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Yeh i cet presentation

  1. 1. The Shape of China’s Truck and Bus Market Yumin Yeh Manager Sustainable Development & Strategic Partnerships1 Innovation Center for Energy and Transportation
  2. 2. About iCET The Innovation Center for Energy and Transportation (iCET), registered in Beijing, China and Pasadena, California, is an independent non-profit organization in the areas of low carbon transportation, clean energy and climate policies. Our Mission - to bridge China with the rest of the world, especially with the US, and provide decision makers at all levels with urgently needed innovative solutions to solve the energy and climate crises. Our Work - identifying and introducing international best practices, providing expert advice, planning and coordination, media outreach. 2
  3. 3. Low Carbon Transportation ProgramLow Carbon Transportation Fuel Economy Standards and Policies for China Low Carbon Fuel Standards and Policies Green Car Guide and Online Rating Electric Vehicle Research 3
  4. 4. Environmentally Friendly Vehicle Program 4
  5. 5. What’s in today’s presentation?• China’s overall market shape and unique, key trends in China’s truck and bus market, especially in comparison with the US• Major findings from the only China Clean Truck and Bus Business Opportunity Guide 2012 • One of a kind 60-page guide available for US companies • Recent data from 2011, especially trucks • Focused specifically on commercial vehicles market (others are focused on passenger vehicles) • Includes success stories, policy overview, top manufacturers, top suppliers and much more • Maybe next year you will be in the guide! 5
  6. 6. Total Volume of Commercial Vehicles in China• China has simply become the biggest single region for the manufacturing and use of medium and heavy-duty vehicles in the world, surpassing the volumes built in any other region.• China’s commercial vehicle industry has experienced rapid volume growth since 2001 with an average annual growth rate of 14.7%.• Commercial trucks and buses account for roughly half of China’s transportation energy use, as compared to one- third of transportation energy use in US. 6
  7. 7. Total Volume of Commercial Vehicles in China• Total sales of commercial vehicles (mini, light, medium, and heavy-duty trucks and buses) in 2011 were approximately 6.93 million, although a huge portion of the overall totals are mini and light trucks.• Medium and heavy-duty commercial vehicles sales in 2011 (weight classes 3-8 in the US) together total more than 1.4 million. More than two times the US production.• Bus sales over 400,000 in 2011. So the bus market still many times larger than US production, particularly of urban transit buses. 7
  8. 8. Truck Market in 2011China’s Truck Market Sees a Decline in 2011, but OnlyAfter Years of Sustained Growth•China’s overall truck market did see an 8.9% decline in2011, a trend which continued into 2012. This is not entirelyunexpected, as the truck market experiences a down yearroughly every five years, but this was the largest decrease inalmost 20 years.•An uncertain market indicator that should be kept in mind 8
  9. 9. Commercial Vehicle Market by End UseTrucks dominate theChina commercialvehicle market byvolumeTrucks make upclose to 90% ofheavy-duty vehicleregistration byvehicle end usetype. 9
  10. 10. Quick Overview: Fuel Usage• There is a disparity between how trucks and buses use fuel• The majority of all trucks and buses in China are powered by diesel (97%).• However, the city bus is an exception: 12% are powered by CNG, 5% by gasoline.• This is likely because government subsidies for NEVs have definitely favored public sector bus fleets versus any truck fleets. Won’t go into detail here… 10
  11. 11. Truck Market by Weight ClassTruck Weight Classification Standards in China since2005•Light-duty Trucks (LDTs): GVW from 3,968 to13,228 lbs ( ≈ Class 1, 2, 3)•Medium-duty Trucks (MDTs): GVW from 13,228 to30,865 lbs ( ≈ Class 3, 4, 5, 6)•Heavy-duty Trucks (HDTs): GVW is 30,865 lbs ormore ( ≈ Class 7, 8) 11
  12. 12. Truck Market by Weight ClassClearly, LDTs have shown the greatest sales volumegrowth in absolute terms. 12
  13. 13. Trending toward Heavier TrucksBut, the trend is going towards HDTs. HDTs have thehighest percentage sales volume growth in the past fouryears is almost 81% 13
  14. 14. Heavy Truck Market by End Use Chinese HDTs are generally classified into three end use types The Purpose and Industries Served by Different Types of HDTs Major service and Truck Type Purpose industryHeavy Cargo highway transport and coal, iron ore and otherTruck construction extractive industryHeavy Truck with manufacturing, heavily influenced byChassis (e.g., engineering and investments in industrialDump Truck) machinery facilitiesSemi-trailer longer distance highway highway transportTractor or Tractor transport 14
  15. 15. Visuals into China trucks 15
  16. 16. Heavy Truck Market by End Use• Within the heavy truck market, although all HDT types have increased in recent years, cargo trucks have jumped ahead as the fastest growing type of HDT.• Cargo trucks are used primarily for raw material extractions, an activity whose demand does not fluctuate as much over time, as does demand for heavy duty trucks serving industry segments more dependent on fluctuating investment.• Cargo trucks have seen a sales volume increase rate of 190% since 2007, while heavy trucks and semi-trailers in general have increased at a somewhat more moderate 40-60%. 16
  17. 17. Another interesting trend: Specialty Vehicles on the riseThe specialty vehiclemarket is not large(roughly 13% in2010)But specialty vehiclescaptured anincreasing share ofthe market in each ofthe past severalyears. 17
  18. 18. Specialty Vehicle Classifications in ChinaSpecialty vehicles range widely, but are usually defined astankers, hoists, cranes, street sweepers, etc.Specialty vehicles are often medium-duty trucks.Although generally losing market share to heavy dutyvehicles, medium duty truck market share increased in2011 because of increased sales of MDT specialty vehicles 18
  19. 19. Chinese HDT Production and Export vs. Import Investment Export Import Year (billions of Production (units) (units) RMB) 2004 59,028 370,795 3,559 9,593 2005 75,095 239,197 11,510 3,770 2006 93,368 305,396 20,514 5,842 2007 117,464 484,366 55,215 8,347 2008 148,738 541,510 69,877 8,518 2009 194,139 635,739 40,930 7,367Table 4: Chinese HDT Production and Export vs. Import 20
  20. 20. Key Takeaways: China’s Truck Market1) Opportunities in the market remain for HDTs. Although HDTs saw a decrease in 2011, sales volume of HDTs reached over 1 million in 2011, up 59.5% year-over- year from 2007.2) The HDT market may see increased demand in the future. Government restrictions on overloading are expected to force many fleets to move from overloaded MDTs to HDTs that can carry heavy loads. Probably more on this in other panels 21
  21. 21. Key Takeaways: China’s Truck Market3) Although decreased in the last few years, specialtyvehicles are still a growing segment: MDT market shareincreased in 2011 because of increased sales of MDTspecialty vehicles such as tankers, hoists, cranes andstreet sweepers.These are all important trends in China’s truck market 22
  22. 22. Onto the China Bus MarketDespite a down year fortrucks in 2011, the busmarket in China still grewby 7%Bus sales volumes for allreported years are largerthan the productionvolumes, indicating lessrisk of over-capacity, unliketrucks. 23
  23. 23. 2011 Bus Type Sales Volume by Length Bus Size Sales (in Increase rate thousands) from 2010 (%) Large 73.8 7.26 Medium 69.1 18 Small 322.5 13.4Source: iCET, China Association of Auto Manufacturers Annual Report 2012 24
  24. 24. Percentage of New Energy Buses in 2011 The large bus is a focus of new energy technology deployment. NEV buses maintain the largest market share in the large bus category. Total sales of Approximate Approximate New buses sales of New Energy Bus as % of Energy Bus* Total market (%)Large 73,800 3,525 4.77Medium 69,128 1,794 2.59Small 322,500 189 0.05Total 403,400 5,508 1.37 Source: iCET, China Association of Auto Manufacturers Annual Report 2012 25
  25. 25. Key Takeaways on China’s Bus Market1) Bus sales volume did NOT decline in 2011,while trucks did. One possible reason is that thebus market is less dependent on macro-economicgrowth as compared to trucks.2) Unlike the truck market, bus sales volumes forall reported years are larger than the productionvolumes, indicating capacity for more production. 26
  26. 26. Key Takeaways on China’s Bus Market3) The large bus segment is not growing as rapidlyas smaller buses, but it is a focus of new energytechnology deployment and NEV buses maintainthe largest market share in the large bus category.4) Lastly, large and high-end buses use the mostforeign components. This trend may not continuein the future as China’s domestic suppliersbecome more technologically advanced but this isa current void in the China market. 27
  27. 27. Chinese versus non-Chinese Commercial VehiclesKey differences between US and Chinese commercialvehicles•Chinese trucks and buses generally have much lesspower, travel at lower speeds, and are designed to carryless weight than those in the EU, Japan and US.•This is very important when finding synergies between USand Chinese technologies. 28
  28. 28. Chinese versus non-Chinese Commercial VehiclesAverage Truck and Bus Power in ChinaType Design Design Horsepower Horsepower (hp) – China (hp) - USHDT 207-433 306-592MDT 138-217 158-286City Bus 145 250-400Joint Venture Bus 364 29
  29. 29. Chinese versus non-Chinese Commercial VehiclesAverage cost of Trucks in China (unit: 10 thousand RMB) 30
  30. 30. Truck and Bus Market ForecastWe would all love to know…. But it is very difficult toquantitatively predict the future market for advanced trucksand buses because of a lack of data and a number of otherunknowns such as government policies, economicconditions and infrastructure capacity.1) In fact, the truck market forecast has often been over-optimistic: Because of the strong and consistent growth inthe last decade, some analysts projected another strongyear for 2011. 2011 was not a growth year for trucks inChina. 31
  31. 31. Truck and Bus Market Forecast2) Furthermore, the truck market decline may last for onlyone year, but may be longer because of the sluggisheconomy worldwide. 2012 is an unknown.But still there has been a general pattern of growth inChina’s truck market history, marked by an occasionaldecline every few years that has historically still recovered.Not all good news so far… 32
  32. 32. Truck and Bus Market ForecastA recap of good news…3) HDT segment likely to grow: Despite the challengesfaced in 2011, the HDT segment is likely to keep growing.This is particularly true for the heavy-duty cargo truckmarket, which is the fastest growing HDT truck end use. 33
  33. 33. Truck and Bus Market Forecast4) Specialty vehicles are still a growing segment: MDTmarket share increased in 2011 because of increasedsales of MDT specialty vehicles such as tankers, hoists,cranes and street sweepers.5) So if we look into 2015 and beyond, MDT and HDT salesare expected to continue to increase. One analyst forecaststhat sales will increase by about 5% between now and2017 (Frost and Sullivan, Business Monitor International). 34
  34. 34. Truck and Bus Market Forecast6) The bus market continues to grow in 2011 at about thesame pace of about 5-7% per year.Emphasis: It is very difficult to quantitatively predictthe market for trucks and buses, especially advancedtrucks and buses, in China. There are many differentfactors and unknown circumstances. iCET would urgecompanies to exercise caution when hearing about certainmarket projections. 35
  35. 35. Possible Market Drivers Pointing to Continued GrowthDespite the uncertainty in numbers, there are overallpositive market drivers.•Road-based transport accounts for about 70% oftransported goods by weight.•Freight transport by rail has been declining dramatically.Rail accounted for as much as 70% of total freight trafficbut by 2010 it had dropped to less than 40% (KPMG) 36
  36. 36. Possible Market Drivers Pointing to Continued Growth• Highway cargo volume increased steadily at an average annual increase rate of more than 15% per year. 37
  37. 37. Possible Market Drivers Pointing to Continued Growth• Increasing or sustained investment and support for infrastructure, construction and logistics signals an intention to continue expanding the use of on-road vehicles for goods movement and transportation. 38
  38. 38. Many other market drivers• Policies and tax incentives for NEVs such as the 12th Five Year Plan and local pilot projects will increase investment in the entire NEV industry and surrounding infrastructure, driving market demand in the future, especially for bus fleets.• Regulations on “overloading” are increasing the demand for HDTs,• Fuel consumption standards for trucks are likely tightening soon, but are being delayed until 2013 due to various lobbying efforts. 39
  39. 39. Where are new energy vehicles going?• This is a huge and unpredictable question• The price of fuel is expected to continue to increase, driving the move towards NEVs.• Some forecasts believe EV adoption in buses is likely to increase, albeit slowly depending on infrastructure developmentThis question will be tackled by many of the other panels. 40
  40. 40. So, what do we do?• With all this unpredictability in the market forecast, what can we do?• Besides tapping into the opportunities such as HDTs and large buses, we can help stir up demand in the market.• This is why we are invested in the US China Clean Truck Summit, gathering all stakeholders because we know that it is possible to play a part in influencing the future market through promoting policies, educating the public, spreading game-changing technologies, and increasing successful partnerships 41
  41. 41. You can help shape the China truck and bus market• As we participate in the summit, let us realize that the market for clean trucks and buses in both US and China is built between governments and policies, but also promoted when we create more and more success stories in the private sector, people like you and me, and show others our solutions and technologies, and when combined together can become game changers.• Together, we are not only shaped and restricted by the China truck market, but we can help shape the China truck market 42
  42. 42. To future success! 谢 谢! • 更多关于信息, 请登陆 iCET网站 www.icet.org.cn43

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