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Author | Harry Zhang
In the Winter Olympic Games, Suzhou Golden Dragon's 50 pure electric buses have become a beautiful landscape. In addition to Suzhou Golden Dragon, whether it is Foxconn, which officially announced the construction of cars in 2021, or BYD, which has repeatedly won pure electric buses in foreign markets, it is actually a strong challenger to this market segment.
At the 2021 Foxconn parent company Hon Hai held a science and technology day event in Taiwan, Hon Hai Group not only released a new pure electric vehicle brand Foxtron, but also unveiled the curtain for three pure electric vehicle models. The Model C is positioned in a mid-size SUV, the Model E is positioned as a medium-sized sedan, and a pure electric bus Model T. Unlike the two pure electric passenger cars, the electric bus can be said to have earned a lot of eyeballs on the spot. This bus not only meets the relevant standards of the United States, but also has completed a large number of tests, and will start commercial operations in southern Taiwan next year. Seeing that BYD is thriving in the global electric bus market, can Foxconn follow in its footsteps and become a new force in the electric bus market?
From the network
Foxconn's product pioneer in the electric vehicle market - electric bus
If Foxconn simply launches two electric vehicles, it is not surprising, after all, since its external appearance on the MIH platform last year, the launch of electric vehicles is already a matter of certainty. What's more, Foxconn also brought in Taiwan's local car company Yulon Automobile, although Yulon has not performed well in recent years, barely able to occupy a place in the narrow Taiwanese local battlefield. However, its vehicle engineering capabilities and supply chain system capabilities are still there, so it is not difficult to help Foxconn build a model that can be mass-produced in a short period of time. What's more, Foxconn also has a certain accumulation in including the three-electric system and the Internet of Vehicles, and the integration of the two is also a matter of course.
However, compared with the two pure electric passenger cars, Foxconn launched a pure electric bus Model T for the first time in the field of electric vehicles, which was somewhat unexpected by many people. The design of this bus is relatively simple, and there are not too many fancy arrangements. In terms of powertrain, the model T has a maximum power of 260kW and a peak torque of 700 Nm; in terms of endurance, the Model T can reach a maximum cruising range of 320km by using a safer lithium iron phosphate battery, and the cruising range of a bus can reach 250km under typical working conditions. In terms of other configurations, the Model T is also equipped with an electronic air suspension system, an electro-hydraulic power steering system, an ABS disc brake system, etc., which can fully meet the configuration required for an electric bus and ensure basic safety.
Compared with the degree of perfection in the configuration, the Model T has completed 200,000 kilometers of durability testing, and has undergone more than 1,000 hours of rigid strength testing, and this model also meets the regulatory standards of the Federal Transportation Administration. Before landing in the U.S. market, the electric bus with the Foxtron logo will begin commercial operations in Taiwan's south-central cities next year. Once the trial operation in the Taiwan market is successful, it is not very difficult for Foxconn to knock on the door of the US market at least with electric buses.
Domestic electric bus market - sales data is pessimistic, but the prospects still exist
According to relevant data, the sales volume of new energy buses from January to August 2021 was 24,000 units, down 11% year-on-year; of which August sales were 0.31 million units, down 37% year-on-year. The increase in sales volume is mainly due to the impact of the sharp decline in domestic new energy bus subsidies since 2018. For related enterprises, the bigger trouble is that according to the "Notice on Improving the Financial Subsidy Policy for New Energy Vehicles", domestic new energy buses will completely bid farewell to subsidies in 2023. However, the policy level is not all bearish, but instead of the country's carbon peak and carbon neutrality time nodes are approaching, as well as the "double reduction" target specified in it, which will form a policy pressure on local governments to purchase new energy buses.
In terms of industry concentration, according to the sales data from January to August this year, we can find that the market concentration of this market segment is relatively high, including Yutong, Zhongtong, CRRC, BYD, which are the top ten head enterprises, with a market concentration of 66.9%. Unlike its invincibility in overseas markets, BYD is still lagging behind the domestic bus leader in the domestic new energy bus market - Yutong Bus is not a lot. With the brand appeal accumulated in the past and the system ability established, the advantages of Yutong Bus in the domestic market are still relatively large.
In terms of power system, unlike heavy truck companies that will pay more attention to fuel cells, pure electric in the field of buses is currently recognized as a technical route, while the proportion of plug-in hybrids and fuel cells is relatively insignificant. Plugging and mixing is more of a transitional technology, so whether to use fuel cells has also been discussed a lot. From the perspective of use scenarios, for models such as buses, they do not need to undertake long-distance transportation responsibilities like heavy trucks, or buses are more just responsible for transportation within the city or intercity transportation. If you consider that fuel cell technology has been applied for many patents by Japanese car companies, pure electric technology is the best choice for domestic related companies.
BYD electric bus - self-developed core technology into the strongest weapon
For the overseas electric bus market, BYD is a player that has to be mentioned. In many traditional automobile powers, including the United States, Europe, and Japan, we can see the figure of BYD electric buses. According to relevant data, BYD's new energy bus sales in overseas markets have exceeded 45,000 units, becoming an important part of BYD's business, especially in overseas markets. The two main reasons why BYD has been able to stand out in overseas markets are that it has built factories locally and mastered many core technologies, including the three-power system.
Unlike passenger cars, which require a high-beat assembly line, buses can be produced in a "workshop-style" mode, which greatly reduces the cost of building a factory locally. BYD can carry out local final assembly through many key components of CKD. In this way, on the one hand, it can avoid the import tariffs of the whole vehicle, on the other hand, it is easier to be accepted by the local government, after all, this model can also bring a lot of employment opportunities, especially in many European countries that attach great importance to employment and environmental protection. Therefore, this has become a reason why BYD can sell well in overseas markets.
Mastering the core technology, including the three-electric system, is another weapon held by BYD. In addition to electric buses, BYD is also a mainstream player in the field of passenger cars. This means that many of the technologies already deployed in the passenger car field can be borrowed from the commercial vehicle field, such as BYD's blade battery, aluminum alloy body, etc., can be found on its electric buses to be used cases. As we all know, for safety reasons, lithium iron phosphate batteries are widely used in pure electric buses. BYD has not only been deeply engaged in the field of lithium iron phosphate batteries for a long time, but also developed blade batteries that have almost reached the energy density limit of lithium iron phosphate batteries in passenger cars. On the DM-i platform, BYD has not only developed a highly thermally efficient internal combustion engine, but also developed a variety of high-power motors, and related technologies can also be shared by electric buses.
In fact, Foxconn and BYD first started from the electronics field, and both still have a lot of mobile phones and other consumer electronics foundry business. In addition, in the core technology of many electric vehicles, the two companies have also mastered a lot of core technologies. However, in the process of transforming into the automotive industry, BYD is much more resolute than Foxconn. Even in the era of the traditional internal combustion engine, BYD has been able to occupy a place with models such as the F3. In the era of electric vehicles, BYD is taking advantage of the momentum and has become the largest car company in china with a market value, even if it looks at the world, it ranks very high. In this regard, Foxconn or Hon Hai, it is impossible not to be red-eyed. Pulling Yulon together to build the MIH platform and related electric vehicle models has become Foxconn's best way to catch up with its former competitors. Especially considering that Foxconn has invested in a number of new force car-making companies in China, it has gone from behind the scenes to the front of the stage and made its own car has become Foxconn's last choice.
However, in general, the electric bus market is not as big as that of passenger cars. Although the price is not cheap, it is difficult to become a new outlet. Especially considering the price of millions of yuan, it is more affected by policy guidance. Once the policy changes, the impact on the relevant OEMs will be very obvious. However, as mentioned above, the full electrification of medium and large passenger cars in the future city has become an irreversible situation. Therefore, domestic bus companies, while continuing to deepen the domestic market, take advantage of China's leading position in electric vehicles and invest more energy in overseas markets, which is a correct corporate strategy.