Market Cap 100: China car, battery manufacturers dominate Asia market

Toyota Motors, CATL, and BYD are each worth at least US$100 billion in their market cap value. In aggregate, The Magnificent III account for a market cap value of more than US$628 billion. The remaining, in total, are worth over US$767 billion by market cap.

DIGITIMES assesses eight tech-related industries across seven Asian countries to rank the "Asia Supply Chain Market Cap 100," a study based on companies' market cap. The list of industries related to the automotive market includes automotive manufacturing, automotive components, and electrical component.

Overview of Asia's automotive industry

Many countries in the Asia region stand out as strong positions in the automotive industry, especially China. Chinese auto companies account for 12 companies. In aggregate, they are worth over US$650 billion by market cap.

The Chinese government policy was the major stimulant for this tremendous growth. Since 2015, central and local governments disbursed over US$3 billion in subsidies for EVs and hybrid vehicles, an average of approximately US$10,000 per vehicle, according to Automotive News China.

With the support from the government, Chinese automotive manufacturers such as BYD, SAIC Motor, Great Wall Motor, Geely Automobile Holdings, Guangzhou Automobile Group, and Chongqing Changan Automobile all introduced numerous electric and plug-in hybrid vehicles.

The new entrants such as NIO, Li Auto, and XPeng focus solely on EVs. The local government was very supportive in providing a foothold for startups as they struggled to increase their market share. However, this support prevented a shakeout so that the winners were able to acquire more of the market.

Based on the data from Gasgoo, by 2021 annual deliveries, none of those startups achieved the milestone of 100,000 units. However, three of them had annual deliveries of more than 90,000 vehicles. XPeng delivered 98,155 vehicles in 2021, outselling NIO, 91,429 vehicles. Li Auto, ranking third, with a total of 90,491 vehicles.

As for other countries, in comparison, Japan at #2, 7 companies; South Korea is #3, 4 companies; India at #4, 3 companies; and Indonesia at #5, one company. The following is a detailed Asia automotive companies' market cap, by country breakdown:

Source: Market data compiled by DIGITIMES, 2022/1

While Japanese automakers have been slower than many global peers when it comes to EV adoption, they are on their way to setting things right. Toyota, Honda, and Nissan are all taking on this new wave of mobility with seriousness and looking to make up for a lost time. All-electric launches including Honda e, Nissan Ariya, Lexus UX 300e, and Mazda's MX -30 are set to fuel Japan's EV industry in the near future.

Meanwhile, South Korean automakers did not perform well last year largely due to supply problems including the chip shortage, which drove down vehicle shipment, according to Reuters.

In terms of the automotive industry, the electrical component has the highest market capitalization growth in the automotive industry, 34.85% due to the surge of electronic vehicle (EV) batteries in 2021. Followed by automotive component, 16.9%, and automotive manufacturing, 11.16% respectively.

Notes. EV battery companies are included in the electrical component category. Source: Market data compiled by DIGITIMES, 2022/1

The Magnificent Three: Toyota, CATL, and BYD

Toyota Motor: Ranked #3

Japan's Toyota Motor tops the automotive companies' chart for two consecutive years with an increase of 18% by market cap in 2021.

Toyota has been investing more in electric cars, while still keeping its hybrid and hybrid-electric vehicle options available on the market. This strategy literally saved internal combustion engine (ICE) power from a dead sentence.

The Japanese manufacturer plans to invest US$70 billion (JPY8 trillion) to electrify its automobiles by 2030, half of it to develop a battery electric vehicle (BEV) line-up. The plan was well-received by investors and experts.

CATL: Ranked #4

China-based lithium-ion battery manufacturer CATL, is both spearheading and benefiting from the global transition to a more sustainable future. The company's vision is to exceed 670GWh by 2025, according to Minnews.

CATL leads in the Chinese battery market share with 55%, followed by BYD, 18.6%. Other major players, including CALB and GORION, each 5.2%; SVOLT, 2.7%; Parasis and LG Energy Solutions, each 1.6%, according to the China Automotive Battery Innovation Alliance data in November 2021.

In 2022, the subsidy for new EVs will be cut in China, and this will place CATL under more pressure. The demand for lithium batteries is skyrocketing in recent years, but growth in supply has slowed down.

EV batteries technology has matured, and its maturity level is increasing. Newcomers are catching up to the incumbent companies. The threshold for starting a new company has been lowered and that makes it easier for them to compete with established players, which might threaten the dominant position of the latter. All first-tier factories may be confronted with this issue.

Tesla's decision on adopting CATL's lithium iron phosphate battery (LFP) for its made-in-China Model 3 had further solidified CATL's competitive position in the market. The company's customer base includes SAIC, NIO, Xpeng, WM Motor, BMW, Volkswagen, Hyundai, Rolls-Royce, Daimler, to name a few, according to a Chinese blogger.

BYD: Ranked #7

Shenzhen-based BYD, the world's largest manufacturer of lithium-iron-phosphate (LFP) batteries, reported the company set a new sales record in China. More particularly, it sold 97,990 passenger vehicles last December, up 77.9% year-on-year (YoY). BYD's passenger vehicles sales reached approximately US$115,302,116.23 (CNY730,093,000) for 2021, up 75.4% on year. BYD's annual passenger new energy vehicle (NEV) sales grew by 231.6% on year to 593,745. NEV sales rose sharply by 236.4% on year and reached 92,823 units in December.

On other hand, BYD EV and hybrid models sold 48,317 and 44,506 units with a growth of 148.0% and 448.6% on year, respectively. All credits to its core technologies including the blade battery, DM-i (BYD's super hybrid system), as well as the e-platform 3.0. The annual EV and DM model sales reached 320,810 and 272,935 with the growth of 144.9% and 467.6% on year, respectively.

In 2021, BYD has accomplished monthly sales growth for 10 consecutive months. In response to China's strategic goals of peaking carbon dioxide emissions before 2030 and achieving carbon neutrality, as well as to make contributions to the "Cool the Earth by 1 Degree Celsius" initiative. The Chinese company expects to sell up to 1.1-1.2 million new EVs (i.e., BEVs 600,000, PHEVs 500,000-600,000) in 2022, according to Shenzhen Economic Daily.

Asia's EV companies to look out for in 2022

The electric vehicle (EV) revolution is just getting started. Jessie Lin, a research manager at DIGITIMES Research Center, commented that "China's EV startups such as Xpeng, Li Auto, and NIO are the companies we should keep an eye on."

NIO: Ranked #18

NIO, an automaker of sports cars and SUVs, attracted investments from Alibaba and Baidu, Singapore's national holding company, Temasek, and Silicon Valley's Sequoia Capital. The startup's initial public offering (IPO) raised approximately US$1 billion.

The startup has officially started construction on a new smart EV industrial park, named Neo Park. The park will house facilities for manufacturing and R&D businesses with a designed annual capacity of 1 million EVs and 100GW batteries

XPeng: Ranked #27

Founded by 2 former engineers from Guanggzhou Auto, with the backing of former Alibaba executive He Xiaopeng and investments from Alibaba and IDG Capital. XPeng succeeded in raising more than US$1 billion with an American IPO one month later than Li Auto.

As compared to 2020, the startup has an increase of 23.67% by market capitalization. Xmart OS is a dashboard that can identify people, monitor music listening habits, and track health. It is currently being used in the Xpeng G3 SUV in Norway, where it has been well-received. More specifically, XPeng has been awarded the "Most Known Newcomer of the Year" in Kantar's Car Index survey. It was conducted in association with Aller Media Group, one of Norway's largest media publishers.

Recently, Xiaopeng released the new electric model G9 SUV equipped with AI-assisted driving system Xpilot 4.0 and a built-in NVIDIA DRIVE Orin platform. It is expected to be released in China sometime during 3Q22.

Li Auto: Ranked #38

In July 2020, Li Auto, a manufacturer of more modestly priced extended-range hybrid vehicles, attracted US$ 1.1 billion with an IPO on Nasdaq. Li Auto had received the backing of China's largest consumer services app Meituan and Bytedance, owner of the controversial video app TikTok. The startup has an increase of 27.41 by market capitalization. It will launch its second EREV model X01, a full-sized SUV, under its X platform in 2022.

Tata Motors: Ranked #58

Another EV company to look out for in 2022 is India-based Tata Motors. The market share of Tata in India was over 70% from April to September 2021, according to AutoCar. The company has gained even more momentum in the EV business in the last few months."

He further, "Tata has just incorporated a wholly-owned EV subsidiary with a capital of Rs 700 crore last month. With the help of its popular Nexon EV, Tata's EV sales are accelerating. Its EV sales hit 1,751 units in November, up from 413 in the same month of the previous year. In December, Tata's EV sales grew 439% to 2,255 units, the highest-ever monthly record."

Appendix

Source: Market data compiled by DIGITIMES, 2022

Editor note: DIGITIMES Asia released the "Asia Supply Chain Market Cap 100 Ranking," based on market capitalization data of listed companies that engage in manufacturing activities in the Asia supply chains with the cut-off date set on December 31, 2021.