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

2.4. 2019 to present: Policy promotion period

Policy-driven replacement demand is conducive to the concentration of the industry to the leader. In 2019, the "Electric Bicycle Safety Technical Regulations", that is, the "new National Standard", was officially implemented, and the document clearly defined the indicators such as the vehicle quality, vehicle size, and maximum time speed of the electric bicycle, and the nature of the indicators were mandatory indicators. On the supply side, the new national standard will change the certification method of electric bicycles from industrial product production license management to CCC certification (that is, mandatory product certification), and the complex 3C certification has raised the industry access threshold. After the original luxury electric bicycles exceeding the standard are classified as electric light motorcycles or electric motorcycles, enterprises are required to have electric motorcycle production qualifications. 3C certification and electric motorcycle production qualification, accelerate the production capacity of small factories that do not meet the standards, making the industry concentrated to the leading, according to Sullivan research, 2021 electric two-wheeler CR2 reached 46.4%. On the demand side, the new national standard has clear requirements for the license and driving qualification of electric light motorcycle and electric motorcycle, and a number of regions have introduced the cut-off time of the transition period, and the two-wheeled vehicles without 3C certification and exceeding the standard can not be on the road and licensed, driving the replacement demand for stock cars. In addition, the "one car, one vote" system in the "Methods for the Use of Motor vehicle invoices" implemented in 21 years has standardized the two-wheeled vehicle sales lines, making the cost of non-standard small factories rise, which is conducive to the concentration of the industry to the leader. Therefore, we believe that industry policies drive replacement demand, and the industry share continues to concentrate on the leader.

3. Analysis of driving factors for two-wheelers: income level, urbanization, growth of export-supported industries

With the increasing income level of residents, urbanization rate and transportation costs, people's travel demand has gradually increased, and electric two-wheelers have a high cost performance, which is more common in short-distance travel, and the number of domestic two-wheelers has steadily increased. According to the data of the China Cycling Association, from 2013 to 2021, the number of electric two-wheelers in China increased from 132 to 241, with a CAGR of 8.92%. In addition, drawing on the experience of domestic development, with the process of industry leaders going to sea, the export market can be expected in the future, and the internal and external needs of two-wheel drive, we believe that the two-wheel vehicle industry is expected to have a high boom.

3.1. The increase in per capita income level supports the demand for two-wheelers

From 2000 to 2006, the per capita income of urban households increased from 60,300 yuan to 11,800 yuan, with a CAGR of 11.02%, and the per capita income maintained a rapid growth. Superposition the total domestic population has increased steadily, and consumer groups provide a solid foundation for the development of the industry.

3.2. The improvement of urbanization level leads to the increase of two-wheeled vehicle usage scenarios

From 2000 to 2006, China's urbanization rate increased from 36.22% to 44.34%. The increasing urbanization rate expands the radius of cities and increases people's commuting time and traffic demand. At the same time, the annual transportation and communication expenditure per capita in urban areas increased from 426.95 yuan to 1147.12 yuan, with a CAGR of 17.91%. The urbanization level and transportation cost increased, and the commuting demand increased. Two-wheeled vehicles have relatively low acquisition costs and use costs, and the cost performance is convex, especially in short distance traffic is more common. Taking electric two-wheelers as an example, according to Sullivan's research, 43.20% of users in electric two-wheelers with a commuting distance of 5-10 kilometers in 2020.

3.3. The future space of two-wheeler export is promising

3.3.1. The proportion of electric two-wheeler exports is still small, and it is expected to be exported to developing countries

According to Sullivan data, in 2020, China's electric bicycle shipments reached 30.2 million, and the export volume of electric bicycles reached 1.5678 million, accounting for only 5.22%, and there is still much room for improvement. At present, some countries in Southeast Asia have introduced a ban on motorcycle policies, and a number of developing countries or regions have also introduced an incentive policy for electric two-wheeled vehicles. Drawing on the domestic electrification replacement process, taking into account the geographical environment and economic growth trend of some developing countries, the export of electric two-wheelers has broad space and is expected to become the future profit growth point of the industry. Among them, Yadi has set up a factory in Vietnam and officially put into production in 2019, with an annual planned capacity of 1.2 million vehicles.