BYD Co., which makes only electric and hybrid vehicles, ordered at least six ships in October, each with 7,700 cars worth 5 billion yuan ($5 billion), to avoid last-mile supply chain swells. $710 million). ). State-owned SAIC Motor Corp., which already operates the world’s fifth-largest shipping fleet through its transportation arm, SAIC Anji Logistics Co., has won bids for seven new carriers, each capable of accommodating 8,900 vehicles. going.
Representatives for SAIC and BYD declined to comment.
Also Read: BYD Raises Prices of Electric and Hybrid Vehicles in Domestic Market.this is the reason
The ship in question isn’t expected to be online for several years yet, so it’s a bold bet on sustained global consumer demand for Chinese cars. China recently overtook Germany to become the world’s second-largest car exporter, exporting about 2.6 million cars abroad in her first 10 months of 2022, surpassing 2021’s export volume. Even an unexpected drop in demand for Chinese goods in October was unlikely to derail its upward trajectory as exports of cars and chassis surged 60% year-on-year to 352,000 units, or a record $7.1 billion. There was not.
The new NIO ES8 continues to be powered by two electric motors, a 160 kW permanent magnet motor and a 240 kW induction motor. (Photo credit: Twitter/@NIOGlobal)
But while car exports are booming, “the number of car carriers around the world has barely increased,” blames Shanghai-based Clarkson’s Research Services, a division of one of the world’s largest shipbuilders. said Xing Yue, an Due to this supply and demand mismatch, investments are being poured into building new ships for vehicle transport. “
The ship shortage is stretching an auto supply chain already worn down by semiconductor shortages, pandemic-related labor shortages and months of port congestion exacerbated by China’s Covid-19 lockdown. The daily rate for a vessel capable of carrying one car (commonly known as a roll-on/roll-off vessel, or ro-ros) soared to about $100,000 per day in October. , more than ten times higher than 2020 levels and a record high. Since at least 2000, according to the Clarksons.
According to Tobias Bartz, chairman and chief executive officer of Rhenus Logistics, it makes sense for Chinese automakers to go their own way given the final supply chain disruption. Speaking on the sidelines of a conference in Singapore last month, he said there was a “huge shortage” of ships.
This shortage has caused some nearly 30-year-old vessels to still operate instead of being scrapped, increasing the risk of accidents. Attempting to extinguish a lithium-ion battery fire that has occurred can also be more difficult.
Chinese automakers aren’t the only ones wanting more freighters. Tesla, which uses Anji Logistics’ car carriers, is also having trouble getting vehicles out of its factories.
“We didn’t have enough boats, trains and car carriers to really support the wave of vehicle deliveries at the end of the fourth quarter,” CEO Elon Musk said on Tesla’s third-quarter earnings call. rice field. “Like it or not, we don’t have enough shipments to move the cars, so we really need to smooth out the delivery of the cars within the quarter.”
This latest pinch point may be new, but BYD and SAIC aren’t the first automakers to operate their own shipping vehicles. Toyota owns shipping company Toyofuji Shipping, while South Korea’s Hyundai Motor owns logistics group Hyundai Globis.
It’s also a sign of how far China’s automakers’ export ambitions are heading.
Until just a few years ago, China primarily sold cars to developing countries in Africa and the Middle East. However, increased production of electric vehicles has led to more Chinese-made cars in Europe, and Europe is now the largest market for Chinese car exports. China exported over 852,000 of her EVs in the first 10 months of the year. More than a fifth of them were Tesla electric cars produced at the US automaker’s Shanghai Gigafactory.
Admittedly, some people aren’t entirely convinced that buying a ship now is the right decision.
Craig Fuller, founder and CEO of supply chain market intelligence provider FreightWaves, said: It’s on the demand side of the equation,” he said.
Until that inflection point, Chinese automakers seem to want to control as much of the process as possible. Electric car makers Nio Inc. and Chery Automobile Co. are also eyeing boat orders, local media reported last week.
Among Chinese brands, SAIC is the most advanced overseas. In 2021, he will have sold 697,000 cars abroad, and this year he is aiming for 800,000, boosted by the success of his acquisition of British brand MG Motor. This is far from meeting the annual shipping capacity of about 10 million units, but on the other hand, SAIC’s vessels allow him to and does serve other automakers, including Nio. I’m here.
First issue date: December 5, 2022 at 9:44am IST