The development of Chinese brands has entered a new stage, and new energy vehicles and export business will become the focus of competition.
Text | Zuo Maoxuan
Recently, various car companies have handed over their 2021 report cards.
Due to the cyclical decline in the Chinese auto market since 2018 and the intensification of industry competition, in 2020, the annual market share of Chinese brand passenger cars fell to 38%, but the continuous decline in the market share of Chinese brand cars was reversed in 2021.
According to the China Association of Automobile Manufacturers, the market share of Chinese brand passenger cars has continued to grow since April 2021. In the first 11 months of 2021, the market share of Chinese brand passenger cars was 44.1%, an increase of 6.4 percentage points over the previous year. Combined with the December data released by various car companies, the market share of Chinese brands will hit a high in recent years in 2021.
Under the pressure of tight chip supply, China's passenger car market maintained a low growth rate in 2021. However, relatively speaking, under the crisis, due to the difference in product positioning and more flexible mechanism response, Chinese brand cars have been less affected than joint venture brands, which has driven the overall increase in the market share of Chinese brands. In addition, the best-selling of Chinese brand new energy vehicles has also greatly increased the market share of independent brand cars.
Specifically, the first and second echelons of Chinese brand passenger car companies have maintained a good development trend, and many companies have achieved double-digit growth, while some marginal brands that are not competitive in the market have almost withdrawn from the stage.
In 2022, with the easing of pressure on chip tension and the gradual increase in joint venture brands, the Chinese brand automobile market will face fierce competition. However, the head car companies have begun to look for new growth points, focusing on the two areas of new energy vehicles and automobile exports.
China's "top three" competition is fierce
In 2021, the top three patterns of Chinese brands formed by Geely Automobile, Great Wall Motors and Changan Automobile have not changed, but the competition between the three car companies is very fierce. The ranking of single-month data is no longer as fixed as before, and it is more intense to come and go with each other.
Geely Automobile (0175. HK) sold 1,328,000 vehicles (including Lynk & Co brand vehicles) in 2021, up about 1% year-on-year, and 87% of the previously set target of 1.52 million units for the whole year.
Looking at the performance of Geely Automobile's various brands and sub-categories, Lynk & Co, a joint venture between Geely and Volvo, is the biggest highlight in 2021. In 2021, the Lynk & Co brand achieved total vehicle sales of 220,500 units, an increase of about 26% year-on-year. This is the first time that Lynk & Co has exceeded the mark of 200,000 units per year.
Although Geely Automobile won the 2021 Chinese brand passenger car sales championship for the fifth consecutive year, the growth rate of 1% was lower than the average level of the domestic passenger car market. In contrast, the performance of major competitors Great Wall Motors and Changan Automobile is very eye-catching, further narrowing the gap with Geely Automobile.
Great Wall Motor's sales in 2021 reached 1.281 million units, an increase of 15.2% year-on-year, a record high, and the gap with Geely Automobile was less than 50,000 units, and continued to maintain a high growth rate.
Among them, the Haval brand sold 770,000 vehicles in the whole year, the Euler brand sold 135,000 vehicles in the whole year, the Wei brand sold 58,000 vehicles in the whole year, the tank 300 delivered 85,000 vehicles in the whole year, and the Great Wall pickup truck sold 233,000 vehicles in the whole year. The hot sales of tank brands and Euler brands have brought new increments to Great Wall Motors.
In terms of Changan Automobile, more than 1.2 million Changan Chinese brand passenger cars will be sold in 2021, of which SUVs such as CS75 and CS55 are still the main sales responsibilities of Changan Automobile, in addition, the Yidong series and UNI series have also achieved high growth.
For 2022, Geely Automobile's board of directors set a target of 1.65 million units, an increase of 24% over 2021, while Great Wall Motors and Changan Automobile have not announced a clear annual target for the time being. At present, the sales gap between the three companies is already very small, if Great Wall Motors and Changan Automobile can still maintain the upward momentum of last year in 2022, it will have a greater impact on Geely's leading position.
The second camp hit million targets
In 2021, the chinese brands in the second echelon began to diverge significantly. Among them, BYD, SAIC Passenger Vehicle and Chery Automobile have grown strongly, and the scale of production and sales has further moved towards the million-level. FAW Hongqi is the highlight of its own brand upwards, and although GAC Trumpchi is still in the bottleneck period of development, GAC Aean has brought growth points to GAC's independent sector.
BYD's passenger car sales in 2021 reached 730,100 units, an increase of 75.4% year-on-year, making it the fastest growing company among all domestic traditional car companies. In addition, BYD took the lead in switching to the new energy vehicle track, selling 593,700 new energy passenger cars in the whole year, an increase of 231.60%. Driven by the hot sales of flagship models such as Han and Tang, the unit price of BYD passenger cars exceeded 150,000 yuan in 2021, ranking first among independent brands.
Although the brand voice is gradually declining, the low-key Chery Automobile has ushered in a full-scale outbreak in 2021. On January 7, Chery Holdings released the 2021 annual sales data, showing that the Group's cumulative sales of 961,900 vehicles, an increase of 31.7% year-on-year.
Among them, chery brand annual sales of 656,800 vehicles (including exports), an increase of 46.3% year-on-year, and Jietu brand achieved annual sales of 154,100 vehicles (including exports), an increase of 17.9% year-on-year. In terms of new energy, a total of 109,000 new energy vehicles were sold, an increase of 144.6% year-on-year.
In mid-December last year, Chery announced its sales target for 2022: annual sales of 1.5 million vehicles, and strive for 2 million vehicles, of which 500,000 vehicles were exported, and the annual operating income was 200 billion yuan. Of course, Chery's desire to accomplish this goal is full of challenges.
In addition, in 2021, SAIC Motor achieved sales of 800,800 passenger cars, an increase of 21.72% year-on-year, a record high.
Judging from the current market development trend, BYD, Chery, and SAIC Passenger Vehicles all have the possibility of breaking through the annual sales of one million units.
In terms of other independent brands, data released by FAW shows that the sales volume of the new Hongqi brand exceeded 300,000 units in 2021, an increase of more than 50% year-on-year. In 4 years, sales increased by 63 times, and the cumulative sales of the Hongqi brand have exceeded 600,000 vehicles. As the business card of FAW's autonomous sector, Hongqi has found a place in the high-end automobile market.
In terms of GAC Motor, GAC Motor achieved sales of 324,200 passenger cars in 2021, an increase of 10.35% year-on-year; GAC Aean's sales exceeded 100,000 units for the first time, reaching 120,200 units, an increase of 101.80% year-on-year.
BAIC is currently the state-owned automobile group with the weakest development of its own sector, and BAIC BJEV is still at a low ebb, with sales slightly increasing by 0.82% to 26,100 units in 2021. In addition, the scale of other edge independent brands such as Haima and Zotye continues to shrink, and enterprises are on the verge of being eliminated by the market.
Win the new energy and overseas exports
After experiencing the "high-speed and barbaric growth period" from 2010 to 2016 and the "market adjustment period" from 2017 to 2021, whether from the pattern of the automobile market or from the direction of industry change, Chinese brands have entered a new stage of development, at this stage, new energy vehicles and automobile export business will become the focus of competition.
In the new energy vehicle sector, at present, the proportion of the top three new energy vehicles in total sales is relatively low, and there is still a large room for improvement, facing greater double integral pressure.
In 2021, Geely Automobile's total sales of new energy and electrified models (including hybrid, mild hybrid, plug-in hybrid, and pure electric) were 100,100 units, an increase of about 47% year-on-year, accounting for only 7.5% of the company's total sales.
Geely Automobile launched a new smart high-end electric brand Extreme Krypton Automobile in early 2021, and the brand's first new car ZEEKR 001 was launched in October 2021, with a total of 6,007 units delivered throughout the year. With the ramp-up of production capacity, the sales volume of the Extreme Krypton brand has risen steadily, but the scale is still small, and the follow-up development remains to be seen. The high-end intelligent electric market of more than 300,000 yuan is fiercely competitive, and Extreme Krypton is facing no small pressure.
Great Wall Motor's cumulative sales of new energy vehicles in 2021 were 137,000 units, accounting for 10.7% of the total sales. However, the main sales of new energy vehicles come from the Euler brand, which at the end of 2021 due to consumer rights disputes, the brand power has been greatly impacted, and the future development may face certain challenges.
Changan Automobile's main new energy sales come from the low-end model E-star, and the quality of future development in the new energy field will depend on its new high-end brand Avita released in 2021.
In terms of the second echelon of enterprises, BYD has taken the lead in completing the switch to the new energy vehicle track, which gives it an advantage in the next stage, and GAC Aean has also scaled up, and several of its models have certain competitiveness. The development of new energy vehicles in SAIC and Chery has its own characteristics and is also the focus of the group's efforts, while BAIC BJEV is still the hope of BAIC to strengthen its independent business.
Overall, the layout and business development in the field of new energy vehicles will greatly affect the development of all the head independent enterprises in the first and second echelons in the future.
In addition to new energy vehicles, overseas business will be another development focus of the head Chinese brand.
In 2021, although the global epidemic continues to spread, China's automobile exports have ushered in development opportunities, and many leading independent enterprises have made new breakthroughs in overseas business.
In 2021, SAIC Motor's total annual exports of passenger cars reached 290,000 units, an increase of 68% year-on-year, continuing to maintain the status of China's single-brand overseas sales champion. Up to now, SAIC's passenger car products have successfully entered 66 countries and regions, and in 2021, it will rank among the top ten single brands in 17 countries around the world.
In 2021, Chery's annual automobile export volume reached 269,000 units, ranking first among Chinese brands, and the cumulative overseas users have reached 1.95 million units; Great Wall Motor's export volume was 143,000 units, an increase of 103% year-on-year; Changan Automobile's annual cumulative overseas sales exceeded 110,000 units; and Geely Automobile exported 115,000 units, an increase of 58% year-on-year.
Among them, in 2021, the shipment volume of Lynk & Co 01 HEV and Lynk & Co 01 PHEV exported to the European market under Geely's Lynk & Co brand was 11,602 vehicles, and in 2021, 5,937 vehicles were delivered in an innovative subscription model (that is, customers used cars and supporting services during the subscription service by paying car subscription fees on a regular basis).
More and more Chinese brand cars have begun to compete with international auto giants in Europe and other places. From the perspective of the strategic direction of each enterprise, accelerating the overseas layout is a major trend. With many companies entering the "million club" and the background of intensified domestic competition, who can win a piece of the world in overseas markets is more likely to win in the future.