their chests.
Lei Xing:
Yeah some kind of de-china going on, right, without…
Tu Le:
They have a partner that is highlighting their product, not them themselves, right? Yeah. Good job.
Lei Xing:
You need to be here, man. Next year you got to be here.
Tu Le:
I will be next year.
Lei Xing:
For me, I think I've attended every year since 2016. I have my routine. I know, I plan ahead. I know how much time is needed to get to certain points. So it's been, worked out ok.
Tu Le:
Next year, we'll divide and conquer, basically.
Lei Xing:
But if you're here first time, like, you'll be lost. If you don't know where are you going, seriously.
Tu Le:
Not only that, but I'd probably be at these after parties. Yeah. So I'm actually glad that a part of me is glad that I didn't go, but a big part of me is kind of bum, but I had way too many things going on over here, too. But hey, man, I don't have anything else. So did you want to close up shop?
Lei Xing:
No, yeah I mean housekeeping. We're going to be behind on some of these episodes. This week I’m busy, you're busy. We'll try to post some of the older episodes. I got to find time too.
Tu Le:
Yeah, no, we're actually not that behind. So but we will be back on track hopefully in the next two or three weeks.
Lei Xing:
And then before you know it, it's already Chinese New Year, we're probably going to have to what, have a break that week or something. It's our annual break.
Tu Le:
Chinese New Year’s…
Lei Xing:
Yeah 22nd.
Tu Le:
Day, day is the 22nd and it is and the world has changed because COVID is no longer a major part of any country.
Lei Xing:
Also, I'm looking forward to one of the demos of Luminar. Those videos are very viral, right? Hitting the kids, the fake kids, the dummies not the kids, the dummies.
Tu Le:
And we will try to get back to our normal time starting next week.
Lei Xing:
So we should be okay, I'm not going to be at CES ext week. So.
Tu Le:
Alright, everyone. Thanks for joining. Good morning, good afternoon and good evening. We will talk with you next week.
Lei Xing:
Talk to you guys next week. Bye bye.
Tu Le:
That brings us to the end of this week show. Lei and I thank you for tuning in. My name is Tu Le and you can find me on twitter @sinoautoinsight. You can find Lei on twitter @leixing77. If you wouldn't mind rating and or reviewing us on Apple Podcast, Spotify or wherever you grab your podcast from, we'd appreciate that as well. Even better if you enjoy this show, please tell your friends about it. Please join this again next week as we track down all the latest news on China EVs & More.