The Zhitong Finance App learned that Guolian Securities released a research report saying that since 2020, domestic automobile exports have rapidly resumed and resumed production, increasing from 1.08 million to 5.22 million. The CAGR in 2020-2023 is 69%. Domestic automobile exports have achieved rapid growth, surpassing Japan as the world's largest automobile exporter. With the gradual enrichment of car companies' external marketing networks and the gradual improvement of production capacity layout, the bank expects to export 5.35 million passenger cars in 2024, an increase of 30% over the previous year, maintaining a rapid growth trend. The bank believes that high-quality vehicle and parts companies are benefiting from the wave of going overseas, and that the domestic automobile industry is going overseas, and that high export growth has boosted sales.

The views of Guolian Securities are as follows:

The share of domestic automobile new energy exports has increased rapidly

Since 2020, domestic production has resumed rapidly, and automobile exports have grown from 1.08 million to 5.22 million units. The CAGR was 69% in 2020-2023. Domestic automobile exports have achieved rapid growth, surpassing Japan as the world's largest automobile exporter. By export region, the increase in passenger car exports mainly comes from Europe and Asia. Among them, the increase in new energy passenger vehicles is mainly pure electric models. Looking at export destinations, the top 10 export growth countries contributed more than 60%. The proportion of domestic NEV passenger vehicle exports in 2020-2023 increased rapidly from 8.2% in 2020 to 27.4% in 2023, and the share of new energy increased rapidly.

Looking for the global consumer market for high-quality automobiles in multiple dimensions

The bank believes that the high-quality automobile consumer market should meet the four major characteristics of a large market size, high dependence on imports, high profit margins, and policy support. In terms of market space, Western Europe, North America, East Asia, Southeast & South Asia, Latin America, and Eastern Europe all have large market sizes. In terms of import dependency, Latin America, Southeast Asia & South Asia, Eastern Europe, Middle East & Africa, and Oceania are highly dependent on automobile imports, and Western Europe, North America, and East Asia also have some import demand. Domestic profitability is currently low, and exports have become the key for car companies to increase their profitability. In terms of policy, all regions around the world have introduced policies to promote the consumption of new energy vehicles.

Cars are expected to replicate the way home appliances go overseas

In 1978-1988, home appliance technology was introduced, corresponding to the construction of early domestic automobile production capacity. From 1988 to 1998, Chinese home appliances entered the global market, corresponding to the establishment of many joint venture brands in the automotive industry and entered the global market. From 1998 to 2008, the Southeast Asian financial crisis hit overseas supply hard, and China's share of household appliances increased rapidly, responding to the rapid recovery under the influence of the epidemic, and achieved high growth in automobile exports. From 2008 to 2018, home appliance companies were able to provide R&D and design, processing and manufacturing of core components. With the accelerated growth of domestic car companies, they are expected to dominate the global supply chain in terms of technology and core components in the future.

Looking at global expansion from Toyota, looking at the export prospects of Chinese car companies

Toyota's global expansion can be divided into three stages. In the 50s, Japan liberalized restrictions on automobile exports, Toyota increased production efficiency under the lean production model, and exports gradually became small-scale, but exploration of the North American market failed. In the 60-70s, Toyota strengthened the targeting of its products to the local market and successfully opened up the North American market. During the oil crisis in the 70s, the scale of exports increased rapidly, and North America became an important market. Since the 80s, Toyota has accelerated the construction of overseas plants and continued to explore emerging markets. Supported by the accumulation of technology, the model is the world leader in reliability and economy.

Domestic competition is fierce, and exports open up a blue ocean

New energy trends drive the transformation of car companies, new forces emerge, industry competition intensifies, and car companies' sales concentration declined. Domestic CR3 was 52%/47%/43%/40% in 20/21/22/23, respectively. This was accompanied by a decline in the profitability of domestic car companies. In addition to exporting products by sea, mainstream car companies are also actively seeking to build production capacity bases abroad to better serve the local market. With the gradual enrichment of car companies' external marketing networks and the gradual improvement of production capacity layout, the bank expects to export 5.35 million passenger cars in 2024, an increase of 30% over the previous year, maintaining a rapid growth trend.

Investment advice: High-quality vehicle and parts companies benefit from the wave of overseas travel, and the acceleration of domestic automobile industry going overseas, and high export growth boosts sales.

1) In terms of vehicles, we recommend automakers such as BYD (002594.SZ), Changan Automobile (000625.SZ), Ideal Automobile-W (02015), and Geely (00175), which accelerate their deployment overseas and achieve technological leading+sales volume.

2) In terms of parts, exports drive sales for downstream customers, and parts companies are expected to benefit. High-quality and innovative auto parts companies such as Electric Connect Technology (300679.SZ), Xingyu (601799.SH), Bethel (603596.SH), Tuopu Group (601689.SH), Xinquan (), Silver Wheel (002126.SZ), and Lingyun (US) are recommended. 603179.SH 600480.SH

Risk warning: Industry competition increases risk, risk of exchange rate fluctuations, and risk of policies falling short of expectations.