The shortage of chips, which has a significant impact on China’s auto market, has improved in December 2021.
According to the production and sales data of the passenger car market information association (hereinafter referred to as the passenger car Association), in December 2021, the sales volume of narrow passenger cars in China reached 2.3667 million, a year-on-year increase of 2.3%. In terms of output, the cumulative output of narrow passenger cars in December was 2.4657 million, a year-on-year increase of 4.2%,
“Since December, the number of manufacturers’ departures has increased a lot, and some of the previously backlog orders have been released.” The sales manager of an independent brand 4S store in Shanghai told the first financial reporter. According to the data of China Automobile Circulation Association, the inventory coefficient of automobile dealers in December was 1.43, up 5.9% month on month, but still decreased by 20.6% year-on-year. China Automobile Circulation Association believes that although the shortage of chips was alleviated in the fourth quarter and dealers actively prepared the warehouse to make the inventory level rise, it is lower than the inventory level in previous years and is at a historical low level in recent three years.
From last year’s output data, compared with September and October, when the chip shortage was more serious, most auto enterprises stopped falling and rebounded in December.
In terms of brands and camps, the production reduction of luxury brand car enterprises has been alleviated. In the past six months, the output of FAW Volkswagen Audi, which has been plagued by production reduction, fell to 0.7% year-on-year in December, which is a great improvement compared with the year-on-year production reduction of more than 60% in September; Similarly, Volvo, which reduced its production by nearly 60% in September, also narrowed its year-on-year decline to 15.9% in December; Beijing Benz’s products fell 13.1% year-on-year in December. In contrast, brilliance BMW and Chang’an Lincoln continued to maintain a good output growth trend. The sales volume of the two car companies increased by more than 20% year-on-year in December, of which the output of Chang’an Lincoln increased by 43.5% year-on-year.
BMW has always maintained a relatively stable performance in the environment of lack of core. Herbert DIS, CEO of Volkswagen Group, once said that BMW has performed better in the chip crisis, and they have been working more closely with semiconductor manufacturers for a long time. Even in September and October, when the core shortage was the most serious, BMW still maintained a positive growth in output and benefited from the stable supply chain performance. In 2021, BMW won the sales champion of luxury cars in China again and opened the gap with the second Mercedes Benz to nearly 80000 vehicles.
Thanks to the recovery of production capacity, in the process of visiting luxury brand dealers, a number of sales consultants told reporters that the preferential margin of some best-selling products has returned to the normal level in previous years. From October to November last year, due to the shortage of new cars, some used cars of luxury brands remained high, and even hung upside down with the price of new cars. Recently, a used car dealer told reporters that the price of luxury brand used cars has fallen, and the price of some models has fallen by more than 10%.
In terms of joint venture brands, joint venture brands that are seriously troubled by chips also ushered in a “stop falling rebound” in December. According to the data of the passenger Association, the year-on-year decline of FAW Volkswagen production narrowed to 2.1% in December, the year-on-year decline of the company’s production decreased by nearly 40% in November, and both Audi and Volkswagen brands under FAW Volkswagen achieved a significant reduction in the decline of production; SAIC Volkswagen, another Volkswagen joint venture, increased its output by 10.9% year-on-year in December and decreased by 18% year-on-year in November. However, it is worth noting that the products of Skoda brand still decreased by 68.7% year-on-year in December. The output of Changan Ford, SAIC GM and other American joint ventures also increased month on month in December.
Japanese brands with relatively stable supply chain system showed some differentiation in December. The output of FAW Toyota, GAC Toyota and GAC Honda increased by more than 10% year-on-year in December, of which GAC Toyota increased by 26.5%; The output of the two Japanese joint ventures of Dongfeng Nissan and Dongfeng Honda declined in December, with a decline of 9.7% and 34.6% respectively.
The relevant person in charge of Dongfeng Honda told reporters: “due to the flood in Malaysia, there was a shortage of some parts, resulting in a decline in production in December.”
Compared with overseas brands, the impact of supply chain shortage on independent brands is relatively small. In December, Byd Company Limited(002594) still maintained a performance far exceeding the industry average, with a year-on-year increase of 73.7%, but the month on month increase narrowed. In 2021, the three leading independent brands that produced and sold more than one million vehicles also walked out of a completely different trend in the output performance in December: the output of Geely motor in December fell by 1.5% year-on-year, and the decline in vehicle production was further reduced compared with previous months; The output of Great Wall Motor Company Limited(601633) in December achieved a positive growth of 7.9%; Chongqing Changan Automobile Company Limited(000625) production fell sharply by 31% year-on-year in December. Chongqing Changan Automobile Company Limited(000625) said that the decline in sales in December was affected by “lack of core and less power”.
From the production data of mainstream auto companies, the output of most auto companies improved in December, but the problem of chip shortage has not been completely solved. According to the analysis of insiders, the output data of Chinese cars in December improved. On the one hand, the supply of chips increased. On the other hand, the demand for parts decreased in December due to the impact of the epidemic and Christmas holidays.
Recently, Toyota Motor has said that due to the shortage of automotive chips and other parts, the production capacity of Toyota’s Japanese factory has been affected, and the global production plan will be reduced from 700000 to 550000 in February.
Li Shaohua, Deputy Secretary General of China Automobile Association, believes that from the previous demand mismatch to the current panic competition for resources, the recovery cycle of out of stock will be prolonged. In addition, the global epidemic has not been completely controlled, and local influences will still appear. The real mitigation requires the formation of upstream capacity. The chip industry began to invest in the layout successively at the end of 2020, and it will take at least more than one year to form production capacity, that is to say, the shortage of automobile chips will not be fundamentally alleviated until the second half of this year.
