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News Jun 2, 2020 07:50 pm EqualOcean

BOE and Fuyao Group Sign a Strategic Cooperation Agreement

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Jul 29, 2020 11:14 pm · qianlong.com

BOE's Smart Retail International Standard Approves by ISO/IEC

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Jul 24, 2020 03:25 pm · Yicai

China's BOE to Buy 17% Stake in EHII to Boost IoT Prowess

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Jul 21, 2020 05:57 pm · CLS

Huawei to Cooperate with BOE on Mate 40 OLED

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Jul 9, 2020 05:27 pm · ifeng

Huawei, OPPO and BOE Top China's List of Patent Holders

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May 27, 2020 07:45 pm ·

Manufacturing Glass for the Automobile Industry: Fuyao Group

► Although Fuyao is one of the dominant players among automobile glass producers, there are some challenges for the company that may take serious measures to overcome in the future. The Fuyao Glass Industry Group Co., Ltd. – briefly 'Fuyao Group' – was founded in Fuzhou, China, in 1987. It specializes in the manufacture of automobile safety glass and industrial technical glass. Within five years of its establishment, the company was listed on the main board of the Shanghai Stock Exchange with a stock code of 600660 in 1993 and the Hong Kong Stock Exchange (3606) in 2015. Currently, the company's market cap is CNY 48.25 billion. It has manufacturing plants in China and the US. Last year it posted a revenue of more than USD 3 billion, a 13.7 percent year-on-year increase, and a net profit of USD 20.9 million, 16.4 percent higher than a year ago. Over the years, the company has placed itself among the top automobile glass producers in China and internationally. Most of this success is attributed to its current chairman: Cao Dewang. "Fuyao's success is largely a result of chairman Cao's superb judgment and persistence… he grabbed onto the massive opportunity in the development of China's automobile industry," said Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management. Cao is a self-made billionaire. He started his career at the age of 14 by selling fruit and fixing bicycles on the streets to help his family make ends meet, in the 1980s, while working at a glass factory, he sensed the market potential for the product class. He found out that imported car glass could sell for prices that were hundreds of times the cost of manufacturing. Now his firm supplies customers in the US, the UK, Germany, Japan and other countries and regions, and claims a one-quarter share of the global market, and 60 percent of China's. While these numbers draw out a promising future for Fuyao, there are some challenges for the company that may take serious measures to overcome. Although Fuyao is one of the dominant players among automobile glass producers, its main competitors are still posing a serious threat. Last year, AGC reported a USD 1.4 billion net revenue. The company also underlined in its financial report that it has been working on improving its environment, social and governance (ESG) activities and increasingly curbing the adverse environmental effects of the company's operations – which are the things Fuyao lacks compared to its rivals. Moreover, Nippon Sheet Glass – another dominant player in the market – reported USD 1. 7 billion in revenue last year. Another challenge is shrinking automobiles sales growth due to the slowdown amidst increased economic uncertainties at home and abroad. The global auto industry dove deeper into recession in 2019 – with sales dropping more than 4 percent as carmakers struggled to find buyers in the developed world as well as in emerging markets such as China and India. The situation is likely to continue this year. According to analysts at LMC Automotive, the number of vehicles sold across major global markets dipped to 90.3 million last year – that is down from 94.4 million in 2018, and well below the record 95.2 million cars sold in 2017. Lastly, the violation of labor laws is harming the international reputation of Fuyao. When the company expanded its manufacturing plants to the US in 2016, it probably was not expecting this to cause a reputation problem. On the one hand, Fuyao's 'American Factory' is financially achieving more than expected – it posted a net profit of USD 20.9 million in 2019, 16.4 percent higher than a year ago. On the other hand, it exacerbates the bad reputation of the company in terms of labor law violations, such as long working hours, safety risks, and environmental protection. In the documentary, Mr. Cao says, "If a union comes in, I am shutting down," during a management meeting in one scene. In another, a manager shows an employee's picture to the camera, describes the man as a friend and union supporter, then says, "He'll be fired in short order." The documentary also shows the unsafe working conditions of the workers – some of them are collecting broken glass with bare hands, and others are forced to engage in much more dangerous tasks. As a result, a day after the documentary about Fuyao's American manufacturing plant was released, an unfair labor practice charge was filed against Fuyao. All this means Fuyao is not applying ESG measures, which might make increasingly conscious investors and major car companies think twice when doing business with the company. However, not all the news is bad. If the company can solve the issues mentioned earlier, it could even boost revenues in the future. As the amount of glass used in cars is increasing – new designs are giving more space to glass in their vehicles, such as glass ceilings – the automobile industry will depend on companies like Fuyao even more, provided that they comply with ESGs.

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May 5, 2020 01:12 pm ·

Shortly Hit by the Pandemic, BOE to Seek Growth in 5G Era

BOE (京东方,SZ:000725) released its 2019 annual financial report and 1Q2020 report on April 28, 2020. In the fiscal year of 2019, BOE recorded CNY 116.1 billion (USD billion) with a year-on-year growth of 19.1%. However, its net profit attributable to parent company decreased to CNY 1.92 billion, which is 44% less than the previous year. Being the biggest display panel manufacturer in China, BOE is a critical participant in the electronics industry. In the first quarter of 2020, the coronavirus affected the industry and BOE’s revenue decreased to CNY 28.9 billion, year-on-year -2.17%; the recognized profit attributable to shareholders for the same period was CNY 567 million, year-on-year -46.12%; gross profit in 1Q2020 was 14.3%, year-on-year -3.34%. Besides the declined demand aggravated by the pandemic, BOE’s new factory in Wuhan was severely affected and the display production dropped amid the quarantine. The factory in Wuhan was built for the 10.5th generation LCD, which aims at the large-area display market. Top display panel manufacturers Samsung and LGD are quitting from LCD production and transiting to promising OLED line. As Samsung planned, it will decrease 2.4 million m2 LCD production by the end of 2020, nearly 16.9% of the global LCD production. Given the declining production of LCD due to main players’ absence, BOE and other display panel makers will swallow the market yielded by these Korean competitors. OLED is the future. Estimated by IHS, OLED TV shipment in 2018 was 2.8 million units and the number increased to 3.5 million in 2019. However, only 1.58% of the global TV shipments were OLED screens. OLED’s penetration rate in smartphone market is estimated to reach 40%, predicted by Sinolink Securities. The production shortage in OLED panels limits the shipments of the final products. Relying on years of experience and advantages in the market, Samsung ‘s market share in OLED panels was as high as 90% in 2019. Being the second-largest soft OLED producer in the world, BOE’s market share in soft OLED is expected to reach 17% in 2020. Except for hard OLED and soft OLED, foldable OLED is the trend for smartphone makers. Nevertheless, the best display maker Samsung’s foldable OLED’s yield rate is around 40%. BOE’s yield rate is less than 15% and the remaining manufacturers may not be able to produce until 2021. Foldable OLED’s low yield rate is yet to be improved and the return can be in the black ink when the yield rate meets 60%, based on the observation of the industry’s experience. In 2020, the production of the smartphone may still face a decline, following the trend in 2019 plus the negative effect brought by the pandemic. Though BOE may suffer from the short term poor market performance, the commercial use of 5G will trigger the new demand of smartphones in a longer period. Considering its strategic cooperation with Huawei, the 27-year-old BOE is a marathon player in the panel world.

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Apr 3, 2020 06:54 am · Sina Finance

Fuyao's global strategy bumps forward

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Apr 1, 2020 12:00 am · EO Company

When is BOE upwind

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NIO Reaches Strategic Cooperation with Suning

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Aug 3, 2020 04:14 pm · Xpeng

Xpeng Delivers a Record High 1641 P7's in July

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Aug 3, 2020 11:57 am · 36kr

Alibaba to Invest in SAICs' Mobility Business

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Jul 31, 2020 06:20 pm ·

MOT to Accelerate the Development of AV and IVICS

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Jul 31, 2020 03:47 pm · 36kr

Suning Enters the Field of Internet of Vehicles

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