The trend of the two-wheeler industry is upward and the structure is better

1. The two-wheeler industry chain belongs to the manufacturing industry, and the products have certain mandatory consumption attributes

From the perspective of the industrial chain, the upstream of the two-wheeler industry includes bulk raw materials (aluminum, rare earth, copper, rubber, etc.) and parts (batteries, motors, frames, tires, wiring harnesses, etc.), and the downstream is the dealer. Two-wheeled vehicle companies are mainly responsible for product design, development and production, brand marketing, core parts technology and other fields, with a certain capital intensive attributes, more sensitive to scale effects. Compared with automobiles, two-wheeled vehicles have a high cost-effective advantage, which is generally accepted by domestic consumers, and the annual sales of the domestic market in 2021 are far more than the sales of the automobile industry. As a transportation tool, the typical demand of two-wheeled vehicles is to commute to work, pick up children, buy food and other needs, as well as takeout, express delivery and other emerging consumer scenarios of high-frequency use needs, with a certain must choose consumer goods attributes.

The proportion of raw materials in cost is high, and there is a gradual downward trend. According to the prospectus of Emma Technology, the proportion of direct materials for electric bicycles and electric motorcycles in the cost in 2021 is 93.68% and 96.67% respectively. Battery, motor, controller as the core components of electric two-wheeled vehicles, by lead, copper, rare earth (sintered Ndfeb) and other raw material price changes are greatly affected. Raw material prices after the cycle of upward, there is a gradual downward trend.

Midstream parts to motor, battery as the core. According to the announcement of Emma Technology, the purchase amount of batteries and motors accounted for more than 35% of the main raw material purchases. Two-wheeled vehicle batteries are still the mainstream of lead acid, according to the Huajing Industrial Research Institute, in 2021 lead-acid batteries accounted for 76.6%, lithium battery market share continues to expand, accounting for 23.4% in 2021. In addition, sodium batteries have greater development potential because of their cost, energy density and other advantages.

The downstream two-wheeler industry has a high concentration. From the point of view of models, two-wheeled vehicles can be divided into treadplate, curved beam, straddle; From the point of view of power type, it can be divided into electric two-wheelers and fuel motorcycles. In terms of electric two-wheelers, Yadi Holding and Emma Technology present a two-strong separation pattern, and the concentration is still improving, and the electric two-wheelers CR2 exceeds 40% in 2021. In terms of fuel motorcycles, Da Changjiang Group has a leading share, with a market share of 15% in 2021.

2. Historical review: three stages of industry development

2.1. Historical recovery: Two-wheeled vehicles have entered a new stage of development

From 2000 to 2006, the industry was in the process of rapid development, and the domestic two-wheeled vehicle production (including two-wheeled motorcycles and electric bicycles) increased from 11.42 million to 40.53 million, with a CAGR of 23.51%; From 2007 to 2018, a number of cities intensively issued the ban and limit policies, and the growth of the industry slowed down, and the output of two-wheeled vehicles (including two-wheeled motorcycles and electric bicycles) increased from 45.61 million to 46.64 million, with a CAGR of only 0.2%; Since 2019, with the implementation of the new national standard, the industry has introduced a number of mandatory standards, and under the strict 3C certification and electric motorcycle production qualification, the replacement demand for the stock of electric two-wheeled vehicles has been driven, forming a pattern of industry share concentration to the leading.

2.2. 2000-2006: Rapid development period

According to China Automobile Association and China Auto Association, the domestic two-wheeled vehicle production (including two-wheeled motorcycles and electric bicycles) increased from 11.42 million to 40.53 million from 2000 to 2006, with a CAGR of 23.51%, and the industry developed rapidly. Among them, from 2000 to 2006, the total output of domestic two-wheeled motorcycles increased from 11.13 million to 21.03 million, CAGR of 11.2%; The total production of electric bicycles from 290,000 to 19.5 million, CAGR of 101.65%, electric bicycles are growing rapidly.

2.3. 2007-2018: The period of tightening regulations

After 2007, a number of cities intensively issued a ban on motorcycle, motorcycle restriction policy, strict laws and regulations, the industry growth rate decreased significantly. According to the data of China Automobile Association and China Auto Association, the production of two-wheeled vehicles (including two-wheeled motorcycles and electric bicycles) increased from 45.61 million to 46.64 million in 2010-2018, with a CAGR of only 0.2%. Among them, the production of two-wheeled motorcycles dropped from 24.23 million to 13.86 million, a decrease of -42.78%, and the two-wheeled motorcycle industry has a significant decline. At the same time, due to the obvious substitution effect of electric bicycles, they benefited from the strict ban on motorcycle policies, and their output rose from 21.38 million to 32.78 million from 2007 to 2018, an increase of 53.32%.