中国电动汽车：突然刹车

1、Global Auto SectorChina electric cars: braking suddenly?Near-term growth bottleneckAfter over 80% sales volume growth in 2018 and 60% in H119, we expect H219 Chinaelectriccargrowthtoslowtoaroundzero.Asubsidycutofover60%sincelate Juneisakeyreason,butover-relianceonlicenceplaterestrictionsandfleetpurc

2、hases arealsodragsonnear-termgrowth.Aftertracingseveralmillioncompulsoryinsurance registration entry data, we estimate over 40% of electric cars are sold in cities with licence plate restrictions and where restrictions are being relaxed amid weak combustionenginecarsales.Ride-on-demandprocurementacc

3、ountsforabout40%of electric car sales and a growth bottleneck is emerging. Car makers urgently need to penetrate individual procurement in non-restrictive cities for further growth, in our view.Wepreferleadingincumbents(GACandGeely)overEV-focusedplays(NIOand BYD) in this environment.The race forinno

4、vationThetougherenvironmentaside,theindustryismakingfasttechnologicalprogress.We analysed hundreds of model variants approved by the government, and found that during the past 18 months energy density has improved by 13%, power efficiency by 26%, and average driving range is up by 50%. The competiti

5、ve landscape is also changing fast with GAC and Geely emerging as new tech leaders. Tesla still leadson brand recognition and used car residual value, and we expect localisation to bring downpricesbyover20%anddisruptthemarket,especiallyatthehighend.Long-term cost parity unchangedBased on innovation

6、and progress on the supply side, we think total cost parity with combustioncarsisachievableinthenextthreetofiveyears,andtheelectriccarmarket willresumea30-40%volumeCAGRto2025E,accountingforaquarterofthenewcar market by then. However, we expect tough competition in thelead-up.Challenging times for EV

7、 companiesWethinkinvestorsunderestimatethechallengesforEVmakersandthesupplychain. We resume coverage of BYD with a Sell rating on rising competition and a rich valuation.WethinkleadingincumbentcarmakerslikeGACandGeelyhavemorethan adequateresourcesforelectriccarR&D,andwehaveBuyratingsonboth.Figure 1:

8、 Key company watch listShareprice2019E2020EEV revCompanyCodeRatingPT (LC)(LC)PE (x)PE (x)exposureKey EV initiatives to watchGAC-H2238.HKBuy9.308.007.46.730%*Aion series new launchesSAIC600104.SSBuy28.0023.918.67.95%Next generation EV product based on Marvel technologiesGeely0175.HKBuy13.6013.8612.11

9、0.715%Fleet powertrain electrification, dedicated PMA platformVWVOWG_p.DEBuy200.00153.945.55.2 5%MEB platform global ramp-upCATL300750.SZSell60.0070.9034.829.6100%Next generation cell/pack, overseas expansionBYD-H1211.HKSell32.0038.1035.830.745%External sales of batteries, e-series new launchesTesla

10、TSLA.OSell160.00244.53n.a.60.8100%China plant ramp-up and model Y launchRefers to GACs Trumpchi unit. Above data of 10 October 2019. Source: Thomson Reuters, UBSestimates HYPERLINK /investmentresearch /investmentresearchThisreporthasbeenpreparedbyUBSSecuritiesAsiaLimited. ANALYSTCERTIFICATIONANDREQU

11、IREDDISCLOSURESBEGIN ONPAGE40. UBSdoesandseekstodobusinesswithcompaniescoveredinitsresearchreports.Asaresult,investorsshouldbe aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making

12、 their investment decision.Global Auto SectorUBS Research THESIS MAP a guide to our thinking and whats where in this report HYPERLINK l _bookmark1 OURTHESISINPICTURESMOSTFAVOUREDLEAST FAVOUREDGAC-H,Geely, SAICBYD-H, NIOPIVOTALQUESTIONSQ: What is the China electric car market growthoutlook?We expect

13、a near-term sales volume growth bottleneck for the China electric car market, before resuminghealthygrowth.WebelieveH219andH120growthwillbelargelyflatYoY,comparedto over 60% growth in H119 and 80% in 2018, due to sharp subsidy cuts and a growth bottleneck in citieswithrestrictionsonlicenceplatesandf

14、leetpurchases.Weexpectgrowthtopickupagainin H220,duetocontinuedtechnologyimprovementsandcostparitywithcombustionenginecars.We estimateac40%salesCAGRupto2025Etoreachoveraquarterofnewcarsales. HYPERLINK l _bookmark2 Q: Has the competitive landscape for China electric cars stabilised?No. We note indust

15、ry leaders constantly rotating with new launches of leading products pushing the technology barrier. BYD has a longer track record and better customer reputation than peers, butitslatestproductsnolongerstandoutintermsofdrivingrange,batterypackdensity,orpower efficiency. GAC is emerging as a leader o

16、f these parameters with its latest Aion series products. Tesla leads in technology and brand premium; thus its localisation strategy should impact local carmakers,especiallythosepositionedinthehighendlikeNIO. HYPERLINK l _bookmark3 UBSVIEWAfter around 80% sales growth in 2018 and 60% in H119, we exp

17、ect H219 China electric car growthtoslowtoaroundzero,beforeresuminghealthygrowth.Weestimateac40%salesCAGR to2025E,reachingoveraquarterofnewcarsales.AmongEVOEMs,GACisemergingasaleader with its latest Aion series products. Tesla has technology leadership and brand premium; thus localisationshouldimpac

18、tlocalcarmakers,especiallythosepositionedinthehighendlikeNIO.EVIDENCE1) We traced about 2m electric car sales destinations through first-time compulsory insurance registration,andfoundabout40%ofelectriccarsaresoldinlicenceplaterestrictivecitiescurrently.2) Our cost parity analysis suggests buyers co

19、st parity has now been reached if annual driving distanceisover20,000km.3)WeanalysedseveralhundredelectriccarmodelvariantsfiledatMIIT, and found industry technology progression remained robust in the past 18 months, with a 13% improvementinaveragebatteryenergydensity,a26%improvementinpowerefficiency

20、anda50% improvement in driving range.WHATSPRICEDIN?TheChinagovernmentcuttheNEVsubsidybyover60%in2019,andEVsalesvolumesinceJuly was lower than our and market expectations. We think the market is partially pricing in the near- termslowdown,butEVmakersarestilltradingatsignificantpremiumstocompaniesthat

21、mainlysell combustioncars. HYPERLINK l _bookmark4 moreUBS global EV sales forecasts20152016201720182019E2020E2021E2022E2023E2024E2025EEurope186,170206,584287,270384,052537,673860,2761,290,4151,935,6222,903,4334,209,9785,893,969growth y/y11%39%34%40%60%50%50%50%45%40% of new car sales1.0%1.0%1.4%1.9%

22、2.6%4.2%6.2%9.2%13.8%20.0%28.0%US116,099159,139199,826361,307397,438457,053525,611604,453695,121799,389919,298growth y/y37%26%81%10%15%15%15%15%15%15% of new car sales0.7%0.9%1.2%2.1%2.3%2.8%3.1%3.5%4.0%4.6%5.3%China206,400333,728561,1211,054,4291,231,6321,595,1272,240,8233,196,8804,506,8726,228,316

23、8,051,353growth y/y62%68%88%17%30%40%43%41%38%29% of new car sales1.0%1.4%2.3%4.5%5.8%7.1%9.6%13.3%18.2%24.7%31.3%Japan25,32824,91854,71052,01367,61787,902123,063172,288241,203361,805542,707growth y/y-2%120%-5%30%30%40%40%40%50%50% of new car sales0.5%0.5%1.1%1.0%1.3%1.8%2.5%3.5%4.9%7.4%11.0%ROW15,0

24、0050,856106,311166,446216,380281,294365,682511,955716,7361,003,4311,505,147growth y/y239%109%57%30%30%30%40%40%40%50% of new car sales0.1%0.2%0.4%0.6%0.7%0.9%1.1%1.6%2.2%3.1%4.6%Total548,997775,2251,209,2382,018,2472,450,7403,281,6524,545,5936,421,1989,063,36612,602,91816,912,473% of global PV sales

25、0.6%0.8%1.3%2.1%2.6%3.4%4.6%6.4%9.0%12.4%16.6%Source: IHS, Thinkercar, UBS estimatesGlobalAutoSectorUBSResearchOURTHESISINPICTURES HYPERLINK l _bookmark0 return 100%80%60%40%20%201720182019E2020E2021E2022E2023E2024E2025E0%201720182019E2020E2021E2022E2023E2024E2025EWhile NEV sales are set to rise on

26、increasing penetration, we expect volume growth H219 and H120 to be bumpyCitieswithcarpurchaserestrictionTier 2 - 4 citiesTier5citiesTotal y/y growth (RHS)Rest of OEMs will have to Leadinglocalcompete ina1,600,0001,400,0001,200,000OEMs could still gain market share shrinkingpool We expect VW and Tes

27、la to contribute over half of the 2020 NEV volume growth1,000,000VW andVW andTeslaare expected to win half theincremental market VWTesla GACPVSAIC PVGeely BYD2020T4 18%T5 11%BJ 10%SHT3 17%26%18%26%18%26%23%24%33%30%44%8%50%9%12%32%31%11%20%T2 19%3%GZRestricted4%35%SZ7%HZTJ4%5%GY2%In2018,citieswithca

28、rpurchaserestrictionsrepresented 35% of BEV and 70% of PHEV sales in China80%60%40%20%Tiny cars are quickly losing market share to compact size cars in NEV market0%201620172018Jan-Aug 2019TinyvehiclesSmall vehiclesCompactvehiclesPlug-in hybrid389360364371 348334318323320389360364371 348334318323320

29、302256380360340320300280260240220200Feb-18May-18Aug-18Nov-18Feb-19May-19NEDC range (km)Average NEDC range of existing BEV models increased from 256km in 2018 to 389km in August 2019, reflecting technology progression12 10.99.1 10.91098Meanwhile power consumption is declining fast7Feb-18May-18 Aug-18

30、Nov-18Feb-19May-19 Aug-19 Power consumption per ton(kWh/100km/ton)%200(20)(40)(60)(80)YTD EV names have underperformed traditional carmakersCSI300NASDAQHSIGACGeelyCATLSAICBYD-HNIO(100)CSI300NASDAQHSIGACGeelyCATLSAICBYD-HNIO300 %0(100)(200)(300)(400)(500)Consensus implies long-term growth in EV-centr

31、ic OEMs, while assigning negative value to traditional OEMs long-term growthGACGeelySAICNIOBYDCapitalized current earnings Capitalized short-term growthImplied long-term growthSource: Thinkercar, UBS estimatesExecutive summaryTheUBSGlobalAutoresearchteambelieveselectricvehiclesarethecarsofthe future

32、:theUBSEvidenceLabteardownofaChevyBoltin2017andaTeslaModel 3 in 2018 supports this view. We have been surprised how fast electric vehicle sales growth has been, particularly in China. While we expected about a 40% electriccarsalesCAGRinChina,thegrowthratewasover80%YoYin2018and over 60% YoY in H119.F

33、igure 2: UBS global EV sales forecasts20152016201720182019E2020E2021E2022E2023E2024E2025EEurope186,170206,584287,270384,052537,673860,2761,290,4151,935,6222,903,4334,209,9785,893,969growth y/y11%39%34%40%60%50%50%50%45%40% of new car sales1.0%1.0%1.4%1.9%2.6%4.2%6.2%9.2%13.8%20.0%28.0%US116,099159,1

34、39199,826361,307397,438457,053525,611604,453695,121799,389919,298growth y/y37%26%81%10%15%15%15%15%15%15% of new car sales0.7%0.9%1.2%2.1%2.3%2.8%3.1%3.5%4.0%4.6%5.3%China206,400333,728561,1211,054,4291,231,6321,595,1272,240,8233,196,8804,506,8726,228,3168,051,353growth y/y62%68%88%17%30%40%43%41%38

35、%29% of new car sales1.0%1.4%2.3%4.5%5.8%7.1%9.6%13.3%18.2%24.7%31.3%Japan25,32824,91854,71052,01367,61787,902123,063172,288241,203361,805542,707growth y/y-2%120%-5%30%30%40%40%40%50%50% of new car sales0.5%0.5%1.1%1.0%1.3%1.8%2.5%3.5%4.9%7.4%11.0%ROW15,00050,856106,311166,446216,380281,294365,68251

36、1,955716,7361,003,4311,505,147growth y/y239%109%57%30%30%30%40%40%40%50% of new car sales0.1%0.2%0.4%0.6%0.7%0.9%1.1%1.6%2.2%3.1%4.6%Total548,997775,2251,209,2382,018,2472,450,7403,281,6524,545,5936,421,1989,063,36612,602,91816,912,473% of global PV sales0.6%0.8%1.3%2.1%2.6%3.4%4.6%6.4%9.0%12.4%16.6

37、%Source: IHS, Thinkercar, UBS estimatesHowever,amulti-yearmegatrendmaynotnecessarilybeassmoothasinvestors anticipate. Sales volume fluctuations as well as changing investor sentiment still move the share prices of related companies. Drivers of EV penetration improvementincludecontinuedtechnologyprog

38、ression,costdeclines,especially coupled with scale, new product launches, changing customer attitudes from sceptical to adoptive, charging infrastructure roll-out, and fleet procurement like taxi or ride-on-demand purchases.Barriers,atleastinChina,includethegradualremovalofthegovernmentsubsidy, occa

39、sionalrawmaterialshortages,disappointmentsforsomeearlycustomersdue toquality,andsomecannibalisationbetweencombustionengineandelectriccars, especially in cities with licence platerestrictions.H219andH120wouldprobablybechallengingfortheindustry,inourview.While technology progression and product launch

40、es continue, the magnitude of the governmentsubsidycutisunprecedented.Foratypicalpureelectriccarthatwas entitled to over Rmb60,000 in government subsidies in Q119, it received Rmb40,000 in subsidies in Q219, declining to just Rmb10,000 to Rmb20,000 in subsidiesinH219(dependingontherange).Eventhoughm

41、anycarmakersarefully compensating the shortfall themselves, there is still reluctance on the part of customerstobuyaspartofthedemandwaspreloadedaheadofthesubsidycut.Fleet sales (eg, taxies and mobility services) have also failed to deliver further growth partly due to the preloading effect. Demand f

42、rom cities that limit the use ofcombustioncars(vialicenceplates)hasalsobeenaffectedbytherelaxationof the restriction in Guangzhou and Shenzhen, and abolition of the restriction in Guizhou.Therefore,weexpectdecelerationofelectriccarsalesinthenearterm,fromover 80% growth in 2018 and over 60% in H119,

43、to zero or slightly negative YoY growth in H219. For full-year 2019, we expect 17% YoY growth to 1.2m units,decelerating from over 80% growth in 2018. The 2020E growth rate could improve to 30% YoY to 1.6m units, mainly driven by foreign carmakers with the biggest contributions from Volkswagen China

44、 (150,000 incremental) and Tesla China(100,000),followedbyleadingplayersGAC,SAIC,GeelyandBYD.Wethink EVsalesforsomesmallerChinesecompanieswillbelowerin2020than2019due to competition.Figure 3: First batch of EV contenders from JV OEMs in 2020E2,000,0001,800,0001,600,000Leading localRestofOEMswill hav

45、etocompetein a shrinkingpoolOEMs could still gainmarketOEMs could still gainmarketshareVWandTeslaexpected to win half of the incremental market1,200,0001,000,0002019VWTesla GAC PV SAICPV GeelyBYDRest2020Source: UBS estimatesThisreportcoversmorethanjustsubsidycuts:wetraceover2melectriccarssale destin

46、ations and analyse who they were sold to. We analyse the effect of licence plate restrictions in large cities on combustion engine cars. We discuss the opportunities for taxi and mobility fleet electrification. We analyse the types of electriccarssoldinChinaandshareourthoughtsonusagescenariosandevol

47、ving trends. We review cost parity of electric cars versus combustion engines, and quantify how the industry should eventually absorb the subsidy exit. We also choosetypicalcarmodelsandcomparetheeconomicsfromtheangleofauser.We also examine the supply side. We downloaded the key specs data of several

48、 hundred electric car variants from MIIT (the Ministry of Industry and Information Technology). We analyse how the industry has been making progress in driving range, pack energy density, battery size and power consumption. We compared leading carmakers products and noted a continued shifting of the

49、 domestic leadershipposition,eventhoughTeslaremainsaheadofChineseOEMsregarding technology. With the upcoming localisation of Tesla production in Shanghai, we alsoshareourthoughtsonhowtheupcomingcompetitivelandscapewouldevolve and who could be the likely beneficiaries.NEVSalesPenetrationFigure 4: Chi

50、na NEVsalesNEVSalesPenetrationNEVNEVSales(mnunits)201720182019E2020E2021E2022E2023E2024E2025E0%201720182019E2020E2021E2022E2023E2024E2025E80%60%40%20%2019E2020E2021E2022E2023E0%2019E2020E2021E2022E2023ENEVSalesVolumeNewcarsalespenetration(RHS) RequiredNEVcreditUBS estimated total NEVcredit Source:Ch

51、inaAutoMarket,UBSestimatesSource: UBSestimatesImplications for companiesBYD-H (1211.HK; Sell; PT HK$32.00)Asanindustrialconglomerate,webelieveBYDsEVbusinessandassociatedEV batteriesarethekeysharepricedrivers.Webelieveitsmarketposition,upstream integration and brand perception in China for EVs is ref

52、lected in its premium valuation. However, this large and concentrated exposure to EV implies that it couldbeadverselyaffectedbyrisingcompetitionanddecliningsubsidies. HYPERLINK /shared/d2RrS7X4PjPPyq BYD Company Limited “Post-subsidy era pain” (Sell) GongGAC-H (2238.HK; Buy; PT HK$9.30)GAC is relati

53、vely new to the EV space. Its early GE3 model demonstrated high battery pack energy density, but was weak on acceleration. Its upcoming EV model,AionLX,anA+segmentSUV,isscheduledtolaunchinQ419.Its2019EV target is only 40k units, roughly 2% of group total sales volume, or 7% of its own brandTrumpchi.

54、TheGAC-HondaJVisabouttolaunchitsfirstBEVmodelVE-1, and GAC-Toyota JV is due to launch iA5 based on the Trumpchi EV platform in 4Q19. HYPERLINK /shared/d2IdoJuR2N4M?wireid=uep54742 Guangzhou Automobile Remains our preferred pick (Buy) GongSAIC (600104.SS; Buy; PT Rmb28.00)AsthelargestOEMinChina,SAICm

55、adeheavyR&Dinnewtechnologyincluding NEV.ItlaunchedMarvelX,amedium-sizeSUVinSeptember2018,whichwasthe most power-efficient SUV model in the China market at that time. In 2019, the companys sales volume and profits from NEV have been below start of the year guidance, while management remains positive

56、on the businesss long-term outlook. On one hand, SAIC VWs MEB plant, which embodies Volkswagens newesttechnology,shouldbecomeanewgrowthdriverafterlaunchattheendof 2020; on the other, SAIC is exporting NEV products, though their profit contribution remains modest. Management expects new-energy produc

57、ts to represent20%ofPVindustrysalesvolumeby2026,afterreachingwhole-lifecost parity with fuel cars by 2024. HYPERLINK /shared/d2zE3ekvLG?wireid=uep55960 First Read: SAIC Motor Investor conference call takeaways (Buy) ShenGeely (0175.HK; Buy; PT HK$13.60)Geely is one of the biggest local carmakers in

58、China. The company saw early success in EV development by launching a shared platform model, Emgrand EV series.Geelyhasadoptedanaggressivestrategyinpowertrainelectrification,asall its recently launched models are available in plug-in hybrid and mild hybrid versions.Geometry,asub-brandofGeely,hasbeen

59、createdtosellBEVswiththe first model being Geometry A. We expect Geely to launch its dedicated EV platform PMA in 2021. HYPERLINK /shared/d2IstRPqVoSbpjQ?wireid=uep52355 First Read: Geely Automobile Geometry A launch in Singapore (Buy) GongCATL (300750; Sell; PT Rmb60.00)CATListheindustryleaderinthe

60、ChinaNEVbatterysegmentwitharounda40% domestic market share. CATL has signed JVs with large OEMs, which could accelerate the companys capacity expansion and also involve large customers. However, recent significant EV subsidy cuts and the approval of foreign battery makerstoequipelectricvehiclescreat