Before the 2024 Beijing Auto Show, the WENJIE M5 was launched.
On April 23rd, the Wenjie New M5 was launched, positioned as a mid size new energy SUV. It has two power forms and three models, with a price range of 249800 to 279800 yuan. Mass delivery will begin on May 15th.
Compared to the old model, the appearance of the new M5 has been adjusted. The extended range version has been replaced with a closed front face. Huawei's executive director, CEO of terminal business, and Chairman of Intelligent Automotive Solutions BU, Yu Chengdong, said that "the big mouth has turned into a small mouth.".
In addition, the new M5 from Wenjie is equipped with Huawei's advanced intelligent driving system as standard across the entire range. "We have invested heavily in research and development of intelligent driving technology, and Huawei's advanced intelligent driving systems priced below 300000 yuan are actually sold at a loss." Yu Chengdong said that Huawei has sent an expert team to the United States to test Tesla FSD, and after comparative testing, it was found that Huawei's intelligent driving system is better than Tesla FSD.
Sales accounted for less than 3% in the first quarter of this year
According to public information, the WENJIE M5 was released at the Huawei Winter Flagship New Product Launch on December 23, 2021. On February 25, 2022, the final selling price of the WENJIE M5 was announced, which has decreased compared to the pre-sale price. The rear wheel drive standard version is priced at 249800 yuan, the four-wheel drive performance version is priced at 279800 yuan, and the top of the line four-wheel drive flagship version is priced at 319800 yuan. It is worth noting that these models are all extended range products.
On March 5, 2022, the Wenjie M5 began delivery. After the start of delivery, the sales of the WENJIE M5 gradually increased, from 3045 units in March of that year to approximately 16800 units in August. However, in September of that year, the sales of the WENJIE M5 significantly declined to 5352 units. During the same period, the pure electric version of the WENJIE M5 was launched, with the standard version (rear wheel drive version) priced at 288600 yuan and the performance version (four-wheel drive version) priced at 319800 yuan.
However, the launch of the pure electric version did not lead to a significant increase in the growth of the WENJIE M5. From September to December 2022, the highest sales volume of the WENJIE M5 was less than 7000 units. After entering 2023, in the context of price wars, the sales of the WENJIE M5 continued to decline, and by April 2023, the sales of the WENJIE M5 were less than 2000 units.
Some argue that at that time, the Wenjie M5 was only equipped with HarmonyOS intelligent cockpit, and the Huawei ADS intelligent driving system was not equipped at that time, which had limited appeal to consumers. In this context, the Wenjie M5 driver's version was launched on April 17, 2023. Among them, the rear wheel drive intelligent driving version costs 279800 yuan, the four-wheel drive intelligent driving version costs 299800 yuan, the pure electric intelligent driving rear wheel drive version costs 289800 yuan, and the pure electric intelligent driving four-wheel drive version costs 309800 yuan
However, the addition of intelligent driving has not brought a huge increase in sales to the Wenjie M5. In April 2023, sales of the WENJIE M5 increased, but fell back to less than 2000 units after September. Some analysts believe that the high cost of the Wenjie M5 intelligent driving version equipped with Huawei ADAS2.0, LiDAR, and high-order domain controller has limited room for price reduction.
In September 2023, the WENJIE M5 also welcomed the "last straw that crushed it" - the WENJIE New M7 was officially launched, with a total of 5 models available, priced between 249800 to 329800 yuan, with a starting price reduced by 70000 yuan compared to the previous version. However, this strategy also allows for a high degree of overlap between the higher sized Wenjie M7 and Wenjie M5 in terms of price range.
In addition, although the Wenjie New M7 is a mid-term facelift product, Hongmeng Zhixing has invested over 500 million yuan in it, and the release of Huawei Mate 60 has played a role in attracting traffic for the Wenjie New M7. And this has greatly affected the sales of the Wenjie M5. According to the latest sales data, the cumulative sales of the WENJIE M5 in the first quarter of this year were 2158 units, accounting for 2.62% of WENJIE's total sales.
Will the new M5 of Wenjie serve as the "firefighting team leader"?
Based on past market performance, the price reduction of the Wenjie New M5 is already a certainty. From the final price range of 249800 to 279800 yuan, it can be seen that the Wenjie New M5 has not adjusted the starting price of the product. However, Wenjie has offered optional rights worth 37000 yuan, lowering the threshold for consumers to purchase a car.
In addition to providing car purchasing rights and lowering the purchase threshold, the Wenjie New M5 has also made significant improvements in product strength. "The proportion of high-strength steel greater than 210MPa in the entire vehicle of the WENJIE New M5 exceeds 60%, and the proportion of submarine grade hot formed steel is nearly 20%, nicknamed 'Land Small Tank'. Yu Chengdong said that the WENJIE New M5 has also been improved in terms of forward collision resistance and lateral active safety.".
In fact, the emergence of the Wenjie New M5 not only changes the sales situation of this model, but also needs to further enhance the sales performance of the Wenjie brand. Compared to the more balanced sales of the three SUVs of Ideal Automobile (Ideal L7/L8/L9), the sales of the WENJIE are concentrated in the WENJIE New M7. As a popular model, the WENJIE New M5 needs to change this "biased" situation.
On the other hand, public data shows that although in the first quarter, Wenjie's sales surpassed Ideal Automobile, ranking first on the sales chart of new force brands. But after entering April, under the influence of the Ideal Auto Show policy, Ideal Auto's sales surpassed Wenjie for two consecutive weeks, and the Wenjie M7, which was able to strengthen the Ideal L series with its own strength, has also surpassed the Ideal L7 in weekly sales. Wenjie urgently needs the new car effect to boost sales.
However, it should be noted that the market environment faced by the Wenjie New M5 is different from before. Huatai Securities stated that the structure of new energy products has rapidly upgraded in recent years, with a more significant increase in the market share of high-end new energy vehicles. But this also means that many car companies are laying out, and market competition is becoming more intense.
Specifically, in the mid size new energy SUV market where the Wenjie New M5 is located, this segment of the market has shown relatively concentrated performance. Among them, the Tesla Model Y has long held the majority of the market share in this segment, while domestic brand models such as the Deep Blue S7 and the Zero Run C11 have also been at the top of the sales chart in this segment for a long time due to their cost-effectiveness. The Wenjie New M5 faces a lot of competitive pressure.
However, as of now, the Wenjie New M5 has gained the favor of some consumers. It is reported that Wenjie opened the booking channel for the Wenjie New M5 on April 17th, and on April 18th, Wenjie officially announced that the accumulated orders for the Wenjie New M5 exceeded 10000 units after 12 hours of pre-sale. "The Wenjie New M5 is expected to become a popular model with Huawei's intelligent capabilities and high cost-effectiveness, driving Wenjie's sales to continue to rise," said Dongfang Securities.
"Hongmeng Zhixing has currently launched four products: Wenjie M5, Wenjie M7, Wenjie M9, and Zhijie S7. From January 1 to April 22, 2024, the cumulative sales reached 105000 units, ranking first in the sales ranking of new force brands in the Chinese market." Yu Chengdong revealed at the Wenjie New M5 press conference.