In this article, we try to explain the steps needed to launch a new car model in China from a consumer's point of view.
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In this latest article, we try to explain how many steps it takes to launch a new car model in China from the consumer's point of view.
For a new brand, the first step involves the launch of the brand, followed by the launch of the new car model.
Unlike common consumer electronics products, the automotive industry usually has a long lead time for launching a new product, and dividing that lead time into multiple steps helps marketing efforts.
If you browse Chinese sources, you'll see that one of the most common Chinese words used in these processes is “发布”, which literally means release, but is itself a very vague term.
In different contexts, the word means something completely different in English. Understanding this will help you understand what follows.
Launch of a new brand
Suppose there is a car company, Carmaker C, which wants to launch a new brand, Brand B, and roll out the brand's first model, the Model M.
Carmaker C might start by unveiling Brand B, making the name and concept of this new brand public for the first time.
This may be done in an event or announced directly on social media platforms, but details about the brand may be limited at this point.
After the unveiling of Brand B, discussions about the new brand may continue in cyberspace for some time, allowing the new brand to gradually gain some visibility.
Typically, after a period of time, Carmaker C hosts a big launch event to officially launch Brand B. At this event, details about Brand B are announced and the first model may be briefly introduced.
At this point, the launch of the new brand is complete.
Specific cases:
Nio (NYSE: NIO) unveiled the Firefly brand on November 20, 2024, and officially launched the sub-brand and had its first model unveiled at the Nio Day 2024 event on December 21, 2024.
BYD (HKG: 1211, OTCMKTS: BYDDY) unveiled the Fang Cheng Bao brand on June 9, 2023, and officially launched the brand on August 16, 2023, debuting three new models at that time.
Launch of new models
Unveiling
Typically, the launch of a new model lasts a longer process than the launch of a new brand.
For a new brand, the first step in launching a new model is to have the model unveiled, which may take place at the brand's launch event.
If it doesn't involve launching a new brand, then a new model may be unveiled at a gala event, or it may be unveiled directly on that car company's social media platforms.
During this process, there may be very little information about the new model, and pricing will not be announced.
This process is often referred to in the Chinese context as “发布”, literally meaning release, and its most accurate English equivalent is unveiling.
Specific cases:
Xiaomi (HKG: 1810, OTCMKTS: XIACY) introduced its EV technologies and unveiled its first model, the SU7, at a tech event on December 28, 2023.
Nio unveiled the ET9 at Nio Day 2023 on December 21, 2023, introducing the model's advanced technologies.
Pre-sales
Some car companies start pre-sales of a new model when the model is unveiled, such as the ET9 on December 21, 2023, and Nio started pre-sales of Firefly's first model when it was unveiled on Nio Day 2024 earlier this month.
For many car companies, the start of pre-sales is seen as an important marketing point, usually accompanied by a big new event.
At the pre-sales event, the technologies used in the new model and its selling points are detailed.
Pre-sales prices are also announced, some car companies may only announce one starting pre-sales price, while some others may announce pre-sale prices for different variants or price ranges.
This process is often called “预售发布” in Chinese, and its English equivalent is “start of pre-sales”.
Specific cases:
BYD Fang Cheng Bao started pre-sales of the new brand's first model, the Bao 5, on August 25, 2023, with a price range of RMB 300,000 ($41,110) to RMB 400,000.
Nio began pre-sales of the Onvo sub-brand's first model, the L60, when it launched the new brand on May 15, 2024, with a pre-sales price of RMB 219,900 yuan.
Official launch
The official launch of a new model usually takes place a few months after pre-sales begin. Car companies can use this timeframe to gather market feedback to determine the final selling price and optimize product details.
The official launch takes place at a new grand event where vehicle details, pricing, and purchase benefits are announced.
Typically, the price of a new model at the official launch is slightly lower than the pre-sales price.
This process is called “正式上市” in Chinese, and its most accurate English equivalent is official launch, or hitting the market.
Specific cases:
Nio officially launched the ET9 at the Nio Day 2024 event on December 21, 2024, with a starting price of RMB 788,000 yuan.
Fang Cheng Bao officially launched the Bao 5 on November 9, 2023, when the starting price was RMB 289,800 yuan.
Delivery
Most of China's major EV makers have adopted a build-to-order and direct sales model, unlike traditional car companies that sell their vehicles through dealerships.
This means that they can't arrange deliveries until they've finished producing the vehicles customized by their customers.
In the past few years, this has been the usual practice in China's EV industry. But as competition gets fiercer, fast delivery after the launch of a new model is starting to become the consensus.
If fast delivery is to be achieved, car companies need to produce some non-customized vehicles in advance and keep the SKU (stock keeping unit) of their products simple.
Specific case:
Nio officially launched the new ES6 on May 24, 2023, and started deliveries of the model the same night.
Nio ET9 deliveries will start in March 2025.
The above steps can be seen at most EV makers and some of them may skip some of them.
If you have questions you would like CnEVPost to answer via the Factbox section, you can email us.
($1 = RMB 7.2982)
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