"The timeline has been extended, and from a decade to twenty years perspective, consumption upgrading is a major trend. With a larger per capita GDP, the economy will also be better, and the trend of consumption upgrading is bound to lead to an expansion of high-end market share." On February 29th, Li Yan, CEO of Xiaoniu Electric, expressed his confidence in the high-end market of Chinese made two wheeled electric vehicles in an interview with media such as Nandouwan Finance News, "It may have an impact in the short term of one or two years, no problem. It's a long timeline, and I think what we're sticking to is this."
Li Yan told Nandouwan Finance News that this year, Xiaoniu Electric's strategy in the Chinese market is to combine online and offline methods to further increase the sales of existing stores and individual stores; Secondly, we will continue to increase our offline stores. In 2024, Xiaoniu Electric plans to open 1000 to 2000 stores, and "the specific number is still under planning."
Previously, in the third quarter financial report of 2023, Xiaoniu recorded its largest quarterly loss since going public. According to the financial report, in the third quarter of 2023, Xiaoniu's revenue was 927 million yuan, a year-on-year decrease of 19.6%; A net loss of 79.4 million yuan was recorded, while a net profit of 2.9 million yuan was recorded in the same period of 2022, a year-on-year profit to loss.
At that time, regarding the third quarter performance loss, Li Yan stated in a financial report conference call: "In the Chinese market, the third quarter was due to sluggish consumption in first tier cities, resulting in a slowdown in product sales. In overseas markets, its main markets, Germany and the Netherlands, also experienced a decline in performance. At the same time, in the European market, Xiaoniu also faced operational pressure from distributors."
At the beginning of 2023, Xiaoniu had predicted in its financial report that the annual sales in 2023 would be between 1 million and 1.2 million vehicles, once again reaching its target of 1 million vehicles. However, in the cumulative data for the first three quarters of 2023, Xiaoniu's total sales were 572326 units, compared to 693314 units in the same period last year, a year-on-year decrease of 17.45%. Among them, the sales volume in the Chinese market was 490500 units, compared to 592500 units in the same period last year, a year-on-year decrease of 17.2%; The total sales in the international market were 81800 vehicles, compared to 100800 vehicles in the same period last year, a year-on-year decrease of 18.89%. It seems difficult to achieve Xiaoniu's goal of one million units in 2023.
During the interview, Li Yan did not shy away from this situation. He admitted, "Our performance in 2023 is relatively poor compared to our peers." Li Yan further explained that last year, a dealer partner in the European market of Xiaoniu had problems, leading to a slowdown in local growth. However, the Mavericks have already started to restart this matter in 2024.
In addition, Xiaoniu has also made two preparations in overseas markets in 2023. Li Yan said that last year, the growth of scooters and E-bikes in the European and American markets was very rapid. Currently, Xiaoniu has expanded its local sales network and entered the mainstream sales positions of scooters and E-bikes, including Amazon, BEST BUY, and others. "So we are very optimistic about the short travel category in the overseas market in 2024."
In the past two years, driven by the dual needs of standardized development and replacement during the transition period of new national standards, the electric two wheeled vehicle industry has entered a period of rapid development. However, as the transition period for two wheeled electric vehicles in various regions gradually expires, the demand for replacement in the two wheeled electric vehicle industry will tend to flatten. According to the 2023 White Paper on China's Two wheeled Electric Vehicle Industry released by iResearch Consulting, the number of electric two wheeled vehicles in China was approximately 350 million in 2022, and it is expected that sales will reach 54 million in 2023, with the market continuing to expand.
Therefore, in addition to continuing to explore new customers and markets, enhancing the high-tech empowerment of products to increase unit prices and profits has also become a necessary task for manufacturers. A reporter from Nandouwan Finance News Agency noticed that on February 29th, Xiaoniu Electric released three new products: the "new generation performance flagship" electric motorcycle NX, the electric self NXT, and the "all scene intelligent driving off-road electric motorcycle" X3, all of which are aimed at the high-end market. On February 28th, Yadea's sixth generation Guanneng new product was launched. At this press conference, new products such as the Yadi Guanneng 6th generation Q50, Yadi Guanneng 6th generation T60, and Yadi Guanneng 6th generation M85 were unveiled. It is reported that the Yadea Guanneng 6th generation is positioned as a "higher end long endurance electric vehicle".
Li Yan emphasized that Xiaoniu Electric still focuses on high-end products. In the past, the market share of high-end products was small, and the entire market was a low-priced market. Other competitors may sacrifice their products to make low prices, leading to the concept of inferior coins replacing good ones in the market. But now more and more manufacturers are also starting to explore this market. Although it may temporarily affect Xiaoniu's market share, it is good to have more competition in this area. Previously, users thought that a car priced at 4000 yuan was expensive, but now the car priced at 7000 yuan is considered good. The high-end market cannot be sustained by a single brand, and the needs of high-end users also vary to a certain extent. It is necessary to have multiple brands in order to do a good job and expand the high-end market
It is worth mentioning that in response to the recent safety issues with electric two wheeled vehicle batteries, Li Yan stated that most of the problems with these batteries are due to illegal and unauthorized behavior. Li Yan revealed that the relevant departments have started drafting management measures for batteries, "and the draft has basically been completed."