Summary of the Analysis
This analysis exposes a critical issue in the current new energy vehicle industry: the practice of rapid expansion and high turnover, which was once common in the real estate sector, has been directly applied to the operations of car manufacturers. It highlights that the complaints from consumers about “quickly produced cars” and “semi-finished products being rushed to delivery” are not due to a lack of engineering expertise among the car companies. Instead, the underlying reason is that the entire industry has shifted to a model focused on generating profits as quickly as possible, similar to how real estate companies relied on selling off-plan properties to quickly recoup funds and then use those profits to acquire new land.
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Detailed Interpretation
1. The Similarity Between the Two Industries’ Profit-Generating Strategies
Many people are unaware that the operational processes of real estate and car companies are almost identical:
In the past, the standard process for real estate companies was: “acquire land → launch a project → collect payments → acquire more land.” At their peak, leading companies could open sales offices just two months after acquiring land, selling off-plan properties before even completing the foundations. They would collect the down payments from buyers and bank loans without keeping any money in hand, and then use that money to acquire new land, continuously expanding their business without waiting for the buildings to be completed or sold.
Many new car companies are following the same pattern: “initiate a project → launch a product → deliver the car → launch a new model.” They would announce a new car model without completing all the necessary tests, hype up features like “autonomous driving” and “800V fast charging,” collect large upfront payments from customers, and use that money to pay for components. They would then rush to deliver the first batch of cars and collect the full payment, without waiting for the previous model’s bugs to be fixed or the after-sales system to be established. They skip the profit-making steps and simply rely on the initial payments to keep the business going.
2. The So-called “Quickly Produced Cars” Are Just a Surface Effect; High Turnover Is the Real Motivation
Many newly delivered cars are plagued by problems: outdated infotainment systems, malfunctioning assisted driving features, and even mismatched components. This is not because car companies are unable to produce quality products; rather, the high turnover requirements leave them with no time for thorough testing.
Traditional car companies used to spend 3-5 years on developing a new model, testing it in extreme environments like Mohe (-30°C) and Turpan (40°C) for millions of kilometers to ensure quality before releasing it to the market. Nowadays, many companies launch new models in just 1-2 years. This is not because engineers have become more efficient; it’s because the high turnover pressure forces them to act quickly. If they slow down even by half a year, their market share could be stolen by competitors, and their stock prices could plummet, leading to financial collapse.
3. Car Companies Are Forced to Adopt High Turnover Due to the Competitive Environment
The reason this high-turnover strategy has become prevalent in the new energy industry is not because car company executives are trying to cut corners. Instead, it’s the nature of the competition: Capital investors focus on whether a company can rank among the top in the industry within three years. If a company spends three years on a perfect model, by the time it’s ready for market release, its customers may have already been attracted by faster-moving competitors, and investors might withdraw their funding. Additionally, the cash flow logic of car companies is similar to that of real estate companies selling off-plan properties—money is collected from customers before the products are even made, and payments to suppliers can be delayed for 3-6 months. Having more liquid cash on hand is crucial for surviving price wars.
4. The Pitfalls of High Turnover Are Similar to Those of Real Estate Crises
The consequences of excessive high turnover were evident in the real estate sector: continuous land acquisitions led to a breakdown in the capital chain when housing sales slowed down or prices stopped rising, resulting in unfinished buildings and customers who paid but couldn’t get their homes. The same risks apply to car companies: rushing to release new models leads to neglected after-sales support, accumulating bugs, and a negative reputation, which in turn discourages customers from making upfront payments for future models. Several new car companies have already fallen into this trap in the past two years.
5. For Consumers, Avoiding These Pitfalls Is Simple
To avoid these issues, consumers should follow two principles: First, don’t be the first to buy a newly released car model. If a company urges you to pay a large upfront fee and rush the delivery within a few months after the launch, wait at least six months to see the real feedback from existing customers. Don’t believe the exaggerated claims made at the launch; many of these features have never been thoroughly tested. Second, if a car company launches a new model within half a year, be cautious—this indicates that the company is more focused on generating profits quickly rather than on quality. Such companies should be avoided when making purchasing decisions.