preface:
Standing at the beginning of 2022, BYD and Tesla respectively released their annual sales in 2021, and both created their own sales records. Today, just take this to talk about the investment logic of new energy vehicles in 2022.
Author: Happy and comfortable
Source: Snowball
First, the 2021 industry summary - beyond expectations
1, the total amount exceeded expectations
I believe that the biggest feeling in the field of new energy passenger vehicles in 2021 is that sales continue to exceed everyone's expectations - even the forecasts of industry institutions are not short to raise.
Taking the multiplication association as an example, in early 2021, the annual sales volume of the 21-year forecast is 2 million, which is raised to 2.2 million in April, and 2.4 million in June, and the relevant forecast is simply not made after the second half of the year.
Taking the China Automobile Center as an example, it is also forecast at the beginning of 2021 to 2 million vehicles, and by the end of the year, it is forecast to be 2.5 million vehicles.
Unexpectedly, the sales target of 2.4 million yuan was fully achieved by October.
We can see the overspeed development of new energy passenger cars in 2020 through the monthly sales trend and the change curve of new energy penetration rate.
2. Hybrid explosion
Hybrid sales exceeded the 500,000-unit mark for the first time in January-November 2021 (annual sales are expected to hit a new record of 600,000), an increase of more than 179% year-on-year, far ahead of the 146% year-on-year growth rate of pure electric models.
In 2021, with the launch of BYD's DM-i super hybrid, for the first time, an affordable alternative to traditional fuel vehicles was achieved, which triggered a wave of consumer purchases.
It is reported that by December, the backlog of orders for BYD's DM-i hybrid models has exceeded 300,000. Bydie's DM-i super hybrid market response has also re-triggered the attention of major car companies to hybrid models, and it is expected that in 2022, independent brands such as Great Wall, Geely, Changan, and Chery will also fully develop the hybrid market.
According to industry agencies, hybrid sales in 2022 will have the opportunity to exceed the new sales record of 1 million vehicles (in terms of growth rate, it will also be significantly ahead of the growth rate of pure electric models).
3. The big pattern has begun to emerge
If you re-examine the new energy sales ranking of top 16 car companies from January to November, it can be found that in addition to the cumulative sales of the north and south Volkswagen (which must be calculated together) can enter the TOP16, no joint venture or luxury brand can enter the list. And that's something that's almost impossible to happen in the era of fuel vehicles.
BYD, relying entirely on the sales of new energy passenger cars, entered the fourth place in the passenger car sales list in November and became the fourth place in the annual cumulative sales of its own brands.
Traditional independent brands such as Geely and Changan are losing ground in the field of new energy, not only inferior to GAC passenger cars and SAIC passenger cars, but even the ranking of new power brands such as Weilai, Ideal and Xiaopeng is ahead of them.
Basically, China's new energy passenger car pattern has initially taken shape: two super + three strong + a group of new and old forces struggling to catch up.
Second super: BYD + Tesla, one is a Chinese new energy leader in the synchronous development of pure electricity + plug and mix, and the other is a new american force based on pure electricity.
Top three: Xiaopeng + WEILAI + Ideal, Xiaopeng is temporarily leading with rich product segments, Weilai is expected to become China's first high-end passenger car brand with design + service, and Ideal relies on a single product to support it.
Catching up: the old forces are SAIC, Great Wall, GAC and Chery, the new forces are Nezha and Zero Run, and the rest of the brands have begun to gradually fall behind.
Second, the 2022 investment outlook - common sense + logic + data
1. How to view the electric vehicle industry?
(1) We can first understand the scale of the automobile industry
The first set of data: What is the GMV of China's automobile consumption?
I believe that many friends may not be able to answer at once. 3.89 trillion yuan in 2018, 3.93 trillion yuan in 19 years, 3.94 trillion yuan in 20 years, 3.92 trillion yuan in 21-11 months, an increase of 10% year-on-year.
This is the data directly related to new car sales, and used cars are about 75% of the new car market, about 3 trillion levels, if you calculate the cost of maintenance and repair is about 3 trillion, the total GMV directly related to the car is about 10 trillion.
This is the second largest consumer market after the real estate industry of 10-15 trillion (the corresponding consumption of communication equipment is about 600 billion)!
The second set of data: What is the operating income of the world's largest automotive company?
The full year 2021 data is not yet available, let's first look at the data for the whole year of 2020. The Volkswagen brand sold 9.31 million units worldwide and Toyota sold 8.9 million units.
Taking the Volkswagen Group as an example, the group's sales volume is 10 million yuan, and the annual revenue exceeds 1.5 trillion yuan. Among them, Volkswagen China (north and south Volkswagen combined), new car sales of 3.5 million, China revenue of more than 500 billion yuan.
If you compare it with the 4 trillion Chinese automotive GMV, Volkswagen's global GMV is equivalent to 37.5% of the GMV of the entire Chinese automotive market, and this is just a global car company.
It can be said that the automobile manufacturing industry and civil aviation together represent the peak of the civil manufacturing industry, and the entire industrial chain is longer, with abundant value creation ability and sufficient employment absorption capacity.
(2) From the Chinese market to the global market
The era of fuel vehicles: China's automobile manufacturing is large but not strong, accounting for 30% of the world's share
In the era of fuel vehicles, China's automobile manufacturing has long been in the middle and lower reaches of the global automobile manufacturing industry chain, whether it is the three major parts of traditional fuel vehicles such as engines, gearboxes and chassis, whether it is core technical strength or research and development capabilities, there is a huge gap from the world-class level.
In terms of global sales, Germany, the United States and Japan and South Korea are the world's automotive manufacturing powers. China's car sales account for 30% of the world's total, while China's own brands have a global market share of only 12.8%, which is extremely incompatible with our position as the world's largest automobile consumer market.
New energy era: China has become the most important market for new energy vehicles in the world, accounting for 51% of the global new energy market.
Entering the era of new energy, whether it is a core three-electric system such as battery, motor, and electronic control, Chinese enterprises are in a leading position in the world, and the research and development of our intelligent cockpit, intelligent auxiliary driving and other technologies can also keep up with the world's first-class level. This is also the first time that China has the strength to synchronize with the world in the local field of automobile manufacturing.
From the perspective of global new energy sales, China, Europe (mainly Germany) and North America (mainly the United States) are the core consumers of new energy passenger cars in the world. Among them, China's sales lead the global new energy market, the highest monthly market share once exceeded 60%, and China is no longer a follower in the automotive field, and the global new energy share of independent brands exceeds 45%.
From 13% of fuel vehicles to 45% of new energy, if China's new energy passenger cars can go global, it will completely change the pattern of global automobile manufacturing.
(3) Re-understand China's electric vehicle industry from a global perspective
If we look at the inner and outer cycles from the perspective of income distribution. Then the vast majority of the domestic consumer market is actually the internal cycle of "left pocket and right pocket", whether it is real estate, medical care or other consumption. In essence, it is to transfer the money earned by ordinary people A to the hands of ordinary people B through consumption, which does create value in this process, but it is more of an internal distribution.
So what is outer circulation? To put it simply: it is to make money in other parts of the world through brands and high value-added products.
In the popular point is "the use of technology generation difference, harvest the global market", how to understand this sentence?
From the steam age to the information age, it can basically be said that it is the continuation of "using the technology generation gap to harvest the global market", the crushing advantage of the machine on manpower, and the monopoly advantage of information. Even now, the reason why they are so afraid of Huawei's technological breakthroughs is because no one wants to be those harvested.
There are many questions: from 2000 to 2010, it was not all the process of China's manufacturing and exporting to the world, why can't it achieve such an effect? The reason is that the added value of the product at this stage is too low.
If in the future, China's new energy passenger cars can go from China to the world, it can be said that it has achieved "the export of high value-added products and brands".
Personally, I believe that such an external cycle is a high-quality external cycle that creates more value.
2. How to build a logical system?
(1) The underlying logic of the industry
Returning to the automotive industry, what are the characteristics of this industry?
Three keywords: technology-driven + asset-heavy + economies of scale
How to understand these three keywords? Let's look at them one by one.
Technology-driven: The threshold of the automotive industry is not high, but the threshold of core components is very high, and the real high value-added is on the one hand the brand, on the other hand, the core components. For independent brand vehicle manufacturers, if they cannot control the core components and brands, the gross profit of the whole vehicle is almost impossible to see.
Positive cases such as Tesla, under the premise of continuous price reduction, the gross profit of the whole vehicle can be controlled at more than 25%, which is the dream of independent brands; compared with the independent manufacturer Geely, SAIC Passenger Cars, etc., the gross profit of the whole vehicle is less than 10%.
In the field of new energy passenger vehicles, the battery is the single component with the highest proportion of vehicle cost, and it is expected that in 2022, with the rise in the price of upstream resources, it will be further transmitted to the vehicle field, and the profit pressure of vehicle companies will increase significantly.
Heavy assets: the vehicle production line investment is huge, the research and development cycle is as long as 2-3 years, and the actual market sales performance of the model is seriously lagging behind (simply put, this is an industry with huge investment in the early stage, but the actual result feedback cycle is relatively poor).
Taking the ideal Beijing factory as an example, the investment in capacity transformation of 250,000 yuan is 6.5 billion yuan, and the investment intensity of an average of 100,000 products is more than 2.5 billion yuan. In the 3-5 year cycle, for more than 85% of the capacity utilization rate and 60% of the capacity utilization rate, the bicycle depreciation fee difference is huge, and it also has a significant impact on the gross profit of the vehicle.
The factory production takes time, new car research and development takes time, but the real model listing sales performance is obviously lagging behind, once the model sales can not break through the phenomenon, the entire operating data will be very ugly.
Economies of scale: Economies of scale are a salient feature of almost all technology-driven and asset-heavy industries, because only scale can amortize huge R&D expenses and fixed asset input costs.
Therefore, in 2021, on the basis of the above three industry characteristics, I summarized 8 words that can well express the characteristics of the vehicle industry: technology + scale + cost + explosion. It basically covers performance from the underlying technology to heavy assets to the sales side.
(2) Quantification of the underlying logic
However, many friends have said: there is no problem with logic, the question is how to quantify the judgment of investors?
Here is a very simple formula: revenue = the sales volume of the model of the model, the unit price of the model, and finally the revenue of all models can be summarized.
Use market share indicators to reflect the scale benefits of car companies;
Use the explosive rate indicator to examine the R&D efficiency of a vehicle company;
The car company's sales volume the car company's ASP to estimate the overall revenue scale.
As a result, 4 quantitative indicators were derived: market share + explosive rate + bicycle ASP + new energy penetration rate (this indicator is mainly used to observe whether vehicle companies can keep up with the changes in the trend)
3. How to establish evaluation criteria?
(1) Indicator 1: Market share - 2%
The market share indicator is the most direct indicator of the scale benefit of withdrawals. The entry standard is 2%, what is the concept of 2%, and the domestic market is about 400,000 / year sales. If it does not reach this annual sales volume, it is basically not too related to the scale. The standard for excellent performance is 5%, which is about 1 million annual sales.
Let's look at the market share from January to November, the market share threshold of the TOP15 brand is 1.88%, and the total market share is 70%. Among them, the highest share of volkswagen reached 11.47%, which is also the only brand with a market share of more than 10% in the Chinese market; in the Chinese market, only Volkswagen, Toyota, and Honda exceeded 5% (Nissan is the closest); among the independent brands, there is no brand that has achieved a 5% market share, Geely, Changan, Wuling, Haval, BYD, Chery, these 6 brands are the leaders of independent brands.
However, in general, the gap from the joint venture brand is still very obvious, and this is still the sales volume under the premise of the obvious growth of the share of independent brands.
(2) Indicator 2: Explosive rate
Let's first define what is a blockbuster?
, monthly sales of 20,000, annual sales of 240,000;
200,000-300,000 models, monthly sales of 10,000, annual sales of 120,000;
> 300,000 yuan model, with monthly sales of 0.8 million and annual sales of 100,000;
At this stage, for new energy models:
, monthly sales of 10,000, annual sales of 120,000;
200,000-300,000 models, monthly sales of 0.5 million, annual sales of 60,000;
> 300,000 yuan model, with monthly sales of 0.4 million and annual sales of 50,000;
From this dimension, in fact, it is particularly simple to only need to look at the TOP10 sales list of each basic model.
Basically, among the independent brands, BYD, Geely, and Changan are relatively leading, and the Great Wall is a partial student, but in the mainstream A-class SUV field, Haval H6 has been dominating the top position of the list all year round.
Looking at the new power brands, Ideal and Xiaopeng are also regular customers of the TOP10 sales list, and Due to the high pricing of Weilai, the sales volume of each model is relatively average.
(3) Indicator 3: Bicycle ASP
Taking the annual sales volume of 50,000 units as the threshold, we look at the average sales price of independent brand passenger cars, and the average sales price of the overall independent brand is 179,000 yuan.
The first echelon: Weilai, Ideal, Xiaopeng and Hongqi, all exceed the average price, which can be said to be China's independent high-end brands;
The second echelon: Lynk & Co, WEY, E-An and BYD, the average price is 140,000-170,000, of which Lynk & Co, WEY and E-An are sub-brands of traditional OEMs, with annual sales of about 200,000, which is a typical mid-range brand;
However, among the top 8 brands, except for BYD, there are no brands with annual sales of more than 400,000 – basically not reaching the 2% market share threshold.
The third echelon: Trumpchi, Benten, Haval, BEIJING, Changan, the average price is 100,000-140,000, belonging to the mainstream brand.
Among the traditional independent brands (not counting sub-brands), BYD's ASP is the highest and has surpassed Volkswagen's ASP.
From the cumulative year-on-year sales volume and the cumulative price year-on-year, there are three main brands that have achieved double-digit growth: BYD, Dongfeng Fengxing and Great Wall Euler.
(4) Indicator 4: Brand new energy penetration rate
The new forces are 100% new energy products, for traditional OEMs, BYD's new energy penetration rate is the highest, reaching more than 80%, followed by SAIC-GM-Wuling at about 45%, GAC passenger cars at about 35%, SAIC passenger vehicles about 25%, great wall at about 15%, basically comparable to the industry's penetration rate, Chery, Changan, Geely's new energy penetration rate are lower than the industry average, especially Changan and Geely less than 10%.
4. Future valuation logic
1. Reconstruction of valuation logic
With the further improvement of the popularity of smart electric vehicles, the entire passenger car industry will change from simple hardware sales to hardware + software value composition. Whether it is the FSD paid subscription model pioneered by Tesla or the Xpolit paid purchase of Xiaopeng Motors, it has begun to break the one-time delivery model of traditional car companies and customers.
In the future, the value composition of an intelligent networked car will become: 40% of the vehicle hardware + 40% of the intelligent software + 20% of the content and services, and the car company is the most promising party to obtain sustainable income from the whole life cycle of the vehicle. Taking Tesla as an example, on the basis of the early hardware embedding, a new revenue-generating model of FSD payment opening, OTA payment upgrade, and networking function paid subscription has been preliminarily verified.
In the future, the valuation of the whole vehicle will evolve into: the hardware valuation of the vehicle sales (the PE valuation of the traditional OEMs) + the software valuation (the valuation of the benchmarking technology or software companies)
2. 3 50% indicators as observation points
If investment requires moderately advanced expectations, there are 3 50% indicators that can be used as observation points for change:
The first 50% - China's new energy penetration rate achieved 50%, basically marking the end of the first half of "electrification".
The second 50% - China's L2+ level of assisted driving penetration rate achieved 50%, basically marking the full opening of the second half of "intelligence".
The third 50%, the global L3 level assisted driving penetration rate of 50%, basically marks the complete formation of a new pattern of the global automotive industry.
Write at the end
Regarding the investment in new energy vehicles in 2022, from common sense to logic to data, as well as 4 quantitative indicators and overall valuation logic and follow-up observation points, I will say this today. I hope that every friend can analyze and screen out from this framework, suitable for their own investment targets
Risk Warning: The views mentioned in this article only represent the opinions of individuals, and the subject matter involved is not recommended, and trading accordingly is at your own risk.
2022 Snowball Private Placement Year Ploy Meeting
How will asset allocation be made in 2022? Can popular tracks such as new energy continue to be strong? Are weaker sectors such as consumer medicine brewing new investment opportunities? Can industries such as real estate banks usher in a reversal?
The Annual Strategy Meeting of Snowball Private Placement brings together many top private equity managers, based on the present and looking to the future, to discuss the investment direction in 2022, and today's wonderful live broadcast is as follows: