Wen | Li Haoxian
Hybrid, autonomous driving, and electric vehicles are undoubtedly still the three key words in the automotive industry this year, and this year we will see more such mature products on the market.
However, in our opinion, there is another keyword that deserves your attention, because it has become another growth point or even a flashpoint in car sales, and this keyword is car export.
Automobile exports hit a record high
According to the report of the China Association of Automobile Manufacturers, China's total automobile exports reached 2.015 million units in 2021, which not only achieved a breakthrough of about 1 million vehicles for many years for the first time, but also directly doubled compared with 2020 (995,000 vehicles in 2020), accounting for 7.7% of total automobile sales, an increase of 3.7 percentage points over the previous year. There is no doubt that 2021 will be a major victory for the auto export sector.
Why did auto exports suddenly double last year? We believe that the following three points are inseparable.
The first is product progress. In the past 3 years, the products launched by the head Chinese brand can play, I believe that everyone has a good idea, and there is naturally no shortage of people to pay for good products. If nothing else, take the share of domestic independent brands, in 2021, the share of independent brands will return to the 40% mark, reaching 41.2%, and at the moment when the competition is more sufficient, the rise of Chinese brands can be said to be full of gold.
"There are many factors in the explosive growth of mainland automobile exports, but fundamentally it is a significant improvement in the competitiveness of Chinese auto brands." Xu Haidong, deputy chief engineer of the Automobile Industry Federation, said. Now, the quality of Chinese brands of automobile products is very good, the export of models is also the fist products of various enterprises, such as Tiggo 8, Haval H6, Lynk & Co 01, etc., these products can compete with foreign brand models in terms of quality, design, or performance configuration, etc., and export to overseas markets naturally obtain certain sales.
The second is to "go out". With the deepening of the overseas strategy of Chinese car companies, at present, China's automobile exports are no longer limited to export trade, KD factories, etc., but direct investment, to build factories in major overseas markets, such as SAIC's Thailand plant, Wuling Indonesia plant, Great Wall Motor's Russia Tula plant, Geely Automobile's Belarusian plant and Malaysia's Proton plant have achieved mass production.
Among them, Chery Automobile, as a major automobile exporter, as of 2021, is already the 20th year of Chery's "going out". In the past 20 years, Chery Automobile's overseas users have exceeded 1.95 million. Chery has established 10 overseas factories and more than 1,500 dealer outlets around the world, including Europe, North America, the Middle East and Brazil. It has won the title of "Most Popular Chinese Car Brand" in Russia for five consecutive times; in Chile, Chery has sold 16,986 vehicles in the first nine months of last year, ranking fifth among all car brands and first among Chinese car brands.
The third is Tesla. It has to be said that Tesla has also contributed a lot to the automobile export business, Tesla Shanghai Gigafactory contributed more than 160,000 overseas deliveries in 2021, of which the model 3 has exported more than 130,000 vehicles in 2021. It should be known that of the 2 million vehicles exported last year, new energy vehicles accounted for 300,000, which means that Tesla accounted for more than 50% of the total export of new energy vehicles.
Heavy responsibilities
Of course, the more cars are exported, the better, and where these cars are sold and to whom, it is more reflective of the competitiveness of the product or the recognition of the brand.
This is a chart from Sohu Auto released in 2021 (January-November) China's automobile export volume and destination, through this chart can be clearly seen that in 2021, the destination of mainland automobile exports, most of the regions are the Middle East, South America, Africa and other developing countries, aside from the reverse output of some "related households", such as SAIC Motor's MG brand exports to Europe, SAIC-GM Buick, Chevrolet "domestic sales re-export" to North America, Chinese cars to developed countries, or export products to automobile powers , there is still a long way to go.
Of course, here will involve some geopolitical factors, such as the European market, traditional power is their core competitiveness, and even said to be the fate of the door, if it is easy to let domestic cars come in, there are more stakes involved, such as in the field of passenger cars in Europe, it is more like a semi-open market, like the French government also owns Renault, PSA shares, Why French cars in Europe flaunting their might, once they go abroad, there must be certain factors at the geopolitical level.
There is also a point that Chinese brands are hot in developing countries or the third world, because there is no local car brand, everyone is an equal "foreigner", the competition is relatively fair, but in the United States, Japan, Europe and other traditional automobile powers, there is a very mature automobile industry and after-sales system, which leads to the inability to form a leading edge in cost, competitiveness plummeted.
Why Skoda has been going well in Europe, I remember that some Volkswagen executives once said that in Europe, Škoda has better cost control measures under the Volkswagen Group system, and the Skoda brand has a deeper historical accumulation in the region, and these cannot be copied in China. I believe that China's traditional powered cars will be in a similar situation in Europe.
To put it bluntly, traditional fuel vehicles, if there is no "blood relationship" like MG, it is quite difficult to enter the above countries, but as we all know, it is now the era of new energy, and there are variables in the gameplay and pattern.
In fact, we have seen many variables, such as BYD's electric bus has already entered the European market, covering more than 100 cities in 20 european countries; on September 30, 2021, NIO and ES8 moved a complete service system to the Norwegian market and started an ambitious journey to the west, according to the plan, in the second half of 2022, NIO will also sell its car product ET7 in Norway, and gradually layout the replacement power station and charging pile; on December 6, 2021, Xiaopeng Motors wrote on Twitter, " The first Xiaopeng G3i SUVs have arrived in Norway "...
There is no doubt that it is only a matter of time before new forces enter the "advanced market", and electrified models will be the best weapon for us to conquer these cities that were once considered indestructible, and the trend of domestic electric vehicles in the open sea this year deserves our attention.
But before that, we have another "roadblock" to solve.
Boat fares have skyrocketed
We have noticed that while doubling the volume of automobile exports, the cost of shipping is also rising exponentially, in the past year, under the influence of repeated epidemics, demand growth, limited supply, port congestion, lack of boxes and cabins, the global maritime market futures freight rates have increased by several times or even as high as 10 times or even as high as 12 times compared with previous periods.
What is this concept?
On the evening of January 24, COSCO Offshore Holdings released its 2021 annual performance forecast, and COSCO Offshore Holdings achieved a net profit attributable to shareholders of listed companies of about RMB89.28 billion in 2021, an increase of approximately RMB79.35 billion compared with the same period last year, an increase of about 799.3% year-on-year. After deducting non-recurring profit and loss items, COSCO Offshore Holdings expects to achieve a net profit attributable to shareholders of listed companies of approximately RMB89.14 billion in 2021, an increase of approximately 829.2% year-on-year.
In 2021, the maritime industry has unexpectedly made a lot of money because of the epidemic, and a friend engaged in the shipping industry has also confirmed to me that the price has soared, saying that it is now the era when cargo owners are begging shipowners.
From the data of the shipping research institute Drury, it can also be seen that the global maritime freight rate has risen significantly, especially after May, the magnitude of the increase in freight rates has risen sharply, even if there has been a brief decline in October and November, but it still has not returned to the level at the beginning of the year. The analysis report of Guohai Securities also pointed out that the probability of maintaining a high level of operation throughout 2022 is still very large.
In the context of soaring freight rates, although China's automobile exports have doubled in 2021, it is certain that the profitability of car companies will inevitably be affected by freight prices, and if the price runs at a high level for a long time, it will inevitably damage the enthusiasm of car companies to expand outward. Judging from the forecast of the China Association of Automobile Manufacturers, the growth rate of mainland automobile exports in 2022 will be about 20%, far less than the 100% in 2021, and it is estimated that the impact of high freight rates is also taken into account.
However, from another point of view, the high freight rate may prompt Chinese brands to boldly invest in overseas factories and take root in the local area, from this point of view, it may not be a good thing.