Episode #164 - AutoBeijing 2024 Recap, NIO's 500,000th, Reflections on GBA (Greater Bay Area)

Tu and Lei spend the first few minutes of the show recapping their overall feelings about Auto Beijing 2024 (the show) and how it was a bit different from Auto Shanghai 2023. 

They both reflect on what the legacy automakers revealed at the show and how the legacies presence in Beijing this year was much different than what it was for 2023 in Shanghai. There's a pulse. 

Tu talks about when he bumped into the GM management team while being interviewed by CNBC's Eunice Yoon at the Chevy booth. 

They both then spent a bit of time reflecting on their 3-day trip from Beijing to Shenzhen in the XPeng G9 Performance including the performance of X-NGP and their thoughts on charging infrastructure during their trip. 

Tu moves the discussion over to his experience attending the 500K production vehicle for NIO that was held at their Hefei headquarters. 

The podcast closes with Tu and Lei's experience spending a few days in Shenzhen and getting to do some other memorable things while there. 

Transcript

CEM #164 Transcript
Recorded 5/11/24

Tu Le:
Hi everyone and welcome to China EVs & More where my co-host Lei Xing and I, Tu Le, will go over the week's most important and interesting news coming out of the global EV, AV and mobility sectors. What Lei and I discuss today is based on our opinions and should not be taken as investment advice. For those that are new to the show, welcome. And for those loyal listeners, welcome back. We ask that you please help us get the word out about this podcast to other enthusiasts and tune in again next week where we will start doing the show again pretty regularly. 

My name is Tu Le, I'm 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.substack.com, which I encourage you all to do. Lei, a Shanghai, a Beijing bound Lei or Shenzhen bound Lei, can you please introduce yourself?

Lei Xing:
Good morning from Shanghai, a rainy Shanghai, I believe this is my 20th day in China. If I did my math correctly, this is your co-host Lei Xing, former chief editor of China Auto Review and this is episode #164 if we also did the math correct. Because we kind of stopped for three weeks. Is that correct? Time flies.

Tu Le:
We did, we provided different forms of content.

Lei Xing:
Yeah. So we're exactly switched places. So the last time we did this live show, I was in the U.S., I think you just finished off with the ZEEKR 009 launch event. And we just had another ZEEKR, important milestone earlier today. The IPO, 9th IPO of Eric or Li Shufu of his conglomerate. And from everything in between, it's difficult to put into words or try to summarize it in simple terms. It has been a lot going on. Let's just say that.

Tu Le:
So congratulations to the ZEEKR team. We know a few of the people there, we know a few people at Geely. So happy for those guys. There's a nice pop, although the IPO target was dialed down significantly over the last few weeks, but they raised like $440 million worth of capital. So I think that should be helpful a little bit. It's not going to be a game changer, but I think it was great to see them able to make some positive gains out of it in the first days.

Lei Xing:
Yeah. And the ZEEKR speed, 3 years, 37 months. I think the interesting thing is, they are starting off with positive margins, it’s not something you normally see. I think last year was 15% gross margins, and they started off having positive margins the first year, I believe, in 2021.

 So I think that's something a bit different than “Wei Xiao Lis” with the group backing. And they have really strong product lineup and momentum. But I think it's only one day in this environment. We just heard about the tariffs, quadrupling of the tariffs on the China EV so this is kind of, right, a very interesting time period.

Tu Le:
We left off the last live show, as you'd mentioned, 009 Grand launch in the Venice of China that I attended. It was a grand event. And ZEEKR has always been very foreign media friendly. So I think that was one of the positives from the IPO that they were able to get a lot of western media's attention. Our friend of the show Kevin Williams, he just dropped his article big one about his thoughts on the week he spent in China, test driving cars, talking to people like myself, you, Will, Mark, Ethan. So if you're wondering who those guys are, Will as China Driven, Ethan as Wheels Boy, Mark as Inside China Auto and we're all friends. We all have a lot of respect for each other. We also saw Phate or Jiawei from CNEVPost and Jiri from Car News China. So.

Lei Xing:
I'll see a couple of those, Jiawei, and some of those, Jill and some other ones today later on this afternoon. So catching up a little bit. It would be nice after Beijing, we caught up with those and in Changsha for that matter.

Tu Le:
So let's, so let's start off with maybe Lei, your thoughts and we won't dedicate this podcast to that, but let's say you have a couple of days or a week, two weeks now to let Auto Beijing kind of marinate, maybe we talk a little bit about the takeaways and kind of the trip we had and then we get into a little more. Some of the immediate news with me attending that event yesterday, a new brand and some events that are happening next week.

Lei Xing:
I mean it's nonstop action, right? Really, I haven't even had time to just sit down and kind of put things into words or put thoughts into word, but I did have a chance to give an auto show recap earlier this week at the AMCHAM Shanghai and basically what I did and speaking of takeaways, I spent three days at the auto show, so from the 25th to 27th before our trip. And I’m just looking at my last slide, the takeaways I put up, a few bullet points. I'll just read it off. The one and only relevant and truly global auto show, party in a bloodbath, Lei Jun and Beijing people show, foreign automaker vengeance, new tech kids on the block, the end of new forces, 10X foreign faces, the second-row battle, the chip war, the live stream war, China, FSD/robotaxi. Let's talk. Chancellor German chancellor Scholz visit before and Xi's European trip after, right? These plenty is simply what I saw. I just put up like 40 pictures that I took of the auto show and involving people, signage, products, tech. Aside from that, I think two things that I think for this trip personally for me, was really no longer getting the shock, but just seeing things as normal as they are. It's no longer like it just felt normal once you are in it, was last year I had that really big shock in Shanghai. We actually recorded a video on our trip about the Beijing Auto Show, so we should.

Tu Le:
That’s episode 163 that will be launching next week. So.

Lei Xing:
Yeah, but I said it's Shock 2.0 but that shock is just it's a fact of life, everyday life. It just felt I look at those green plates in Shenzhen and anywhere all the cities that we visited.

Lei Xing:
Let me go ahead and talk about my thoughts a little bit because my situation was completely different than yours over the last several years with regards to China. So again, not very surprising, but I was really worried in Shanghai Auto Show. And I'm just a bit more reinforced with my worry and concern that the legacy automakers just aren't up to the task. Shanghai kind of shows that. And so I had the opportunity to speak to a couple of foreign automaker friends of mine off the record. So no names, but it gets the impression that they're all in survival mode. They're all trying to find a bottom. They are still a little bit shell shocked because in a situation where you would think things would let up, begin to let up. We see that the end of this year, Xiaomi is going to launch an SUV targeted directly at the Model Y. Next week ONVO is going to be launching, which is NIO’s, and I know a few of you want to talk about that a little bit. So happy to do that a little bit later, but ONVO is going to be launching on May 15. They're having an event, and they're going to show the exterior, not the interior yet of the L, is it L6? 

Lei Xing:
L60.

Tu Le:
L60. Sorry. That's going to be around RMB250,000. It's going to be built at NEO Park where I visited yesterday. Within the next 3 months. Xpeng is also going to be launching MONA.

Lei Xing:
So the MONA launch will be toward the end of June.

Tu Le:
I tweeted earlier today, China EV Inc. launches brands like legacy auto launches products. And so we always have to be grounded in the numbers, because NIO probably has at least half a million units or 300,000/400,000 units of capacity and they need to go somewhere, and they're probably not going to hit 300,000 units this year. Everybody I talked to Lei, is there's this disconnect between what the brand’s able, what seems like the brand’s able to accomplish with people, users and followers of NIO, and how that's not quite translating into sales. There's a lot of people scratching their heads on that stuff. But it's just going to be a crowded field. And Tesla with FSD is also going to be an alsoran. It's not going to be unique. And you and I can personally say that because of the saddle time, we spent in XNGP but and I also sat in a Baidu. We sat in a DeepRoute. I sat in a JIYUE for about 40 minute for a 40 minute ride. I did NOA Li Auto just two days ago for about 25 minutes. So we've been in quite a, one of the ones that I don't have comments on yet is Huawei, because I haven't been in that.

Lei Xing:
Yeah, same.

Tu Le:
Everyone is telling us that's a one-two in the currently in the China market. So.

Lei Xing:
One-two being Huawei number one, Xpeng number two in the advanced driver assist urban NOA feature.

Tu Le:
That's kind of my thoughts on the auto show. Kind of to summarize some of the stuff that we talked about last week. Really quickly, because we haven't launched that episode yet. There was a ton of South American and Latin American media at BYD for their presser, a ton of Germans at the auto show because they, Chinese government has given 12 countries visa free access for 40 days. So you can expect a lot more Germans to come a lot more often to China on the not only OEM side, but the tier-one side.

Lei Xing:
As a matter of fact the last few days I have been in Shanghai, I am seeing a lot more foreigners. I can tell they are tourists, in the subways, in Xintiandi where I spent the first full day there. So that's something. And then you talked about the different visits. So me adding to it is the visit to WeRide the day when I returned the G9 finally, this was on the 8th, I think. I took a ride in a RoboBus and one of those latest robotaxis. Just last night, I randomly had a dinner with the dealer consultant friend of mine at the mall where they had the largest JIYUE showroom. And this young guy who's just gotten into the job like a month ago, took the two of us out for a ride, and I tested out the NOA capabilities as well. Pretty impressive. Consider it’s vision only based.

Tu Le:
Let me stop you there Lei. Because JIYUE.

Lei Xing:
It’s called the PPA, sorry. 

Tu Le:
Yeah. Yeah, you're killing it, dude, you're killing it. But it's the only intelligent driving system that should be compared apples to apples to Tesla. Because they're both vision only, every other system is uses LiDAR, but also, JIYUE is basically a proxy for Baidu’s apollo system. When you think about JIYUE, it works really well, but it's a Baidu system effectively.

Lei Xing:
Kind of surprised with that, what do you call that steering wheel, the U-shaped.

Tu Le:
Yoke?

Lei Xing:
The yolk, actually, I got used to it pretty fast. And everything voice activated basically, there wasn't a lot of touching going on, but just like speak to it, say things it'll do some of the functions.

Tu Le:
This is another one of those vehicles Lei that we think is the high-quality products that just doesn't reflect in sales.

Lei Xing:
They're giving this RMB49,000 worth of packages of this high advanced driver assistant package before the end of May as kind of an incentive.

Tu Le:
That's like $8,000.

Lei Xing:
Yeah. Like a lifetime, inclusion of all those whatever features.

Tu Le:
On a RMB200,000 car, on a $30,000 car.

Lei Xing:
Yeah. RMB200,000. And as you mentioned, right? The hits are coming. ONVOs, MONA, Geely’s Galaxy E5 that they just announced, revealed, looks pretty sleek, right? We are, I mean…

Tu Le:
Just so we give the foreign legacies a fair shake, because again, apologies. We should have gotten 163 out. We'll do that. But to talk a little bit about the legacies, Volkswagen came in the big way, they are redefining what the design language on their ID. series vehicles are. They effectively hired a new designer. And now the design language is called ID.CODE, and it's supposed to be DNA across all three of their joint ventures, the JAC, the FAW and the SAIC so they had a strong presence at the show and Xpeng happened to be right next to them. So that was a good synergy between those two. GM, the Buick GL8 was introduced as a PHEV or PHEV is what the GM folks call it. Chevy or chevy had launched a couple of PHEVs that were around RMB150,000 or RMB180,000, so really cheap. And Cadillac had launched OPTIQ, which is if you are familiar with a Cadilla LYRIQ, is the little brother. So it slots right under the LYRIQ. It was a strange marketing strategy, because I understood about 65% of what they were saying, because everything is, I think Chinese, but their marketing slogan was Option B, let us be option B. Yeah, man, I talked to a few people at the press event. I was like, I understand kind of generally what they're saying in Chinese, but it doesn't translate well, option B doesn't translate well. But anyways, that could, so it's a BEV and it's a Cadillac. It's going to be dropping at RMB250,000 so $32,000. So it's effectively almost at a mass market price level for a Cadillac product.

Lei Xing:
I think one of the jarring scenes that epitomizes the current landscape at the auto show was on the one extreme Lei Jun and his entourage, the Xiaomi booth, versus seeing Mary Barra, carrying her little handbag and just walking. Nobody probably even knew who she was.

Tu Le:
We got to tell that story. So.

Lei Xing:
That kind of the epitomizes that if you want to say the GM or the foreign automakers versus the new forces, right? At this year's auto show. And in this industry overall, Kevin, his article talked about these foreign automakers being cooked. I don't think it's a.

Tu Le:
Exaggeration.

Lei Xing:
No. I don't think it's an exaggeration to be honest. If we just pick GM, right, we pick on someone. All of their brand dilution have been significant over the last few years. The joint ventures or the partners. I don't think they're on the same page.

Tu Le:
They are not. They are all focused on their own domestic EV brands.

Lei Xing:
So this is, yeah.

Tu Le:
So let's talk about that story. The Mary story how we bumped into her, because Eunice Yun, who is the correspondent for CNBC, she had reached out to me. Can we do an interview? You're going to be at the auto show. I think let's meet at the chevy booth. Let's meet at 9:30. So go to the Chevy booth and we set up a shot. And I happen to know one of the guys at chevy, an ex-pat. He's talking, he's like, there's going to be a surprise guest, can't tell you who it is. I get.

Lei Xing:
It doesn't really matter, like it didn't really matter. But…

Tu Le:
So I kind of mentioned it to Eunice and Eunice was like, I'm going to go see if she wants to answer any questions or get an interview. And then Mary politely said no media interviews this time around. So not only was Mary Barra there. Mark Reuss was there and Steve Hill, who coincidentally was appointed the GM China role two days ago. So, again, this goes back to what I had mentioned earlier about the Volkswagens and the GMs and these other legacy auto makers seemed to be seeming to be in survival mode, because they haven't found a bottom yet and what I mean bottom, sales are still declining. And to give you an example of how extreme it is. Both Porsche and Ferrari, Q1 sales in China are down. Porsche is 24%, Ferrari is down 20%. Porsche sales as a percentage of overall sales for China is much more significant. I think it's 35% of their global sales. For Ferrari, it's about 12. So this should put to bed that in even if the European brands that have so much heritage in Europe and these traditionalists who can't fathom a consumer buying a NIO over a BMW or a NIO over a Porsche. There are no sacred cows in China. There are no heritage brands that will sell just because of the brand name. It doesn't work in China. Let me be clear. You can feign your surprise, you can feign your shock, but the numbers don't lie. Porsche is going to continue to lose sales this year. So.

Lei Xing:
And that's their expectation, too, so. But it was interesting. I mean being in the different cities was interesting to see like in Shenzhen, obviously, all you see is BYDs and in Shanghai, actually you see a lot more NIOs, right? You kind of see these regional discrepancies between which brands are doing more.

Tu Le:
In Shanghai you see a lot of MGs, a lot of Roewe.

Lei Xing:
MGs, Roewes, I saw a Roewe 75 like the ICE, like one of very early Roewes on the road.

Tu Le:
You see a bunch of Buick Velites.

Lei Xing:
A lot of Buick Centuries, not the sedan Centuries, but the GL8 Centuries.

Tu Le:
The GL8. And Kevin talked about that, because it might have been me that told him the Velites are basically fleet vehicles for DiDi.

Lei Xing:
Yeah the Chevrolet Menlos, Velites or Velites. Yeah.

Tu Le:
And one thing that we talked about Lei was not only from a city to city how the brands are a bit stronger in certain cities, certain brands in certain cities. It's also the characteristics of XNGP are tested because our first stop was Zhengzhou. We tried to drive around 800 km a day, so about 500 miles. And we are averaging on the highway, we're average probably between 100-120 km/h. We didn't pass the speed limit. And, first of all, since you were the owner of the charging responsibility, maybe you can kind of give three bullet points of kind of your general thoughts on charging in China.

Lei Xing:
So number one, I will say…

Tu Le:
And Mike, this is for you. 

Lei Xing:
Number one I'll say after this road trip, China EV road trip is, I am erasing range anxiety out of my vocabulary. That's number one. I will say after this road trip. Second was the working conditions. Everything was smooth. We did not have one issue, except maybe that one charger that was charging a bit slow, and we kind of decided we move on and find another one.

Tu Le:
Because we were spoiled.

Lei Xing:
Yeah every charger we used was, it was working, right? Regardless of how fast it was. And then the extra few days I’ve had with the vehicles after the road trip. The, I charged at one of the Xpeng’s S4 360-kW chargers, and I also charged at an AC charging pile in the parking lot of the apartment where I was staying at 7-kW, but it was overnight charging, which was perfect. So there was different conditions, different type of charging. I think infrastructure wise…

Tu Le:
And to illustrate compatibility or to test compatibility, we used the Li charger, we use the Xpeng charger, used the NIO charger, what other? We did not use the Tesla, we did not use the Tesla.

Lei Xing:
we did not use the Tesla, CAMS chargers, the State Grid chargers, the TELD Te Lai Dian chargers, all just one socket, one standard, scan, charge.

Tu Le:
No range anxiety and charging was generally pretty fast.

Lei Xing:
No range anxiety with an asterisk that asterisk being, you just needed to plan a little bit.

Tu Le:
I was actually going to say this Lei, because let's throw out the qualifier. So Xpeng did not pay us. We did not or they did not tell us or try to edit us. We could say whatever we want. And we do. They don't have any editorial control and we weren't paid. And I thought this up over 3 days and we didn't plan anything. We just got in the car and went.

Lei Xing:
The only thing we planned was we're going to do this in 3 days, which I asked some other people that have done this long trips. They said it's more than enough to get you to Beijing from Shenzhen. 

Tu Le:
But we were stretching it because we would get in around 8 o'clock on most days. Six, Seven.

Lei Xing:
But knowing beforehand which city to stop along the way, that's it. And then we're on the road, right? We…

Tu Le:
So, effectively we relied on the infotainment system to tell us where to go.

Lei Xing:
The other asterisk is we did not, we would pick the right dates. That's the other asterisk because had we gone during the May holidays? I think it would be a little bit more disastrous, because you've seen the videos of people fighting for chargers.

Tu Le:
And the one thing that I'll say about the intelligent driving side, Zhengzhou, less aggressive Changsha, like driving habits of the people and the traffic. Zhengzhou less aggressive, Changsha, very aggressive, more aggressive than Beijing, Shanghai, in my opinion, Shenzhen more aggressive than Zhengzhou, less aggressive than Changsha. So for Will, China Driven, he was driving, he drove us, he picked us up. He's kind enough to take us out to dinner. And he picked us up in his ET7 and he was pretty aggressive. If it as where it was raining like crazy, and we went to this mall. So.

Lei Xing:
Yeeah, I mean I told Xpeng last year, when I test drove the G6, the XNGP had just rolled out the urban elevated highway XNGP in Beijing. And I told, I said then as a , I'm a 30-year-old, I’ve had my license since ‘94. I will consider myself a Lao Si Ji, which is (experienced driver)…. I had said last year I wouldn't have said, I wanted to use XNGP, but this year after this trip, I said, I do like to use it when I’m on the road, because it's, the capabilities have gotten better.

Tu Le:
Just for your feet and your legs, not having to put…

Lei Xing:
Yeah, not for the eyes, so still have to pay attention. I think that's important to point out.

Tu Le:
And the other thing to point out as well is that the Xpeng system, you need to have your hand on the wheel or at least shake it every once in a while. There is a driver monitoring system, there is a camera on the A-pillar. So it sees if you're not looking at the road, it can tell when you're looking at your phone. I don't know how I know that, I just know that. So Li Auto, you gotta have your hand on the wheel. JIYUE, you got to have your hand on the wheel. And so each of these systems works differently that way, too. But to your point Lei, the kind people at Apollo, the Baidu folks, I rode in a taxi about 30 minutes in Yizhuang yesterday. And then the person I was sitting with talking to and she's like, so how would you think, I was like, I looked at her, and I was like, it's kind of boring.

Lei Xing:
That's what I tweeted too.

Tu Le:
It's un, it’s uninteresting. So these systems are almost there. Now, again, these edge cases make them not safe, right? Not safe enough for sure, but for the highway miles, and let's say 90% of the trip was highway miles. I felt completely comfortable in the Xpeng.

Lei Xing:
Yeah, the total kilometer we did, including the last few days I've had the car was 3,000 km. I would expect 2,500 of those were probably under NGP conditions. That's my rough. Yeah, so 90% would be 2,700. So I probably say a little bit less than that, but still.

Tu Le:
So Lei, last, but not least. Do you have any questions for me about the 500,000? What's your take on that?

Lei Xing:
Yeah, I mean I think we should, I mean you were there. I was doing something else, but I think aside from that 500,000, I think there was a lot of, the new president of the ONVO brand, I think, made an appearance. He was a former Disney marketing executive. And I think number 107 owner of the ES8 Founder’s Edition. So I think they actually had, Li Bin talked quite a lot about ONVO, right, and now you're seeing more info being pushed out.

Tu Le:
So let me say this. Let me kind of go through the day that I had. I was effectively the only foreigner at the event. And it was cool. So we took a bus, so I flew from Beijing to Hefei, which is about a 2 hour for high speed rail from Shanghai. And so the morning of, we get a, leave the hotel around 7:30 arrive at NEO Park around 9 am, go into one side of the factory. Excuse me. And if you look at Twitter, you can see some of the pictures. There's a bunch of seats for media, dignitaries and local government officials. They walk in. And it's, the atmosphere is really positive, and you've been in NEO Park. I've been and worked.

Lei Xing:
I'll be there next week.

Tu Le:
Yeah so and I've worked in half dozen assembly plants. This is one of the cleanest factories you'll ever see. A ton of robots, ton of robots. So if you're thinking, NIO workers are all over the place, putting a bolt, putting a bolt in place, that's not right.

Lei Xing:
Did you notice? I don't know. If you visit the factory, did you notice they have a special color, a NIO color for the Kuka robots, right?

Tu Le:
Orange, orange and white. So.

Lei Xing:
Continue.

Tu Le:
There were thousands of these Kuka robots. So there might have been one or two people there for doing, to see your quality control. But anyways, a couple of, so Li Bin started out with a speech, and then iFlytek CEO who happened to be the owner of the 500,000th, ES8, he did a pretty fiery speech and he got people motivated, they are cheering. I understood a lot of what he said, but I've actually recorded it and what Lei and I might try to do is get it translated because I know there are certain videos floating out there. I sent one to Lei. He said the English translation is complete trash. So I have every speech recorded. We might not post the entire speech, but there might be a couple of sections that are worth. Because I know Li Bin talked about Tesla and the competition. I think those types of comments are worth posting, but we'll try to get some chopped up video up in the next week.

Lei Xing:
So two points that you just mentioned. The Kuka robots are owned by Midea, which, in turn, owns the Welling Motor that recently, remember, they rolled off this new electric motor component for NIO, right? And iFlytek is a supplier to NIO. 

Tu Le:
They do the voice control.

Lei Xing:
Yeah, voice thing, which iFlytek is probably one of the biggest companies in that space.

Tu Le:
And they also happen to be in Hefei.

Lei Xing:
In Hefei, yeah. So one of the Hefei home grown champions, as you were saying, in Chinese. So those are the two points. And I think going back to the ONVO launch, similar to the ZEEKR IPO, I think they're happening actually, at a good, in a good momentum, because we saw the April deliveries, both ZEEKR and NIO were pretty good. And I'm hearing that NIO’s recent order intake was pretty good as well. And I think what it was either Li Bin or Qin Lihong who mentioned that they're starting ONVO at, they have much, as a new brand, is building on one, more than thousand battery swap station or whatever, how many charging stations NIO have. It's not like when NIO started, so they're talking about it being a 1 to 10 rather than 0 to 1. I think the expectations are, again, pretty lofty. I'm hearing 20,000, 25,000 a month.

Tu Le:
They need that to fulfill that capacity at NEO Park. And then where's the other place that they build? Is it…

Lei Xing:
It's in JAC NIO, which is the other side of the town, right?

Tu Le:
So NEO Park is, NIO employees building NIO cars. JAC is JAC building NIO cars, just FYI. But I watched Li Bin for that hour, because so let me finish my description, big speeches. And then at the end, all the employees came up, took a big picture under the 500,000 flag. Everybody seems super excited, like genuinely happy, right, genuinely proud. I was pretty pumped up for them because I mean 500,000 is a lot, for where they came from. And so bunch of people took a picture around the car. Yeah. Some KOLs interviewed Li Bin in front of the car, and so you probably see a little bit of chopped video and that stuff. What else did we do?

Lei Xing:
They also prided themselves on being to this day, the number one BEV brand above RMB300,000, right? So I think they talk about a lot about that, but…

Tu Le:
I think people speak in a disappointing way with NIO. I know sometimes I do, but it's because everything just the things that you could normally point to that would be challenging for them. It doesn't seem like they're challenged in those ways. It's just the numbers and Will has an ET7. So he's got a handful of frustrations and…

Lei Xing:
And that ET7 looked old, cause things are iterating fast.

Tu Le:
Yeah. And Will was not very happy about that either. But then so I talked to another friend who has an ET5 Touring. And he's a big NIO fan. But he said that he had a front wheel problem. He showed me the app. He had the car for 297 days. They couldn't fix it after the 10th time. So he still said the above 80 km/h, it shakes a little bit, so he's a little frustrated with that, but man, the ET5 Touring is a beautiful, beautiful car. And then they gave us cupcakes, Li Bin and Qin Lihong did like an hour long Q&A with the media. And so that's when the ONVO CEO came up. He's wearing a white T-shirt, shorter guy. I couldn't help but to think this is Li Bin’s environment because he controlled that room. He seemed like so natural. And just he wanted to be there. It seemed like, you know?

Lei Xing:
And remember, also ONVO is now counting from when Li Bin had the idea in 2021. It's also they mentioned something about turning three years old. And then really that journey, the rest of it is really getting to 30 years old.

Tu Le:
That's that 0 to 1, 1 to 10, 10 to 100.

Lei Xing:
Yeah, these China kind of the colloquial speak or something. So really, ONVO is not, it’s 3 years old, basically, because he had the idea starting in 2021 that they had to have this kind of the lower-tier brand. I think it's just natural.

Tu Le:
Li Bin, he's a likable guy. He's pretty humble guy. And he just yeah, so that was cool that he spent an entire hour talking to the media. And then after that, we did our tour and I was pretty like focus because that's where I made my bones and working in factories for the first couple years of my life. So just kind of looking, comparing and contrasting how the U.S. does it, new, old to new, how things are different now, and how there are so many of those robots that follow the line on the floor to move parts, to move racks. So super automated plant, and then they also take us over to the motor factory.

Lei Xing:
The e-motor, that's the E2, I believe.

Tu Le:
And there's 600,000 units. Each vehicle has two motors, so that's why there's 600,000 unit capacity. They did say that in the future they would consider selling the e-motors to other manufacturers, though.

Lei Xing:
Yeah, I think we mentioned that before on our show that right now, if you look at Xpeng, they're kind of becoming to Volkswagen almost kind of a supplier. And NIO, with the recent battery tie up, one more with GAC Group and the e-motors. There could be a lot of opportunities for different revenue streams. I think again, this is not first time we've seen this that this kind of lofty expectations of whether a new brand or model and then how it actually performs on the market. I think in recent times, we've seen enough of the higher the expectations that I think that's part of the competition where the foreign automakers are not even, let's say they're probably not even relevant. 

Tu Le:
So let me put it this way. Lei. I believe that not only foreign automakers are in survival mode, but some of the Chinese EV brands are in survival mode. The difference is that these Chinese EV brands, Xpeng, NIO, they're playing offense. They're launching new products, launching refreshes, launching new brands. So they're not sitting still waiting to get picked off. And I think that's, but they also have the ability to move as fast as they need to. Okay. And I can't help, but to think that the foreign legacies, they likely have a disproportionate amount of foreign suppliers that supply them. And it's not just an OEM that needs to move fast. It's their entire supply chain to support that speed and my guess would be a Tesla, NIO, 90% of their suppliers are Chinese. And so their condition to be responsive in order to keep up with what changing and evolving environment and market in China is. And I think just like the legacy automakers, the foreign OEM not OEM but the foreign tier ones might be struggling to keep up with the pace of China as well. So, yeah. I think we're good. And there are some questions. Peter Liu was talking about your charging rate. Do you remember what some of the rates were?

Lei Xing:
So the highest I’ve gotten on that 360-kW S4 was 211-kW

Tu Le:
No, I mean price, cost I mean.

Lei Xing:
Price. So it's anywhere. It's usually around the 1.5, 1.6, 1.7, 1.8 RMB/kWh, but that entails two things. So the electricity itself and the service fees, which usually, if I remember was half and half. So really half the cost was electricity and half of that was service and those changes depending where you are. But I think I remember the slow charging, I did the other night, the overnight slow charging. I think it was like RMB100 for 70 kWh of electricity.

Tu Le:
So let's do this. If anyone has any questions, please feel free to raise your hand. Mike. Instead of you, typing in the thing. Why don't you raise your hand? I'll bring you up. So you can ask us your question, but tell us about your dad's awesome awesome awesome golf museum. 

Lei Xing:
Yeah I mean, we didn't include those fringe programs, right? Even.

Tu Le:
So Lei and I wern’t sitting around doing nothing when we weren't doing car stuff. So.

Lei Xing:
So the reason, one of the reasons we had wanted to do the road trip because I was going into heading for Shenzhen for the Volvo China Open, which is being held at this golf course, which is where my dad's second dream of opening a golf heritage museum was taking place. So it was to visit him, to be checking out the, we got free tickets, right? Check out the Volvo China Open golf tournament.

Tu Le:
Met up with the Snowball team.

Lei Xing:
Met up with, right,we got to mention, met up with the home boy now Taylor.

Tu Le:
Taylor, Bridget, Jack. Ordered some KFC using a Meituan drone.

Lei Xing:
Yeah, hats off. So we witnessed the opening of the Golf Heritage Museum, which my dad is the current. What do you call it? The guan zhang, which means the director or on the last day of after the final round, the winner was announced at the Volvo China Open. It was really inspiring for me because after he started China Auto Review, this is his second dream coming true for and he's 80 years old. And but my parents are in Scotland right now. They're still traveling around. So like for us to be doing what we do, I get a lot of inspiration from him to be honest, and just we're also nerds, right? I mean right, like this trip. We talked about it three or two months ago. I sent you a message and say, let's get a car and drive down. We need to be in Shenzhen, and spend some time visiting companies, local companies. And again, if you want to see NEVs, you go to China. If you want to see the variety of NEVs, you go to Shenzhen. I think Shenzhen, I, to me we saw some ENOVATE, right?

Tu Le:
Yeah. And it's still well, which well…

Lei Xing:
Skywell.

Tu Le:
Skywell. We saw two of them.

Lei Xing:
Yeah, we saw some, quite a few WM Motors, like the ones you don't often see.

Tu Le:
I'm just going to do a picture dump of some of the pictures, some of the cars we saw. It's on #163, but you might as well tell them the story about the Xiaomi owner at the charging station.

Lei Xing:
Yeah. So Xiaomi is, April delivery, official number was what, 7,000 units. At least we know one of them is a flipper as somebody paid, this family paid RMB30,000 extra to get a standard edition, which is RMB219,000.

Tu Le:
We had stopped to charge at one of the rest areas. I saw a SU7 charging and Lei and I walked over there, Lei just started talking to the guy, super young guy with a wife, young family. And so what you would expect of an SU7 owner to be honest. And I mean he was less than 30 years old, probably 32, 30 years.

Lei Xing:
Probably right around 30.

Tu Le:
And so I would say that tells me, I would say maybe 10% of the sales are going to speculators who want to make an extra buck on the SU7.

Lei Xing:
Let me share two numbers that people might not know. The official Beijing Auto Show organizers said 892,000 people visited during the 10-day show. And Xiaomi put out a post said 152,000 visited the Xiaomi booth. What's the percentage? I don't know, a fifth or more.

Tu Le:
Almost 20% man.

Lei Xing:
The other one is, ever since the launch of the Xiaomi Su7 on March 28, I think this is day 40 or 41. Since then they've, every single day they've launched this, they pushed out this Q&A style like frequently asked questions every day of the different type of questions that people ask. And they put the answers on there and they pushed out in their WeChat channel. And 353 questions have been asked and answered, and they put those through their channel in the 40 days. It's like these are some of the simple things that you wouldn't think of people doing, but Xiaomi is doing it to making it more transparent and helping with the sales and marketing.

Tu Le:
First of all, Lei Jun is front and center for a lot of this stuff. I mean he's tweeting a lot on X.

Lei Xing:
He's, not himself, but his team. But still…

Tu Le:
His account is. And Li Bin uses a lot of social media and KOls and influencers. So that's just the. And the legacy automakers, they feel uncomfortable with that, but it works. Remember was it Ingenlath who had to quarantine for 2 weeks?

Lei Xing:
Yeah I'm surprised he didn't do more this time.

Tu Le:
Yeah he had posted about it. That thing was super popular. Yeah. That's all I have, but there's a couple of questions. So I want to make sure that we answer them. Mike, the car geek. If you advise GM, Volkswagen, Toyota, would you tell them to give up on China? You lost, or triple quadruple investment to keep trying? I'll, let me take this one first and we'll get your thoughts next, Lei. Mike, I would tell them to find a partner, like an Xpeng Volkswagen, Stellantis LeapMotor. They obviously cannot, the China market is way too important for every foreign legacy to just not be a part of it. And with regards to Toyota, Volkswagen and GM, they still have significant sales. We're talking a couple million. And so if they can quickly find that bottom, then they can start to climb their way out. The challenge is that most of them are, they still haven't hit that bottom. And so I think the world is going to bifurcate. And it's the reason GM owns Cruise, but also invest heavily in Momenta. It's why Volkswagen is partnering with Horizon, ThunderSoft and Xpeng. But what are your thoughts Lei?

Lei Xing:
I think there's really only three things, options you can do, double down, pick your battle and leave. I can give you three examples. For the pick your battle, Ford has done it, which I think is smart. Leave, which means Chevrolet, Buick, even Cadillac, they leave, meaning maybe no longer producing in China. I think it's very high possibility that one of these brands exits, let's say Chevrolet. I don't think it's a surprise at all if it does happen. And then double down, meaning, I think the Germans are at the top of the pyramid in terms of doubling down in China, we saw that at the Volkswagen Group Night, we saw BMW, Mercedes all doubling down. So there's really three options that you can have. And some of it, let's say the Stellantis was one, I believe, picking the battle, a different battle, a different path which is investing into LeapMotor and utilizing their kind of the technology and LeapMotor, utilizing their international channels, which they are, next week they're officially announcing their joint venture, sales joint venture, right? I think that’s it, there's no other, what else can you do? And the tides have turned.

Tu Le:
I'll also emphasize that it's a constant assessment, because Lei and I and Lei if I'm putting words in your mouth, please correct me. But 14 months ago, I think both of us kind of thought Stellantis was dead in the China market. And then this announcement comes with LeapMotor. And now they seem really reinvigorated. My concern with a GM or one of the foreign legacies is that they willy nilly procrastinate, but ultimately decide that the China market is too important, but all the good partners are gone. It ends up being a fortune on situation where the JV just never ever meshes. Because Chang'an, there's a specific reason. Chang'an was one of the last dance partners. It's because they're notoriously difficult to deal with. And Ford, because they didn't go bankrupt, they did a good thing. And stayed out of bankruptcy, they had to shore up their domestic sales and operations and didn't have the opportunity to invest in China as early as a GM or some of these other companies did. My concern is that if they do decide to partner, they do it earlier rather than later, or risk being partnered with the least attractive Chinese brand. So anyways, let me make sure, does anyone know what is ONVO’s sales delivery target for this year? I do not know what that is.

Lei Xing:
Delivery starts, I think, in Q4, I believe. So it's probably not going to be significant, but based on, Li Bin said about getting to that second 500,000 units much faster, you could kind of do your math, right? And expectations of in that segmentation, the Tesla killer, whatever you want to call it. You can imagine the type of volumes they want to do a month, monthly volume, right? Let's just say if they do 20,000 units, again, we're putting ourselves on the spot like quite a few models that we kind of talked about have flopped. I’d say 20,000 units is probably a good gauge of how well it does. And also, remember, I just remembered, they're only going to have launched three models, the ONVO brand, at least that's what Li Bin says. So this one, another SUV, and the third model. So family, purely focused on the family segment.

Tu Le:
So had a good chat with Li Auto, they are supposed to be launching four more products before the end of the year.

Lei Xing:
Well the next three BEVs I believe, right?

Tu Le:
So likely that mini MEGA, okay, for the folks that are wondering about the MEGA, I really like it. It didn't seem when I drove it, it was 5 meters big. And they emphasized this the second row has the legroom of an extended long wheelbase 7 Series. The third row has the leg room of a long wheelbase 5 Series.

Lei Xing:
I did sit in the third row at the auto show. It was, I’m 6’2”, 6’3”, so 189 cm, it was very roomy in the third row. So.

Tu Le:
And the screens are amazing. I'm sitting in the back watching the screen and it’s beautiful.

Lei Xing:
Those are what you expect, right? All the new ones that some of the new ones that were shown the WEY, Lanshan, the Dongfeng eπ, the new STERRA ET, I mean they are all like that.

Tu Le:
So let me just say this to my automotive, traditional automotive alumni, who which I am one of. The fit and finish of the Li Auto, and for that fact, the G9, there was no squeaks. This was a poor car, so it's probably not treated very nicely, I'm talking about the G9. And we drove 2,500 km. There was not a squeak, not a rattle, no quality issues, not that I could look at and think of. Now the vehicle is super dirty. I didn't really get a chance to look at the exterior very thoroughly, but normally on rental cars or cars that aren't taken care of very often you'll hear rattles, you'll hear whatever wind noise, you and I set next to each other, obviously, in the front seats, you and I didn't have to yell or scream or talk loudly. We could hear each other pretty well. So I think the sound deadening for the interior was pretty good. Sound deadening in the MEGA is excellent. But.

Lei Xing:
Yeah I think it was just a solid car from all fronts. There's no major significant issue that we saw.

Tu Le:
It's a victim of circumstance because RMB350,000.

Lei Xing:
Underappreciated, victim of circumstances, but right, that's the reflection with the competition.

Tu Le:
See, this is the one thing, if you don't believe me, and as someone who's worked in assembly plants and understands American quality, German quality, European quality, read Kevin Williams’ article, who reviews American cars all day long. He ripped on the Blazer, he ripped on the LYRIQ, rightfully so, because they had a lot of problems. So read what he says, because if you don't trust me or don't believe me, the fit and finish they're already. This is why it's frustrating to me when people kind of compare the Japanese and Koreans to what's going on with China right now. Because from day one, these cars would be sell selling a lot.

Lei Xing:
Yeah, I would say it’s also important to know, and in about 10 days, I will go back to my good old Santa Fe Hybrid with that little head unit and having driven the G9 for 10 days, it's going to get some used to, but the things that we see here in China fitting the Chinese consumer taste, they're not going to work in the U.S. if you just try to bring it over, and you do have to kind of cater to the local taste aside from this tariff, right? That are they going to be even allowed to go in in the first place, but I mean it's.

Tu Le:
Well the one thing that should scare them is that we know that they're quick learners. Yes, so it's not going to take 5 years for them to figure out what the U.S. consumer wants versus what the Chinese consumer wants.

Lei Xing:
I think I just heard a clip of, somebody tweeted a clip of Trump saying he doesn't want Chinese building in Mexico. He wants Chinese building in the U.S.

Tu Le:
I said that like, no, so cause so he had a speech in March where he said, I’m going to raise tariffs to 100% or by100% or something like that. And then he was, the next sentence that the following sentence, he was like, BYD, we invite you to come build in the U.S., nobody picked up on that sentence. So anyways, but let me make sure there are no last questions. China Driven wrote, while Li Auto screens are 4th gen OLED slightly smaller than the competitors, but the panel quality is way way better. Yes, the Li Auto quality, screens are amazing. So I think that's it, Lei.

Lei Xing:
I think the last thing I wanted just to say, just I think I'm so happy that Kevin and a lot of the rest of the world got to come over to China to the Beijing Auto Show and anywhere else for that matter to see the action on the ground. Some of them might be shocked, but I think for us it’s a fact of life. Just things the way they are. I don't feel that jarring feel anymore, whether it's robotaxis, whether it's the green license plates. It just that's where it's progressed, right? And then where do we go from there?

Tu Le:
Well, the important thing to remember, right now, anyways, is that they're really just beating the shit out of each other.

Lei Xing:
Yeah. That is true, which is, this kind of bloodbath and the price war, which is causing more people holding their pocket, because they're wondering who's going to come out with a cheaper product next day or week. So.

Tu Le:
But yeah, that is all I had. Let me make sure I actually had to write notes down. Yeah that's all I had man. So cool, everyone. Apologies for being inconsistent the last few weeks. We are going to have the live show again, starting this week. Moving forward, Lei will be back in the U.S. We might actually even make it a video show. So we're still working through all that stuff, but thanks again for joining us. Please catch us again next week. Good morning, good afternoon, good evening. 

Lei Xing:
Thank you all. 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.