Compared with the "happy troubles" of direct finished product exports, Chinese automakers are encountering greater challenges in deploying production capacity overseas.
Text: "Autobots" Huang Yaopeng.
If the year's auto exports are regarded as a race, the last month becomes "garbage time", which undoubtedly demonstrates the strong position of China's auto industry.
A year ago** reviewed today
Statistics of the General Administration of Customs of China: From January to November, the export of finished vehicles was 47620,000 units, a year-on-year increase of 598%；The export value is 6529200 million yuan, a year-on-year increase of 796%。The price comes first in quantity, and the volume and price fly together. There is no suspense about exporting 5 million units in 2023, and it may even reach 5.3 million units. Japan's annual exports are likely to be less than 4 million units, and there is no suspense about the ownership of the championship.
The caliber of the China Automobile Association is slightly lower than the customs statistics: from January to November, automobile exports were 44120,000 units, a year-on-year increase of 584%。A few days earlier, the China Automobile Association also counted 423 exports from January to October90,000 units, if you add the November export data released by the China Association of Automobile Manufacturers (48.).20,000 units), and exports from January to November were 47210,000 units, which is very different from the data of the General Administration of Customs. However, the CAAM seems to have "revised downward" the data, for reasons that will be analyzed later by Automan.
At this time in 2022, "Automan" has made several **s on the export situation in 2023. Among them, the ** about the trend is all right, but the ** for the specific number of ** is conservative.
First of all, China's auto exports will win the championship in 2023, which is highly agreed by the industrySecondly, Southeast Asia is the first "fire area" for Chinese enterprises, which is no problemThird, although the EU market has long-term potential, it is unfortunate that there will be "policy **" in the near future.
As for the number, standing at the most optimistic estimate at the beginning of the year, it was only 4.8 million units. The China Association of Automobile Manufacturers (CAAM) estimates that it is expected to hit 4 million units. Obviously, everyone is seeing the trend, but the estimate of growth momentum is generally weak.
At this point, at the export level, China, Japan and Germany are no longer players of the same grade, and it is expected that Germany will have 2 million+ vehicles, Japan will be close to 4 million, and China will be 5 million+ vehicles. This is obviously not a fixed pattern, and everyone knows that once China gains momentum, it will be difficult to stop it. There is no problem in exporting more than 6 million units in 2024, and the only suspense is whether it can surpass Japan's all-time peak of 6.8 million units.
Export perceptions can't keep up with reality
The pattern of the export market has not changed much.
From January to October, the top 10 markets are: Russia, Mexico, Belgium, Australia, the United Kingdom, Saudi Arabia, the Philippines, Thailand, the United Arab Emirates and Spain. The four regions are still evident: Russia, ASEAN, Western Europe, and the Middle East, all of which are regulars on the list.
Autobots once predicted that the Russian market was a gift, and the export volume targeted at it was a little more than the second, third, and fourth places combined, but these data do not yet indicate the weight of the gift. This is because the OEMs and IP-licensed vehicles produced by local Russian brands (which need to pay a royalty to the licensor for the use of the model, just as a joint venture pays to the foreign parent company) account for a larger share of the market.
Or to put it another way, the flood of Chinese cars has inundated the Russian market, which has a volume of 1.6 million units. And in 2024, sales in the Russian market may reach 2 million units, and Chinese brands will get more and deeper benefits.
In fact, what needs to break through traditional cognition here is not only us, but also Russia's. In the annual "Putin Wired" program, Russia** said in response to "whether it is worried about the expansion of Chinese cars in Russia": "The expansion (of Chinese cars) is not unique to Russia, and Chinese manufacturers are also actively exploring other markets to replace local brands, including the European market." ”
Previously, the Russian market was carved up and cannibalized by European, Japanese and Korean brands (the share of local brands has been declining), but Russia has never seemed to have similar worries, what does this mean?
Russia can accept the wanton occupation of its market by "first-mover countries", but it shows a certain discomfort with a similar offensive of Chinese cars. If you don't consider the deeper reasons, at least the stereotype can't keep up with the reality of the rise of China's auto industry. In the past 11 years, even though China's market has been the largest in the world, it has always been evaluated as "big but not strong". If the first export cannot be called a "rise", it is too Versailles.
Europeans have acknowledged the technological and commercial leadership of China's automotive industry. However, they blamed European automakers on scaling back investment during the three years of the pandemic, while "young Chinese rivals seized the opportunity."
This argument is clearly untenable. Because the global multinational car companies are reluctant to give up the technical assets of fuel vehicles when the new energy wave is coming. They underestimate the height of the wave, but also the pressure to intervene and transform. This is a difference in speed due to strategic differences, not a difference in investment.
When will the bottleneck of sea freight be broken
However, the Germans are right about one thing, and that is that the width of the Chinese market has severely suppressed the production capacity of Chinese automakers. Many factories are scheduled to produce at half or less of their design capacity.
Going global and quickly realizing overseas full-chain deployment (rather than simple asset-light commerce) is the strategic assumption of most Chinese brands.
In fact, exports are now constrained by ocean freight capacity, not customer orders.
From 2019 to 2022, China's export volume increased by 6 times, and freight rates soared 8 times at one point. However, the ro-ro ships that Chinese companies can provide and are suitable for carrying finished vehicles are only 1 7 of the corresponding global capacity, and only a dozen of them have ocean capacity. Chinese shipowners also lack foresight on export waves.
Chinese automakers and shipping companies have responded by frantically placing orders for new ro-ro ships, and China Shipbuilding Corporations alone have received orders for more than 200 ships, including 42 similar ships to be built at the Guangzhou shipyard in three years. Today, the production capacity of this type of ship has expanded eightfold. A large ro-ro ship that can accommodate 7000-9000 vehicles.
BYD ordered 6 ships;Chery cooperates with Wuhu Shipyard to develop its own ship type;SAIC and COSCO have established the Ocean Motor Shipping Company, a new company that is building a fleet of 24 ships with an annual capacity of 700,000 vehicles. In addition, Changan, GAC, and Great Wall have all made similar moves, and Chinese car companies are preparing to do a big job.
To this end, Yangshan Port in Shanghai, Beilun Port in Ningbo, and Yantian Port in Shenzhen have transformed large areas, even islands, into parking spaces for new cars. This is the reason for the discrepancy between the data of the General Administration of Customs and the data of the China Association of Automobile Manufacturers at the beginning of this article.
In the customs caliber, the process of completing the customs declaration and waiting for loading has been included in the export data. Due to the shortage of capacity, these ships are waiting for longer and longer to board, resulting in more and more vehicles that are "not in transit".
With the large number of ro-ro ships reloading, the port transshipment cycle of three or four weeks is now expected to be shortened. Aggressively building shipping capacity is the best illustration of the rise of China's auto exports.
Chinese and Japanese brands are highly competitive in Thailand
Compared with the "happy troubles" of direct export of finished products, the deployment of overseas production capacity is encountering greater challenges. The EU market is trying to impose restrictions on both (big trade and local production).
ASEAN, which has no restrictions, can see the process of Chinese companies firing their full firepower and challenging Japanese companies. Almost all of the new EV market share was taken by Chinese brands.
At the 2023 Thailand Motor Expo, there are 5Of the 30,000 cars booked, 38 of them4% are electric vehicles. Among the top 10 orders, there are five Chinese and five Japanese brands, followed by Toyota, Honda, BYD, Aion, MG, Changan, Great Wall, Suzuki, Nissan, and Mazda. In 2020, the Japanese market share in Thailand was as high as 85%. Now the situation is changing very quickly.
Thailand currently has the largest car production capacity in ASEAN (2 million units), half of which is exported, more than the UK and Italy combined. Indonesia and Malaysia also have production capacity of 1.5 million and 700,000 units.
The key is that Thailand does not have the best barriers against Chinese brands, and Thailand, Malaysia, Vietnam, and Indonesia all want to serve as ASEAN electric vehicle industry centers. If Thailand were to make the transition to electric vehicles, nothing would hurt more than Japan.
Recently, both Japan and China have been engaged in a game over Thailand's second-phase EV subsidy (about 30,000 yuan by the end of 2023). Japan wants to eliminate subsidies for electric vehicles, while China wants to maintain them. Thailand has not yet made a decision, but it is possible that the subsidy will be halved.
The consumption tax on pure electric vehicles is 2%, and the Japanese have won the consumption tax standard of 8%, while the consumption tax on gasoline vehicles starts at 12%. It can be seen that China and Japan are engaged in a fierce game over Thailand's industrial policy.
In the Thai market, the competition is fierce, with both Japanese and Chinese brands seeing a 10%-15% drop from the same period in 2022. This is almost an abbreviated version of the competitive situation in the Chinese market.
In 2023, sales of pure electric models in Thailand are expected to be around 80,000 units, 10 times more than in 2022. Although the base is small, it can only be described as a surge. Among them, 9,000 electric vehicles were sold in November. In the same month, Thailand's new energy penetration rate reached 182%。Thai regulators want to have 30% of the 2.5 million vehicles produced locally by 2030 that are electric. This wish is likely to be realized ahead of schedule with the strong investment of Chinese enterprises.
The Japanese have a complete brand service, ** chain and extensive brand identity in Thailand. Now the Japanese are in a similar dilemma in ASEAN, and if they refuse to use the electric ** chain brought by Chinese car companies, they will not be able to compete with each other in terms of cost. If you share the ** chain with your opponents, you will not be able to maintain the differentiation of brands and products. In terms of some unique product capabilities of electric vehicles, Japanese manufacturers have not yet kept up with the pace of Chinese companies.
In Japan, the penetration rate of electric vehicles is 3%. For a variety of reasons, Japan has not massively subsidized electric vehicles (at least part of the lobbying by car companies). But in this way, the ability of local incubation of electric ** chains has been weakened. As the only power battery manufacturer in Japan that can rank among the top 10 in the world, Panasonic's ranking is constantly moving backward.
To this day, Toyota remains a giant in the Thai market, but it is being challenged by increasingly tough Chinese brands. Changan, Aion, Great Wall, BYD, and MG have established a solid brand image of electric vehicles in Thailand. Chery, on the other hand, has regrouped and announced that it will re-enter the Thai market under two independent new brands, OMODA and JAECOO.
Thai consumers have now reached a consensus that they should choose Chinese brands when buying electric vehicles, which is similar to the domestic market. With the rapid increase in the penetration rate of electric vehicles in Thailand, the window of opportunity for latecomers will become narrower and narrower.
ASEAN has FTAs with both China and Japan, while ASEAN has a population of only 50 million fewer people than the whole of Europe (more than the EU) and only 11 countries, which is more European integration than 45 countries.
Among the medium-sized markets (million-level), only Thailand and Indonesia (real-world level). The potential medium size is possible in Malaysia, Vietnam, and the Philippines, but the Philippines is the least likely.
It is no secret that the first strategic choice for Chinese car companies to go overseas on a large scale is Southeast Asia, and the object of challenge is Japan. But the competition is so fierce in 2023, not 2025, that even at the beginning of 2023, there is a lack of estimates.
At the end of 2022, "Automan" believes that 2022 is the beginning of China's auto export scene, and this judgment seems to be more accurate today. 2023 has really created a big scene, and the scale is even bigger than previously imagined. This may lead to the realization of the two planned nodes of export and overseas production capacity layout in a significant early stage. It seems that imagination should be a little bolder.
The EU, another strategic priority, will continue to face headwinds in 2024. However, since European car companies have long-term and deep commercial interests in China, the EU will not theoretically go too far. Of course, this is based on the rational trade-off of the other side.
Over the past year, multiple events have shown that certain countries are not thoroughly "rational people", and in many cases populism and short-term actions based on votes prevail. This forces us to tend to estimate the short-term prospects for the export of cars from China and Europe, with greater difficulties. 【Copyright Notice】This article is the original manuscript of "Autobots", and it is not allowed to be unauthorized **.