China's helmet industry: after thirty years, it has finally become a new "outlet"

China’s helmet industry: after thirty years, it has finally become a new “outlet”

#Chinas #helmet #industry #years #finally #outlet

This article is from the WeChat public account “Interface News” (ID: wowjiemian), author: Cheng Di, 36氪 published with authorization.

On May 1 this year, the “Regulations of Shanghai Municipality on the Safety Management of Non-motorized Vehicles” were formally implemented. A number of new non-motor vehicle traffic regulations have been added, the most important of which is: safety helmets should be worn when driving and riding electric bicycles.

Nowadays, in Shanghai, not only riding motorcycles and electric motorcycles, but also riding electric bicycles with a speed of no more than 25 kilometers per hour, you must wear a safety helmet.

This is also one of the most stringent traffic regulations in the country since the Ministry of Public Security launched the “One Helmet and One Belt” guarding operation nationwide in 2020, that is, “wear helmets when riding motorcycles and electric bicycles, and fasten seat belts when riding or driving cars.” One.

Nowadays, motorcycle helmets have officially become a rigid demand of the general public in China, and have even become the “outreach” in the eyes of many investors and entrepreneurs.

A few years ago, if you wanted to see them on a large scale, you might only have to watch motorcycle races, or go to train stations, long-distance stations, or subway exits where motorcycle drivers waited for work. More than ten or twenty years ago, most motorcycle helmets belonged to the “handsome props” in movies, basically equated with “luxury goods”, and only a few motorcycle riders who got rich first could have them.

In these short decades, the “experience” of motorcycle helmets can be described as ups and downs. Through this helmet, the rider can see the continuous development of the domestic economy in the past few decades, the continuous improvement of traffic laws and regulations, and the continuous changes in the manufacturing industry.

01

From the death of “Lawrence of Arabia”

On May 2, 1935, British officer TE Lawrence (the prototype of the protagonist in the classic movie “Lawrence of Arabia”) returned from the post office on his beloved Brough Superior SS100 motorcycle. In order to avoid two teenagers on bicycles, Lawrence died in the hospital 6 days after his head hit the ground, at the age of 46.

The death of Lawrence greatly moved the neurosurgery doctor Hugh Keynes who was involved in the rescue at the time. Keynes started research on unnecessary head injuries of motorcyclists for several years, and finally announced the research results: the world’s first professional motorcycle helmet. It is precisely because of Keynes’ research report that Britain became the first country to require motorcyclists to wear helmets.

However, whether it is the motorcycle helmet body or related laws and regulations, it seems that it is still far from enough. Through those classic motorcycle or road movies, you can get a glimpse of one or two—for example, “The Speeding Party” starring Marlon Brando in 1953, you can find that Americans did not have the habit of riding motorcycles and wearing helmets at that time.

It was not until the mid-1970s that most developed countries in the world made the “helmet must be worn when riding a motorcycle” into the law.

02

China’s motorcycle helmet industry: once belonged to a very small group

The first generation of motorcycles and motorcycle riders in New China appeared in the late 1950s, but for a long time, they did not have the habit of wearing any protective gear. In the 1980s, those who got rich first began to wear sunglasses and string gloves, and motorcycle helmets were almost hard to find.

It wasn’t until the 1990s when Taiwan’s VR-1 entered the mainland market to find a foundry, and two motorcycle manufacturers, Adela and Everlasting, were established in Foshan, that Chinese knights gradually realized the existence of motorcycle helmets. However, at that time, the cheapest helmet was nearly 100 yuan. For most people-just take a look.

Image source: Visual China

“Motorcycle Technology” has listed a set of statistics on the operation of the industry in 2005-at that time, the annual output of motorcycles reached 17.7 million, and they were exported to 186 countries and regions, of which Nigeria’s export volume It broke through 1 million vehicles.

The huge throughput will inevitably drive a series of upstream and downstream industrial chains. Although Chinese consumers were still ignorant of motorcycle helmets at the time, it did not affect the two largest motorcycle production areas in China, the Yangtze River Delta and the Pearl River Delta, and many manufacturers specializing in motorcycle helmets emerged.

Most of the manufacturers are targeting the domestic “blue ocean of helmets” in response to the processing orders from overseas, playing a “trick” of exporting to domestic sales.

Of course, another reason why riders are willing to try helmets is inseparable from the experience of repeatedly watching classic Hong Kong films such as “A Lang’s Story” and “Heavenly Love” in the video hall-so when most people choose helmets, the first standard Is to wear it to look good or not, and then to consider safety.

Around 2010, riding on the east wind of domestic e-commerce, genuine and overseas brands that were placed in the windows of some motorcycle stores entered China one after another. Schuberth from Germany, ROOF and SHARK from France, LAZER from Belgium, NOLAN from Italy, and OGK from Japan and HJC from Korea for three to five hundred yuan all poured in.

Image source: Visual China

However, for the vast majority of Chinese motorcycle riders, the behavior of domestic and foreign helmet brands to seize the domestic market is still a typical “fairy fighting mortal watching.”

03

How did China’s helmet industry quickly heat up?

Indeed, the most obvious growth rate is in 2019 and 2020.

On September 1, 2019, the “Classification of Toll Road Vehicle Toll Vehicles” was officially implemented. The new standard completes the current domestic motor vehicle categories that can be driven on toll roads. Different models can find corresponding stripes in this new standard. Among them, there are motorcycles: you must have a driver’s license to go to the high speed, no people are allowed, you must wear a safety helmet, and you can only drive in the rightmost lane, and the speed should be above 70km/h and below 80km/h.

The implementation of this new regulation has played a major role in driving the consumption of motorcycle helmets in my country-compared with the market size of 1.881 billion yuan in 2018, it has rapidly increased to 2.376 billion yuan in 2019.

However, the helmet market really experienced a massive surge in May 2020.

On April 21, 2020, the Traffic Management Bureau of the Ministry of Public Security issued a notice on the nationwide deployment of the “One Helmet and One Belt” security guard operation: From June 1, the public security traffic control department will strengthen law enforcement management and investigate and correct motorcycles in accordance with the law. , Electric bicycle riders do not wear safety helmets and car drivers do not use seat belts.

On May 15, Jiangsu and Zhejiang respectively passed the province’s electric bicycle management regulations. The two regulations coincidentally stated: In order to ensure the safety of electric bicycle drivers and passengers, mandatory regulations are made for drivers and passengers to wear safety helmets. And they all stated that the regulations will come into effect on July 1, 2020.

This is true for electric bicycles that cannot exceed 25 kilometers per hour, not to mention electric motorcycles that are much faster than the former. The regulations of Jiangsu and Suzhou directly led to a huge gap in the national motorcycle helmet market, which also allowed many “bad guys” to see new business opportunities.

So there are rumors that “you must wear helmets when riding electric bikes from June 1st”, which directly caused motorcycle helmets to become popular all over the country and the price soared to two to four times the original price. “Tuyere” also quickly spread to the secondary market. Since May 18, the “helmet concept stocks” continued to strengthen. National Technology and Nanjing Julong had their daily limit for three consecutive days, and the two companies had to issue the “Announcement on Abnormal Stock Trading Fluctuations.”

The rhythm of this wave of being brought up indeed allows motorcycle helmets to enter the public and capital vision on a large scale in a very short period of time.

According to incomplete statistics from the Huajing Intelligence Network, in May 2020, 52.98% of single-person motorcycles nationwide were equipped with one helmet, 31.79% of single-person motorcycles were equipped with two helmets, and only 11.92% of single-person motorcycles were not equipped with one helmet. helmet.

According to data from the Ministry of Public Security this year, the average wearing rate of safety helmets for electric motorcycles and electric bicycles in 36 major cities across the country has increased from less than 20% before to 54%. Among them, Shanghai, Nanjing, Shenzhen, Hangzhou, and Haikou The helmet wear rate of riders in China has reached more than 80%, and some cities such as Ningbo have even reached more than 90%.

04

The number of takeaways increased sharply, contributing to the hot sale of helmets

Of course, another important reason for the rapid growth of the motorcycle helmet market is inseparable from the food delivery industry.

According to the relevant data of the Huajing Industry Research Institute: in 2020, the number of domestic takeaways has reached 7-8 million. With the addition of the courier, the first-line grassroots personnel engaged in the logistics service industry will exceed 1,000. Ten thousand people.

Because of the rapid rise in the “home economy” caused by the epidemic last year, the domestic online food delivery market has increased by 15.0% compared with 2019, reaching 664.62 billion yuan. During that time, the gap for takeaway riders continued to expand, and the number of riders continued to increase. The best way for countless riders to prevent the new crown virus, in addition to masks and gloves, is the motorcycle helmet with its own isolation effect.

Many of them wear helmets not only for their health, but also because they know they have to drive dangerously in a hurry. In addition, in the summer of the same year, Meituan and Ele.me took turns using kangaroos and bamboo dragonflies and other “cute things” to set off a “helmet battle” without gunpowder on the forehead of the delivery staff.

Therefore, these 10 million front-line logistics personnel who race against time are undoubtedly the main consumer group of helmets in the past two years.

Image source: Visual China

However, the delivery staff generally wear extremely cheap domestic motorcycle helmets.

According to the relevant data of the “Analysis of China’s Motorcycle Helmet Industry Pattern and Development Trend in 2020” released by Zhiyan Consulting, the market competition for domestic motorcycle helmets, especially low-end domestic motorcycle helmets with low prices, has been quite fierce in recent years. According to relevant data, the market size of the ABS industry in 2015 was 1.142 billion yuan, last year it was nearly 6 billion yuan, and the growth rate reached more than five times in five years.

This seems to illustrate a problem, that is, the size of my country’s helmet market has been increasing in the past 20 years. Although ABS resin is inferior to glass fiber reinforced materials and carbon fiber composite materials, it has the characteristics of high impact resistance, good heat and low temperature resistance, high dimensional stability, and no warpage of the finished product. These two biggest advantages of the foot have always been the most important components of the low-end motorcycle helmets.

Relevant industries are gradually saturated, product prices continue to decline, and the inevitable profitability is also getting worse every year. However, due to the small scale of the domestic motorcycle helmet industry, the profitability is still slightly higher than the average level of the general manufacturing industry, and the operating profit margin in the past five years has reached about 20%.

Coupled with the introduction of the “One Helmet and One Belt” safety protection action notice in 2020, the helmet market has become a new outlet, leading to the influx of many manufacturers that were originally unrelated to the motorcycle industry. According to CCTV News: At the end of 2019, there were less than 200 electric motorcycle/electric bicycle helmet companies in my country, with a daily output of about 500,000; by the end of 2020, related companies had reached 500, with a daily output of more than 5 million.

With the rapid increase in production, various quality problems have emerged in an endless stream. Some “hard injuries” that were not likely to occur before professional manufacturers have exploded. In order to reduce costs or appearance designs, many new manufacturers have soft helmet shells. Reduce or even eliminate potential safety hazards, such as a buffer layer and poor impact resistance.

For example, last year’s common Meituan helmets and Ele.me helmets-whether it is animal ears or bamboo dragonflies, these additional decorations appear on professional motorcycle helmets and should not be allowed.

The ambition of the domestic helmet economy in the future

Compared with the low-end cheap domestic helmets with more problems, mid-to-high-end products have higher cost and price due to the requirements of raw materials and technical content, and the purchase and consumer groups are relatively narrow-so there are still obvious industry barriers. .

Data from Zhiyan Consulting’s “China Motorcycle Helmet Industry Development Strategic Planning and Investment Scale Forecast Report for 2020-2026” shows that many of the current mid-end products are mostly formed by the slow transformation and upgrading of previous low-end helmet manufacturing companies. For example, the aforementioned Mustang, Auspicious, Eternal, etc. Although the degree of market competition continues to increase, compared with low-end products, the profit margins of these mid-end products are significantly higher, with an operating profit margin of approximately 25% in the past five years.

The high-end market is mostly imported brands, with high barriers and small quantities, and high-end products are like luxury goods with high added value, so the product has the strongest profitability, and the profit margin in the past five years is much higher than 30%.

The investment in the report also predicts that the solidified style many years ago is no longer suitable for the current market trend. In the future, as helmet products gradually develop in the direction of differentiation, functionality, and intelligence, the added value of products will continue to increase. It is expected that mid-to-high-end products will continue to emerge new selling points and profit points, thereby driving related companies and the overall profit level of the industry.

The report released by Zhiyan Consulting also predicts: As the Z generation gradually becomes the main force of motorcycle consumption, in the future, there will be two major changes in China’s motorcycle helmet products, namely, personalization and intelligence.

At CES in Las Vegas in 2019, a start-up company JARVISH demonstrated two AR helmets with mature technologies-in addition to basic functions such as Bluetooth, noise cancellation and WiFi, they can provide 2K front cameras to help Make the riding experience more enjoyable and safe. You can also connect Siri and Ok Google by voice, allowing the rider to voice control the camera, mobile phone, adjust the volume or play music, and keep their eyes from leaving the road.

At first glance, smart helmets are likely to become an inseparable part of future motorcycles and become their smart brains-to some extent, it is very similar to the current research of many autonomous driving technology companies that do not need to modify the vehicle to improve the car. The cost, basically relying on mapping and car-side cameras, can complete the intelligent travel “expansion package” of the intelligent driving upgrade service.

With this helmet, the driver only needs to focus on driving, and other things including route finding, safety judgment, mobile phone call answering, etc., can be achieved by raising the eyelids or moving the mouth, which is very suitable for the current increasing dependence. A smart travel society.

It is expected that the motorcycle helmet industry will transition from “quantity as the core” to “quality as the core” in the future. The competition in the motorcycle helmet industry is no longer limited to price competition and material competition. There may be marketing and venture capital in the future. Financial, human resources, scientific and technological research and development, the acquisition of upstream and downstream industry chain resources, and more comprehensive and deeper comprehensive competition.

After the editor:

At present, a large number of non-professional helmet manufacturers have flocked into this tuyere, and the quality problems of many helmet products should only be temporary. Just like the domestic auto industry today, those companies that are truly permanent and value products and brands will inevitably transform in the future and continue to expand toward the mid-to-high-end level.

For more than a hundred years, motorcycles have always had the highest accident rate among all vehicles. It is precisely this fatal sense of danger that is more attractive. But today’s Chinese people in the field of transportation have become more and more aware of how to protect themselves-in order to seize the excitement of those few seconds, for a few dollars to buy a low-quality helmet and take their lives, it is a pity.

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