Wei Lai year: from the edge of bankruptcy to the top of bubble

category:Finance
 Wei Lai year: from the edge of bankruptcy to the top of bubble


Tesla saves Weilai

The market believes that these emerging electric vehicle companies have different business models, whether in terms of energy, digital or next-generation models, so every enterprise has an opportunity. Bill Russo, founder and CEO of automotive consulting firm mobility, told first finance reporter, the valuations of traditional car companies are constantly being undervalued by the market, and these emerging car brands are more favored by investors. Now its not the end of the game, but the rise of the new forces of car making will continue.

These companies have a very strong digital gene and a strong ecosystem behind them, which drives up their valuations. In an era of Internet, the electric vehicle market will grow exponentially, Rowe told the first financial reporter

Although Chinas electric vehicle market is growing rapidly and its market size is expected to surpass that of the United States, there are divergences in the market over the irrational rise of Chinas new car making forces. Bearers believe that the market value of Chinas emerging electric vehicle companies deviates from their commercial reality.

This is not to say that there is no bubble in these enterprises, but a huge bubble problem. Stock prices cant reflect the commercial nature of enterprises. The rapid rise in valuations of these enterprises is just a use of the hype of public sentiment, an auto technology company executive told the first finance and economics reporter

The above-mentioned people believe that Teslas share price rise this year has saved Weilai automobile. Weilaidu was on the verge of bankruptcy, and Teslas share price saved them. He said to the first financial reporter, but these enterprises are not Tesla, although they are similar to Tesla, but opening the cars shell, from a technical point of view, the difference between cars is not at a level, so the bubble is very big.

But he also admits that from a consumers point of view, its hard for them to identify technology. Thats why Chinas emerging electric vehicle companies can quickly compete with Tesla for market share in China.

Market size may not support valuation

Sales rose 146% in the third quarter to $628 million and delivered 12206 vehicles, even though the sales were only in line with Teslas four years ago, according to the companys results.

Citron research, a US short seller, had short the company ahead of the companys earnings report and triggered a sell-off. Xiangchuan believes that the companys business will never be able to support the $62 billion valuation at that time.

However, the stock price of Weilai automobile quickly rose back, which means that the market is still wrestling with the bulls and bears of Chinas emerging car manufacturing forces. Bank of America, Deutsche Bank and J.P. Morgan have all raised their target share prices. Bank of America predicts that Weilai will start to make profits in 2023, one year earlier than previously expected.

Dan ives, managing director of the US securities firm wedbush, said: velai, ideal and BYD are among the most innovative electric vehicle companies in the world. We believe that China is an opportunity for electric vehicles, and the growth rate will be eight to nine times higher than the current growth rate of the U.S. automobile market.

According to wade bush, only about 4.5% of Chinas passenger cars are electric vehicles, which is expected to reach 10% by 2027. Analysts believe the Chinese market is big enough for companies in the industry to grow, but whether they can achieve their own valuations is another matter.

From the perspective of market sales rate, the current valuation of Weilai, Xiaopeng and ideal automobile is not cheap, and the market sales rate has reached more than ten times, even higher than Tesla.

Mr Ives said Tesla has gained scale advantage from its Shanghai Super factory, which has started producing model 3 electric vehicles at the end of 2019 and will start production of SUV model model y next year. This has helped Tesla to maintain its position as a leader in the domestic electric vehicle market, helping to maintain its presence in the Chinese market. In a report, Ives wrote. In addition, analysts believe that Teslas real advantage lies in intellectual property. Recently, musk publicly accused Xiaopeng of plagiarism on social media. There is no doubt that these domestic manufacturers are imitating Tesla, but many things can not be learned by imitation. It requires a lot of expertise in software and semiconductors, a senior autopilot told the first finance reporter Source: Chen Hequn, editor in charge of Finance and Economics_ NB12679

Mr Ives said Tesla has gained scale advantage from its Shanghai Super factory, which has started producing model 3 electric vehicles at the end of 2019 and will start production of SUV model model y next year. This has helped Tesla to maintain its position as a leader in the domestic electric vehicle market, helping to maintain its presence in the Chinese market. In a report, Ives wrote.

In addition, analysts believe that Teslas real advantage lies in intellectual property. Recently, musk publicly accused Xiaopeng of plagiarism on social media. There is no doubt that these domestic manufacturers are imitating Tesla, but many things can not be learned by imitation. It requires a lot of expertise in software and semiconductors, a senior autopilot told the first finance reporter