＂Old Man Music＂ is sought after by foreigners. Is it cold at home and hot abroad？
Text | DoNews Zhang Yu
Editor | Yang Bocheng
A new species is emerging in cities all over the world: small in size, light in weight, similar in appearance, structure and performance to that of a fuel car, and driven by a battery, but the speed is generally lower than 70 km/h. At present, low-speed electric vehicles are very common in East Asia and Southeast Asia, and they are more and more popular in Europe and North America.
Low-speed electric vehicles are commonly known as "Old Man Le". At first, "Old Man Le" was mostly "Three Jumpers". Later, with the upgrading of travel demand, four-wheeled vehicles appeared, and their shapes were getting closer and closer to cars.
Contrary to the increasingly popular situation in foreign countries, in China, "Lao Toule" drivers not only need no license and driver’s license, but also are not bound by traffic rules at all. However, due to the low safety of low-speed electric vehicles and frequent traffic accidents, they have been severely supervised.
Since January 1, 2024, Beijing has banned illegal electric three-wheeled and four-wheeled vehicles from going on the road and parking in public places, and offenders will be investigated and punished according to law. In addition to Beijing, Hunan, Anhui, Jiangsu, Shanghai and other provinces have also introduced relevant policies to supervise and restrict the "old man music" on the road.
However, it should not be overlooked that by 2021, the market scale of "Lao Toule" will reach 16.885 billion yuan, and it is expected to reach 17.578 billion yuan in 2028. At the same time, due to the advantages of low price and low maintenance cost, the number of "Lao Toule" has exceeded 10 million. With the end of the transition period, the process of retiring the "old man music" in various places has accelerated, and many "old man music" manufacturers are also actively saving themselves through transformation and upgrading. In the future, where will the "old man music" go? Can you find soil suitable for survival abroad?
First, low-speed electric vehicles are popular abroad
Low-speed electric vehicles exploded in foreign countries because the video works of a Chinese blogger in the United States attracted widespread attention.
Previously, in order to welcome the arrival of Christmas, the blogger asked his domestic friends to buy an electric tricycle as a gift and gave it to her American father-in-law. Then a series of interesting things happened around the "Three Jumpers". Under the eager attention of netizens, the blogger continued to share the adventures of "San Xunzi" in the United States. Her American father-in-law couldn’t put it down, and even drove to the local vehicle management office to get a license. Even the local police said that "the police station can also come to one" and suggested that she could propose to the mayor’s office to build a factory and sell cars.
It is reported that the "three scorpions" that bloggers gave to American father-in-law were produced by an electric tricycle manufacturer in Wuxi. The manufacturer revealed that since New Year’s Day in 2024, the number of orders placed by American local consumers from various e-commerce platforms has continued to soar, and the orders exported to the United States have tripled year-on-year.
Low-speed electric vehicles have gradually emerged in foreign countries for two main reasons.
First of all, the price of low-speed electric vehicles is relatively close to the people, which is a big advantage of its popularity abroad. Especially for the European and American markets, the price of a low-speed electric vehicle is not high, and consumers have little pressure to buy it. Moreover, many European and American families have their own power generation equipment, and the use cost is quite low, far cheaper than the use cost of cars.
Secondly, Europe and the United States have clear standards and specifications for low-speed electric vehicles. Among them, four-wheeled electric vehicles with a speed of less than 25km/h are included in the management of non-motor vehicles in Europe, and electric three-wheeled and four-wheeled vehicles that meet EEC standards in Europe can be legally sold and put on the road.
However, it is still difficult for low-speed electric vehicles to explore overseas markets. According to the data released by the market research organization Baijian Strategy, the global electric tricycle market is expanding steadily. In 2023, the global electric tricycle market sales reached 61.86 billion yuan, and it is expected to reach 149.89 billion yuan in 2030. Asia-Pacific is the largest market in the world, accounting for 90.06% of the market, followed by the European market, accounting for only 5.14%. With the continuous improvement of global environmental awareness, low-speed electric vehicles will have more imagination in the international market.
Second, the domestic cold, the transformation of manufacturers
Strong market demand has spawned a number of "old man music" brands. From 2016 to 2018, Reading Automobile won the championship of low-speed electric vehicle sales for three consecutive years, with sales of 150,000, 210,000 and 287,000 respectively, and its market share once exceeded 30%, making it the "old man is a brother".
But a paper rule ended the glorious years of Reading. In November 2018, the Ministry of Transport and other six ministries and commissions jointly issued the Notice on Strengthening the Management of Low-speed Electric Vehicles, requiring local governments to stop approving or filing investment projects for low-speed electric vehicles in accordance with the general idea of "upgrading a batch, standardizing a batch and eliminating a batch", and stop building new low-speed electric vehicle enterprises, expanding production plants and other infrastructure projects.
Under the pressure of the ban, some "Laotoule" manufacturers began to seek transformation and upgrading: on the one hand, through the acquisition of new energy vehicle production qualifications, cooperation with traditional car companies, etc., they laid out the new energy automobile industry and launched mini-car products that meet national standards; On the other hand, we are deeply involved in sinking the market and even exporting overseas to find new market opportunities.
However, the transformation is not an easy task. Redding Automobile has launched three new energy vehicles, namely, the pure electric mini-car Redding i3, the pure electric mini-car Redding i5 and the pure electric SUV Redding i9, with the price ranges of 49,800-62,800 yuan, 75,800-75,800 yuan and 115,800-139,900 yuan respectively, which are mainly used in the low-end market.
Reading tried to complete the brand transformation and upgrading through I-series, but the feedback from the market declared that the dream of Reading became a fantasy. According to public data, in 2019, the sales volume of I-series was only 3,387, so it was completely discontinued after only one year of listing.
After the I-series was smashed, Reading Auto set its sights on the mini-car market, and launched Reading Mango and Reading Mango Pro, with the sword referring to Wuling Hongguang MINI EV. However, the profit of mini-car is meager, and it is the most sensitive to cost. As the price of raw materials continues to rise, the profit space of mini-car is severely compressed and overwhelmed.
In the end, the sales of mango series are not satisfactory. In May, 2023, the announcement of Changle County Court in Weifang, Shandong Province showed that Redding Automobile had filed for bankruptcy, and the former "Old Man Le" leading building would collapse.
Not only reading cars, but also many low-speed electric vehicle manufacturers have encountered difficulties on the road of transformation.
In 2017, Yujie won the investment of Great Wall Motor and changed its name to Lingtu Automobile. The market performance of several pure electric SUVs launched was bleak, and then it was transformed into a mini-car with little splash and eventually disappeared. In 2018, Fulu Group, which owns four brands of low-speed electric vehicles such as Lichi, Fulu, Qifeng and Lupai, signed a strategic cooperation agreement with BAIC Manufacturing to jointly build new energy vehicles. However, most of the mini-car products built by the two parties are based on the transformation and upgrading of the original low-speed electric vehicle products of Fulu Group, which has not caused waves.
It should not be overlooked that the manufacturers of "Laodule" are far behind the "regular army" in terms of technology, capital and market resources, and will inevitably be weak after the transformation. If there is not enough profit space as a support, the outcome of welcoming the manufacturers of "Laodule" may only be to withdraw from the historical stage.
Third, mini-cars are not life-saving straws
The transformation and upgrading of "Laotoule" manufacturers, without exception, are all aimed at the field of mini-cars. Although the technology and configuration required by mini-cars are relatively low, the price is affordable and close to the people, which is convenient for them to gain a firm foothold in the field of new energy vehicles, it should be pointed out that the bonus period of mini-cars has officially ended.
In December 2023, the Ministry of Industry and Information Technology, the Ministry of Finance and the State Administration of Taxation jointly issued the Announcement on Adjusting the Technical Requirements of New Energy Vehicle Products for Vehicle Purchase Tax Reduction and Exemption, which clarified the applicable technical conditions and implementation requirements of the vehicle purchase tax reduction and exemption policy for new energy vehicles after 2024. The maximum speed of pure electric passenger cars in 30 minutes is not less than 100 km/h; The driving range of pure electric passenger cars has been increased from not less than 100km to 200km；; The mass energy density of the power battery system of the pure electric passenger car is increased from not less than 95Wh/kg to 125Wh/kg.
Obviously, the announcement will undoubtedly further eliminate a number of mini-cars, such as some models of Wuling Hongguang MINI EV, some models of Changan Lumin and some models of Chery QQ ice cream.
In fact, the decline of mini-cars has already appeared. Taking Wuling Hongguang MINI EV as an example, in October 2023, the sales volume of Wuling Hongguang MINI EV was 20,337, down 57.51% year-on-year; In the first 10 months of 2023, although Wuling Hongguang MINI EV still ranked first in the mini-car market, its sales volume has dropped by 65.73% year-on-year to 189,863 vehicles, only completing 34.2% of the sales volume in 2022.
As the industry leader, the sales of Wuling Hongguang MINI EV are not optimistic, and all mini-car players have a hard time. Take Chery QQ Ice Cream as an example, its sales in 2022 were close to 100,000, with an average monthly sales of 8,333. However, according to the disclosed data, the monthly sales of Chery QQ ice cream in the first four months of 2023 were all below 5,000, and it was not until September and October that it recovered to about 7,000.
A person in the new energy automobile industry told DoNews that it is extremely unlikely that "Laotoule" manufacturers will break through with mini-cars. At this stage, "Laotoule" manufacturers are faced with a stock competition market with high industry concentration, and at the same time, they have to face the dimension reduction blow of a large number of traditional automobile companies, such as SAIC, Chery Automobile and Great Wall Motor, which have mature automobile manufacturing processes and a large number of technical deposits, and it is difficult for them to compete with them.
At present, the competition in the new energy vehicle market is fierce, and the price war is intensifying. In order to gain a foothold in the market, "Laotoule" manufacturers must increase investment in research and development and improve product quality and technical level. At the same time, it is necessary to strengthen brand building and marketing, explore the possibility of entering overseas markets, and shift domestic sales to exports. For "Lao Toule" manufacturers, planning the development direction and forming a unique technical advantage is a key step to break the existing deadlock.