In December 2015, Hebei Hongxing’s alternative energy vehicle was successfully off the production line. This
signalised that Do-Fluoride, shareholder of Hebei Hongxing, will further expand
its alternative energy business. However, as it is Do-Fluoride’s primary
cross-industry step into vehicle field, certain risks exist.
On 25 Dec., 2015, Do-Fluoride Chemicals Co., Ltd. (Do-Fluoride) announced that
its subsidiary, Hebei Hongxing Automobile Manufacturing Co., Ltd. (Hebei
Hongxing) had taken its traditional oil-fuelled vehicle and alternative energy
vehicle off the production lines successfully - Hebei Hongxing had resumed
production and operation.
This signalised that Do-Fluoride will officially step into the alternative
energy vehicle industry, to further expand its alternative energy business.
Accordingly, Do-Fluoride noted the alternative energy vehicle manufacturing
plan in August, saying that it will establish a production capacity of 1,000
unit/a in 2015 and further 100,000 unit/a by 2018. In September, it finished
the acquisition of Hebei Hongxing, and at once started its production line
reconstruction and prepared for its production resumption.
The business of alternative energy vehicle will have positive impact on
Do-Fluoride's transformation and upgrading of business structure, but will also
present operation risks as it is a new hand in this cross-industry vehicle
field, according to CCM research.
Opportunities
- Hebei Hongxing's electric vehicle has been listed in the national
recommended catalogue, which lays a foundation for Do-Fluoride to continuously
expand its alternative energy vehicle business.
12 Dec.: Hongxing branded transport van
(Type: HX5028XXYVEV) listed in the 76th batch of the Recommended Vehicle Types
for the Demonstration, Popularization and Application of Energy Conservation and
Alternative Energy Automobile by the Ministry of Industry and Information
Technology of the People's Republic of China (MIIT)
14 Nov.: Hongxing branded all-electric
passenger car (Type: HX6401BEV) listed in the 75th batch also
- Do-Fluoride has fairly complete Li-ion battery supply chain, expected to
build up advantage in cost.
Do-Fluoride has already established a supply chain from raw materials, such as
electronic-grade hydrofluoric acid, electronic-grade lithium fluoride, lithium
hexafluorophosphate (LiPF6), to Li-ion battery materials, such as electrolyte
and cathode materials, and further to power Li-ion battery. Of this, the
production capacity of LiPF6 will increase to 6,000 t/a in 2016, hopefully to
generate significant scale effect. At the same time, its production of power
Li-ion battery will also rise to 600 million Ah/a.
Challenges
- Hebei Hongxing, despite years of experience in vehicle field, has
suffered from losses in recent years. Now its brand recognition remains very
little. Its reproduction is in need of re-established channels for procurement,
marketing, etc.
- The overall scale of alternative energy vehicle is very small currently, in
spite of its explosive growth: during January-November, the cumulative
production was up by 400% YoY to 279,200 units, however, only 1.28% of the
total vehicle output.
- The market is dominantly occupied by leading companies, indicating hardship
for new comers to stand firm. In January-October, the top 8 alternative energy
vehicle manufacturers held 66.10% of sales in the domestic market, of which BYD
Company Limited still headed the list, by 24.31%.
Top 8 alternative energy vehicle
manufacturers by sales in China, January-October 2015
|
No.
|
Company
|
Proportion in national sales mix
|
|
1
|
BYD Company Limited
|
24.31%
|
|
2
|
BAIC New Energy Vehicle Co., Ltd.
|
8.00%
|
|
3
|
Zhidou Electric Vehicle Co., Ltd.
|
6.95%
|
|
4
|
Kangdi Electric Vehicle Group Co., Ltd.
|
6.72%
|
|
5
|
Chery Automobile Co., Ltd.
|
5.68%
|
|
6
|
Zhongtai New Energy Vehicle Co., Ltd.
|
5.35%
|
|
7
|
SAIC Motor Corporation Limited
|
4.77%
|
|
8
|
China Anhui Jianghuai Automobile Co.,
Ltd.
|
4.32%
|
|
Total
|
66.10%
|
Source: China Association of Automobile Manufacturers & CCM
About CCM:
CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc. More about CCM, please visit www.cnchemicals.com.
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Tag: alternative energy vehicle