Auto & Transportation

The first half of 2021 has passed. What is the performance of the domestic auto market? Recently, as the sales of various auto companies have been released one after another, the overall performance of the auto companies industry has been gratifying. According to data from the Passenger Federation, in the first half of this year, domestic passenger car retail sales reached 9.942 million, a year-on-year increase of 28.9%, which is at the historical high level of growth in the same period since 2011.

Cui Dongshu, secretary general of the Passenger Association, analyzed that in the first half of this year, car sales grew extremely strongly. The reason was firstly the low base effect of the 23% cumulative retail sales decline in the national passenger car market during the same period last year, and secondly the increasing contribution of new energy vehicles. Contributed 9% of the year-on-year growth rate in the first half of the year.

There are also hidden worries. In the second quarter, due to the tight supply of chips and other components, the production and sales of some passenger cars showed a slight decline. However, the industry generally believes that the global automotive chip shortage has reached its peak in the second quarter of this year. With the expansion of production by manufacturers such as TSMC, it is expected that the global automotive chip shortage crisis will gradually ease.

Self-owned brands are better than joint venture brands

Although the domestic auto market has maintained steady growth in the first half of this year, its monthly performance varies greatly. Especially in the past June, the passenger car market retail sales were only 1.575 million units, a year-on-year decrease of 5.1%, and a decrease of 11% compared to June 2019. This is the first time passenger car sales have experienced a year-on-year decline in a single month this year.

Cui Dongshu believes that there are many reasons for the decline in car sales in June. The first is that the economic recovery after the May epidemic has brought strong global demand for car purchases, and the pick-up of demand in the European and American auto markets has further exacerbated the gap in chip supply. Insufficient global automotive chip shortages have led to more-than-expected losses in production cuts by some Chinese auto companies. Although the shortage of chips was not obvious in the first few months of this year, the wholesale end sales plummeted in June, which brought unfavorable factors such as order demand matching and the imbalance of existing inventory to the retail end, resulting in weak retail sales. In addition, the outbreak in Guangzhou and other places has also affected sales in the southern region.

However, it is worth noting that although the market environment is the same, the difficulties faced are not much different, and the response of independent brands is obviously much better than that of joint venture brands. In the June sales data, the self-owned brand and the joint venture brand showed a clear contrast, which exceeded many people's expectations.

Specifically, about 600,000 self-owned brands retailed in June, a year-on-year increase of 16% and a month-on-month increase of 2%. The wholesale market share of self-owned brands was 42.8%, an increase of 11% over the same period last year; the retail share was 38%, an increase of 7 percentage points year-on-year.

Correspondingly, in June, the retail sales of mainstream joint venture brands were about 730,000, a year-on-year decrease of 18% and a month-on-month decrease of 7%. Among them, the retail share of Japanese brands in June was 23%, a decrease of 2.5 percentage points year-on-year. Although German brands are supported by many luxury brands, they are still in the stage of adjustment and gaining momentum. In particular, the two Volkswagen joint ventures are the only car companies among the top ten car companies that have experienced a year-on-year decline of more than 20%.

In this regard, the research report of Soochow Securities analyzes that the overall outstanding performance of independent brands is mainly due to three reasons: first, the industry chain of independent brand head enterprises is strong and effectively overcomes the pressure of chip shortage; second, the market demand for new energy vehicles is captured more quickly , Gaining a significant increase; third, the overseas market expansion is gradually getting better. These three aspects are what the joint venture brand lacks.

According to the Passenger Association, the shortage of automotive chips in the international market this year has caused tight demand for vehicles, and China's automobile exports have performed strongly, especially passenger car exports that have exploded. Due to the soaring prices of second-hand cars in the United States and other places caused by factors such as engine and core shortage, China's new car has a strong performance-to-price ratio, especially for the strong growth in the markets of Central and Western Europe, South America and Oceania.

Regarding the chip shortage that both independent brands and joint venture brands face, Cui Dongshu said that TSMC will expand production in August, and Bosch’s new automotive chip factory will also be put into production in August and September. Therefore, the chip shortage will not affect China’s car sales. It is expected that the annual sales volume will only decrease by hundreds of thousands of vehicles.

Ye Shengji, chief engineer and deputy secretary-general of the China Automobile Association, also said at the China Automotive Forum 2021 that the first half of this year was severely affected by the shortage of chips, especially in the second quarter, the shortage of automotive chips reached its peak, which may be most likely to be by 2022 at the latest. ease.

New energy vehicles are better than fuel vehicles

The sales of new energy vehicles have become a bright spot in the auto market this year. The performance in the first half of the year has continued to shine, and it is expected to continue to set new highs during the year.

Judging from the sales data released by various auto companies, the year-on-year "surge" is the "commonality" of the new energy vehicle market. In the first half of this year, the wholesale of new energy passenger vehicles was 1.087 million, a year-on-year increase of 231.5%; the retail sales of new energy passenger vehicles was 1.001 million, a year-on-year increase of 218.9%.

Generally speaking, the sales of new energy vehicles from traditional auto companies still dominate the market. The main reason is that independent brands are less affected by the shortage of parts and components, and the strong growth of local new energy vehicles such as SAIC-GM-Wuling, BYD and GAC E'an.

For example, GAC E'an sold 10,403 vehicles in June, a sharp increase of 190% year-on-year. The cumulative sales from January to June this year were 44,800 vehicles, a year-on-year increase of 128%; BYD's production and sales also relied on the new energy vehicle sector to set new highs. In the first half of this year, its cumulative sales of new energy vehicles were 1,54579, a year-on-year increase of 154.76%; Hongguang MINI EV became the only domestic car that pulled the Tesla Model 3 from the sales throne of a single model, and maintained rapid development in the first six months. Cumulative sales exceeded 180,000 vehicles, with an average monthly sales exceeding 30,000.

In addition, the collective performance of new car manufacturers such as "Wei Xiaoli" is also excellent, which is a great driving force to boost the sales growth of the new energy vehicle market. Especially in June, Weilai ranked first with 8,083 delivered units, Ideal Car ranked second with 7713 delivered, and Xiaopeng Motors ranked third with 6,565 delivered, with year-on-year growth of 116%, 321% and 617 respectively. %; Nezha and Lingpao ranked fourth and fifth with 5138 and 3941 respectively.

The vigorous production and sales of new energy vehicles has also driven the surge in power battery loading. According to data from the China Power Battery Innovation and Development Alliance, the number of power batteries installed in the first five months of this year has increased by 224% year-on-year. As the expansion of different links has cycle restrictions, the industry expects that many links in the upstream supply chain of lithium batteries will quickly enter a state of tightness, and the tight state of battery production capacity will continue until 2022.

It is worth noting that with limited market capacity, new energy vehicles have begun to gradually occupy the traditional car market. In June, the retail sales of new energy vehicles increased by 169.9% year-on-year, while the traditional fuel vehicles fell by 20%, showing sharp differentiation.

Cui Dongshu believes that since the beginning of this year, the new energy vehicle market has shown a clear upward trend, new car-making forces have initially achieved solid accumulation, and traditional car companies are also actively replacing tracks. Coupled with national and local measures to boost the new energy vehicle industry, the entire industry chain is promoting the growth of new energy vehicles.

Shi Jianhua, deputy secretary-general of the China Association of Automobile Manufacturers, pointed out that with the advancement of new energy vehicle technology and the increase in cruising range, consumers have become more and more accepting of new energy vehicle products, and the new energy vehicle market has entered the real market.化 stage. In 2021, the domestic new energy vehicle market is expected to achieve a growth of 46%, and the annual sales volume will eventually exceed 2 million vehicles.

Usually starting from July, the auto market will enter the off-season of annual sales. The third quarter of the calendar year is the bottom of the domestic auto market. Some industry insiders believe that the third quarter of this year may be different. First, as the shortage of chips gradually eases, joint venture brands will resume their efforts; second, the continued increase and rise in sales of new energy vehicles is also expected to change the traditional trend of the auto market. In the face of fierce competition, the auto market in the second half of the year may present a new pattern.