Three Models of Taiwanese Businessmen Entering the Mainland Electric Vehicle Supply Three models of Taiwanese businessmen entering the mainland electric vehicle supply Chain

China is the world's largest producer and seller of electric vehicles. In 2020, electric vehicle sales will look at 2 million units, driving the rapid growth of industries such as batteries, connected cars, autonomous driving and charging equipment. Although the Chinese electric vehicle market is dominated by domestic production and domestic sales, due to the current lack of technology and R & D capabilities of local Chinese manufacturers, Taiwanese businessmen still have the opportunity to seize the opportunity to enter the Chinese electric vehicle supply chain through three major models ...

In order to promote the development of the new energy vehicle industry, the Ministry of Industry and Information Technology of China officially released the “Measures for Parallel Management of Average Fuel Consumption and New Energy Vehicle Points for Passenger Car Enterprises” (“Double Points Policy”) in 2017, which is highly efficient on the one hand Encourage China to develop electric vehicles while suppressing the production of fuel vehicles. Guided by the double-point policy and other related policies, the production and sales of new energy vehicles in 2019 exceeded 1.2 million.

With the continuous development of the new energy vehicle industry, the Ministry of Industry and Information Technology of China has revised the double point policy twice in July and September 2019, and has issued a new version of the double point policy amendment to expand the scope of application of traditional energy vehicles and establish 2021 ～ The proportion of new energy vehicle points in 2023 will be 14%, 16%, and 18%, respectively.

China's electric vehicle policy subsidies shift to supporting facilities for charging piles

China is the world's largest producer of fuel vehicles and electric vehicles, as well as the largest sales market for fuel vehicles and electric vehicles. Since 2018, China's fuel vehicle market has maintained approximately 26 million vehicles per year with a growth rate of less than 1%. From 2019 to 2022, electric vehicles are growing at an annual rate of about 400,000.

The development of China's electric vehicle industry has started from a germination period and rapid development period, and has now entered the "stability and stability" period. The Chinese authorities want to use electric vehicle sales to promote the ecology of related industries such as batteries, connected cars, autonomous driving and charging equipment Department development. In the development process of the electric vehicle industry in China, there is a widespread problem of focusing on vehicles rather than charging infrastructure. In some regions, electric vehicles have grown rapidly, but the scale of charging infrastructure construction is insufficient; or the acceptance of electric vehicles by users in some regions Not high, making the overall growth of electric vehicles lower than expected, coupled with the unreasonable layout of some charging infrastructure construction, the phenomenon of "cars without piles" and "piles without cars" coexist in China. In order to solve the charging infrastructure problem, the Chinese government's subsidy policy has shifted from car building to supporting facilities for charging piles, and it has provided subsidies for the construction of charging pile infrastructure, electricity prices, parking and other concessions.

China's electric vehicles are mainly self-produced, self-made, and self-sale. The total annual production and sales are about the same. Zhang Jiahong, director of the Electronic Information Procurement Service Group of the Market Development Division of the Foreign Trade Association, pointed out that China has the thrust to develop electric vehicles because of the domestic consumer market It provides the largest testing and sales ground for sales and production. Sales and production can complement each other. Together with policies to promote the healthy development of the new energy vehicle market and industry, it also provides subsidies for the establishment of charging facilities, so that electric vehicles have a better vehicle environment in China. As China hopes to reduce its dependence on oil imports, the next-generation automotive industry revolution will fully develop electric vehicles, which will also drive the development of electronics, steel, chemical, and information technology industries. However, due to the insufficient technology and R & D capabilities of key components (BMS and electric motor control), the current quality and performance of China's entire vehicles are still inferior compared to international automobile brands, and the Chinese electric vehicle market is concentrated in Beijing, Shanghai, Guangzhou and Shenzhen. In regions, the number of electric vehicle charging facilities in third and fourth tier cities is insufficient, resulting in low consumer acceptance of electric vehicles, which is the resistance to be overcome in the development of electric vehicles in China.

Three suggestions for Taiwanese factories to cut into China's electric vehicle supply chain

Under the trend of vehicle electrification and intelligence, telematics products are urgently needed by Chinese car manufacturers. Taiwanese companies have R & D and production advantages in products such as automotive electronics and semiconductors. Product cost control is also better than that of European and American Nissan. However, the pace of technology, product upgrade, and inventory adjustment in the Chinese automobile industry is quite fast. To enter the supply chain of Chinese automobile manufacturers, Taiwanese manufacturers must be fully prepared.

Recommendation 1: Electronic control supplier

The electric motor control is the key to determining the performance of the vehicle. The car manufacturer can choose to make its own electric motor control, or the supplier can provide solutions. As the automakers develop their own motors and electronic controls, in addition to the cost pressure, the development time is also long. At present, Chinese local automakers have begun to cooperate with overseas companies such as Denso, BOSCH, Nidec, ABB, Toshiba, etc. Control market has development opportunities. Zhang Jiahong believes that after purchasing components from China's electronic control module factory, the finished products are assembled. For semiconductors, PCBs, IGBTs and other electronic products, not only are the technical requirements high and the demand is high, Taiwan's electronic control suppliers can carry out related business layout.