Bicycle Industry News: The electric assistance will increase

Bicycle Industry News: The electric assistance will increase

The China Bicycle Association (hereinafter referred to as the CBA) held a press conference online to announce the development and characteristics of the bicycle industry in 2021 and from January to April of 2022 and accepted interviews and questions from a number of industry and foreign media.

The meeting was presided over by Mr. Guo Wenyu, vice chairman and secretary-general of the China Autonomous Association, and Ms. Zheng Xiaoling, director of the Industry Development Department and spokesperson. Yang Yufeng, president of Tianjin Jinlun Bicycle Group, Liu Chunsheng, general manager of LTWOO Zhang Zhenyuan, and other corporate representatives attended the meeting.

Industry Data Announcement: Exports Exceed US$10 Billion for the First Time in 2021

In 2021, under the complex and severe domestic and international situation, the bicycle industry will show strong development resilience and potential, achieve rapid growth in revenue and profit, and export over 10 billion US dollars for the first time.

According to statistics from industry associations, the output of bicycles last year was 76.397 million units, a year-on-year increase of 1.5%; the output of electric bicycles was 45.511 million units, a year-on-year increase of 10.3%. The total operating income of the whole industry is 308.5 billion yuan, and the total profit is 12.7 billion yuan. The export volume of the industry exceeded 12 billion US dollars, a year-on-year increase of 53.4% and a record high.

In 2021, 69.232 million bicycles will be exported, a year-on-year increase of 14.8%; the export value will be 5.107 billion US dollars, a year-on-year increase of 40.2%. Among them, "competitive bicycles" and "mountain bicycles" representing high-end sports and high added value have grown significantly. The export of parts and components maintained a high growth momentum for three consecutive years, with an export value of 5.58 billion US dollars, a year-on-year increase of 63.7%. In addition, according to industry statistics, the export volume and export value of electric bicycles have increased significantly compared with the previous year, and the industry is actively going abroad to deploy overseas.

From January to April this year, the output of bicycles dropped by about 15% compared with the same period last year, and the output of electric bicycles increased by nearly 10% year-on-year. At the same time, due to the slowdown in international demand, the growth rate of bicycle exports dropped significantly. In addition, the spread of the domestic epidemic has caused unstable upstream supply, shortage of human resources, increased logistics costs, and prolonged transportation cycles, which have put greater downward pressure on the operation of the industry. At present, the bicycle industry is actively responding and seeking to stabilize exports. It is expected that the whole year will show a trend of low and then high, and exports will return to normal.

The overall situation of the industry: three factors increase and one decrease, and digital transformation accelerates

In the whole year of 2021 and the first quarter of 2022, the growth rate of the main benefit indicators of the bicycle industry will achieve rapid growth, all exceeding the average level of the light industry.

Among them, in the first quarter of 2022, electric bicycle manufacturing has strongly driven the industry to achieve rapid growth, and the average growth rate of operating income is 10.1% higher than that of the light industry.

Specifically, the economic operation of the industry in 2021 will show the characteristics of "three increases and one decrease".

Production increased. In 2021, the output of bicycles will increase slightly, and the total output of electric bicycles will reach 120 million, a record high. It is expected that the output of the industry will shrink moderately and gradually return to normal in the next period of time. The output of bicycles will fluctuate from around 70 million units, and the scale of electric bicycles will remain at more than 40 million units.

Benefit increase. In 2021, the industry will overcome the impact of multiple factors such as rising commodity prices, labor shortages, power and production restrictions, and fully realize a substantial increase in revenue, profit, and other indicators; the industry-wide revenue margin will further increase, reaching 4.12%, a year-on-year increase of 0.05%.

Exports increased. With the strong recovery of external demand, the industry's exports have reached a new record high. The industry's export volume exceeded 12 billion US dollars, a year-on-year increase of 53.4%, which was the highest growth rate in the past five years; the average growth rate of the industry's exports in the two years of the epidemic also reached 37%, enjoying the dividends of the home economy.

loss reduction. In 2021, the loss level of the whole industry will continue to decrease, and the loss of enterprises will be 15.5%, which is 0.72% lower than that of enterprises in the light industry in the same period. Among them, the bicycle sub-industry lost 203 million yuan, a year-on-year decrease of 22.2%, showing a good trend of narrowing losses.

With the growth of economic indicators, the industry actively adjusted and responded actively, realizing a good situation of continuous optimization of product structure and steady acceleration of digital transformation.

The grade and added value of bicycle products have been further improved. Lightweight, lithium-electric and intelligent products of electric bicycles have developed rapidly. New progress has been made in the integration of digitalization and intelligence in the industry. At the same time, new forms of sharing business have developed steadily. continue to play a key role.

According to incomplete statistics, as of 2021, there will be about 18 million shared bicycles in the market, and the market share of the three major platform companies will remain basically stable, with an output of about 5 million, mainly for the replacement of old and new; and the industry has produced more than 2 million vehicles.

Predicting the industry trend in 2022, the bicycle market will rise steadily

Since the beginning of this year, affected by external factors such as rising raw material prices, rising labor costs, poor logistics, and large exchange rate fluctuations, the operation of the industry has faced greater downward pressure. Especially in the first quarter, the spread of the new crown epidemic led to the insufficient operation of enterprises and instability of the industrial chain, which had an impact on the industry in a short period of time. In general, the industry faced greater pressures and difficulties in the first half of the year. In the second half of the year, with the improvement of the epidemic situation, the operation of the industry will resume stability or usher in a new round of development opportunities.

Among them, bicycles have once again become the focus of social attention this year, and it is expected that the whole year will show a trend of low before and after high.

Recently, the sales of bicycles in many places in China have become very popular, and even some models are "hard to find". This is due to the successive outbreaks of epidemics in major production areas such as Tianjin, Jiangsu, Zhejiang, and Shanghai. Many companies have stopped production and limited production, and the overall delivery period has been extended, resulting in partial supply shortages in the market. The favorable factors to promote the development of the bicycle industry in the second half of the year are still clear, especially with the implementation of a series of national relief policies, domestic demand will continue to recover and expand.

In this regard, the industry needs to seize the new opportunities of consumption upgrading and expand the market. Including continuing to expand the supply of mid-to-high-end sports bicycles, and continuously improving the technical content and added value of products.

In addition, electric bicycles are increasingly favored by consumers, and the market has great potential for growth. The domestic market will become a new growth point for the industry. At the same time, Internet rental bicycles entered a stage of stable development, and production orders were stable and orderly. It is expected that the domestic bicycle market will show a positive growth trend.

In terms of bicycle exports, the overseas market of bicycles will be hot in 2021, which will cause importers to place excessive orders to replenish their inventory, and some orders will be overdrawn in advance. At present, the conflict between Russia and Ukraine continues to push up commodity prices, global inflation has significantly intensified, and the bicycle market demand has remained high. Slowly, new export orders fell sharply. In the first half of the year, the growth rate of exports entered a downward range, but the overall scale is returning to the normal before the epidemic.

At the same time, we should also see new opportunities for the bicycle industry: first, the United States, as the largest export market for the industry, has exempted tariffs on some bicycle products, which is good for expanding exports; second, the "Regional Comprehensive Economic Partnership Agreement" (RCEP) will come into effect, which can further stimulate the vitality of exports; third, countries along the “Belt and Road” are still important growth points for exports, and business opportunities can be seized from these countries and actively respond. It is expected that the export for the whole year will decline compared with last year, but the total volume will remain above 50 million vehicles; the industry output is affected by the slowdown in exports and is expected to drop by about 15% compared with last year, but it will be basically flat compared with previous years or slightly decreased.

Speech by the representative of the company: Actively seek changes and seize the 3-5 year window

During the interview session of the online press conference, representatives of participating car companies gave detailed responses to reporters' questions.

Mr. Yang Yufeng, President of Jinlun Group, believes that in the face of the continuous export boom of electric bicycles, Chinese car companies with export business should not only pay attention to ensuring the timely receipt of accounts receivable, but pay attention to the delay of orders, etc., but also need to Do more homework in product safety and technology research and development. Only by ensuring product quality and stability, can market stability be brought about.

Regarding how Chinese companies go overseas during the epidemic, Yang Yufeng said that he is optimistic about the development prospects of EU market countries. Chinese companies can build their own factories in Europe to effectively solve the problems of market expansion and after-sales service; the next 3-5 years will be a window for the stable development of the industry, Chinese enterprises should act as soon as possible to establish their own product import channels in the EU market.

Regarding the development of electric bicycles in the Chinese market, Yang Yufeng believes that the definition of electric bicycles in current laws and regulations is still not clear enough. Many ordinary consumers mistakenly believe that electric bicycles are equipped with motors. The relevant 3C standards also need to be further refined. It is necessary for the whole industry to act together to standardize and give electric bicycles more space for development.

Mr. Liu Chunsheng, the general manager of LTWOO, when talking about the opportunities and breakthroughs for the development of our domestic components in the future, said that LTWOO is an entrepreneurial company. Although it is still very young compared with foreign century-old brands, he believes that "in three to five years, through Rapid iteration and new technology development can solve this problem.”