This week's topic: die casting process is a casting method in which liquid or semi-solid metal or alloy is filled into the mold cavity of the die casting machine at a high speed under high pressure, so that the metal or alloy solidifies under pressure to form a casting. (1) China's die casting industry is developing rapidly and its demand is expected to grow. For the die casting industry, the main downstream industries are automobile, household appliances and other industries. According to the data of China industry information network, automobile accounted for 70% of the market in China's die casting downstream industry in 2017. At the same time, the automobile industry is also the largest downstream market of the aluminum die casting industry in North America, accounting for about 68% of the total shipments, followed by housing, accounting for about 9% of the total shipments. China's die-casting industry has experienced about four stages. The 1950s was the embryonic period, mainly relying on the introduction of a small amount of die-casting equipment for production. From the 1970s to 1980s, China's die-casting industry entered a period of basic development, and large enterprises began to establish die-casting workshops and professional die-casting factories with a certain scale. In the 1990s, the industry entered a period of rapid development, and the die casting industry penetrated into various industrial fields. Since the 21st century, China's automobile industry has grown rapidly, and China's die casting industry has also entered a period of rapid development. According to the data of the National Bureau of statistics and China Foundry Association, the output of die castings in China was 4.62 million tons in 2020, with a year-on-year increase of 3%. Foreign enterprises were unable to start construction due to the overseas epidemic, and the rapid growth of new energy vehicles led to the contrarian growth of our die casting machine output. With the growth of new energy vehicle sales and the improvement of vehicle lightweight demand, the demand of die casting industry is expected to continue to grow. (2) China is the global aluminum casting production center, and the concentration of die casting industry is low. According to the data of modern casting, from 2010 to 2017, the global output of cast aluminum alloy iron parts increased from 10.87 million tons to 19.07 million tons, with a compound annual increase of 8.35%. Over the same period, China's output of cast aluminum alloy iron parts increased from 3.8 million tons to 7.3 million tons, with a compound annual growth of 9.78%. In 2017, China's output of cast aluminum alloy iron parts accounted for 38.27% in the world, ranking first in the world. The global die casting industry is highly concentrated. Nemak, Ryobi, georgfisher and ahresty account for 11%, 9%, 4% and 3% of the market share respectively. The concentration of China's die casting industry is low. In 2019, the market concentration Cr5 of China's aluminum die casting industry was only 11.6%, and the market share of leading enterprises Guangdong Hongtu Technology (Holdings) Co.Ltd(002101) and icodi was only 4.2% and 3%.
Risk factors: the global epidemic is accelerating, the global shortage of automotive chips continues, and the price of upstream raw materials fluctuates.
