At Boao Forum, two big news about the auto industry was hand in hand. 'China will greatly ease market access, and the next step will be to liberalize the foreign-investment-to-equity ratio limit, especially for the auto industry's foreign investment restrictions'; at the same time, Reduce auto import tariffs. '
These two heavy news about the auto industry directly brings ripples to the automotive sector in the capital market.
Among them, A-shares, as soon as the news was announced, Yaxing buses and other vehicle companies went straight to daily limit in the morning, but the stock price was quickly suppressed by 'market rationality'. The most powerful car segment was the auto parts industry. Subdivided varieties, including Dong'an, including parts and components stocks have been hugely bought in the daily limit.
The performance of Hong Kong stocks seems to be even more dramatic. The auto distributors that have imported imported luxury cars, such as Zhengtong Auto, Yongda Auto, and Zhongsheng Holdings, have all experienced significant price increases. Among them, Zhengtong Automobile has surged more than 12%. %.
In fact, the A-share market also has similar varieties. However, the SINOMACH has suspended trading for planning major issues and therefore missed this stock price 'show.'
Two paths appear
Although the market is expected to lower domestic import tariffs and limit shareholding ratios, it appears to many in the industry that the two major references to this debut are not exactly the same as the “expected differences” previously imagined.
On the one hand, under the background that the domestic automobile industry has achieved a relatively high degree of competitiveness, modest reductions in tariffs were previously considered by some to be expected;
On the other hand, the previous view generally held that the traditional auto stocks have not yet reached the opportunity to release. Therefore, the state’s top position has exceeded market expectations.
In any case, judging from the current signs, the automobile industry, as one of the largest import and export industries, is expected to be the first industry to make industrial changes under the background of Sino-U.S. trade friction. However, it is worth emphasizing that the market is greatly relaxed. Access to take the initiative to expand imports, China actually has arrangements, and there is no direct relationship with Sino-US trade frictions.
Going back, as early as this year's 'two sessions' in the country, the government work report has already proposed that we should expand telecommunications, medical care, education, pensions, and other areas to open up, and lower import tariffs on automobiles, some daily consumer goods, etc.
The People's Daily also deliberately emphasized that: 'To further expand our opening up, China will have more of its own adherence. That is, China’s pace of opening to the outside world has its own claims, demands and rhythm, and its opening to the outside world will not be at the expense of China’s national interests. The price. No one can expect that China today will be unrestrained by external pressure and open its doors unprincipledly.'
Reduce the structural impact of tariffs
Taxes on imported cars are usually composed of three parts: tariff, consumption tax and value-added tax. All three are important factors in determining the final tax-paying price of an imported car.
But overall, the impact of import tariff cuts on domestic high-end cars is relatively greater.
According to Northeast Securities estimates, if the tariff of imported vehicles gradually decreases from 25% to 5%, the price difference ratio of C-class vehicles will be significantly reduced, while the price difference between B-class vehicles and A-class vehicles will be smaller than the relative change. Therefore, import C grade The reduction of vehicle tariffs has a greater impact on domestic limousines. Imported A-Class and B-Class vehicles have less direct impact on domestic A-Class and B-Class vehicles.
However, there are always two sides of the coin. For the buyer, the C-class car price reduction will inevitably have a crowding effect on the B-class car, which will lead to a relative increase in sales.
Of course, tariffs on imported cars are expected to decrease, leading companies in the imported car market will benefit first.
State Machine Motors holds more than 20% of imported vehicles, with agency brands Jaguar Land Rover, Volkswagen, Ford, Chrysler, and Porsche. In 2017, the US-based Lincoln North Market and the Tesla Group were added.
Another giant group of distributors succeeded in smashing hot spots. After the news broke out, the huge group's stock price soared 5% yesterday. However, as the market became rational, coupled with the top-down plans of senior executives, it eventually only closed up. 2.6%.
In fact, as a whole, the general view of people in the industry is that, in the current context, the gradual reduction of import vehicle tariffs will not have much impact on domestic autonomous vehicles and joint venture vehicles.
In terms of trend, in the context of globalization, reducing tariffs is actually the trend. After years of development, China has cultivated a number of vehicle companies with strong independent brands, including SAIC, GAC Group, Great Wall Motors, and Geely Automobile. This is exactly where the Chinese auto industry has dared to 'greet the enemy'.
For example, from the company's annual report in 2017, the company achieved 6.93 million units of total vehicle sales, a year-on-year growth of 6.8%, more than double the market growth rate of 3.3%, and the overall development of the joint venture has seen both wings fly together. situation.
In terms of joint ventures, last year the company’s three major joint ventures performed strongly in the market with annual sales exceeding 2 million units. SAIC Volkswagen sold 2.063 million units, sales ranked first in the domestic passenger car market; SAIC General Motors 2 million vehicles, exceeded 2 million for the first time SAIC-GM-Wuling's 2.15 million vehicles, ranking first in sales of vehicles in China.
Autonomously, SAIC Autonomous Passenger Vehicles Roewe and MG sold 522,000 vehicles, a year-on-year increase of 62.27%. SAIC Chase sold more than 71,000 vehicles, an increase of 54% year-on-year, and self-owned brand sales volume increased by 227,000 vehicles contributed 51.6 to the group's growth. %, becoming the new engine driving growth.
It was precisely this kind of confidence that SAIC's stock price came to a bottom on April 10th. The logic behind this is: At the beginning, the market is worried that the company will be affected by the impact of tariff reduction on imported cars; The rationality of the market was quickly restored, and funds were bought on a bargain, which helped boost the stock price of the company.
Releasing limit ratios:
Break under pressure
It is a topic of discussion for many years to open up the ratio limit. The relevant positions of the relevant state departments in recent years have been repeated for many times. It seems to the industry that restricting the ratio of foreign investment stocks can be regarded as a market exchange for the right to speak, and then obtain technology. The model can also be said to be worn on the foreign side, and the auto industry’s stocks should be the dream of foreign car companies for a long time, but it involves a multi-power game.
China Automobile Association clearly stated its objection. One of its concerns is that it does not want China to become a processing plant for foreign products.
Dong Yang, executive vice president and secretary-general of the China Automobile Association, had previously made clear to the Securities Times reporter that 'the automobile industry is not an ordinary manufacturing industry, but a strategic industry that supports the transformation and upgrading of the national economy. It is an economic power among the world’s largest countries. Both are not car powerhouses; and in a new round of technological and industrial changes, the automobile industry will play a very important role. The Internet of Things, mobile terminals, etc. will all use automobiles as the main carrier. If you now give up the dominant power of development, Industry may become a processing plant for foreign products.
At this time, the Central Government has raised a background of the issue of opening shares. The same is true for the Chinese auto brands. The product technology, R&D, manufacturing, sales channels and services have been greatly improved. Participate in the competition of joint venture brands. At the same time, the international economic environment has also undergone considerable changes, attracting foreign investment, encouraging long-term investment, and gradually becoming an important issue for the country’s reform and opening up.
According to Niu Dawei, a veteran automaker, it is necessary for domestic auto companies to continue to work hard to increase their core competencies if they want to increase their strength. 'The household appliance and mobile phone industries are fully competitive, and independent home appliance brands have obtained free competition. With good development, although there is still some way to go in the mobile phone industry, the outlook for domestic mobile phones is still relatively good.
