The conflict between Russia and Ukraine is a household name, and everyone should know it! As soon as the cannon sounded, it could be described as a golden two, and all walks of life were affected to varying degrees, such as the stock market, the international wheat price and so on. But do you believe that this Russian-Ukrainian conflict will affect China's auto industry?
▍Under the conflict, how should the Great Wall be resolved? ▍
According to data previously released by the European Business Association, in 2021, the total sales of Chinese brand cars in Russia reached 115,700 units, doubling from 2020, and the share of the Russian passenger car market increased to nearly 7%. Chinese brand cars are increasingly favored by Russian consumers.
Specifically, in 2021, Haval, Chery and Geely Automobile sold 39,126, 37,118 and 24,587 vehicles in Russia, respectively, an increase of 125%, 224% and 59% year-on-year, ranking twelfth, thirteenth and seventeenth in the Russian automobile sales list.
★ Great Wall: 39,000 units sold in Russia in 2021
The Haval brand under the Great Wall will sell 39,000 vehicles in Russia in 2021, +125% year-on-year, ranking 12th in sales. According to the company's official website, the company's plant in Tula Oblast, Russia, was completed and put into operation in June 2019, and the plant currently has an annual production capacity of 80,000 vehicles, including stamping, welding, painting and final assembly, and has now introduced Haval H7, H7x and H9 models. According to the company's announcement, the company's total sales in 2021 reached 1.28 million vehicles, and sales in Russia accounted for 3% of its sales.
★ Chery: 37,000 units will be sold in Russia in 2021
Chery Automobile sold 37,000 units in Russia in 2021, +224% year-on-year, ranking 13th in sales. According to the company's official website, Chery's models in Russia include Tiggo 8 pro, Tiggo 7 pro, Tiggo 4, Star Chart TXL and other models, and the company's production in Russia adopts CKD mode. According to the China Automobile Association, the company's total sales volume will reach 960,000 vehicles in 2021, and sales in Russia account for 4% of its sales.
★ Geely: 25,000 units will be sold in Russia in 2021
Geely Automobile sold 25,000 units in Russia in 2021, +59% year-on-year, ranking 17th in sales. The company exports its products to Russia through its CKD plant in Belarus. At present, the company's sales models in Russia include Boyue, Xingyue and Emgrand. According to the company's announcement, the company's total sales volume in 2021 is 1.33 million vehicles, and sales in Russia account for 2% of its total sales.
At the same time, the localization process of Chinese car brands in Russia is continuing to accelerate.
In April last year, Haval officially started construction of an automotive engine plant in the Uzlovaya Industrial Park in Tula Oblast. Lavluhin, vice chairman of the Tula state government, said the plant is of great significance to promote the development of the tula state's automotive industry. The plant is expected to be completed by the end of 2022 and will produce approximately 80,000 engines per year.
In addition to improving the construction of automobile production supporting industries in Russia, Great Wall Motor's product matrix in Russia has reached 6 models, more than 100 dealer networks, and Haval Automobile Factory will optimize the production and marketing model in 2022, and it is expected that automobile production and sales will further increase.
Also based on Great Wall Motor's in-depth layout in Russia, Great Wall Motors (HK.2333) closed down 5.24% on February 24, hitting HK$16.8 per share intraday, a new low since June last year.
Subsequently, Great Wall Motors responded that the Russian-Ukrainian conflict would not affect the production and sales of the company's Russian factories; the Ukrainian export business may be affected in the short term, but there is no problem in the long run.
But it is clear that the conflict is still ongoing, and economic sanctions from the United States, Europe, Britain, Japan and even more countries that may join in the future may cause setbacks to the Russian economy to a large extent, thus affecting the purchasing power and consumer confidence of the local people.
▍ Global car chips may be "out of breath" due to lockdowns▍
How does the Russian-Ukrainian conflict affect the global automotive industry? It is necessary to start from the current global "lack of chips", chips as the soul or brain of the car, with irreplaceability, chip manufacturing belongs to the high-end technology industry, the world's top ten well-known intelligent car chip suppliers for NXP, Infineon, Renesas Electronics, ITALIAN half, Texas Instruments, Bosch, ON Semi, Microchip, Toshiba, ROMA, there is no one is a Chinese chip company.
There are many reasons for the lack of chips, among which the global epidemic is the most serious, the factories that produce chips have stopped production due to the epidemic, from foreign Volkswagen, Toyota, Mercedes-Benz, Ford, Tesla to the domestic Great Wall, Geely, Weilai and other car companies some factories have reduced production or even stopped production.
Due to the lack of chips, according to the feedback of many car companies, the price of various types of chips has generally increased by 5 times to 20 times, but it is still "difficult to find a core". Car companies in order to pass on the risk of thinking of price increases, among them, new energy vehicles have begun to increase prices, FAW-Volkswagen two cars rose by more than 5200 yuan, Xiaopeng Automobile rose by more than 4000 yuan, Weilai Automobile also rose to varying degrees.
At present, the lack of chips has affected the development of the global automobile industry, and the Russian-Ukrainian conflict will exacerbate the global chip shortage, because "the Russian-Ukrainian region is an important producer of rare gases such as krypton, krypton and xenon, Russia is responsible for crude gas separation, Ukraine is responsible for refining and exporting, ukraine supplies 70% of the world's krypton, 40% of krypton and 30% of xenon." These three gases are the materials used to make the chips.
Noble gas refers to the gas element corresponding to all group 0 elements on the periodic table, also known as inert gas, which is chemically stable and difficult to produce chemical reactions with other substances, so it is widely used in the semiconductor industry. For example, argon is used in plasma deposition and etching processes, neon can be used for chip fabrication and high-pressure neon lamp filling, and helium is used for cooling, plasma treatment, and leak testing in electronics manufacturing.
In the supply chain of noble gases, Russia and Ukraine occupy an important position. It is reported that Russia's rare gas resources are abundant, while Ukraine inherits the Soviet Union's iron and steel metallurgy and air separation (air separation) and other industrial technologies, has a solid gas refining equipment foundation, gas refining level ranks among the forefront in the world. The Russian-Ukrainian conflict may have a huge impact on the supply of rare gases to the global semiconductor industry.
In addition to rare gases, some of the organic compounds needed by semiconductor manufacturers and the supply chain of rare metals are also in Russia. According to Techcet, a market research institute in the United States, many semiconductor manufacturers rely on materials from Russia and Ukraine. The report points out that Russia is an important source of perfluorobutadiene (C4F6) gas required by the US market; more than 90% of the semiconductor grade neon supply in the United States comes from Russia and Ukraine; Russia is also an important source of palladium, accounting for about 42% of the global market share, and palladium is an important metal needed to manufacture sensors and memory.
Joe Pasetti, vice president of global public policy at the International Semiconductor Equipment and Materials Association (SEMI), sent an email to members this week assessing exposure to critical chip manufacturing supplies, pointing to potential supply disruptions for raw materials such as C4F6, palladium, helium, neon and scandium, Reuters reported.
At the same time, the White House has warned the chip industry to ensure supply chain diversification to prevent Russia from retaliating against the threat of U.S. export restrictions and preventing access to key raw materials.
Will the supply of noble gases and other raw materials be cut off as a result of the Russian-Ukrainian conflict? Judging from the current judgment of industry insiders, the supply should not be cut off, but a sharp price increase is probably doomed. The original global core shortage crisis has not been alleviated, and the problem of core shortage is bound to be further aggravated.
In fact, with the impact of the epidemic and chip shortage, the price of rare gases has been rising since the second half of 2020. The price of neon gas (content of 99.99%) in the mainland has risen from more than 600 yuan / cubic meter in October 2021 to more than 1700 yuan / cubic meter at present, and the average price of krypton gas in the market has risen from more than 10,000 yuan / cubic meter to more than 30,000 yuan / cubic meter, both of which have increased by about 3 times. As the Conflict between Russia and Ukraine escalates, the price of noble gases is expected to continue its upward trend.
However, for the supply chains of chip and semiconductor manufacturers, the current sense of crisis does not seem to be strong. According to Reuters, Intel spokesman William Moss said: "The company does not expect the neon supply to be affected in any way. ”
This confidence comes mainly from semiconductor companies' strong inventory reserves. Ren Lu, a senior analyst in China's specialty gas market, pointed out: "At present, there is no problem at all in the normal use of rare gas stocks of global semiconductor companies for 6 months. ”
However, considering the current global chip supply and demand situation, the supply of rare gas is still worth vigilance, once the upstream supply is reduced, downstream fabs seeking alternative suppliers often take more than half a year to verify, affecting wafer capacity. Techcet expects demand for materials such as helium, neon, palladium, scandium, C4F6 and other materials to grow by more than 37% over the next 4 years, and Intel, Samsung and TSMC have recently released new products in Ohio, Arizona and Texas, all of which will boost demand for materials.
"Although from a certain level, Sino-Russian relations are relatively relaxed compared with other situations, the automotive industry chain is long, and its global supply attributes doom the Chinese industrial chain to be difficult to retreat." Conflict is bound to increase public panic, and higher commodity prices are an inevitable trend and will continue for a long time.