(Report Producer/Author: Orient Securities, Jiang Xueqing)
1 The penetration rate of automobile lightweight and integrated die casting will increase rapidly
Driven by the tightening of fuel consumption standards for fuel vehicles, the increase in the subsidy threshold for electric vehicles, and the pressure of new energy integration, vehicle and parts manufacturers urgently need new technical paths to achieve consumption reduction and energy saving. Automobile lightweight and integrated die casting is an important way to reduce fuel consumption and improve endurance, and it is expected that the penetration rate of automobile lightweight and integrated die casting will continue to increase under the impetus of demand.
In order to mitigate global warming and achieve sustainable development, China put forward the "double carbon" targets of "carbon peaking" and "carbon neutrality" in 2020. Automobiles are one of the main carriers of carbon emissions, and the introduction of the "double carbon" goal makes consumption reduction and emission reduction a definitive development direction of automobile technology. According to the "Energy-saving and New Energy Vehicle Technology Roadmap 2.0" issued by the Society of Automotive Engineers of China, by 2025, 2030 and 2035, the average fuel consumption of passenger cars needs to be reduced to 4.6L, 3.2L and 2.0L per 100 kilometers, respectively, of which the average fuel consumption of fuel vehicles needs to be reduced to 5.6L, 4.8L and 4.0L per 100 kilometers, respectively. In addition to China, major economies such as the United States, the European Union, and Japan are also gradually tightening fuel consumption standards for passenger cars. For fuel vehicles, with the tightening of fuel consumption standards, the space for power system consumption reduction will continue to shrink, and it is the general trend to seek new directions for reducing consumption and emission reduction technologies.
For new energy vehicles, under the trend of subsidy policy decline, the threshold requirements for the mileage of new energy vehicles are gradually increased, and the mileage will directly affect the new energy points of car companies, so the demand for new energy vehicles to improve the mileage is more urgent; on the other hand, the proportion of power batteries in the cost of the vehicle is 30-40%, and increasing the battery capacity will significantly increase the cost of electric vehicles. Electric vehicles need to increase range in new areas.
Lightweight refers to the premise of ensuring the strength and safety performance of the car, as far as possible to reduce the curb weight of the car. Studies have shown that if the fuel vehicle loses 10% weight, the fuel consumption will be reduced by 6-8%,; if the new energy vehicle loses 100kg, the mileage will increase by 10-11%, while reducing the battery cost and daily loss cost by 20%. For traditional fuel vehicles and new energy vehicles, lightweight technology can improve the efficiency of the power system, thereby reducing energy consumption and improving the endurance of the whole vehicle, and gradually become an important technical direction for major vehicle and parts enterprises. On the basis of lightweighting, Tesla announced at the Battery Technology Day event in September 2020 that it will use integrated die-casting technology in the rear body baseplate of the Model Y to lead a new round of technological innovation.
The traditional automobile manufacturing process includes stamping, welding, painting, assembly and other 4 major links, the main route is to stamp the steel plate into different parts of a single piece, through welding, riveting, gluing and other ways to assemble into a body-in-white, and then anti-corrosion, painting and other coating treatment, and finally the interior and exterior decoration, powertrain, chassis assembly and other parts assembled to the body to complete the assembly of the vehicle. Traditional cars are assembled from about 500 parts of different shapes and materials, and the error fluctuations of each part will affect the accuracy of the whole vehicle. In order to ensure that the quality of the whole vehicle meets the requirements, each part must undergo strict testing before assembly, and the assembly of the car also requires a lot of debugging and matching work, which is expensive in time and money.
Tesla's integrated die casting technology leads the way in both the manufacturing process and the materials. At the end of the manufacturing process, the integrated die-casting technology can make the body one-time molding, eliminate the complex process of first split stamping and welding, and greatly simplify the manufacturing process; because there are only 1-2 large parts, the integrated die-casting technology can eliminate the cumulative error caused by the connection of a large number of parts, and the manufacturing accuracy can be improved, while saving a lot of debugging time and money costs. At the material end, the traditional automobile manufacturing process widely uses steel that is easy to stamp and weld as the body material, and in the integrated die-casting technology, the aluminum alloy that is convenient for die-casting will become the main material of the body, driving the application of aluminum alloy components on the whole vehicle to increase and further enhance the degree of lightweight of the car.
Taking Model 3 and Model Y as an example, the Model 3 rear body baseplate adopts the traditional process and is assembled from 70 parts; Model Y adopts integrated die-casting technology, and the rear body baseplate as a whole is composed of 2 large castings, the connection point is reduced from 700-800 to about 50, the manufacturing time is reduced from 1-2 hours to 3-5 minutes, and the weight of the car body assembly will be reduced by 30%. Tesla's next step is to use integrated die casting technology to create a complete assembly of vehicle bodies, and to die-cast about 370 parts into 2-3 large castings, which will further reduce the weight by 10%, thereby increasing the cruising range by about 14%.
2 The main products of automobile lightweight and integrated die casting
2.1 Chassis lightweight product penetration rate will be increased
The automobile chassis is a combination of four parts of the automobile transmission system, driving system, steering system and braking system, the main functions include supporting the engine and power system assembly, accepting the engine power to drive the car, building the overall shape of the car, etc., which directly affects the safety, stability, comfort and sports performance of the car.
Chassis lightweight is an important area of vehicle lightweighting. As one of the core components of the car, the car chassis accounts for 27% of the total vehicle weight, second only to the body in white and the powertrain. Compared with the body, the chassis lightweight technology and technology is more mature, the cost is lower, according to the analysis of the car chassis home, the weight reduction cost coefficient of the chassis suspension is 0.95, which is much lower than the cost coefficient of the body of 1.35. The chassis carries 70% of the body weight, and the lightweight chassis helps to reduce the underspring weight, thereby improving the acceleration, handling and comfort of the car.
At present, the main path of chassis lightweight is to replace steel with aluminum alloy, and the aluminum alloy parts of the automobile chassis include steering knuckles, subframes, brake calipers, control arms, wheel hubs, various housings, etc. According to the data of China Industry Information Network, in 2020, the penetration rate of aluminum alloy steering joint, subframe, brake caliper and control arm in the Chinese automotive market is 15%, 8%, 40% and 5% respectively, which has a broad room for improvement. According to the International Aluminum Association, the penetration rate of aluminum alloys in the powertrain is 90%, and the automotive chassis is still a blue ocean market compared with it.
Many domestic aluminum alloy precision die casting companies are in the field of chassis lightweight layout, with the increasing demand for automotive lightweight, it is expected that aluminum alloy components will accelerate penetration in the chassis field, related parts companies are expected to continue to benefit from the chassis lightweight trend.
2.2 Body lightweight: Thermoformed steel and lightweight technology are the mainstream ways
Automobile body is the highest proportion of vehicle weight, but also the field with the greatest potential for lightweight, traditional cars with high-strength steel instead of ordinary steel can reduce weight by about 11%, the use of aluminum alloy can reduce weight by about 40%, lightweight material weight reduction effect is significant. In view of the requirements of body strength, the price of lightweight materials and the level of processing technology, the status of steel as the main material of automobile bodies is difficult to shake in a short period of time.
Aluminum alloy materials have obvious advantages over steel in terms of lightweightness and corrosion resistance, but the application of aluminum alloys on the body still faces huge challenges: (1) The processing process is complex. At present, the steel processing process is very mature, and the processing and connection of the aluminum alloy body requires aluminum resistance spot welding, self-punching riveting, gluing connection, laser welding and other processes, and the complexity and automation requirements of the production process are much higher than those of the traditional steel body. (2) High manufacturing costs. First of all, the price of aluminum alloy itself is higher, and the unit price of automotive aluminum alloy is about 15,000 per ton, which is nearly 3 times that of steel materials, and secondly, the complex processing technology makes the cost of aluminum alloy body further increase. (3) High maintenance costs, due to the poor ductility of aluminum and the complex maintenance process, aluminum alloy body maintenance usually requires full replacement, resulting in a significant increase in after-sales maintenance costs. According to the announcement of Wencan shares, the current penetration rate of aluminum alloy body structural parts in fuel vehicles is only 3%, and the penetration rate of pure electric vehicles is 8%, with the improvement of processing technology and the continuous improvement of the demand for electric vehicle weight reduction, it is expected that the application of lightweight materials such as aluminum alloys on the body will continue to increase.
At this stage, the use of ultra-high-strength steels such as thermoformed steel and lightweight manufacturing processes are the mainstream ways to achieve lightweight body. Thermoforming steel is a hot stamping molding and quenching process that is carried out in a cooling mold after heating the steel plate to obtain ultra-high-strength stamping parts. Thermoformed steel has extremely high material strength, with a yield strength of more than 1000 MPa and a tensile strength of more than 1300 MPa, which is more than 2 times that of ordinary steel. At present, the mainstream body-in-white is made of general steel, high-strength steel, thermoformed steel and other steels of different strengths, which thermoformed steel is usually used in the front and rear bumpers, AB columns, middle channels and other important safety structural parts, which can achieve the same safety performance with lower thickness, thereby achieving lightweight body. In addition to thermoforming technology, lightweight manufacturing processes such as laser welding and hydroforming can also reduce the thickness of steel plates under the premise of ensuring body safety, and achieve the purpose of lightweight body.
In recent years, the rapid development of domestic thermoforming and other lightweight technologies, domestic parts companies have mature thermoforming technology capabilities, can provide domestic and foreign vehicle companies with AB columns, anti-collision beams, bumpers and other thermoformed body parts, is expected to benefit from the general trend of body lightweight.
2.3 Incremental areas: new energy vehicle three-electric system and integrated die-cast parts
Compared with traditional cars, the new energy vehicle three-electric system will lead to an increase in the weight of the whole vehicle, which will affect the endurance For the same model, the three-electric system will lead to an additional weight increase of 200-300kg for the whole vehicle; at the same time, the lightweight system of new energy vehicles is 1.5-4 times higher than that of traditional fuel vehicles, which means that the lightweight degree of new energy vehicles is lower. The three-electric system usually accounts for 30-40% of the total weight of new energy vehicles, and its lightweight is the key to achieving lightweight and improving the endurance of new energy vehicles.
In the new energy vehicle three-electric system, the battery pack is the largest part of the weight, accounting for about 18-20% of the vehicle weight, of which the battery pack shell (battery box) accounts for about 10-20% of the weight of the battery pack, which is the second largest part of the battery pack in terms of weight. After the battery energy density improvement gradually entered the bottleneck period, battery box lightweight became the key area of new energy vehicles.
Battery box by the upper cover and the lower shell of the two parts of the composition, the current battery box cover main materials include stamped steel plate, stamped aluminum plate, SMC, etc., the lower shell material to aluminum alloy-based, according to the process can be divided into extruded aluminum profile stirring friction molding, stamped aluminum plate welding molding and overall casting molding. At the current stage, the best lightweight solution for the battery box that takes into account the cost performance and the lightweight effect is the combination of the extruded aluminum profile lower shell and the upper cover of the SMC, with the price of carbon fiber, magnesium alloy and other materials falling, the battery box lightweight program is expected to usher in further optimization.
Keeping up with the tide of rapid development of new energy vehicles, domestic parts manufacturers such as Wencan Shares, Lingyun Shares, and Huayu Automobile have actively developed lightweight battery box products and obtained fixed-point projects. In addition to the battery box, domestic manufacturers also have relevant layouts in the fields of aluminum alloy motors, electronic control system housings and hybrid automobile transmission housings. As the production, sales and penetration rate of new energy vehicles continue to rise, the lightweight of the three-electric system is expected to open up the new increment space for domestic parts manufacturers.
Under the leadership of Tesla, a number of domestic aluminum alloy die-casting parts companies began to lay out integrated die-casting technology, and purchased a number of giant die-casting machines for integrated die-casting in the field of body structural parts. Integrated die casting has the advantages of simple process, high production efficiency, high degree of lightweight, with the expansion of the scale of integrated die casting, production costs will gradually decrease, it is expected that more vehicle companies will adopt integrated die casting technology in the future, and the penetration rate of integrated die casting is expected to continue to increase. (Source: Future Think Tank)
3 Industry market space and characteristics
3.1 The industry market space is large
Based on China's passenger car production, the amount of aluminum used in passenger cars, the proportion of aluminum alloy die castings in automobiles, and the sales price of automotive aluminum alloy parts, we calculate the market space of aluminum alloy die castings for vehicles in China for 2020-2025:
(1) China's passenger car production: In 2020 and 2021, China's passenger car production was 19.9941 million units and 21.408 million units, respectively, according to the China Automobile Association, China's passenger car production will reach 23 million units in 2022, an increase of about 7.4% year-on-year. From 2023 to 2025, the growth rate of Passenger Car production in China is expected to slow down, to about 3% per year.
(2) China's passenger car bicycle aluminum: In 2020, The amount of aluminum used in China's passenger car bicycles was 138.6 kg, and it is expected to increase to 187.1 kg in 2025, with a compound growth rate of 6.2% in 2020-2025.
(3) Aluminum alloy die-casting parts account for the proportion of aluminum used in automobiles: die-casting is the most widely used aluminum alloy form in automobiles, which is widely used in the chassis, body, power system and other fields. According to Die Casting Magazine, die-cast aluminum alloys account for about 77% of the amount of aluminum used in automobiles.
(4) Sales price of automotive aluminum alloy die castings: According to the data of the prospectus of Aikodi, the average selling price of automotive aluminum alloy die castings industry is about 45,200 yuan / ton. Since the price of aluminum alloy die castings is greatly affected by aluminum price fluctuations, we assume that the average selling price of automotive aluminum alloy die castings remains unchanged.
According to the above data calculations, it is expected that in 2025, the market space of aluminum alloy die castings for passenger cars in China will reach 163.714 billion yuan, and the compound growth rate of market space in 2020-2025 will be about 11.2%, and the market for aluminum alloy die castings for vehicles has broad prospects.
3.2 The industry belongs to the asset-heavy industry, and the profitability has certain cyclical characteristics
Lightweight die casting industry is a heavy asset industry, the early stage of project development needs to invest in land, equipment, plant and other fixed assets, capital expenditure increases, the project construction process because of the increase in fixed asset depreciation and other factors drag down the overall profitability, with the completion of the project production and step by step release of new production capacity, capital expenditure and depreciation amortization decreased, capacity utilization rate increased, profitability increased.
Comparative analysis of Aikodi and Chervon motors.
2017Q3-2018Q3 Ecodi invested more money in the purchase of fixed assets, which partially led to a decline in gross profit margin. At the end of 2017, after the listing of ICODI, the funds raised were used to build precision die castings, wiper system components, precision metalworking parts and other projects, and the planned investment was more than 1.5 billion yuan, resulting in a rapid increase in fixed assets and depreciation, and the average single quarter purchase and construction of fixed assets, intangible assets and other long-term assets in 2016Q1-2017Q2 paid cash of 113 million yuan, and the average single quarter cash payment of 151 million yuan in 2017Q3-2018Q3, an increase of 0.38 billion yuan compared with before the expansion of production; 2018 At the end of the third quarter of 2017, fixed assets increased to 1.327 billion yuan, an increase of 48.6% over the end of the third quarter of 2017. The combination of increased fixed assets and depreciation and declining automotive industry prosperity led to a decline in gross margin of 33% in the third quarter of 2018, a sharp decrease of 7.3 percentage points from the fourth quarter of 2017.
In 2020, Ikodi will expand production and build lightweight die casting projects again, and short-term profitability will be under pressure, and it is expected to promote profitability after the completion of new projects. In March 2020, the company announced that it will build an automotive lightweight aluminum alloy precision die casting project in Liuzhou with a total investment of about 500 million yuan, and will also invest in the construction of an industrial park in Ningbo with a total investment of about 1 billion yuan, and pay cash for the average single quarter purchase and construction of fixed assets, intangible assets and other long-term assets in 2020Q2-2021Q3, an increase of 0.86 billion yuan over the average single quarter payment amount in 2019, and fixed assets at the end of the third quarter of 2021 are 1.727 billion yuan, compared with 2020 At the end of the first quarter, the company's gross profit margin increased by 25.6% before expansion, and the company's gross profit margin in the third quarter of 2021 was 24.8%, down 6 percentage points year-on-year, which was affected by the increase in fixed assets and related depreciation and amortization, accounting standard adjustments and other factors. According to the company's early project construction plan, it is expected that the 2022 young quantitative precision die casting project will be completed and the production capacity will be gradually realized, which will effectively meet the needs of the previous orders in hand, and the capacity utilization rate will be improved, which is expected to improve the overall profitability in 2022.
From the perspective of the relationship between capital expenditure and gross profit margin, the increase in capital expenditure will lead to a decline in gross profit margin, the capacity utilization rate will increase after the expansion is completed, and the unfavorable factors of capital expenditure on gross profit margin will be reduced. Capital expenditure in 2018 reached 656 million yuan, the highest level of capital expenditure after 2015, superimposed on factors such as the decline in the prosperity of the automotive industry in 2018, which led to the gross profit margin of Aikodi falling to 34.23%, down 5.8 percentage points year-on-year, and the decline in gross profit margin after 2018 was the decline in industry prosperity. In 2022, with the completion of the construction of the Liuzhou lightweight die casting project, it is expected that the company's die casting products will be gradually increased, and the unfavorable factors of capital expenditure on gross profit margin will be reduced.
In 2020, Chervon Motor expanded production of new projects, and the depreciation of fixed assets increased and dragged down profitability. According to the announcement in October 2020, Chervon Automobile will build an auto parts intelligent manufacturing project in Ma'anshan with a total investment of 2.05 billion yuan, an average of 147 million yuan in cash for the purchase and construction of fixed assets, intangible assets and other long-term assets in the 2020Q4-2021Q3, and only 0.22 billion yuan in the single quarter of 2019Q1-2020Q3; the company's fixed assets increased from 878 million yuan at the end of the third quarter of 2020 to 10.11 at the end of the third quarter of 2021 100 million yuan, an increase of 15.1% year-on-year, affected by the growth of fixed assets and depreciation, accounting standard adjustments, etc., the gross profit margin of 2021Q3 was 23.1%, down 4.4 percentage points year-on-year.
According to the announcement, due to the strong demand for lightweight die casting industry, the company's investment in Ma'anshan auto parts project is rushing to speed up the progress, the first batch of die casting capacity will be completed from the end of October to the beginning of November 2021, and gradually introduce the mass production stage; in addition, it is expected that the Hungarian construction project will also begin to gradually mass production in the third quarter of 2022, and the production capacity of factories in Ma'anshan, Hungary and other places in 2022 is expected to be released, effectively solving the current die casting production capacity bottleneck.
From the perspective of capital expenditure and gross profit margin, 2017-2018 Chervon Automobile capital expenditure is at a high level, higher capital expenditure part leads to gross interest rate is at a low level, capital expenditure in 2018 is 356 million yuan, Chervon Automobile gross profit margin fell to 24.38%, down 0.42 percentage points year-on-year, after 2018 Chervon Automobile gross margin increase is continued to optimize the product structure, the company obtained including Tianjin Mainland MER3 shaft transmission motor shell, PSA inverter shell, BMW series inverter housing and other new energy vehicle parts projects with high gross profit margins. According to the plan, the Ma'anshan auto parts intelligent manufacturing project and the European production base project, which will start construction in 2020, are expected to gradually achieve mass production in 2022, and the capacity utilization rate will be improved, and the adverse impact on gross profit margin will be reduced. (Source: Future Think Tank)
4 Analysis of industry competitive barriers
The concentration of the domestic die casting industry is low, and most enterprises are small in scale. Due to the particularity of the automotive industry, there are barriers to entry in the auto parts precision die casting industry such as qualification and customer certification barriers, technical barriers, and barriers to capital and scale, and new entrants will face greater obstacles. It is expected that in a short period of time, the large-scale parts die-casting companies that have entered the supporting systems of major vehicle manufacturers in China will still occupy the dominant position in the industry.
(1) Qualification and customer certification barriers. The automobile industry is a specialized, high degree of refinement of the industry, in order to meet the strict requirements of the car in terms of safety, comfort and other aspects, parts and components companies need to pass a series of strict audit and certification system before entering the vehicle supporting system, mainly including vehicle manufacturer certification and third-party system certification two categories:
In order to meet the strict quality requirements of auto parts, international organizations, national and regional automobile associations and organizations have established a series of quality system certification standards, the most important of which is the IATF16949 (formerly ISO/TS16949) quality management system certification formulated by the International Automotive Standards Cooperation Organization (IATF). IATF16949 puts forward strict requirements for parts suppliers in design and development, raw material management, production capacity, product quality management, etc., and has basically become one of the entry thresholds for major vehicle manufacturers and first-class parts suppliers at home and abroad.
On the basis of obtaining third-party system certification, Volkswagen, GM and other mainstream vehicle manufacturers will usually conduct strict audits of the R&D capabilities, processing technology, mass production capacity, quality control capabilities, etc. of the parts manufacturers to be cooperated in accordance with their independent supplier review system, and on this basis, material tests, product tests, road tests and other quality certifications are carried out, and the certification time is usually more than 1 year. The strict, complex and lengthy qualification certification process has become an important barrier for parts manufacturers to enter the supporting system of vehicle enterprises.
In this context, once the cooperative relationship between OEMs and parts companies is established, OEMs usually do not easily change suppliers, forming a strong customer stickiness. At present, major domestic die-casting enterprises and downstream vehicle manufacturers have established long-term and stable cooperative relations to further improve the threshold for industry entry.
(2) Technical barriers. With the development of the automobile industry, the performance, quality and reliability requirements of vehicle enterprises for auto parts have gradually improved, and the technical barriers of the industry have shown a trend of continuous improvement. Specific to the precision die casting industry of auto parts, suppliers need long-term technical accumulation in many aspects such as product structure and manufacturing scheme design, mold design and development and manufacturing, material development and preparation, die casting process technology, etc., in order to meet the quality requirements of vehicle enterprises and first-class parts suppliers for products. At this stage, Wencan Shares, Ecodi and other major domestic aluminum alloy precision die casting companies have formed a number of core processes and technologies in the various processes of production and manufacturing, further enhancing their competitive advantage in the industry.
On the other hand, with the rapid development of new energy vehicles and the increase in the influence of new power car companies, the development cycle of automobile models has shown a shortening trend, requiring auto parts manufacturers to have stronger synchronous development capabilities and refined management capabilities. For newly entered and small-scale enterprises, it is difficult to meet the needs of high-speed iteration of parts development at this stage in terms of experience accumulation, personnel team, and management mechanism.
(3) Barriers to funding and scale. Automotive precision die casting is a typical capital-intensive industry, die casting equipment, melting equipment, mold production equipment, testing equipment and other necessary production and manufacturing equipment require high purchase costs. In the increasingly fierce trend of industry competition, in order to ensure that the technical indicators such as precision, strength and processability of products reach the advanced level, domestic enterprises often need to purchase more high-end processing and testing equipment, which puts forward higher requirements for the financial strength of enterprises. In 2020, the proportion of fixed assets of major domestic automobile precision die casting companies in total assets is at a high level, and the proportion of fixed assets such as Chervon Automobile and Rongtai Shares is greater than 40%, and the characteristics of high fixed assets are more significant.
At the same time, major vehicle manufacturers at home and abroad have put forward strict requirements for the production capacity scale and supply capacity of suppliers to ensure that large-scale orders can be delivered on time, according to quality and quantity, and it is difficult for new entrants to reach the corresponding scale in a short period of time. In addition, as a high-fixed asset industry, automobile precision die casting requires a large production scale to improve the utilization rate of fixed assets, reduce marginal production costs, and achieve economies of scale. It is difficult for new entrants to achieve large-scale production in a short period of time, resulting in relatively high unit costs and limited profitability, which also poses a greater obstacle for new entrants.
5 Competitive landscape: The scale of independent suppliers with lightweight layout and integrated die casting is expected to increase rapidly
The lightweight die casting industry in the mainland is lowly concentrated, there are many participating enterprises, and the overall competition is fierce. According to the prospectus of Wencan shares, in 2018, the number of related enterprises in the continental die casting industry was about 12,600, of which the number of enterprises producing die castings accounted for more than 70%, and there were various die casting manufacturers of different production scales, and most of the suppliers had low production capacity of lightweight die castings.
The number of die casting suppliers of foreign or joint venture brands is small, the scale of a single enterprise is large, the degree of specialization is high, and it has advantages in terms of capital, technology, production scale, etc., leading most domestic suppliers, through the establishment of joint ventures or subsidiaries in China to cut into the Chinese market, related enterprises include NEMAK, RYOBI, Aresti, Pierburg, George Fischer, DGS, etc.
Domestic independent brand of lightweight die casting suppliers can be divided into two categories, one is subordinate to the downstream vehicle group, attached to the automakers to provide die casting products for related car companies, including the die casting division established by Great Wall Motors, BYD's Fordy Seiko, etc.; the other is an independent lightweight die casting supplier, in 2018, the domestic die casting enterprises in the medium and large die casting enterprises accounted for only about 10%, a small number of independent suppliers in China have high-quality lightweight die casting products and large complex mold self-control capabilities, Able to respond quickly to customer needs and continuous improvement, has established long-term and stable cooperative relations with well-known car companies at home and abroad, with certain strength, related self-suppliers include Wencan shares, Chervon Automobile, Echodi, Tuopu Group, Xusheng shares, etc.
From the perspective of product range, most of the foreign-funded and joint venture brands and independent brands are laid out in multiple system fields such as body, transmission, chassis, steering, etc., and the lightweight die-casting products involved include transmission housings, motor housings, brackets, cylinder blocks, cylinder heads, etc.
From the perspective of the relevant customers of various die-casting enterprises, Japanese suppliers such as RYOBI and Aresti cooperate with Japanese car companies in foreign-funded and joint-venture brands, such as Aresti and Toyota, Nissan, Honda, Suzuki, etc.; while Pierburg, DGS, George Fisher and other European and American suppliers are more supporting die-casting products for European and American car companies such as Audi, BMW, Mercedes-Benz, Volkswagen, and General Motors; domestic independent suppliers have many supporting customers, and the customer range involves American, Japanese, European, and independent car companies. For example, rongtai shares customers include volkswagen, Audi, BMW and other foreign brands, but also include great wall, geely, BYD and other independent brands; Xusheng shares for Tesla, ideal, Weilai, zero run and many other new forces supporting die castings.
Judging from the operating income of global die casting enterprises, the income scale of foreign-funded die casting enterprises is relatively high, and there is a gap between the scale of most domestic die casting enterprises and foreign enterprises. Specifically, several head die casting enterprises with higher operating income are George Fischer, NEMAK, RYOBI, etc. In 2019, George Fischer and NEMAK operating income exceeded 25 billion yuan, and in 2020, the income affected by the epidemic declined, but it still exceeded 20 billion yuan, and the comprehensive competitiveness was strong; the income scale of most of the domestic die casting enterprises was below 3 billion yuan, and the gap with foreign-funded enterprises was obvious, and the enterprises with higher domestic operating income included Guangdong Hongtu, Wencan shares, Ikodi, etc The internal die-casting enterprises expand production, obtain more new orders through cost-effective advantages, and lay out new technologies such as integrated die-casting, gradually narrowing the gap with foreign-funded die-casting enterprises.
Enterprises with rapid progress in the field of integrated die casting, including Wencan Shares, Guangdong Hongtu, etc., have obtained project fixed points or realized batch supply, and have a first-mover advantage in the integrated die casting layout. Specifically, Wencan co., Ltd. has obtained a large-scale integrated die-casting body structural parts after the floor project fixed point, in 2021 the company ordered 7 large-scale die-casting machines including 2 sets of 6000T die-casting machines, for the development and manufacture of integrated body structural parts, in the integrated die-casting layout is faster; Guangdong Hongtu into the Xiaopeng Automobile supporting system, the two sides will synchronously develop integrated structural parts.
Chervon Automobile, Tuopu Group, Ecodi and other die-casting enterprises have also carried out corresponding layout planning in the field of integrated die-casting, and will further enhance the company's product and technical strength in the future. In September 2021, Tuopu Group ordered 21 die-casting units, including 7200T, 4500T and 2000T die-casting equipment of different scales, which is expected to increase the production capacity of integrated die-casting parts; the 2700T die-casting machine of Chervon Automobile Nanjing headquarters has entered the state of mass production and supply, the 5000T die-casting machine is expected to be delivered in the fourth quarter for mass production, in addition, the company has purchased a number of large-scale die-casting equipment at the Ma'anshan production base, and the Hungarian factory will also lay out die-casting equipment. In order to lay a solid foundation for the release of production capacity, Icodi announced in January 2022 that it intends to issue 1.6 billion yuan of convertible bonds, of which part of the funds raised will be used to introduce medium and large precision die casting units ranging from 800T to 8400T, further enhancing the company's competitiveness in the field of integrated die casting.
6 Key Investment Strategies
From the perspective of investment strategy, as the penetration rate of new energy vehicles continues to rise, the scale of lightweight and integrated die castings of automobiles will continue to expand, and companies that lay out lightweight and integrated die castings will benefit, and in the stage of capacity release, their capacity utilization rate will promote the improvement of profitability, and their profits will also grow rapidly.
(This article is for informational purposes only and does not represent any of our investment advice.) For usage information, see the original report. ）
Featured report source: [Future Think Tank].