Author: Shi Lin Wu Xiaoyu
Edited by Zhu Yimin and Xu Tingting
Photography | Liang Yuanhao
Li Xiang, CEO of Ideal Auto, is a person with a strong sense of crisis. Even though the company had more than 40 billion cash flow on its account at the end of last year, and its gross profit margin was ahead of its former rivals, once its sales volume failed to meet internal expectations, its actions would be adjusted.
On April 7, Ideals carried out a new round of organizational structure adjustment. On April 22, Ideals officially announced the price reduction of the whole system for the first time in its history, with the official reduction of 18000-30000 yuan except for L6. Today, the change of the ideal car continues.
The 21st Century Business Herald exclusively learned that after the May Day holiday, a new round of personnel optimization is being carried out in the company, The overall optimization ratio exceeds 18%. The 2023 financial report shows that there are nearly 31600 people in the ideal car, with a year-on-year growth of 63%. Calculated according to the optimized proportion, This round of optimization involves more than 5600 people.
Specifically, the sales service operation department will optimize more than 400 people, and the recruitment department will reduce from more than 200 people to 40-50 people, The Smart Drive team will be reduced to less than 1000 people.
The ideal car is the best one among the new forces of car making. In 2023, Ideals will deliver 376000 vehicles, with a net profit of more than 11.8 billion yuan, making it the third profitable new energy vehicle enterprise after Tesla and BYD.
Good financial performance was the foundation for ideal automobile expansion. The ideal of substantial recruitment was the plan determined at the autumn strategy meeting last September. Li Wenzhi, the head of the CFO Office, led the work. Ideally, the sales target for 2024 at the end of last year is 800000 units. Under this sales expectation, the company's staff will be allocated according to the sales expectation of 800000 units.
Ideal cars have therefore become the fastest expanding new force. Based on the data of various financial reports, the number of ideal auto employees has increased by 63% year on year compared with 2022. In the same period, the year-on-year growth of employees of Weilai, Xiaopeng and Jikrypton was 23%, 17% and 28% respectively.
At the beginning of March, the sales of MEGA and the new L series did not meet the internal expectations. MEGA's ambition is to become "the first model with sales volume of more than 500000", regardless of the form of energy and body. But based on the data reported by all parties, Its sales volume in the last month was only 671. At the end of last year, L7, L8, and L9, which achieved a monthly sales of 50000 yuan, had sales of less than 30000 yuan in the first four months of this year.
Although in the new energy vehicle market of more than 200000 in the first quarter, the sales growth rate of the ideal vehicle (52.9%) outperformed the market (31%), and it was still the first sales volume of the new force in the price range, at the end of March, the sales volume of the ideal vehicle was lowered from 800000 units to 560000 to 640000 units in consideration of all parties.
After lowering the sales forecast, the original staff must also be reduced accordingly. At the same time, Ideals also made a series of official announcements to reduce prices. Price reduction will affect gross profit, and personnel optimization is the key step for the ideal to be responsible for the operation.
The whole story of ideal layoff
Ideally, this round of personnel adjustment was mild at first. From the beginning of this year to March, Ideal Auto has been cleaning up low performance employees, and employees who were rated as "I" and "F" last year will be affected. "In some business teams, low performance employees only involve 10% of the number of people in a single team", a close to ideal insider told 21st Century Business Herald, "less than a few hundred people".
Among them, HR department was one of the most adjusted departments at that time. At the beginning of the year, nearly 100 HR resigned.
People familiar with the matter said that at the end of April, the management approved the final optimization list, and this round of layoff optimization was officially launched in the first week of May, most of which will end before the end of May, with N+1 compensation for optimized employees. Ideal Auto hopes to complete most of the personnel optimization plans before the lifting of the ban on employees' shares on June 15, so as to save some of the cost of stock redemption for employees.
The overall goal is to reduce the proportion of social recruitment in the whole company and increase the proportion of school recruitment. "It will give priority to the 2022-2024 level school enrollment, and if it cannot be maintained, the 2022 level school enrollment will be given priority", said the above person.
The 21st Century Business Herald learned from many independent sources that the departments with more optimization this time are the recruitment department, sales service operation department and intelligent driving department. An ideal employee said that several employees he met were "Be notified to optimize on the same day and leave on the same day".
When the recruitment demand decreases, the recruitment department is the first department to be optimized. At the end of last year, the recruitment department expanded to more than 200 people. At present, the overall department has less than 50 people left, of which only 20-30 are employed by the social recruitment department, The proportion of department layoffs exceeded 70%.
In the sales and service group, the "sales service operation" department is mainly responsible for second-hand cars, network expansion, network planning and other services matching sales. In July 2023, the team size will be less than 200 people, and the expansion will accelerate after the ideal monthly sales of more than 30000 units last year. This department has expanded to nearly 1000 people at the beginning of this year, but because the front-line sales did not meet the expectations, they now receive the reduction target of optimizing more than 400 employees.
Last year, nearly 50% of the Smart Drive team was expanded, The optimization indicator received is "the team is reduced to less than 1000 people".
Smart driving business was once the focus of ideal car recruitment. After the autumn strategy meeting at the end of September 2024, the ideal car official released more than 50 smart driving recruitment positions at one go, and the number of smart driving teams has also expanded from 600 at the beginning of 2023 to nearly 1000. If about 200 college admissions are included, the size of the smart driving team has doubled from the size at the beginning of 2023.
By contrast, in 2015, Li Bin saved an autonomous driving team in North America, but until 2023, the number of intelligent drivers in Weilai will only be about 1000.
At the same time, the number of employees newly recruited by Ideal Auto has doubled. An insider close to the ideal car said that in the position of automatic driving algorithm, the company's starting salary for the enrollment of 2024 will be nearly 40% higher than that of 2023.
The person said, Last year, we recruited many "high priced but low skilled" people, However, the output results are limited.
Taking Smart Drive as an example, in April last year, the Ideal Auto official announced the plan for the city NOA to be launched in 100 cities by the end of the year. In the second half of the year, the plan made slow progress. Until the end of 2023, NOA, the ideal car city, has not been implemented in a large scale in a city to achieve mass production.
"The ideal car may want to squeeze out some of the social recruitment in this way," the insider told the 21st Century Business Herald.
Help Li Xiang save 2.1 billion yuan
When the business situation is not optimistic, personnel optimization is the most direct way to reduce costs and increase efficiency.
Last November, Li Bin, CEO of Weilai, issued an internal letter, which pointed out that the company would reduce the number of jobs by about 10%. In the fourth quarter of 2023, Weilai delivered a total of 50000 vehicles, with a net loss of 5.36 billion yuan, and a loss of more than 20.7 billion yuan in 2023. In Li Bin's view, layoffs are "a difficult decision that we have to make" in the face of fierce market competition.
Referring to the data of 2022, Weilai paid more than 11.2 billion yuan of salary to its employees in that year, with a per capita salary of 370000 yuan, twice the salary of SAIC Group. According to Li Bin, 10% layoffs can save more than 1 billion yuan.
In 2023, the total salary of Ideal Auto employees will exceed 12.1 billion yuan, and the per capita salary will exceed 380000 yuan, More than 18% of layoffs can save more than 2.1 billion yuan.
The condition of the ideal car is not bad, even the best performing new car making force. In 2023, Ideals delivered a total of 376000 vehicles, with annual revenue of 123.85 billion yuan, net profit of more than 11.8 billion yuan, and gross profit margin of 22.2%. Ideals is the first new car making force in China with revenue of more than 100 billion yuan, and the third profitable new energy vehicle company after Tesla and BYD.
By the end of 2023, there will be 44.19 billion free cash flow in the ideal car account and 103.67 billion cash reserves.
At the beginning of this year, the sales volume of the ideal car declined slightly, but the average monthly sales volume also remained above 26000 units. With abundant funds in hand and monthly average sales of more than 20000 yuan, why does the ideal car still need personnel optimization?
By the end of 2023, the sales volume of the ideal car is expected to be 800000 units, and all staffing, production capacity, and parts procurement are prepared according to this sales volume expectation.
In the prediction of ideal cars, there are periodic targets to be achieved under the general goal of 800000 units - from March to 50000 units, from June to 70000 units, and 100000 units will be delivered in a single month at the end of the year. However, the actual sales volume in March and April this year was less than 30000 yuan, and the annual sales volume of 800000 yuan was a great challenge.
In the ideal car, the prediction logic of the annual sales target is calculated according to the "overall sales forecast of the market market * market share".
Insiders told 21st Century Business Herald that the current market share of the ideal car is still in line with expectations, and the only one not in line with expectations is MEGA. But at the end of last year, the market was too optimistic about this year's market, resulting in a difference of 500000 sets between the original market forecast and the current market forecast.
The expectation of the market mainly depends on whether Li Xiang is optimistic or pessimistic about the market, "There will be a misunderstanding. Instead of making predictions based on the actual situation, we will try to use data to verify Li Xiang's idea."
On March 22, Ideal Auto held an investor meeting and officially lowered its sales forecast from 650000-800000 to 56000-640000.
After the sales forecast is lowered, the corresponding staffing will also be reduced, and the layoff plan will also be determined at the same time. An insider close to the ideal car said, "MEGA did not immediately lay off employees after the big surprise, because it was worried about affecting the sales of L6."
At present, the internal consensus on the sales forecast this year is 560000 units. Even this number is still a great challenge for the current ideal car.
In the past four months this year, Ideal has sold 106200 cars in total, less than 20% of the annual target after the reduction. This means that in the next eight months, the goal can only be achieved if the average monthly sales of the five models on sale reach more than 54000.
To achieve the sales target of 560000 yuan, the sales of L7, 8 and 9 models need to reach 30000 yuan per month to barely achieve this target. However, comprehensive public data shows that the total sales of these three models in the first three months of this year are 31000, 20000 and 25000 respectively, which is still a long way from 30000. In December 2023, the sales volume of these three models has exceeded 50000.
MEGA does not contribute much to the overall sales volume. The new L7, 8 and 9 models have limited improvement to the existing sales target. The lower price L6 is considered by the outside world as the hope of the ideal car to increase sales volume and win the price war.
On April 19, Ideals L6 came into the market in a low profile. The official starting price was 249800 yuan, which was 10000 yuan cheaper than the original internal starting price. Add the limited time rights during the May Day holiday, and the starting price will be 10000 yuan cheaper. On May 5, Ideal announced that the number of orders for L6 has reached 41000 since it was launched half a month ago.
The order exceeded 40000 units in half a month. As a new car, the L6 has achieved outstanding results in the outside world. However, the order of 41000 units is "Longjing Grand Order", that is, the order can be returned within 7 days. For an ideal auto investor, the number of lock orders in the last half month of L6 listing must reach more than 20000 to meet expectations.
The growth potential of L6 still needs to be further developed, and the competitive environment that ideal cars face is extremely narrow. There are the strongest competitors such as Quest and Xiaomi, and there is no room for ideal mistakes. In order to participate in the competition more effectively, personnel adjustment is an ideal and more radical and realistic adjustment method.
Li Xiang has a strong sense of crisis, and the ideal car is no exception. It is always right to economize on food and clothing and prepare for risks in advance when the signs are not good for you.
SFC
Editor of this issue: Liu Xueying
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