Recently, high-end pure electric intelligent travel service provider Lotus (LOT. US) announced unaudited financial results for the second quarter and first half of the year. According to the financial report, Lotus achieved a total revenue of 398 million US dollars in the first half of this year, a year-on-year increase of 206%; Lotus reported a net loss of $460 million, an increase of 30% year-on-year. Although the losses have expanded, Lotus' profitability has significantly improved. According to the financial report, Lotus' gross profit for the first half of 2024 was $51 million, compared to only $6 million in the same period last year. The gross profit margin increased from 5% to 13%, an increase of 8 percentage points.
Regarding the increase in gross profit margin, Lotus stated, "This is due to the growth in profit margins from product sales and service revenue
Sales increase, previously indicated no roll price
Public information shows that Lotus is a globally renowned manufacturer of sports cars and racing cars, with its headquarters located in Heather, Norfolk, UK. In 2017, Geely Holding acquired a 51% stake in Lotus for £ 51 million, becoming the controlling shareholder. In 2018, Lotus released the "Vision80" ten-year brand revival plan, announcing a comprehensive transformation towards electrification and intelligence, becoming the world's first all in electrification and intelligence ultra luxury brand. Subsequently, Lotus released electric models such as EVIJA, EMIRA, and ELETRE, which not only have racing performance, but also incorporate more technological elements and environmental protection concepts.
With the trend of new energy vehicles gradually becoming mainstream in the market, consumers are also beginning to favor high-end new energy vehicles. According to data from the China Association of Automobile Manufacturers, in 2023, new energy vehicle models priced between 300000 yuan and 500000 yuan in the Chinese market are experiencing rapid growth, with a total of 2.384 million units sold. Among them, the year-on-year growth rate of sales for models priced above 500000 yuan is as high as 58.5%. In this context, Lotus' sales have also been further boosted.
According to the financial report, Lotus delivered a total of 4873 products in the first half of 2024, a year-on-year increase of 239%. Among them, daily use vehicles and sports cars increased by 174% and 337% respectively year-on-year. The significant growth is not only due to the enhancement of product strength, but also related to Lotus' marketing layout. According to the financial report, Lotus has entered important strategic markets worldwide, forming four major marketing regions: Europe, China, the Americas, the Middle East, and the Asia Pacific. With over 200 stores located in prime locations around the world, Lotus' key markets contribute 20% to 30% of delivery volume. Among them, the sales volume in the US market increased significantly, reaching 1278 units, accounting for 26% of the total delivery volume.
Lotus' financial report for the first half of the year mainly reflects two aspects: a significant improvement in product strength, and further deepening of global marketing layout. "Automotive analyst Xu Jiaping told Huaxia Times reporters that from the perspective of product strength, Lotus continues to launch innovative car models to meet the diverse needs of consumers. In terms of marketing, Lotus actively explores global markets, not only expanding sales channels, but also enhancing brand awareness and influence worldwide.
In addition, based on its globalization strategy, Lotus is constantly expanding its market and plans to launch deliveries in 24 countries and regions this year. At present, the pure electric supercar SUV Eletre model has begun delivery in new markets such as the Middle East, New Zealand, India, and Egypt, and production orders have also been initiated in new markets such as Australia, Japan, and South Korea. At the same time, the pure electric supercar Emeya model has begun to be delivered in Europe and pre orders have been opened in markets such as the Middle East, Japan, South Korea, and Southeast Asia. In terms of stores, Lotus plans to increase its global store count to 300 by 2024-2025 and continue to expand its market share.
It is worth mentioning that in the fiercely competitive market, Lotus' average selling price remains above $100000 in the first half of 2024, thanks to its "no price reduction" strategy. Lotus Group CEO Feng Qingfeng recently made it clear on social media that as a million dollar luxury pure electric vehicle brand, Lotus will not participate in price wars. He believes that although price wars are common in the current Chinese automotive market, it does not mean that all brands must compete by lowering prices. Feng Qingfeng emphasized that Lotus is confident in its intelligent manufacturing, quality control, product performance, and brand appeal.
Continuously laying out intelligent driving and customized services
In addition to continuously expanding its sales channels, Lotus is also deeply cultivating in the field of intelligence. At present, Lotus has built three major product matrices for intelligent driving, including ROBO Soul ROBO Galaxy、ROBO Matrix。 As of June this year, Lotus owners have achieved a maximum of 419 kilometers of no take over mileage on a single highway NOA, and their highest total intelligent driving mileage within a year has reached 21764 kilometers.
Thanks to breakthroughs in intelligent driving, Lotus has also started collaborating with other car companies. According to the data, Lotus Robotics has already provided intelligent driving technology and solutions to brands such as Lynk&Co and Remote Automotive. According to the financial report, Lotus achieved service revenue of $15 million in the first half of 2024, a year-on-year increase of 194%. With the increase in the delivery of advanced technology vehicles for daily use, Lotus' revenue from paid software will continue to rise in the future.
In terms of customization, Lotus has launched the Lotus Chapman Bespoke premium customization service, providing personalized options, designer customization, limited edition and exclusive customization to meet the growing needs of customers. In the industry's view, with the delivery of customized Lotus models, the brand's image will be further enhanced, and the gross profit margin will also increase.
However, based on a cautious assessment of the global market environment and tariff policy uncertainty, Lotus has adjusted its delivery target for 2024 to 12000 vehicles.
This is a very wise and responsible decision, "Xu Jiaping told reporters. In the current volatile global market environment and uncertain tariff policies, Lotus was able to adjust its delivery targets in a timely manner, demonstrating the company's keen insight and flexible adaptability to market changes.
In addition, Lotus has also launched the "Win26" program. The Huaxia Times reporter learned that this plan is a comprehensive initiative launched by Lotus to address the global diversified market and promote sustainable growth. Intended to optimize internal processes and structures, implement overall cost control, and readjust product plans to adapt to changes in the global market. Lotus hopes to enhance the company's resilience, strengthen its brand, and achieve sustainable growth through this plan.
Mr. Li Kunlong, Chief Financial Officer of Lotus, stated that the company will firmly implement the "Win26" plan to achieve EBITDA and operating cash flow normalization by 2026, improve financial performance, optimize the balance sheet, and fulfill the company's commitment to shareholders.