Basic conclusion
The global bicycle industry is mature, and the production is concentrated in China and Southeast Asia. Bicycle manufacturing is concentrated in countries and regions with cost advantages such as China and Southeast Asia. China has become the world's largest bicycle producer and exporter, with complete industrial clusters. Three bicycle cluster industrial belts have been formed, including Tianjin Bohai Bay, Jiangsu, Zhejiang and Shanghai and the Pearl River Delta. In the long run, considering the rise of labor costs and the high probability of the transfer of manufacturing links to Southeast Asia, the growth space of pure vehicle OEM is expected to continue to shrink.
Bicycle brand concentration is low, and the channel is relatively strong. Globally, the concentration of bicycle brands is low. The high-end market is dominated by large European and American brands. At the same time, there are many regional brands in various regions. Foreign local enterprises have mastered a large number of sales channels and occupy a high market share in the local market, so it is difficult for foreign brands to enter. The traditional main sales channel of overseas bicycles is Shangchao, and the voice of the channel side is very strong.
Different markets around the world have different demands on the bicycle industry. Europe is the world's largest bicycle consumption market, giving consideration to both travel and sports. The imported models are mainly electric bicycles, urban bicycles, mountain bicycles, performance bicycles and children's bicycles. Depending on the progress of motor, battery and other related technologies and the introduction of government subsidy plan, the European electric bicycle market has developed rapidly. According to the data of bikeeurope, the sales volume of electric bicycles in Germany has increased by more than 30% every year in the past two years, and the electric bicycles in the Netherlands have occupied 40% of the bicycle market share. The United States is the largest exporter of bicycles in China, mainly sports, and the sales of mountain bikes account for the highest proportion. The impact of bike sharing in China has basically ended, but it is still dominated by low-end travel.
The epidemic has accelerated the transformation from offline consumption to online consumption, and China's supply chain has helped independent brands successfully enter the overseas market. After the epidemic, thanks to the effective control of the epidemic in China, China's bicycle industry chain quickly resumed production to meet the strong market demand in the world, The export volume (+ 14.83%) and export amount (+ 28.59%) of bicycles have achieved the same rapid growth. At the same time, the epidemic has accelerated the switching of European and American consumption habits from offline to online to a certain extent, weakened the channel advantages accumulated by such brands for many years, and brought opportunities for Chinese independent brand enterprises.
Innovative demand, electric bicycles and other new products promote the expansion of the bicycle industry. The functions of bicycles have been expanded, the market focus has shifted to mountain bikes, road bikes, electric bicycles and other products, and emerging products have gradually increased. Electric bicycle has higher technical threshold and price, and the value of bicycle is much greater than that of traditional bicycle and electric two wheeled vehicle. For vehicle manufacturing enterprises, although the requirements for design and accuracy are higher, there is no qualitative change in the process itself; In terms of brand, there is no brand with global competitiveness, which provides an opportunity for China's electric bicycle manufacturing and brand enterprises.
From the perspective of Companies in China's industrial chain, Joy Kie Corporation Limited(300994) is China's ODM leader, focusing on design, development and sales channels, focusing on product export. In 2020, it successfully launched its own brand through cross-border e-commerce, and electric bicycles helped its space expansion; Bafang Electric( Suzhou) Co.Ltd(603489) is the leading manufacturer of electric bicycle motor in China, with a high share of overseas market and a relatively perfect overseas marketing and after-sales system; Giant machinery and Merida are leading brands of internationally renowned bicycles, and China listed in Taiwan, with strong momentum of development. Hl Corp (Shenzhen)(002105) as the leader in the field of bicycle parts, the orders continue to be in full production. According to the company's caliber, the orders in 2022 have been scheduled to the end of 2022.
Investment suggestion: we are optimistic about grasping both ends of R & D and sales, and have strong supply chain integration ability. In this round of Chinese bicycles going to sea, we have successfully launched our own brands, improved the medium and high-end product structure, and realized Joy Kie Corporation Limited(300994) with high growth and high gross profit margin; At the same time, it is suggested to pay attention to the high growth of bicycle export production supporting facilities, and the business of rehabilitation equipment is expected to usher in a great development after the epidemic situation is controllable.
Risk tips: international trade policy risk, risk of changes in international macroeconomic and market environment, risk of exchange rate fluctuation, risk of continuous rise in upstream raw material prices, risk of continuous tension in shipping capacity and high rise in freight rates, and risk of capacity restriction caused by the aggravation of covid-19 epidemic in China.
