Rebirth of the Age of Wealth

Chapter 522 Let’s fight, who is afraid of whom?

Li Weidong frowned and asked: "Reducing the price, how much?"

"According to the information we received from inside, SAIC Industrial Sales Corporation and Fangrun Technology Systems Company conducted a month-long joint brand promotion event in more than a dozen cities including Beijing, Shanghai, Guangzhou and Shenzhen, including Qizhou."

"The content of the event is that anyone who buys the latest Santana 2000 sedan can get a Founder Excellent computer worth 5,000 yuan, and those who buy the risk can get a computer worth 4,000 yuan."

Xia Guoqiang glanced at Yiweidong, and then continued: "After all, the prices of their three Santana models are almost the same as those of our mid-range products. The targeting is very obvious!"

Li Weidong was silent. There is no doubt about this operation of SAIC. They are targeting Skoda and regard Skoda as a potential opponent. It seems that they have seen the threat of Skoda from this year's data.

The current car market is far from what it was in later generations, with a wide variety of brands and countless models. If you don't take into account the very small number of imported car brands of all kinds, the number is even smaller.

Not to mention the brand, even if all the models are added up, there may not be as many brands as those of later generations. Even the famous Honda Accord made in China is only pre-announced. So far, no Honda Accord has truly hit the road.

The high-end car brand that can be seen on the market now is Audi, which was just produced by the joint venture between FAW and Volkswagen. It has four-cylinder and six-cylinder models, but it has only been put into production. It takes at least six months from the time of reservation to the time when the car can be picked up.

In addition to Audi, there are also the new Hongqi and Buick New Century, which have just been launched. However, the situation is worse than Audi. Basically, there is no market, and there are no cars for sale.

Moreover, the price of these high-end cars is around 300,000 yuan. A six-cylinder Audi costs more than 400,000 yuan, a Buick New Century costs 350,000 yuan, and even the worst Hongqi costs more than 200,000 yuan.

If you have this kind of money to buy a car, you are generally not a small businessman, and you don’t care about spending tens of thousands more to buy an original and imported car.

Ordinary people who want to buy such a high-end car may have to think more about whether their pockets are that big?

With the current income of Chinese people, high-end cars are still a bit high-end. They can afford them, and not many people are willing to buy them. Therefore, major automakers are focusing on the mid- to low-end market.

There are slightly more brands of mid-range cars, and they are more mature. The brands are mainly the four major joint ventures, SAIC Santana, FAW Jetta, FAW Shenlong Fukang, which is later known as Citroën, and the other one is the Skoda sedan of Qizhou Automobile Factory.

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Each of these three brands has its own small brand, so shopping is naturally divided into three categories, so cars are naturally divided into ordinary, luxury and supreme models.

However, the price is generally between 100,000 and 200,000, which is more in line with current consumption power. Of course, it is mainly more in line with enterprises, institutions and some small bosses who have just become rich.

It is not difficult to see that three of these four cars are related to the German Volkswagen, including Skoda, which uses Volkswagen’s engine technology. Speaking of which, Dr. Kahn, the former president of Volkswagen, is a major contributor.

While other national brands were still hesitant to launch sedans, Volkswagen had already taken the lead in looking at China's domestic market and cooperated with China to build factories, becoming the first to try it.

By the time other international brands see the first person who wants to take advantage of it, they are already talking about it. When they want to come in, Volkswagen has already opened up the brand and formed a brand effect.

Even the Skoda car invested and built by Li Weidong relied on the mature brand effect of Volkswagen Engine when promoting it, so that this new type of car was quickly accepted by the market.

As for low-end cars, they are domestic own brands or cars that cooperate with some foreign niche brands. The main representative brands are Xiali and Alto.

The current selling price is generally relatively low, mainly around 60,000 to 70,000 yuan. Of course, this price is not cheap. You can buy a small two-bedroom apartment in the suburbs of Qizhou.

But at this time, few people still notice the difference between buying a car and buying a house.

It is said that a few years ago, a shopping mall opened in Shanghai, and a shopping lottery was added. For the sake of business promotion and instant success, the prizes were particularly large. The first prize was a small house worth 200,000 yuan, and the second prize was a 10 yuan car.

Eighty thousand Santana.

The winner of the first prize did not want the house, but the Santana that won the second prize. Finally, after friendly negotiation between the two parties, the first prize winner added some cash and exchanged it with the second prize Santana.

A few years have passed, and the Santana worth 180,000 yuan has become a second-hand car, which is estimated to be worth less than tens of thousands of yuan. Although the house worth 200,000 yuan has become older, the price is already 400,000 yuan.

Of course, this matter is highly suspected of speculation in Li Weidong's view. Even the shopping mall owner feels that a shopping mall and a house are not enough to attract attention. Wouldn't it be more sensational if they exchanged it?

Despite this, there are still many owners in China who are not short of money and have made significant contributions to automobile sales. In five years, China's automobile sales have increased significantly.

From 310,000 vehicles in 1995, it has experienced rapid growth for five consecutive years, and now, annual sales have successfully doubled.

According to statistics from the China Material Circulation Center, the sales volume of passenger cars last year was 660,000. Although the proportion of mid-range sales declined due to the development of the low-end market, it still accounted for 60%, which is 400,000.

Cars or so.

However, the gap between mid-range car brands is relatively large. Santana is the brand with the earliest introduction, the most mature technology, and the highest recognition, and naturally has the highest sales volume, reaching 190,800 units.

Next is Skoda, which has the shortest history of building a factory, with sales of 85,000 units last year, followed by Jetta with 76,400 units, and finally Shenlong Fukang with 43,800 units. The rest are some imported vehicles or other brands.

Santana's sales volume is already far ahead, accounting for half of the market. It is said that it should be the most secure in Diaoyutai.

But looking at their sales changes in the past few years, I'm afraid they won't be so optimistic. The person working in Diaoyutai is definitely not Santana.

The year before last, that is, in 1998, the entire domestic car sales volume was 580,000 units, and Santana itself accounted for 213,000 units, basically accounting for half of the domestic cars.

But in 1999, as the construction of the Skoda factory was completed and full production began, a large piece of fat was torn out of Santana's mouth, causing them to miraculously experience a decline in sales.

This is the first year that SAIC Motor has experienced a sales decline since its cooperation with Volkswagen. Such data has to make their management feel a sense of crisis.

Moreover, Skoda's production capacity of 150,000 vehicles was completed in the second quarter of last year. In other words, for Skoda, the sales of these 85,000 vehicles may be the limit of production.

According to this calculation, the sales volume this year will definitely increase significantly. Santana has to worry and find a way. He has not thought of a good way, but there are many bad ideas. This is a disguised price reduction.

The market is so big. If one party lowers its prices, other parties must also lower their prices if they want to occupy market share. This will inevitably lead to a price war, and price wars are more popular now.

There were color TVs in the past, but several domestic manufacturers joined forces to cut prices, drive all foreign brands out of the domestic market, and they were already victorious.

However, there was no end to greed, and as a result, it was not contained. After the Patriotic War, there was still an internal war. There was a strong attitude that they would not give up until the opponent was killed, and there were endless underhanded tactics.

Several major color TV manufacturers are booming, and the boss of Changhong TV thought that I had bought all the color picture tubes, leaving you without goods and having to buy high-priced imported goods.

I will first drain the fire for you, and then lower the price to add fuel to the fire. After this series of schemes, I don’t believe you can still survive. In the future, the color TV market will not all be controlled by me, Changhong, and I will truly realize Changhong.

It’s just that the ideal is very full, and the reality is very skinny. Now this battle is basically coming to an end. It is estimated that the chairman of Changhong will announce his resignation soon!

In addition to color TVs, there is also a market for DVDs. Now PDAs are also starting to engage in price wars, and Tsingtao Beer is doing the same.

Buy factories everywhere, go to other people's territory, first buy a brewery, and then start a price war to kill the peers, so as to form a monopoly market in some areas.

Anyway, in the past two years, the word "price war" has been posted everywhere in China. There are ready-made examples and ready-made operations. Santana has imitated them. It is easy to start a price war.

And Li Weidong is not surprised at all by this result. In fact, the first two years after China's accession to the WTO was indeed the time when domestic price wars were most intense.

In his previous life, he remembered that when he wanted to buy Xiali, the price was reduced several times a year, from 65,000 at the beginning of the year, first to 60,000, then to 55,000, and finally to 48,900.

There are many people in the middle who are defending their rights and making trouble. Anyway, it’s quite lively. There’s nothing you can’t think of, and there’s nothing I can’t do.

But in the end, Li Weidong still didn't buy it. Business boss, is it reasonable for you to buy a car that costs less than 50,000 yuan?

Now that this has happened to him, the feeling is different again. Based on the annual output of 100,000 cars, every 1,000 yuan reduction is equivalent to a loss of 100 million yuan in profit.

Originally, when making cars, the profit margin was quite high, but he couldn't bear the hassle. Moreover, every penny reduced would be multiplied by 100,000, which was all his profit.

It’s no wonder that Xia Guoqiang came to Li Weidong. He didn’t dare to decide on this matter. How much money he would make for the company, selling him would not be enough to compensate him!

But now others have taken action. Although it only targets Beijing, Shanghai, Guangzhou and Shenzhen, these cities are the cities with the strongest consumption power in China. Winning these cities is very symbolic.

Li Weidong thought about it and realized that this matter was unavoidable, and the current price was indeed a bit too high. Of course, the cost of auto parts during this period was also relatively high.

Domestic parts factories are not very mature, and many key parts cannot be made domestically and must be imported from original manufacturers. This has created a certain monopoly and is also the main reason for the high cost of joint venture cars.

If the price can be reduced through external sales, it will force the cost of the company's products to drop, which is also a way for the company to develop.

However, Li Weidong still asked: "What is the reaction of other companies?"

Xia Guoqiang said: "As far as I know, after Jetta got the news, it also held a meeting to discuss countermeasures. It is said that it wants to reduce the price by 3,000 yuan, but so far, there is no news that it has been approved."

Seeing that Li Weidong didn't speak, Xia Guoqiang sighed and said: "It seems that this war is inevitable."

Santana, which has the largest sales volume, has to do this kind of thing in order to maintain sales, killing 1,000 enemies and losing 800 to itself. You can just refuse to fight if you want.

Li Weidong decided: "Let's fight, who is afraid of whom! The costs of their three state-owned enterprises can still be lower than ours. Just aim at Santana. As much as he lowers it, we will lower it a little more than him!"

Xia Guoqiang had a bitter look on his face, could this be the same? They are state-owned enterprises and are not afraid of losses. The price reduction protects not only the share, but also the face.

Li Weidong decided to reduce the price. The reduction was all profits and his own money, but the boss didn't care anymore.

, a small witch meets a big witch.

Moreover, Li Weidong's decision will inevitably bring about some changes in the automobile market, and no one will be immune from the price war.

Xia Guoqiang left with Li Weidong's order. He wanted to go back and convene a meeting with the sales department to formulate various plans. The price reduction must be of good quality and standard. Otherwise, wouldn't it mean that anyone in his position can sit?

After Xia Guoqiang left, Li Weidong received calls from several relevant departments, all expressing concern about his interview and offering to help them if necessary.

Li Weidong does not doubt the purpose and starting point of these people, but their true opinions are not that serious, let alone owe others favors for such insignificant things.

It is said in the movie that debts of gratitude are the hardest to repay. Despite this, Li Weidong still thanked them one by one and declined politely. He always believed that the Internet would make people forgetful.

Sure enough, the matter of Li Weidong's exclusive interview gradually calmed down after a day or two. It's not that everyone didn't discuss it, but that everyone had better topics to discuss.

There are hot spots on the Internet every day, and there are many hot spots that can be hyped. And it has been so many days, and Li Weidong, as the person involved, has not come to clarify, the topic has lost the basis for continued speculation, and everyone has lost patience.

Who in their right mind would continue to struggle with a question that is destined to have no answer.

After Li Weidong had some free time, he also began to participate in company reform. After all, these newly formed departments and special committees were a way to realize his ideas. If they were completed as soon as possible, he would be completely relieved.

After attending several reporting meetings of consulting companies, Li Weidong's impression of them changed greatly. It turned out that these people only had the power of words and must have poor practical ability.

But after these few meetings, Li Weidong saw what an international consulting company is, and how can he survive?

(End of chapter)