Core Consulting: Light Commercial Vehicle Market Forecast Research Report in January 2022

1. Industry Insights

Notice on further strengthening the management of light trucks, small and micro passenger cars and grades

• The Ministry of Industry and Information Technology and the Ministry of Public Security jointly issued the "Notice on Further Strengthening the Production and Grade Management of Light Trucks and Small and Micro Passenger Cars", which requires that newly declared products and products in production that have been included in the "Announcement" must not only comply with relevant national policies and mandatory standards, but also meet the requirements of the "Technical Specifications". The Ministry of Industry and Information Technology will not announce new products that do not meet the requirements of the "Technical Specifications", which means they cannot be registered as blue-plate products.

• This "Notice" puts forward requirements from three aspects: product, production and sales, and supervision, and sets a transition period for non-compliant products, effectively eliminating illegal products and illegal behaviors from the source.

• From the product level, in addition to the blue-plate light trucks being greatly affected, the most affected products are dump trucks. At present, there are no blue-plate engineering vehicles on the market with "rear single tires" that meet the requirements of the new regulations. Therefore, this is both an opportunity and a challenge.
• Cangzha trucks were greatly affected, with overall sales of Cangzha trucks falling by 45% in 2021.
• Affected by demand, some blue-plate trucks will be converted into yellow-plate medium-sized trucks, blue-plate small trucks, new energy light trucks and light buses, and products will return to compliant and balanced development.

• On December 25, the Zhilan Automobile brand was launched on the cloud platform of the Zhilan Automobile 2022 Strategic Partner Summit, completing the upgrade of Foton Zhilan New Energy to Zhilan Automobile. Zhilan Automobile will carry Foton Automobile's new energy technology, new platform, and ecological development direction, and make great strides towards a technology and energy-based enterprise.

Auman Light Trucks: "Technological Innovation and User Driven"

2. Application Scenarios

Urbanization is increasing year by year, driving the demand for municipal sanitation

• In 2020, my country's urbanization rate reached 63.879%. Due to the combined influence of factors such as the accelerated urbanization process, increased government investment in sanitation, increased sanitation mechanization rate, and enhanced public awareness of sanitation, my country's demand for sanitation vehicles, especially new energy sanitation vehicles, has increased year by year.

Driven by policies, the demand inflection point has arrived

• Under the general background of carbon neutrality, coupled with the particularity of idling sanitation work and the strong demonstration effect, the promotion logic of new energy sanitation vehicles has become more solid and policy support has clearly strengthened.

The trend of municipal sanitation product structure miniaturization and new energy is obvious

• Judging from the product structure trend in recent years, the trend of lightweight municipal sanitation products is very obvious, and the proportion of light trucks and small trucks continues to squeeze the market of micro and heavy products. Coupled with the policy inclination, the number of light new energy municipal sanitation models will continue to rise.

The downward pressure on the domestic economy will increase in 2022

• The Central Economic Work Conference was held in Beijing from December 8 to 10 to summarize the economic work in 2021, analyze the current economic situation, and deploy economic work in 2022. In general, facing the "triple pressure" of weakening demand, supply, and expectations, the central government proposed a triple response measure of "expanding demand", "adjusting supply", and "stabilizing expectations".
• In 2022, my country's economy will still face multiple internal and external pressures and uncertainties, and the downward pressure on the economy will increase, but the fundamentals of my country's economy, which are resilient and long-term positive, will not change.

Analysis of the main factors affecting the market in 2022

• In the future, China's economy will gradually enter a stage of medium-speed and high-quality development. The demand structure will gradually shift from investment-oriented to consumption-oriented. Regional development will gradually tend towards balance, freight elasticity will decrease, and the freight market structure will become more reasonable.
• The overall demand for light commercial vehicles is gradually stabilizing, market demand is gradually returning to the origin of the product, and demand is gradually becoming balanced.
• From the product dimension, products are gradually becoming more high-end and customized, entering a stage of innovation and intensive cultivation, so there will be an obvious period of decline and sedimentation.