There is pressure, power, action and thinking parts industry: with the whole vehicle in the ups and downs of refining skills
The first half of 2023 has been an unusual half year for the domestic auto industry. The first is that at the beginning of the year, the "price war" affected the entire car market, and the impact on the upstream industry chain has continued to this day. Of course, the industry is not only the impact of market turmoil, automatic driving, charging pile and other areas of policy "spring breeze" blowing, facing the new development situation, enterprises are also accelerating the expansion of layout.
Looking back at the first half of the year, what "sunshine" and "wind and rain" did the auto parts industry experience? What new survival skills have you tried?
Power battery field: new development in the volatility of raw material prices
In the first half of this year, the most exciting thing in the power battery industry is the fluctuation of lithium carbonate prices. Last year, the price of battery-grade lithium carbonate was as high as 600,000 yuan/ton, and this year, the figure fell all the way down. At the end of February, battery-grade lithium carbonate fell below 400,000 yuan/ton; In late March, it was less than 300,000 yuan/ton; In early April, the price of battery-grade lithium carbonate fell below 260,000 yuan/ton. Subsequently, the price decline of battery-grade lithium carbonate did not show signs of suspension, and the minimum broke the threshold of 200,000 yuan/ton. Recently, its price has rebounded and fluctuated around 300,000 yuan/ton.
Fluctuations in the price of lithium carbonate have triggered changes at both ends of the industrial chain. When raw material prices are rising wildly, many head material companies have signed a long-term lock price agreement with lithium miners, and use a floating mechanism for procurement, which will add purchases on the basis of the difference and stock up at the same time.
For example, at the end of February this year, multiple sources revealed that Ningde Times is implementing a "lithium ore rebate" plan. It is reported that according to the plan, Ningde Times will be part of the quality customers will be 50% of lithium carbonate raw materials at the price of 200,000 yuan/ton settlement, the rest in accordance with the market price calculation, the difference returned to the car enterprises; However, the car companies that signed the agreement need to commit to lock in about 80% of the battery purchase volume. On March 10, Ningde Times released the record of investor relations activities, talking about the original intention of the "lithium ore rebate" plan, said: "The company's lithium ore sharing is not for the purpose of price reduction, but we have some mineral resources, do not want to obtain windfall profits, hope to share with long-term strategic customers, is promoting relevant communication." But in the end, this plan also lost traction as the price of lithium carbonate fell.
Recently, the news from the high industrial lithium battery shows that in addition to the current old customers and long-term agreement orders, lithium miners are still reducing the supply of lithium carbonate on the market; In the sales model, some lithium miners have adopted the form of auction to increase the price of products.
In any case, the "roller coaster" changes in the price of lithium carbonate have made vehicle companies and power battery suppliers worried. They have accelerated the layout of the upstream industry chain, and locking in the supply of more key raw materials for power batteries has become the focus of this year's work. On June 20, Ningde Times confirmed that it would invest $1.4 billion to help develop Bolivia's vast but uncommercialized salt lake lithium resources, consolidating a partnership with the Bolivian government established in January this year. Construction of the two plants will begin as early as July, and the total investment in the follow-up project is expected to increase to about $9.9 billion. On July 4, BYD executive vice President Li Ke said in an interview with media reporters that Chile is the world's largest lithium resources reserves, BYD is negotiating with the country's government and enterprises including Chile Mining and Chemical Company (SQM) on new lithium extraction technology; In Brazil, BYD has a small independent mining project.
With the stabilization of raw material prices represented by lithium carbonate, upstream and downstream enterprises in the power battery industry chain will usher in profit redistribution. However, in the case of the withdrawal of electric vehicles, the cost of power batteries is reduced to $100 per kilowatt-hour, and the vehicle can truly compete with fuel vehicles. For the industry, one of the challenges of reducing costs is the non-uniform size of power batteries.
It is understood that the current size of the power battery is still too much, and the applicability is not strong. At the 2023 World Power Battery Conference held in the first half of this year, Miao Wei, deputy director of the Standing Committee of the CPPCC National Committee and the Economic Committee, used "important and urgent" to describe the standardization needs of power battery specifications and sizes. Xin Guobin, vice minister of industry and Information technology, also said at the meeting that it is necessary to study and prepare a standard system for power replacement technology, and promote the unification of standards such as battery size, power replacement interface, and communication protocol.
In the first half of this year, it is also worth paying special attention to the landing of the EU's new battery law "boots". The regulation aims to regulate the full life cycle of all types of batteries sold in the EU, including design, production and recycling. For example, future electric vehicle batteries and rechargeable industrial batteries will have to have carbon footprint statements, labels and digital battery passports to enter the EU market.
At present, Europe is one of the important markets for the development of power batteries, including a number of Chinese power battery companies such as Ningde Times, Zhongchuang Airlines, and Guoxun High-tech have set up factories in Europe. The EU's new battery law has virtually raised the threshold for Chinese batteries to "go to sea" in Europe. For Chinese power battery companies, it is necessary to strengthen the construction of the full life cycle carbon footprint system of power batteries and find a more suitable carbon reduction technology route.
Charging pile field: demand expansion and experience improvement under market segmentation
New energy vehicles go to the countryside, charging pile first. With the sinking of new energy vehicle sales, the layout of the charging pile network is also further expanding. At present, the promotion of policy and market demand makes the charging pile to the countryside be pressed the fast forward key. On May 5, the executive meeting of The State Council deployed to accelerate the construction of charging infrastructure, better support new energy vehicles to the countryside and rural revitalization, and proposed to "moderately advance the construction of charging infrastructure." On May 17, the National Development and Reform Commission issued the "Implementation Opinions on Accelerating the construction of charging Infrastructure to Better Support New energy Vehicles to the Countryside and Rural Revitalization", proposing to accelerate the realization of "full coverage of county and county charging stations" and "full coverage of township charging piles", and rationally promote the construction of centralized public charging stations.
In response to the policy and market demand for new energy vehicles to the countryside, many companies have begun to vigorously build related products. Gan Chunming, director of technology products at EN+, told reporters that the demand for charging pile products in the rural market mainly needs to consider its operational scenarios and household scenarios. First, the rural market is characterized by relatively dispersed consumers, imperfect power grid construction, and uneven layout of existing charging facilities. Second, rural new energy users pay great attention to cost performance, so best-selling models generally have low prices, short mileage, small size and other characteristics; Most of the new energy users in rural areas charge at home, and many people can install charging piles independently. On the basis of ensuring safety, convenience and extreme cost performance have become factors for consumers to consider. In China's new energy vehicle market, "to the car charger (OBC)" has become a trend, for the village market, the launch of small DC products more in line with the "charging pile to the countryside" application scenario needs. "In this regard, EN+ Technology launched the low-power portable box and low-power DC pile in a timely manner to meet this market demand." 'he said.
With the electric vehicle industry entering the market-oriented driving stage, the downstream charging pile industry has also ushered in the "tuyere" of the rise of private charging demand. Statistics from the China Electric Vehicle Charging Infrastructure Promotion Alliance show that as of March this year, among the 4.216 million new energy vehicles sampled by vehicle enterprise members, the number of private charging piles equipped with vehicles reached 3.884 million.
At the same time, high-power charging also ushered in the dawn of development with the emergence of high-voltage fast-charging models. According to market research institutions, in 2025, China's charging pile market space will reach 67.2 billion yuan, and the compound annual growth rate from 2021 to 2025 is expected to achieve 59%. With the improvement of driving range of new energy vehicles and the growth of fast charging demand, high-power HVDC charging has become a technical trend. At the second Shanghai International Charging Pile and Power Station Exhibition held in June this year, many equipment manufacturers have launched 480kW and above ultra-fast charging related products.
At present, the demand for global charging pile market has increased rapidly. Recently, Cinda Securities released a research report that the charging pile market in Europe and the United States has entered a period of rapid development, and the contradiction between the pile ratio is prominent, and the market has large room for growth. It is estimated that in 2025, the European charging pile market is expected to reach 40 billion yuan, and the U.S. charging pile market is expected to reach 30 billion yuan, an obvious increase from 16.1 billion yuan and 24.8 billion yuan in 2022. With the acceleration of Chinese car companies to "go to sea", the export of charging piles supporting new energy vehicles is also accelerating. Data from Alibaba's international station show that in the first week of the New Trade Festival in March, the peak season for foreign trade, overseas demand for its charging piles increased by 218% year-on-year. To this end, Ali International Station also set up a special area for the charging pile for the first time, and 295 domestic charging pile enterprises settled collectively, covering most of the leading enterprises in the industry.
It is worth noting that domestic and foreign charging pile product technical standards are different, overseas mainstream certification standards include CE standards issued by the European Electrotechnical Commission, FCC and UL certification of US market access and Germany's TuV EU market access certificate. In order to seize the overseas charging pile market, domestic manufacturers have also accelerated through overseas certification. Fragrant Hill shares revealed that in terms of the charging pile going to sea, the company has completed the European standard charging pile certification in 2022, and continues to promote the American standard charging pile certification; In the first quarter of this year, the company's overseas charging pile business began to contribute revenue. Gan Chunming told reporters that EN+ technology has obtained UL American standard certification, CE European standard certification and national standard Cape/CQC certification, products and services cover more than 40 countries and regions around the world.
Autonomous driving field: urban navigation-assisted driving landing menacing
The current autonomous driving industry has moved from the first half of the focus on technical competition to the second half of the commercial landing. In the field of passenger cars, the mass production of urban navigation-assisted driving is a proof. Mainstream manufacturers have already "rolled up" on this new track, and many L4 autonomous driving companies have also begun to join the market competition.
On July 6, at the 2023 China Auto Forum, Yu Kai, founder and CEO of Horizon, said that for independent brand models of more than 300,000 yuan, L2+ automatic driving has basically become standard, with a coverage rate of more than 80%. In his view, by 2025, what enterprises really need to do is to realize the reasonable cost performance of L2+ automatic driving, improve the use experience of urban navigation assisted driving, and the cost of configuration cannot be too high.
The market research report of Western Securities predicts that from 2023 to 2025, the vehicles equipped with urban navigation assistance driving system will reach 700,000, 1.69 million and 3.48 million, respectively, of which the proportion of vehicles supporting this function will reach 17%, 40% and 70%, respectively.
In this view, urban navigation assisted driving will become the mainstream demand of car consumers in the future, and it is not difficult to understand that the head companies have seized the high point in advance of the layout. On July 6, Xopeng Motor announced that OTA4.3.0 has been pushed, the new generation of NGP has been launched, and the urban
NGP has been added to cover Beijing and Foshan.
At the same time as the large-scale expansion of urban navigation-assisted driving functions, the promotion of higher levels of autonomous driving is also moving forward. Tesla CEO Musk predicted at the 2023 World Artificial Intelligence Conference that with the rapid development of artificial intelligence technology, full autonomous driving will be achieved at about the end of this year. He said that currently Tesla's technology is very close to the goal of fully autonomous driving. Tesla may have L4 or L5 autonomous driving capability later this year.
The development of autonomous driving in China has always been at the forefront of the world. In the field of L3 and higher levels of autonomous driving, China continues to evolve toward technological maturity and commercial landing through the expansion of demonstration projects.
For the commercial application of L3 and higher levels of automatic driving, Xin Guobin said at a routine policy briefing held by The State Council Information Office not long ago that it will launch intelligent network car access and road access pilots, organize city-level "vehicle road cloud integration" demonstration applications, and support conditional automatic driving.
Local governments are also actively promoting the development of the autonomous driving industry. Demonstration zones in Beijing, Shanghai, Guangzhou, Shenzhen and other places have actively carried out supporting infrastructure construction for the implementation of L3 and higher levels of autonomous driving technology. On June 8, the launch conference of the Intelligent Connected Vehicle Innovation Leading Area in the Lingang New Area of Shanghai Free Trade Zone was held. 15 vehicles from four enterprises, Youdao Intelligent Road, Tucson Future, Saike Intelligent and Yunji Intelligent Hang, were awarded the first batch of driverless intelligent connected vehicle road test licenses based on legislation.
The further improvement of the policy not only promotes high-level automatic driving to enter the pilot stage on the road, but also promotes the rapid promotion and landing of related products of automatic driving enterprises. In May, Pony Wisdom and Jinjiang Leasing under Shanghai Jinjiang Group announced the cooperation, and jointly applied for the Shanghai Intelligent Network demonstration operation notice and operation certificate, and officially launched the intelligent rental demonstration operation activities. On June 30, Wenyuan Zhixing officially obtained the demonstration application license of "unmanned vehicle outside remote stage" in Beijing high-level autonomous Driving Demonstration Zone, and its autonomous taxis can carry out pure unmanned demonstration operation in Beijing.
The development of high-level autonomous driving can not ignore the segmentation areas such as sanitation and distribution. In February this year, Shenzhen issued the Notice of the Urban Management and Comprehensive Law Enforcement Bureau on Further Promoting the mechanization and intelligence of sanitation Operations, requiring the effective implementation of the requirements of the Regulations on the Promotion of Artificial Intelligence Industry in the Shenzhen Special Economic Zone, improving the proportion of product configuration such as unmanned sanitation vehicles and sanitation robots, and expanding the application scenarios of sanitation artificial intelligence products. At present, the sanitation market is undergoing changes in intelligent, new energy and unmanned development, and the growth space of its autonomous driving market is worth imagining.
Whole Zero Relation: A "two-way rush" in Game Relation
The car market in the first half of this year, the most impressive is the "price war", the price war officially opened in March involving more than 10 car companies and dozens of brands. The remaining warmth of the "big fight" of this price reduction promotion has not been dispersed, and it is inevitable that it will spread to the upstream of the industrial chain.
In addition, the "price war" in the car market in the first half of the year has also accelerated the "reshuffle" of the new energy automobile industry, and many car companies have been scarred by "shopping", and new forces such as Weima, Love Chi, and Skyrim are Mired in business difficulties. The relevant person in charge of an automotive electronics startup company told reporters that they were dragged down by the new forces of car building, and a large amount of money was not recovered, affecting the normal cash flow. And it is understood that this is not a case, many parts industry people coincidentally pointed out that it is necessary to do a good job of customer choice.
The automotive supply chain affects the whole body, and the operating pressure faced by vehicle companies often spreads upward to suppliers, especially for some start-up and small parts companies, the impact is greater, and the survival pressure will become greater.
Shao Yuanjun, a senior analyst in the automotive industry, believes that the "inner volume" car market will bring more intense supply chain competition, forcing the cost performance of parts and components products to continue to improve. If parts enterprises want to survive and live well, one is to avoid homogeneous competition and find their own characteristics and barriers; The second is to choose a better and wider range of customer groups to reduce market risks; The third is to expand business boundaries, carry out characteristic development and customization, and improve the level of profit margin.
The market volatility in the first half of the year reminds parts suppliers that in addition to enhancing their own value, they should also study the industry and customers, expand the scope of supply as much as possible, and do not put "eggs in the same basket" to prevent and reduce potential business risks.
It is also worth noting that the development of electric and intelligent vehicles has also put forward new requirements for the industrial chain. In the first half of this year, whether the whole vehicle enterprise should self-research has become a hot topic in the industry. In this regard, some people in the industry believe that for vehicle companies, in response to the rapid changes in the automotive industry, they can neither involve in all segments, nor fully rely on the overall program of third-party companies, but to form an interaction with parts companies in a competitive relationship, while maintaining an independent "soul", more efficient reserve of core technologies. This also reflects that the traditional vertical linear supply chain system is changing, and the supply and demand game between parts suppliers and vehicle enterprises is protracted. Chu Ruisong, vice president of Baidu Group, put forward a point of view that the full stack self-research is difficult to achieve, and the full stack controllable must be done. "Car companies and parts suppliers should follow first principles, calm down, return to the original heart, and build a new model of co-operation with the goal of providing consumers with a safe, secure and intelligent experience with a real sense of gain," he said.
There is no doubt that the established relationship between traditional vehicles and suppliers needs to be redefined to better adapt to the rapidly changing and complex industrial ecology. In order to achieve more efficient and smooth cooperation, it must be a "two-way journey" between the whole and the zero.
Originally published by China Automotive News on July 13, 2023