Special interpretation of Zinc consumption: the negative effect of Zinc consumption of passenger cars under "lack of Core"

The supply of chips has been tight for more than half a year, and its impact on automobile production can not be underestimated. Although the relevant semiconductor chip manufacturers have begun to expand their production capacity to deal with the problem of lack of cores, the expansion and delivery of the chips still take some time, and it is expected that it will not be produced until Q3 at the earliest.

This paper attempts to solve the impact of passenger car production reduction on zinc consumption under the action of lack of core, which needs to solve three problems:

1. Before the shortage of chips, the zinc consumption caused by the growth of passenger cars in 2021

2. The reduction in the production of passenger cars in 2021 after the shortage of chips.

3. After the shortage of chips, the final zinc consumption of passenger cars in 2021 is of the order of magnitude (zinc consumption density per vehicle type).

China Automobile Association caliber predicts that China's car sales will reach 26 million in 2021. Under the condition that the car inventory remains unchanged, it is estimated that the expected automobile production in 2021 will be 27.3 million, of which 22.78 million passenger cars will be produced (hereinafter referred to as "2021E"). Under the influence of chip shortage, we expect China's passenger car production (compared with "2021E") to decrease by 114.0-1.82 million in 2021, that is, the expected production of passenger cars in 2021 will drop to 2096-21.65 million.

We select the common passenger car models, split the parameters of the relevant weight and galvanized quantity of its body panels, and find that the galvanized amount of passenger cars with different price ranges and market positioning are very different.

We found that the weight of galvanized steel for low-grade cars accounts for about 30% of the weight of body panels, while the weight of galvanized steel for middle-grade cars and high-end cars accounts for about 40% and 50% of the total weight of body panels, respectively.

I. shortage of chips in 2021 restricts automobile production

The supply of chips has been tight for more than half a year, and its impact on automobile production should not be underestimated. Since December last year, many car companies have been forced to reduce production capacity or even shut down some production lines because of chip shortages. At the beginning of 2021, famous car companies, such as Volkswagen Group and Honda, issued a statement saying that they would adjust their production plans to reduce car production due to the shortage of chips. Li Shaohua, deputy secretary general of the China Association of Automobile Manufacturers, even said. Domestic car companies cut production by 5% to 8% in the first two months of this year due to lack of cores. According to the relevant news and the automobile production and sales data released by listed automobile companies, we sort out that some domestic and foreign automobile companies are affected by the shortage of chips:

As can be seen from the above relevant news reports, the shortage of chips has had a certain impact on the production of some automobile companies, although the relevant semiconductor chip manufacturers have begun to expand their production capacity to deal with this problem, but the expansion and delivery of chips still take some time. Deputy Secretary General Li Shaohua said recently that the chip shortage is expected to be alleviated in six months at the earliest, and now it may take nine months to a year.

We try to explore the magnitude of the negative impact of chips on zinc consumption. So next, there are three issues that need to be solved:

1. Before the chip shortage, the zinc consumption caused by the growth of passenger cars in 2021

two。 The reduction in the production of passenger cars in 2021 after the chip shortage.

3. After the shortage of chips, the final zinc consumption of passenger cars in 2021 (zinc consumption density per unit model)

Previously, the China Automobile Association predicted that China's car sales would reach 26 million in 2021. Assuming that the domestic car inventory remains unchanged (sales increment is production increment), it is estimated that the expected automobile production in 2021 will be 27.3 million vehicles, of which about 22.78 million passenger vehicles (hereinafter referred to as "2021E"). Under the influence of chip shortage, we expect that China's passenger car production in 2021 will be 14-1.82 million fewer than previously expected (if there is no shortage of automotive chips), that is, after being affected by the chip problem, The number of passenger cars dropped to 2096-21.65 million (hereinafter referred to as "2021E (1)").

So, based on the reduction in the number of passenger cars of this volume, how much will it affect the zinc consumption of cars?

II. Separation of zinc parts for passenger cars

01 subdivision of zinc consumption of different series of passenger cars

In the production of passenger cars, in order to improve the corrosion resistance and prolong the service life of passenger cars, at present, a certain proportion of galvanized steel plate is generally used to prevent corrosion of passenger car body panels (such as wheel cover inner plate, floor, suitcase inner plate).

By consulting the relevant data, we selected several best-selling representative passenger cars from the common automobile brands in the market, and split the parameters of the relevant weight of their body panels and the weight of galvanized sheet as follows:

To sum up, we found that the weight of galvanized steel for low-grade cars accounts for about 30% of the weight of body panels, while the weight of galvanized steel for middle-grade cars and high-end cars accounts for about 40% and 50% of the total weight of body panels, respectively; while vehicle double-sided hot-dip galvanizing consumes 80-120 kg per ton, up to 140-200kg. In addition, we found that high-end passenger cars even consume twice as much zinc as low-grade passenger cars.

Effect of production reduction of 02 passenger cars on zinc consumption

We mentioned earlier that if the estimated output of 2021E is reduced by 5%, 8%, it will reduce the production of 114-1.82 million passenger cars (compared with the original expected quantity without chip problems), and because the unit zinc consumption of different grades of passenger cars varies greatly, it is impossible to convert the reduction in order of magnitude directly according to a certain average zinc consumption. Therefore, we will focus on measuring the impact of chip shortage on low-end, mid-range and high-end cars.

According to the production data of automobile manufacturers in 2019, the production of low-grade cars, middle-grade cars and high-end cars accounted for 79%, 18% and 3% respectively, but according to the latest passenger car production data in February 20121, the production of high-end cars increased rather than decreased. The possible reason is that in the face of the lack of chips, car companies prefer to produce high-end cars with higher profits. In this case, the impact of the chip shortage on high-end cars is relatively limited, so we assume that the output of high-end cars still maintain the previous increment, based on this premise to calculate the change of automobile zinc consumption in 2021 compared with the expected normal production.

Based on the above reasons, we assume that high-end passenger cars will maintain the previous growth level in 2021, and the production proportion of low-and middle-grade passenger cars will remain unchanged, and calculate the output and zinc consumption of low-grade, middle-grade and high-grade passenger cars under the condition of chip shortage:

Summary of zinc consumption for passenger vehicles

Through the separation of the important parts of the passenger car body and the analysis of the different effects of different grades of passenger cars caused by the shortage of chips, we roughly estimate the change of zinc consumption of passenger cars.

Based on the domestic passenger car production data in 2020, we find that domestic passenger cars consume 27-670000 tons of zinc. Assuming that the annual production of high-end cars maintains the previous growth level, while the proportion of medium-and low-grade cars remains unchanged in 2019, we expect the total zinc consumption of passenger cars to be between 30-760000 tons in 2021, about 14022-58786 tons less than expected before the chip problem (2021E). The reduction accounts for about 5% and 8% of the zinc consumption of passenger cars in 2020.

We estimate that the total zinc consumption of passenger cars in 2021 is between 30 and 760000 tons, which is about 14022 to 58786 tons less than that before the chip problem (2021E), and the reduction accounts for about 5% of the zinc consumption of passenger cars in 2020. 8%.