A letter from the chairman of Shineray Group

You need a right extended range electric car, instead of an expensive one

Dear friends:

    I am Gong Daxing from SWM Motor. For many people, 2022 has been an unforgettable and rapidly forgettable year. Not only in this year, but in the past three years each of us is experiencing the tremendous transformation of the surroundings.

    In the past twenty years, the whole country has been striving hard, and we always believe in the good and rapid changes, believe in the fast development. Usually, we assure ourselves that we are one of the windmills standing side by side. After all, the day will always get better and better. But the chaos of these three years has made us reorient ourselves when we are running forward in the last twenty years, and provided an opportunity to know about ourselves.

    15 years ago, we started to build cars, and we have been maintaining solid research and development, improving production capacity, developing more channels, and strengthening management. These years, we have been dedicating our efforts without a single halt. In the vast China auto industry, SWM is just a small part, and we’ve been through some cheerful highlights, as well as some setbacks. I am also a member of this rapid development. After entering 2020, the temperature is getting colder and the time seems to pass more quickly, but I am always pondering on the car that should be made, which is supposed to be a good product that ordinary users can afford to buy. How can we build a car that adapts to our original aspirations while following the current trend?

    In recent years, along with the trend of electric vehicles, consumers embrace more and more cars with better equipment, which is quite good. But on the opposite, these vehicles are getting more and more expensive. No matter what sort of power unit they have, it seems like expensiveness has become reasonable, and when we are discussing the price of one car and if it’s reasonable to buy that car, everyone tends to keep silent. Another interesting point is that, although the car price is spiraling, it seems that there are not many profitable car companies, which I cannot understand. If they do not increase the enterprise value, have they just increased the appraisal value?

    When we just entered the passenger car industry, everyone was discussing the electric vehicle market. With its development, the cost of the battery, control system and electric motor will drop significantly in the future. However, in less than two years, the price of battery-grade carbonic acid has increased by more than ten times, which makes the price of electric cars rather undesirable. Compared with the high cost of electric vehicles, China's car consumption market of 150,000 RMB level witnesses a share of nearly 50% of the whole market in the first three quarters of 2022. We cannot ignore this 50% of the new energy products demand. These products are not very profitable, but users are clear about the range cost, car cost and maintenance cost. Small business in a big market, if you do well, is an opportunity.

    Therefore, I turn my attention to the extended range electric vehicle technology. This technology has always been controversial in the industry, but I think the controversy has to be based on this premise—the focus should not be on how good the range extender is, but on whether the technology should be sold at such a high price. The battery capacity of one extended range electric car is literally one third of what a pure electric car has, and the price of a set of range extender is about 10,000 yuan, which can efficiently solve a series of problems of battery cost, range and charging. However, some crazy developers choose to equip the cars lavishly, and make them become products that will cost 300,000 to 400,000 yuan. This is unacceptable for the target consumers who just want to spend 100,000 yuan on this sort of car. As a consequence, the inborn practicality of this sort of vehicle fades away.

    Cars are a part of life. During these three years, some people take a pay cut to start a job, and some people choose to stay at home. The credit deficit might make somebody lose what they’ve scrambled, but life still goes on. Some people reduce the non-essential expenses, and the decent travel might be replaced by camping. This is just like Japanese society after the Plaza Accord in the 1980s, where people stopped chasing luxury brands,and chose to facethe uncertainty, then asked themselves: Who am I? What do I need? After figuring out the meaning of “I”, Japan eventually stepped onto its revival, as the simple and comfortable products went popular, and the trend of throwing away the unnecessary slowly rise. Besides, the youngsters’ preference for Wabi Sabi is also a sign of the Japanese rationality. 

    To different people, the definition of a car varies a lot, but the car should never define the people. The essence of the car is to simply complete the physical movement for the things in the car. Drivers can drive with their cell phones, but there is no need to turn the car into a smart terminal, since the cost is too big and the efficiency won’t be high. Returning to the car’s essence is the response to the demand in this era—simplicity.

    Therefore, I have a bold idea of wanting to make an affordable extended range electric vehicle for those consumers who just want to spend about 100,000 yuan to buy the car. I decide to bring the price down so that the consumers can enjoy a good price and a good ride! This is my innovative way for the development of new energy vehicles, and I name this SWM electric vehicle as "Giant Tiger EDi". It's on the way of coming and will be seen tomorrow. 

    Previously, we desired for the luxuriousness, but now we tend to chase for simplicity. Indeed, practicality, rationality and simplicity is the car needed in this era. 

SWM·Gong Daxing