Analysis and Anticipation on Chinese Light Duty Truck Industry (Q3 2013) (Ⅰ,Ⅱ)

www.chinatrucks.com: 1. Analysis on the production and sales in the first three quarters

Statistics of China Association of Automobile Manufacturers show that from January to September 2013, production and sales of Chinese automobiles are 15938351units and 15883084 units, seeing a double-digit growth year on year, 12.78% and 12.70% respectively. The sales volume of trucks (including non-complete vehicles and semi tractors) totals 2633069 units, up by 7.33% over the same period of last year.

Looking deeper into the truck market in the first three quarters, accumulative sales volumes all see positive growth. The accumulative growth of MD and HD trucks outnumbers 10%, while that of LD and micro trucks is less than 10% (details are available in table 1).

In the first nine months, light trucks remain to take up half of the market, reaching 54.75%, decreasing 0.77% year on year; HD trucks account for 21.54%, rising by 1.49%; micro trucks account for 15.28%, dropping by 0.95%.

The sales volume in Q3 exceeds that of last year. Sales volume of HD trucks totals 164530 units, up by 36.73% year on year; that of LD trucks totals 437731 units, up by 7.75% year on year; while MD trucks 62466 units, up by 1.96% year on year.

Table 1 Sales of Chinese HD, MD and LD trucks from January to September 2013 (Units, %)

The peak time of updating light truck fleets comes in 2013. Besides, thanks to policies released by governmental departments to support micro and small enterprises, the opening of private investment and control on loan interest, Chinese light trucks hit historical high in the last four years for three consecutive months, namely in July, August and September (see Figure 1).

In Q3, the sales total 438,074 units, while the sales in 2010, 2011 and 2012 are respectively 427,516 units, 416,214 units and 407,346 units respectively (see Figure 2). Q3 contributes to 30.39% of total sales volume in the first nine months of 2013. The figure is respectively 29.21%, 28.85% and 29.91% in 2010, 2011 and 2012. The figure breaks through 30% for the first time.

2. Competition analysis on Chinese light truck market

1) Competition analysis on light truck market in the first three quarters

In the first nine months, CAAM report shows 34 enterprises produce light trucks, leveling off with last year. The top five enterprises (Foton, JAC, Dongfeng, Jinbei and JMC) each sell more than 100,000 units (see Table 2), forming the first light truck camp. The five enterprises take up a share of 58.04% by selling 836,802 units all together, up by 4.98% year on year. Foton, accumulating 280,000 units with a negative year-on-year growth rate of -1.39%, accounts for more than 20% market share and remains to take the lead in this market. JAC accumulates 170,000 units, up by 8.26% year on year and with a market share of 12.05%. Jinbei accumulates 130,000 units, up by more than 20% year on year. JMC is roughly same with JAC in terms of growth rate, slightly above 8%.

There are 14 enterprises with sales among 10,000 units to 100,000 units. The 14 enterprises accumulate to sell 568,427 units, up by 8.72% year on year and with a total market share of 39.43%, up by 1.04 per cent compared with the same period of last year. The rest 15 enterprises accumulate 36,506 units with a market share of 2.53% (see Table 3).

Table 2 Sales of Chinese light truck manufacturers in first three quarters 2013 (Units, %)

In terms of accumulative sales from Jan. to Sep., Changan (177.73%) and Sinotruk (106.29%) achieves a growth rate over 100%; Chongqing Changan achieves a growth rate of 84.09%; Chongqing Lifan 42.29%; Jinbei 22.44%; NAC 19.65%; Tangjun Ouling 18.29%, FAW 17.66% and Dandong Huanghai 13.78%; 3 enterprises achieves a growth rate less than 10%, namely Hebei Zhongxing (8.98%), JMC (8.28%) and JAC (8.26%); Qingling witnesses a growth rate less than 1 per cent. By contrast, there are four enterprises encountering a one-digit negative growth rate: Foton (-1.39%), Dongfeng (-1.41%), Great Wall Motor (-2.38%), and Zhejiang Feidie (-4.55%). Three enterprises suffer a negative growth rate over 10% and even 30%: Shandong KAMA (-12.65%), BAC (-29.78%), Sichuan Hyundai (-31.57%).

In the first three quarters, the market presents the following changes: compared with the same period of last year, 11 enterprises remain to hold the same positions, for example, Foton, JAC, Dongfeng, Jinbei, JMC, Great Wall, Changcheng and NAC remain No.1 to No.7, Qingling and Zhongxing maintain No. 9 and No. 10, and Lifang and Feidie remain hold No. 13 and No.15; five enterprises get raised in ranking like FAW (rising to No.8 from No.11), Tangjun Ouling (from No.l2 to No.11), Chongqng Changan (from No. 17 to No.14), Dandong Huanghai (from No.18 to No.16), and Baoding Changan (from No.23 to No.19); four enterprises suffer drop: Shandong KAMA (from No.8 to No.12), BAC (from No. 14 to No.17) and Sichuan Hyundai (from No.16 to No.18).

2) Analysis on operation of light truck manufacturers in Q3 2013

There are 13 enterprises with sales in Q3 surpass that in the same period of last year. Baoding Changan and Chongqing Changan soar by 145.62% and 92.57% respectively; Dandong Huanghai and Jinbei increase by 37.84% and 34.86% respectively; JAC (18.38%), Tangjun Ouling (17.78%), FAW (15.91%), Qingling (12.65%); five enterprises achieves an one-digit growth rate: JMC (8.34%), Dongfeng (4.68%), NAC (4.53%), Zhongxing (4.49%) and Foton (4.02%). Great Wall increases less than 1 per cent. There are also five enterprises suffering negative growth: Chongqing Lifan (-2.90%), Zhejiang Feidie (-4.78%), Shandong KAMA (-15.18%), Sichuan Hyundai (-23.51%) and BAC (-32.27%).

Second, there are 19 enterprises with sales in Q3 accounting for more than 23% of total sales in first three quarters, among which BAC has 40% of sales completed in the third quarter. The proportion of Q3 in total sales of first three quarters: Jinbei (38.24%), Chongqing Lifan (33.39%), Dandong Huanghai (32.99%), JMC (32.93%), Changcheng (30.95%), Zhejiang Feidie (30.69%), Shandong KAMA (29.79%), Chongqing Changan (29.76%), Tangjun Ouling (29.42%), Foton (29.31%), and FAW (29.22%).

3) Sales analysis on light truck model

Regarding the sales of detailed model, according to statistics of CAAM, 17 enterprises with 38 models accumulate 1112393 units (including exported ones) from January to September 2013, up by 4.12% year on year (see Table 3).

High-level light trucks grow fastest: JMC Shuailing (15.89%), JMC Kaiyue (17.01%), JMC Kaiwei (17.68%), Cabstar (56.06%), JAC Shuailing (4.98%), Foton Ollin (10.79%), Foton Aumark (32.42%), Sinotruk HOWO (23.00%). Aumark and Cabstar even enjoy a growth rate over 30%.

Other models also grow fast: Yujin Zuanka (23.55%), Yuejin Chaolika (319.86%), Changan Kuayue (84.09%), and Changan Shenqi (177.73%), all growing by over 20% with sales volume surpassing 10,000 units.

Table 3 Sales of Chinese light truck model from Jan. to Sep. 2013