Summary of Key Points
The number of new energy vehicles in use has surged from 120,000 to 43.97 million in just ten years, but the after-sales infrastructure has not kept up. Many car manufacturers (such as WM Motor, AiChi, and Nezha) have ceased operations, leaving vehicle owners facing various issues such as a shortage of spare parts, unauthorized repairs, outdated software, and difficulties in purchasing insurance. Although the government has introduced policies to grant repair permissions and ensure consumer rights under warranty agreements, the closed software and hardware systems (including data, diagnostic tools, and software licenses) used by car manufacturers still prevent independent repair shops from providing services. The lack of a clear framework for handling after-sales responsibilities in the event of a manufacturer's bankruptcy also poses significant challenges. Additionally, battery repairs are expensive, and insurance companies often face losses due to these issues. Although efforts have been made to support the after-sales market, they mainly benefit larger, well-known brands.
The Dilemma for Vehicle Owners
For owners of new energy vehicles, there are two main concerns: fear of being in accidents and the high cost of repairs. After car manufacturers like WM Motor and Jiyue collapsed, owners encountered problems such as:
- Shortage of Spare Parts: Critical components (such as batteries and electronic control units) are often out of stock, with alternatives being either used parts from dismantled vehicles or imitations.
- Outdated Software: Connectivity services cease to function, leaving owners without access to features like smartphone remote controls and air conditioning, forcing them to purchase data plans separately to maintain basic vehicle functions.
- Difficulty in Buying Insurance: With manufacturers gone, spare parts are scarce, repair costs are uncertain, and insurance companies are reluctant to cover repairs due to potential losses.
Why is this the case? The rapid growth of new energy vehicles has outpaced the development of a competent after-sales infrastructure. There are very few repair shops nationwide that can handle battery, motor, and electronic control unit repairs, and there is a severe shortage of skilled technicians. As the first batch of vehicles reaches the end of their warranty periods, these issues have become more prominent.
The Closed Repair System Created by Car Manufacturers
In contrast to the fuel vehicle era, where independent repair shops could service multiple brands using standard manuals and tools, new energy vehicles require a combination of mechanical and digital components. Replacing even a simple part (like a tire) requires software matching and authorization from the car manufacturer. Car manufacturers control all aspects of the hardware, software, and data, creating a closed system that prevents independent shops from providing repairs. As a result, if a manufacturer goes bankrupt, there is no clear mechanism to address after-sales needs.
What Happens When a Manufacturer Goes Bankrupt?
When a car manufacturer collapses, after-sales services often fall into disarray:
- Former dealers or technicians may convert their businesses into social repair centers to serve existing customers.
- Vehicle owners form groups to share information about spare parts and sometimes provide repair manuals themselves.
However, this only helps larger, well-known brands like Nezha. Smaller brands face greater challenges, as it is difficult to find replacement parts and train technicians. Although regulations require manufacturers to ensure the supply of spare parts for discontinued models, these obligations often go unmet due to financial difficulties.
The WM Motor case offers some hope: During its bankruptcy, investors covered the costs for connectivity and after-sales services, which were classified as "common interest debts" and given priority in repayment. The court also transferred the owners' data and provided necessary spare parts. This shows that after-sales support is not a trivial matter but is crucial for protecting consumers' rights. However, there is still a need for a universal system to ensure smooth transitions when manufacturers exit the market.
The Challenge of High-Budget Battery Repairs
Battery repairs are a major expense in new energy vehicle insurance claims. Insurance companies often face losses due to the high cost of replacing batteries. New policies propose two approaches to address this:
- Separation of Ownership: For example, with NIO's BaaS model, the battery is owned by a separate company, which handles battery replacement and maintenance, potentially concentrating risks.
- Separated Insurance Coverage: Insurance policies may include specific coverage for batteries, but this depends on access to accurate battery health data and repair costs, which again relies on manufacturers providing the necessary information.
However, insurance can only cover financial losses; it cannot provide spare parts or repair authorization. Therefore, the key to solving these issues lies in car manufacturers sharing their data and allowing independent repair shops to perform battery repairs.
Can the After-Sales Market Catch Up?
Leading repair chains and battery manufacturers (such as CATL) are collaborating with car manufacturers to establish repair networks. However, this effort mainly benefits larger brands and cities with higher vehicle ownership rates. Smaller brands remain underserved. To effectively support the new energy vehicle market, companies need to plan for their eventual exit from the market, including preparing adequate spare parts and repair information in advance. They should also ensure that after-sales funds are secured in case of bankruptcy and establish mechanisms for responsible handover of responsibilities between parties.
Currently, the average age of new energy vehicles is still low, so the demand for advanced repairs has not yet peaked. This provides a window of opportunity to address these shortcomings. However, time is running out; if more vehicles become obsolete or manufacturers go bankrupt, the problems will only worsen. After all, while companies can withdraw from the market, the vehicles must continue to be used on roads every day.