Chapter 830 - 338: Xiangnu’s Invitation_2

Chapter 830: Chapter 338: Xiangnu’s Invitation_2

Li Bin and Li Xiang are both representatives of this group.

Their two car companies both launched their first car in 2018, and they spent billions on marketing, but no one bought them.

At that time, Extreme Shadow Cars had already launched its second generation, outperforming them in every way.

Moreover, the price of the cars they launched was very high, with the lowest starting price over three hundred thousand, directly competing with the Extreme Shadow Megrez Series.

As expected, they were utterly defeated.

Their high-end car was priced over six hundred thousand, and in front of the Extreme Shadow Shaking Light, it had no competitiveness whatsoever, and the plan was stillborn.

The low-end cars barely sold over a thousand units a year, with the majority being due to hype, and the rest due to consumer curiosity.

"Extreme Shadow Cars plans to hike prices, which is good for us. We still have lithium battery contracts in hand, so in the short term, the cost of lithium batteries won’t affect us much. If we can launch a price war now, we might be able to snatch back some of the market from Extreme Shadow Cars." 𝒻𝑟ℯℯ

"Price war? But then we won’t make any money..."

When they said they wouldn’t make money, they meant they couldn’t cover the research and development costs.

Generally, they allocate research and development and operating costs over one hundred thousand cars, meaning that each car must have a profit of tens of thousands to cover the costs.

"At this point, why even talk about costs? If we don’t sell the cars, investors will disappear."

The two were competitors before, but now they share the same plight.

They need to produce some figures to attract capital investment; otherwise, with only their own money, they can’t manage such a large company.

Unlike Extreme Shadow Group, which is never short of money; their initial funding gap was at least tens of billions, no one knows where they got it from.

"Li Yang, that bastard, doesn’t even want to let us have a share of the market. The domestic high-end new energy market is being monopolized by him alone!"

They both resent Li Yang, but there’s nothing they can do.

Competition?

How do you compete in the car-making business?

It’s just about mudslinging, price wars, and configuration battles.

Price war? They can’t afford to play!

Mudslinging?

Li Yang is the king of the internet.

They often mudsling Extreme Shadow Cars, and apart from Kuai Pai, it’s all over other platforms that Extreme Shadow Cars is no good. Whenever there’s an accident, it’s definitely a hot topic.

But it’s useless!

Those who want to buy will still buy.

Especially now, as Kuai Pai has quickly become the number one short video platform in the country, media channels are almost monopolized by Kuai Pai, all information platforms are over there, even traditional media have to rely on Kuai Pai to survive, so the mudslingers are increasingly ineffective.

Configuration battle?

The top configuration of domestic new energy electric cars was cultivated by Li Yang with huge investments. Although some companies choose to cooperate with foreign car makers, the prices haven’t been reduced at all, some even increased.

Their configuration, at best, can only match Extreme Shadow Cars, but they can’t match the cost of Extreme Shadow Cars, nor can they sell at the same price.

"Now, it’s not certain. Extreme Shadow Cars has to raise prices by ten thousand this time, and with such a price hike, their sales will definitely be affected, and orders related to their supply chain will also decrease. Those companies used to have plenty to eat and have all been expanding production. Now, with insufficient sales and decreased orders, those companies definitely won’t survive, we know the cost of overcapacity better than anyone, and it’s our chance to take over those supply chain companies..."

For those supply chain companies, having already invested in expansion, the foreseeable future with reduced orders is definitely unbearable.

Even if they made money for a few years, they could lose it all in one year. Facing such a loss, they will certainly try to find a solution.

They used to benefit by following Extreme Shadow Group, but now Extreme Shadow Group can’t provide as much, and even selling top-grade components at regular or discounted prices is possible.

It’s better to sell and break even than not to sell and incur losses, any rational person would make this choice.

Meanwhile, Li Yang is also holding a meeting, primarily discussing this matter.

After consolidating the data from the various departments, Li Yang said: "Raising prices is indeed necessary, but we can’t just raise prices. Over the years, we’ve developed the related supply chain, those companies also need to survive. According to estimates, sales will drop by thirty percent after the price hike, which would be a devastating blow to those companies and could even affect their future R&D iterations..."

Feng Xinli said: "Boss, there’s no choice in this matter; if we don’t raise prices, the company will face widespread losses. Moreover, those supply chains have gained a lot over the past few years with us; now letting them give back a bit, they should also be able to accept it."

Li Yang shook his head: "They might be able to accept it, but at this critical moment, we can’t gamble! Once the carefully developed supply chain collapses, we won’t be able to consistently maintain a performance advantage. However, President Feng is also right; they’ve made quite a bit of money over the years. Let’s negotiate with them and request a twenty percent reduction in purchase prices. This way, we can reduce the car cost from another source, and this time only raise the price by five thousand..."

The increase in battery costs is fixed, but other costs can be reduced.

Feng Xinli took out a document and said: "Boss, this is the content of a discussion with a supply chain company a few days ago. They are willing to reduce their prices but hope that we can open up full product authorization..."