The performance of car companies in the first quarter was uneven, and the decline in the second quarter may be more serious

Lu Jiangtao, a reporter from China Economic Weekly, | Beijing reports

The start of the car market in 2022 is fraught with difficulties. Repeated epidemics, shortages of chip supply, and sharp rises in raw material prices have superimposed on many unfavorable factors overshadowing the quarterly reports of car companies.

According to the statistics of the "China Economic Weekly" reporter, the 2022 quarterly report of passenger car manufacturing enterprises listed in A-share has been fully disclosed, the performance of BYD, Changan Automobile, GAC Group and other companies has been stable and progressive, and SAIC Group, Beiqi Blue Valley, Great Wall Motors and other companies have declined to varying degrees, which can be described as several joys and several sorrows.

Different from the uneven performance in the first quarter, the industry's expectations for the second quarter of the car companies are generally pessimistic, and since April, many car companies have fallen into a shutdown crisis, and they have not yet returned to full production. Behind the suspension crisis is the supply chain crisis, the automotive supply chain involves eight major manufacturing systems, tens of thousands of parts, is one of the longest chain, the most difficult to manage one of the industrial supply chain, if the supply chain can not be restored as soon as possible, or will affect the performance of car companies in the second quarter or even the second half of the year.

The epidemic has affected the first quarter performance of many car companies

In the first quarter of this year, the outbreak of the epidemic in many places affected the production and sales of some car companies.

Among them, although SAIC Motor is still the only company with revenue of more than 100 billion yuan in the first quarter, its revenue and net profit both fell. According to the financial report, in the first quarter of this year, SAIC Motor achieved operating income of 182.471 billion yuan, down 3.5% year-on-year, and achieved a net profit of 5.516 billion yuan, down 19.44% year-on-year. SAIC Motor is also the only A-share listed car company in the first quarter of this year that both revenue and net profit fell.

It is worth noting that SAIC Motor's net cash flow from operating activities in the first quarter of this year was -9.143 billion yuan, down 555.3% year-on-year. In this regard, SAIC Motor explained in the financial report that this is due to the expansion of the loan scale of its subsidiary, SAIC Motor Group Finance Co., Ltd., on the other hand, due to the reduction of sales revenue due to the impact of the epidemic in the first quarter.

In addition to SAIC Motor, the car companies that have been greatly affected by the epidemic are Also Great Wall Motors. In the first quarter of this year, Great Wall Motor achieved operating income of 33.619 billion yuan, an increase of 8.04% year-on-year, and achieved a net profit of 1.634 billion yuan, a slight decrease of 0.34% year-on-year. In the first quarter of this year, Great Wall Motor sold a total of 285,900 vehicles, down 14.16% year-on-year. Great Wall Motor said: "Affected by the epidemic in many places in China, many parts suppliers of Great Wall Motor have been affected, resulting in limited production capacity of factories. ”

In February this year, Bosch Automotive Components (Suzhou) Co., Ltd. suddenly broke out, and Great Wall Motor's sales fell by 20.5% to 70,000 units that month, one of the reasons was the insufficient supply of bosch Suzhou production of body electronic stability system (ESP), and Bosch ESP is the exclusive supplier of Great Wall Motor's main models.

In addition, although the revenue of Xiaokang Shares, Beiqi Blue Valley and Haima Automobile in the first quarter of this year increased year-on-year, the net profit declined to varying degrees.

In contrast, by-THED, GAC Group and Changan Automobile are in much better shape. Among them, Changan Automobile achieved operating income of 34.576 billion yuan in the first quarter, an increase of 7.96% year-on-year, and net profit of 4.536 billion yuan, an increase of 431.45% year-on-year; BYD's revenue in the first quarter reached 66.825 billion yuan, an increase of 63.02% year-on-year, and net profit reached 808 million yuan, an increase of 240.59% year-on-year; GAC Group achieved revenue and net profit of 23.268 billion yuan and 3.009 billion yuan in the first quarter, an increase of 45.21% and 27.17% respectively.

Source: Quarterly report

The decline in the second quarter may be more severe

In the past two years, the biggest bright spot in the domestic auto market is the explosive growth of new energy vehicle sales, but with the sharp rise in the price of power batteries, the gross profit margin of new energy vehicles has also continued to be squeezed.

Since the middle of March this year, a number of car companies have announced price increases for new energy models, including Xiaopeng, Geometry, Zero Run, WM, Great Wall Euler, GAC and other car companies have successively issued price increase notices, with an increase of up to 32,600 yuan. For example, Tesla raised prices for three consecutive times in March alone, raising prices on All Of Its Domestic Models on March 10, 15 and 17, with a cumulative increase of 14,000-30,000 yuan, which does not include the 10,000-20,000 yuan price increase announced at the end of last year. Xiaopeng Automobile also launched the second price increase in 2022 on March 21, with the price of its models on sale rising by 1.01-3.26 million yuan, an increase in line with Tesla; BYD also adjusted the official guidance prices of its Dynasty Network and Ocean Network related new energy models twice in March, with two price increases ranging from 1,000 yuan to 7,000 yuan and 3,000 yuan to 6,000 yuan.

According to the incomplete statistics of the "China Economic Weekly" reporter, there have been more than 50 models of more than 20 car companies since the beginning of this year, and the reason for the price increase is the increase in the price of raw materials for power batteries. The price of lithium carbonate, which is the raw material for power batteries, rose more than 7 times last year, and rose by more than 80% in the first quarter of this year. Affected by this, in the first quarter of this year, the general net profit of A-share listed power battery companies fell by 20%-30%, of which the net profit of CATL fell by 23.6% year-on-year to 1.493 billion yuan, far below market expectations.

Power battery companies in the cost pressure, began to transmit pressure to car companies, car companies also began to transmit cost pressure to the consumer side, but the terminal price increase is not enough to cover the cost of rising raw material prices, BYD, Xiaokang shares, Beiqi Blue Valley and other car companies in the past two years the gross profit margin continued to decline.

More worrying than the decline in gross margins is the supply chain crisis. Since April, as an important town in the automobile industry, the epidemic prevention and control situation in the Yangtze River Delta, northeast China and other places has been grim, and the national automobile production has been seriously affected.

Among them, Shanghai is home to many auto parts giants and some of their factories, and nine of the world's top ten auto parts groups have their Chinese headquarters in Shanghai, namely Bosch, ZF, Magna, Hyundai Mobis, Aisin, Continental, Valeo, Lear and Faurecia. Affected by the shortage of parts supply, vehicle production bases in central And southern China have also been shut down.

According to the statistics of the Association of Automobile Manufacturers, the average daily retail sales of major manufacturers in the first and second weeks of April were 24,600 units and 26,700 vehicles, respectively, a year-on-year decline of 32% and 39%; in the third week of April, the automobile market will recover under the impetus of the resumption of work and production in the industry, and the average daily retail sales of major manufacturers are expected to pick up to 36,000 units, a year-on-year decline of about 35%; in the fourth week, the value is expected to be further adjusted to 69,000 units, and the year-on-year decline is narrowed to about 26%. According to this, the association expects that the retail sales of narrow passenger cars nationwide in April will be 1.1 million units, down 31.9% year-on-year.

The good news is that Shanghai has recently begun to try to resume work and production, and many car companies such as SAIC Motor and Tesla have been included in the "white list". But there is still uncertainty about the epidemic, and the auto industry has a strong global attribute, especially in the parts supply chain, whether it is a vehicle company or a core parts supplier, behind them there are thousands of low-level suppliers, if these suppliers can not resume work, the entire automotive industry chain is ultimately difficult to maintain benign production.

Editor-in-charge: Guo Jiyao

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