The automotive industry began to gear up speed

Market volume rose sharply yesterday, the two cities once again hit a new market high, including the Shanghai Stock Index once broke the 2100 point integer mark, the market sentiment is extremely high. In this context, the collective exertion of the automotive sector was attracting attention. Shanghai Auto and Foton Motor received a daily limit from news stimulation. Yutong Bus and China National Heavy Duty Truck also performed well. The stock price hit a record high. In the past, one of the five gold flowers, the automotive sector came back to make the market imagination.

The dawn of the industry is that the production and sales volume of the national auto industry in 2005 had increased by 13.54% year-on-year, but due to negative factors such as macro-control, raw material price increase, and industrial capacity expansion, the industry as a whole continued to experience a substantial decline in efficiency, and industry profits declined year-on-year. 40%. However, after entering 2006, although plagued by high oil prices, domestic car sales remained strong, with 5.77 million vehicles sold in January-October, up 26% year-on-year, 14% growth rate in 2005 and 16% in 2004. The growth rate and the recovery of the auto market in 2006 are cause for concern.

At the same time, the impact of oil prices on the value chain of the automotive industry, on the one hand, the rise and fall of oil prices will cause automobile manufacturers to increase or decrease the cost of manufacturing; on the other hand, oil prices will directly affect the cost of the use of automobiles, high oil prices increase the cost of use, suppress vehicle demand, Conversely, the drop in oil prices will stimulate demand for cars. The recent decline in the price of crude oil in the international market has further promoted the recovery of the automobile industry and the dawn of the automotive industry.

Structural differentiation is obvious Although the recovery trend of the auto industry has shown some signs of recovery, due to the numerous automotive sub-sectors, even though they belong to the automotive segment, the differences in core technology mastery, manufacturing level, marketing model, and target customer group include: Various sub-sectors such as passenger cars, commercial vehicles, and spare parts perform differently in terms of production and sales levels, competitive pressure, and profit status.

The rapid growth of the automotive industry mainly comes from the promotion of cars. From January to October, a total of 4.11 million passenger cars were sold, an increase of 32% year-on-year, of which sales of cars increased by 40% year-on-year to 3.04 million, accounting for 53% of the total sales of automobiles. In 2005, this proportion was 48%. From January to October, sales of MPVs, SUVs, and minibuses increased by 21%, 17%, and 10% year-on-year, respectively, and sales of passenger cars and trucks rose by 12% and 11% respectively year-on-year. It is worth noting that more than 80% of car manufacturers have increased sales in different degrees. Among them, Changan Ford and FAW Toyota are far ahead of the growth rate of 165% and 80% respectively, indicating that investment opportunities in the automotive sector are more concentrated in the car sector. .

Mergers and acquisitions highlight investment opportunities On the one hand, international capital focuses on China, and China’s huge auto consumption market has become a paradise for foreign investment. The outstanding performance of China's economy has attracted a lot of attention and inflow of international capital. At present, the focus of foreign M&A focuses on the high threshold industry. The auto industry bears the brunt, and the three domestic automobile giants led by FAW, Dongfeng and SAIC are lit up. After the fire of foreign investment in the auto industry, foreign mergers and acquisitions in the entire automotive industry are surging. The international capital is optimistic about China's potential huge consumer market and the future profitable prospects. It is foreseeable that with the accelerating process of China’s internationalization, topics such as mergers and acquisitions by the auto industry and foreign participation in shares will intensify. The positive news triggered by the favorable news of 297 million shares issued by Futian Automobile to Dyke on the market yesterday. Rising market is no doubt a rehearsal of the theme.

On the other hand, the current domestic auto industry still has the characteristics of decentralization, low-scale, and low-level. According to the statistics of China Association of Automobile Manufacturers, in 2004, China's top ten auto manufacturers accounted for 83.90% of the country’s total automobile output, sales accounted for 84.19%, and the top five companies accounted for 68.8% of the national auto market. From the perspective of the development status of the international auto industry, auto companies with an annual output of less than 1 million cars can no longer exist alone, and the scale of 2 million vehicles is also facing restructuring. Therefore, how to become bigger and stronger is the top priority for the domestic auto industry. At the beginning of the year, the Changan Group completed the restructuring of the Jiangling Group, and SAIC's overall listing has shown that the reorganization efforts of leading companies are under such a background. The investment opportunities contained in mergers and acquisitions are worthy of attention.