(Producer/Author: Kaiyuan Securities, Deng Jianquan, Zhi Lujing)
1. The basic brake leader has made power to control the electric control, and its operating conditions have gradually improved
1.1. The leading industry in the basic brake system, the automotive electronic control system has continued to make efforts to control the
. The company started with traditional basic braking businesses such as brakes and brake pumps. In recent years, the automotive electronic control system business has made rapid progress and has successively launched EPB, ESC, and IBS products. Asia Pacific Co., Ltd. was predecessored by Xiaoshan Automobile Brake Factory established in 1979. Its main products are disc/ drum brake , brake pumps, vacuum boosters and other basic brake components of automobiles. In 2000, the ABS anti-lock braking system jointly developed by the company and Tsinghua University was officially launched. The company has become the first domestic company to independently develop and produce automotive hydraulic ABS. In 2016, the company's EPB electronic parking brake and ESC body stability system were officially mass-produced, driving the company's automotive electronic control system business to rapidly develop. In 2020, the electronic assisted braking system iBooster was also successfully mass-produced. In H1 in 2021, the company's automotive electronic control system revenue accounted for about 11.7%.
In addition to braking system-related business, the company has also deployed hub motor and wire-controlled chassis technology, ADAS intelligent driving products. In 2020, the company independently developed ADAS solutions including environmental perception, driving decisions, and control execution were successfully mass-produced on the Chery S61 model. Currently, the company includes four major business segments: automotive basic braking, automotive electronic control system, intelligent driving system, hub motor and wire-controlled chassis system. Among them, the basic braking business contributes to the company's main revenue. In the field of basic braking systems, the company's customers include independent brand OEMs such as Changan Automobile , Great Wall Motor , Wuling , etc., as well as some joint venture/foreign brands such as Changan Mazda , General Motors, Nissan , PSA, etc. In the field of automotive electronic control systems, the company's customers mainly use independent brands, such as EPB products mainly supply vehicle manufacturers such as FAW Hongqi, FAW Jiefang, Changcheng Automobile, Dongfeng passenger cars.
1.2. The performance in three years of difficult situations is under pressure. Since 2021, the operating conditions have gradually improved
2018-2020, the decline in disc brake business revenue has driven the company's overall revenue level to decline, and in 2021, the company's revenue resumed positive growth. Overall, the company's total revenue in 2019/2020 was -18.5%/-8.2% year-on-year respectively. In 2021, the company's revenue resumed positive growth, setting a new high since 2019, with revenue increasing by 24.3% year-on-year.
2017-2020, the decline in capacity utilization rate and rising raw material prices led to a decline in the gross profit margin of the company's brake products, and the company's overall profitability declined. Since 2017, the company's disc brake production and sales volume has declined, and the capacity utilization rate has declined. At the same time, the price of raw material steel has risen, resulting in the company's gross profit margin of brake products. The gross profit margin of the company's automotive electronic control system remains relatively stable. Due to the high proportion of revenue of brake products, the company's overall gross profit margin level declined from 2017 to 2020.
2021 Q1-Q3 The company's overall gross profit margin increased by 1.4pcts year-on-year, and its profitability was gradually repaired. Since 2021, the company's overall gross profit margin level has slightly improved due to the increase in capacity utilization and the increase in automotive electronic control system products with high added value and high gross profit margins. In the full year of 2019/2020/2021 Q1-Q3, the company's gross profit margin was 13.17%/12.88%/14.32%, respectively, and the company's overall profitability has been restored. The company's previous fixed-investment and fundraising projects have reached full production one after another. The scale of capital expenditure for projects under construction has decreased year by year since 2017, which will help alleviate the profit pressure brought to the company by depreciation of fixed assets. With the increase in the proportion of revenue of automotive electronic control systems and the rebound in the utilization rate of basic braking capacity, the company's profitability is expected to be restored upward.
2. The leading position of basic braking is stable, and the global supporting facilities are gradually making breakthroughs.
Early automotive braking system mostly uses mechanical braking. After that, the emergence of hydraulic/pneumatic braking systems further optimized the performance of the braking system, and hydraulic braking systems gradually became the mainstream braking solution in the market.Automobile hydraulic braking systems generally include: brake pedal, vacuum booster, brake master pump, liquid storage tank, hydraulic pipeline, proportional valve, , brake sub-pump, brake assembly and other components. After the driver presses the brake pedal, the vacuum booster amplifies the pedal force. The mechanical signal of the rear pedal force is converted into a hydraulic signal through the brake master pump and transmitted to the brake sub-pump and brake to achieve braking.
Since the 1970s, Asia Pacific Co., Ltd. has focused on the research and development and production of automobile brake products. The basic automobile brake product industry chain has a wide layout, including disc brakes, drum brakes, brake pumps and vacuum boosters. Disc brakes are lightweight, easy to maintain and have good heat dissipation performance, and cost is higher than drum brakes. They are mostly used in car and light micro car . Some passenger cars also have disc brakes on the front axles, and drum brakes are mostly used in medium and heavy duty vehicles. The company's brake pump products include brake main pumps, brake sub-pumps, clutch main pumps, clutch sub-pumps, etc. Due to the company's adjustment of product structure, the revenue of vacuum booster products has declined year by year in recent years.
has more than 40 years of experience in manufacturing brake products, and the product quality has been tested for a long time and has been recognized by many OEMs. Automobile braking system components affect the safety performance of the car and have high requirements for product quality. Since the 1970s, the company has been manufacturing disc brakes, drum brakes and other products for more than 40 years. The basic braking products have been verified by many OEMs for a long time. In recent years, they have won the FAW Toyota quality achievement award, Great Wall Motors Reliability Excellence Award, General Chinese Supplier Quality Excellence Award, etc.
The company's basic braking products are ahead of other domestic competitors, and the domestic basic braking industry has a stable leading position. The company's "fist product" is disc brakes. After years of development, the market is now becoming mature. Independent suppliers have performed outstandingly in the domestic market with their product cost-effectiveness and service advantages. From 2010 to 2015, the company's output of disc brakes and drum brakes ranked first in the domestic market. At present, Asia Pacific's disc brakes remained leading in scale, with a production capacity of 18.14 million pieces in 2020, and its leading position in the basic braking industry is stable.
In recent years, the company has been committed to optimizing its customer structure and has made consecutive breakthroughs in the global supporting facilities of joint venture vehicle manufacturers and foreign-funded brands. Overseas suppliers such as Mainland China, Bosch , ZF Tianhe, Brembo have rich experience in the field of automotive braking. In recent years, the company has successively obtained foreign-invested/joint venture brands such as NISSAN and Changan Mazda, and has entered the general/PSA global supporting supply system. Foreign-invested automakers have made great breakthroughs in the global supply of brands, and is expected to drive the company's basic braking business customer structure optimization in the future. (Report source: Future Think Tank)
3. After the disc brake, the electronic control system is expected to start a new round of high growth
3.1. From basic braking to electric control, the company's brake system product sequence is improved
Automobile braking can be divided into parking brake and driving braking system. The parking brake is handbrake . The braking force is smaller than driving braking. The main function is to lock the rear wheels to prevent the car from slipping when parking on the ramp. Driving braking is used to provide braking force during the vehicle's driving process. With the development of intelligent automobiles, the electronic wire control process has been gradually started. The parking brake system has gradually evolved from mechanical braking to electronic parking brake (EPB), and the vehicle brake has developed from traditional hydraulic braking to hydraulic fusion electronic systems (such as ABS, ESC, etc.). The more advanced wireless control system has also been used in many models such as Tesla Model 3, BYD Han, Audi E-Tron, Cadillac CT6.
working principle: In the field of driving braking, from traditional hydraulic braking, to ABS/ESC hydraulic fusion electronic braking, to EHB electronic hydraulic line control and EMB electronic mechanical line control, the role of electronic control systems in the braking system is becoming increasingly important. The traditional hydraulic braking system provides braking force by brake fluid , and the hydraulic signal is transmitted in the system.Based on the traditional braking system, the ABS system has an electronic control system, which can control the hydraulic pump, oil inlet valve/oil drain valve, etc. by the ECU, thereby automatically controlling the size of the hydraulic braking force. The brake force in the EHB system is also provided by brake fluid. The conductive signals in the system include electrical signals and hydraulic signals. The pedal sensor transmits the electrical signals to the control unit, and the control unit sends an electrical signal command to the motor. Then the motor drives the hydraulic pump and pressure-building, and the hydraulic signals are transmitted to the brake sub-pump for braking. The EMB system conducts electrical signals, and the braking force is directly provided by the motor, and there is no longer a brake fluid hydraulic signal in the system.
system device: In the driving braking system, the application of electronic control may gradually replace vacuum pump , vacuum booster and other mechanical devices, and the traditional hydraulic circuit device in the EMB system will no longer exist. The EHB system uses a control unit and a motor to replace the vacuum pump and booster in the hydraulic braking system. The power assist method changes from vacuum assist to electrical control, realizing intelligent control, while the hydraulic device at the execution end has not changed. The EMB system has cancelled the hydraulic circuit device, and the device at the execution end changes significantly compared with EHB, hydraulic braking, etc. On the basis of further consolidating the basic brake business, the company has expanded its product scope to automotive electronic auxiliary braking systems. The market size of the traditional basic brake business is relatively stable. The company has firmly ranked as the leader in the domestic basic brake market with its competitive advantages such as technology, product quality, cost and service. The customer scope has expanded to foreign-investment/joint venture brands, and the basic foundation of the basic brake business is stable. At the same time, the company actively develops electronic auxiliary braking systems including ABS anti-lock braking system, ESC automotive electronic control and stability system, EPB electronic parking system, two-box IBS +ESC system, one-box EHB system, etc. The company has a complete braking product sequence and has laid out the traditional hydraulic brake-ABS/ESC-line control route, becoming one of the few first-level parts suppliers in China that specialize in researching and developing and producing a complete set of automobile brake systems.
3.2. Foreign investment is dominated by the electric control market, and the domestic substitution process can be expected. The domestic suppliers have already had certain competitive strength, and customers have gradually broken through to foreign investment/ joint venture car companies, while foreign suppliers in the electric control system market still dominate. Automobile Brake is an indispensable part of different automotive brake system technical routes (including electric control and wire-controlled control systems). The market size is relatively stable and the growth is slowing down. Self-owned suppliers have certain competitive strength compared with foreign brake system suppliers. The penetration rate of of automotive electric control systems such as ESC and EPB is at a relatively high level. With the further increase in penetration rate, the growth rate of the electric control market is expected to be higher than that of the basic brake market. In the electric control system market, international suppliers such as Bosch, Mainland China, ZF Tianhe account for most of the market share.
Domestic EPB market, mainland China, Trinhe and Edex have the leading share. The electronic parking brake industry has a high concentration, with CR3 reaching 69%. Mainland China, ZF Tianhe and Edex are the top three suppliers with the highest share in China. The shares of the three in 2020 were 28%/27%/14% respectively. Among domestic independent EPB suppliers, Bethel achieved mass production of EPB systems earlier (2012) and had a higher market share; Asia Pacific achieved mass production of EPB in 2016, which was lower than that of foreign suppliers and Bethel.
In recent years, the domestic ESC market penetration rate has increased rapidly, and the current domestic front-install market penetration rate is about 90%. The ESC body stability system has added steering wheel angle sensor , inertial sensor (such as yaw angle speed sensor , longitudinal acceleration sensor , transverse acceleration sensor), driving force control system, etc. to prevent the car from slipping when starting and turning excessive or insufficient when turning. According to Gaogong Intelligent Automobile Research Institute, the domestic ESC system preinstallation market loading rate will be about 90% in 2021.
Bosch, mainland China and other suppliers dominate the domestic ESC market, with customer base covering mainstream joint ventures and independent brand car companies. Asia Pacific ESC products have gradually entered the supply systems of Great Wall Motors, Chongqing Changan and other companies. Bosch, Mainland and other suppliers have accumulated a deep accumulation in the field of automotive braking systems, maintained long-term cooperation with foreign-funded car companies, and have a good reputation for products and established a certain market influence. The customer base covers domestic mainstream joint venture car companies such as SAIC-GM, FAW-Volkswagen , SAIC-Volkswagen , etc., as well as domestic mainstream independent brands such as Geely Auto , Great Wall Motor, etc. Asia Pacific shares were early on developing automotive electric control systems. In 2000, the ABS product developed successfully, becoming the first domestic supplier to independently develop and produce automotive hydraulic ABS. Later, the company developed ESC products with upgraded functions based on the ABS system. At present, Asia Pacific has achieved ESC supporting supply of many mainstream independent brands, and is relatively ahead of its independent suppliers.
Asia Pacific Co., Ltd. has rich experience in developing and manufacturing in the field of braking systems, strong independent R&D and technological innovation capabilities, and a complete testing and testing system. With the subsequent expansion of electric control system production capacity and the continuous development of customer development, the company's electric control market share is expected to further increase and accelerate domestic substitution. Since its establishment in 1979, the company has been deeply engaged in the automotive braking field for more than 40 years. It has led the scale of basic braking products in China. It has cooperated with many independent brand OEMs for a long time, and has gradually accumulated product reputation and brand influence, helping the company's electric control business market to develop. For automotive safety parts of brake system, product quality and performance are the core competitive elements of suppliers. The company has strong independent research and development capabilities, and has many independent intellectual property rights and core technologies such as electric vehicle energy feedback braking and ABS integrated technology, integrated automobile braking system technology, electromagnetic brakes, etc. In addition, the company has built a 6,000 square meter laboratory and road test bases such as Huangshan, Heihe , and has an experienced inspection team in terms of advanced testing equipment and braking systems. It has the testing and testing capabilities of the entire process from development to production of the braking system.
3.3. The market prospects of the line control are broad, and the company has rich technical reserves
Compared with traditional hydraulic braking systems, the advantages of line control lies in the following three points: (1) The response speed is faster. The response time of the line control is generally between 120 and 150 milliseconds. The braking time of the EMB system can be shortened to about 90 milliseconds; (2) The braking distance is shorter, and the braking distance of the EHB braking system can be shortened by more than 9 meters compared to the hydraulic braking system; (3) The energy recovery efficiency is higher. In traditional hydraulic braking systems, the magnitude of the hydraulic braking force is related to the pedal force. When decelerating, the main source of braking force is hydraulic braking, and the motor feedback braking account for a small proportion, while the line control The driving can adopt decoupling energy recovery technology. The hydraulic braking force is no longer linearly related to the pedal force. During the braking process, the motor is used as much as possible to improve the braking energy recovery efficiency.
Line control includes multiple technical routes. According to whether the system contains hydraulic circuit devices, line control can be divided into EHB and EMB systems. At present, the industrial application of EMB systems also faces the problems of insufficient braking force and the possible demagnetization of magnetic materials of permanent magnet motors at high temperatures. EHB is the mainstream application route of line-controlled. According to whether the ESC function is integrated in the EHB system control unit, EHB is divided into two-box and one-box. Early line-controlled braking mostly uses two-box systems, such as Bosch iBooster, Hitachi E-ACT, etc. In recent years, many suppliers such as mainland China and Bosch have made breakthroughs in the development of one-box systems, and the one-box system has gradually been applied.
Automobile intelligent upgrade demand drives, and demand for the line-controlled market is expected to usher in high growth. The development of intelligent automobiles has improved the performance requirements for braking systems. Since the braking performance of line control is better than that of traditional hydraulic braking systems, it meets the needs of intelligent upgrades in automobiles, and the penetration rate is expected to increase rapidly in the future. According to the China Economic Industry Research Institute, the global penetration rate of cyclic control systems is expected to reach 30% in 2026, and the domestic cyclic control market size may exceed 20 billion yuan.
Asia Pacific shares are two-box and one-box routes, which are expected to benefit fully from the rapid development of the wi-fi control system. Judging from the models currently equipped with two-box and one-box, the two-box route technology is more mature and there are more models equipped with one-box. The mass production time is late, and industrial application is being promoted. Asia Pacific Co., Ltd. currently has IBS+ESC in the form of two-box and IEHB in the form of one-box. The two-box products have been mass-produced in 2020, and are supplied with Chery New Energy, Great Wall Haomo Intelligent Walk unmanned logistics vehicle, Hongqi unmanned minibus, etc. IEHB products are still under development, and the second-generation products are being tested on Changan Automobile prototypes. The company has rich reserves of wing-controlled braking technology and is expected to benefit fully from the high growth in the demand for wing-controlled market. (Report source: Future Think Tank)
4. Leveraging external cooperation, forward-looking layout of ADAS and hub motors
Currently, the mainstream driving system on the market is central drive. The power output from the new energy vehicle drive motor must be transmitted to the wheels through mechanical transmission devices such as transmission , clutch, transmission shaft , etc. to drive the vehicle to drive the vehicle. The hub motor integrates power, transmission, braking devices, etc. into the wheel hub, saving a large number of transmission devices, thereby improving the energy utilization efficiency of the power system. The wheel side motor and the hub motor are both distributed driving, the difference is that the driving motor of the wheel side motor is located outside the wheel, and its power is transmitted to the wheel through the wheel side reducer . The main advantage of
hub motor is that it has high transmission efficiency and is easy to realize complex driving methods, but the high cost limits the promotion of products. Hub motor drive saves a lot of mechanical transmission devices, which not only improves transmission efficiency but also saves space inside the car. Since each drive wheel can be controlled independently and accurately, models using hub motor can realize a variety of complex driving methods, catering to the development trend of intelligent automobile driving, and are also regarded as one of the ultimate solutions for the new energy vehicle drive system.
Company in 2015, it invested in Elaphe, a leading global hub motor supplier in the field of passenger cars, and made a forward-looking layout of hub motor technology. Elaphe is Europe's leading manufacturer of distributed in-wheel motors for electric and hybrid vehicles. It has started to develop hub motors in 2003 and successfully developed its first hub motor product in 2006. Its products currently have more than 10 models. In 2015, Asia Pacific Co., Ltd. acquired 20% of the equity of Elaphe Company through capital increase. In 2016, the two parties jointly established a joint venture Hangzhou Asia Pacific Ilaphe Power Technology Co., Ltd. to introduce Elaphe advanced technology to promote domestic application. In 2018, the company's first automated hub motor assembly production line was officially put into operation.
According to the official website of Asia Pacific Co., Ltd., Dafen riding motorcycle equipped with the company's M700 model hub motor product is expected to be officially delivered in 2022. Based on experience in braking system development, the company enters ADAS intelligent driving business. Before the company took stake in Shenzhen, Xiang Qichuang Digital Technology Co., Ltd. and Titanium Information Network Technology Co., Ltd. , and cooperated with Titanium Information to establish Zhejiang Netlink Automobile Active Safety System Co., Ltd. to cooperate in the development of active safety system , autonomous driving and other technologies. In 2020, the company's independently developed ADAS solution including environmental perception, driving decisions, and control execution has been mass-produced on the Chery S61 model, and several models are currently undergoing matching tests.
5, profit forecast and investment analysis
key assumption
Asia Pacific is a leading domestic basic braking company with a wide layout of basic braking products. Disc brakes, drum brakes and other products have led the domestic share. In recent years, the company has rapidly developed automotive electronic control system business and has prospectively laid out ADAS, hub motors and other businesses. Overall, the company's basic braking business is stable, the electronic auxiliary braking business scale is rapidly increasing, and the line control and ADAS, hub motors and other long-term highlights are brought.
Basic Braking Business: The company has been deeply engaged in the field of basic braking of automobiles for decades, has rich product manufacturing experience, and has long proven product quality and reliability. Customers include Great Wall, Changan , Geely , SAIC, FAW, GAC, etc. In recent years, the company has made great progress in the development of basic braking business joint ventures/foreign-invested customers, and has successively obtained project designated locations for General GEM global procurement platform, Volkswagen Group MLB platform, Nissan, Changan Mazda, etc. With the continuous development of the company's customer development and the continuous supply of new supporting projects, the company's basic braking business capacity utilization and gross profit margin are expected to increase. It is estimated that the company's disc brake revenue will be 2.26/254/2.82 billion yuan from 2021 to 2023, with gross profit margins of 13.6%/13.7%/13.9% respectively, and drum brake revenue will be 53/55/570 million yuan, with gross profit margins of 13.0%/13.2%/13.5%.
electric control business: The company is the first domestic independent supplier to successfully develop automotive hydraulic ABS anti-lock system. In recent years, it has accelerated the layout of automotive electronic auxiliary braking systems, and the proportion of related business revenue has continued to increase. In 2020, the company has obtained designated electronic auxiliary braking system products from many auto companies. It is estimated that the company's electric control business revenue will be RMB 46/1.04/1.55 billion from 2021 to 2023, and the gross profit margin will be RMB 17.8%/18.0%/18.2%.
(This article is for reference only and does not represent any of our investment advice. If you need to use relevant information, please refer to the original text of the report.)
selected report source: [Future Think Tank]. Future Think Tank - Official Website
