April_Electric Vehicle｜Electric vehicle miniaturization to save the red sea market (Part3)

In terms of EV functionality, EletricBrands from Germany has launched the Xbus, a shared EV platform with different entertainment-oriented component modules for consumers to choose from. In addition to functionality and personal style, the Xbus fully satisfies the other two elements mentioned above, with a minimum of only 17,000 Euros to meet the trend of low-cost EVs, and a lightweight unit of power mileage to give play to its strengths. With a 10kwh battery module (one-fourth to one-fifth the size of a typical electric car), it can provide a range of 200km, and with a 30kwh module, it can provide a range of up to 600km. Despite two delays, the Xbus will begin shipping in late 2024 to early 2025, just in time to meet the current demand for price optimization as the EV market recedes.

Electric trolley to help domestic automotive-related enterprises to develop

As we mentioned in our article, "EV Demand Declines at the Heart of Automotive Technology Development," domestic automotive companies will need to focus on the three key factors of "EVs are not the only thing," "cost optimization," and "geo-politics" in order to achieve revenue growth in the short-term future. While the small car trend is mainly about cost optimization from the perspective of vehicle manufacturers, companies in the automotive supply chain need to satisfy the other two core elements when supplying goods in order to have the complete conditions for growth.

Xinbang Electronics

Shinebond Electronics is a major Taiwan-based connecting cable manufacturer, and its automotive-related products include charging pile harnesses, ADAS-related cables and power-related cables, which are exported to ChargePoint, China Express, BYD, SAIC, and Weilai, etc. (Figure 8). By the end of 2023, due to the decline in demand for electric vehicles, the charging pile, automotive harnesses and connecting cables business will be in the inventory-digesting stage. However, the company recently announced that it expects to see quarterly revenue growth in the third quarter of 2024, as inventory depletion comes to an end in the first half of the year, with the automotive product segment becoming the main engine of growth for the company. In addition, the power system developed by SinoCom-Auto and SAIC is expected to reach large-scale shipment in 2024, which will bring more than $300 million in revenue to the company. Automotive-related revenue will grow by at least 15%.

Chart 8: Customers and Share of Shinebond's Automotive Products

Source: Yuanta Investment Consulting; collated by Chi Pu Industrial Trend Research Institute 2024/4

UNITED WAY HOLDINGS

The main core business of Uni-Tech Holdings is automotive metal-related components, and its products cover a wide range of automotive parts, including airbags, seat belts, armrests, sunroofs, doors, power steering wheels, chassis, engine mounts, etc. (see Figure 9). In the past few years, Lianhe's aggressive production expansion in Kunshan, Czech Republic and Mexico is nearly completed, and is expected to increase 20% and 50% production capacity in China and Europe respectively in 2024, which is currently rumored to drive more than $300 million in revenue growth. The company forecasts that the revenue of the automotive products division is expected to reach $3.3 billion, and is expected to continue to grow, reaching a further $6 billion by 2028. For the full year, overall revenue is expected to grow by 25% in 2024, and earnings are expected to double due to product mix optimization.

Figure 9: Luen Tak Holdings' automotive products and production bases

Source: ChipSiP, Yuanta Investment Consulting, National Vote; Collated by ChipSiP Industrial Trend Research Institute 2024/4

Lai Ching Technology

As a LED automotive lighting module manufacturer (Tier 2), Lai Ching supplies its products to automotive lighting system (Tier 1) manufacturers, such as HASCO Vision, etc. The system manufacturers then assemble their products into automotive lighting systems and ultimately supply them to car brand manufacturers. After that, the system makers will assemble their products into vehicle light systems and ultimately provide them to automobile brand manufacturers. The products are mainly supplied to the China market, accounting for more than 75% (Figure 10), and the end customers include electric vehicle manufacturers such as BYD, Great Wall Motor and SAIC, as well as providing parts for Xiaomi's newly launched SU7 vehicle. In the highly competitive environment of China's automotive industry, internal sources have confirmed that the prices of existing lamp products will remain unchanged, while the design of new models will consider the use of domestically produced materials to meet the need for cost optimization. As vehicle technology continues to advance, including upgrades in light personalization, advanced driver assistance systems (ADAS), and automated driving systems, it is expected to further drive LED market penetration. Lai Ching forecasts that the company's revenue is expected to grow by approximately 20% in 2024.

Figure 10: Li-Qing Automotive Products Sales Area

Source: Yuanta Investment Consulting; collated by Chi Pu Industrial Trend Research Institute 2024/4