Haima’s current task is, of course, to find funds, on the one hand to preserve the shell; on the other hand, there is still a lot of pressure to invest more in the project.
Article/"Automan" Qize
On March 24, Hainan Mazda and Toyota (China) Investment Co., Ltd. signed the "About the R&D and Industrialization of Hydrogen Fuel Cell Vehicles" Framework Agreement for Strategic Cooperation (hereinafter referred to as the "Hydrogen Agreement"). This matter has been talked about by Jing Zhu, chairman and founder of Haima Motors, for a long time.
As a representative of the 14th National People's Congress, Jingzhu proposed building hydrogen energy projects and developing hydrogen industry in Hainan on many occasions. Unexpectedly, he actually pushed him to take a big step forward. .
The reason why Haima Motors is betting on hydrogen energy
Will Haima Motors’ operations be improved as a result? It should be difficult unless Toyota is willing to directly inject funds into the hydrogen projects of both parties. The agreement has no practical content yet. It is a veritable framework agreement, and all terms are naturally unrestricted.
Moreover, although the "Hydrogen Agreement" mentions "promoting commercial operations", it does not involve joint ventures, nor does it involve capital injection, and it lacks deployment of operations. Promoting commercialization is the goal, not the goal. means.
Such an agreement may not be what Jingzhu wants in the end, but it is already the best at the moment. Toyota's own hydrogen-fueled passenger cars have had a difficult time commercializing, and have not yet made a profit.
Therefore, there is no hope for Haima to make money for the time being. This agreement does not directly help Haima’s current operations, but instead intensifies the pressure on cash flow.
Since Jingzhu returned as chairman of Hainan Mazda in 2017, Haima has failed to turn around losses and has continued to decline. As of the end of 2022, Haima had lost 6.6 billion yuan in six years, and its business had long been marginalized. Moreover, at the end of 2021, the foundry contract between Haima and Xiaopeng expired and could not be renewed, making Haima's life even more difficult.
Haima has tried traditional energy and electric vehicles, but the results have been poor. Its monthly sales have dropped to the level of 2,000 vehicles, degenerating into a local enterprise in Hainan and losing the ability to radiate the brand nationwide.
In the capital market, the listed Haima has long experienced the feeling of "wearing a star and wearing a hat", and it has managed to keep its shell by relying on operations such as selling houses. Since announcing in January this year that it will expect a loss of 1.2 billion to 1.8 billion yuan in 2022 (which is likely to reach the upper limit), it is once again faced with protecting its shell.
In the past two months, the scandals between Haima, Didi and Xiaomi have been shattered one after another. The "Hydrogen Agreement" signed this time did not win the understanding of investors. Haima's stock price fell continuously on that day and in the following trading days.
It seems that the capital market also believes that it is unclear whether the agreement with Toyota can make money. Even if it can, it will not be able to quench the thirst.
Content of support from the Hainan Provincial Government
However, this matter cannot only be viewed from the corporate level, but also needs to be enlarged.
In 2021, which is the 30th anniversary of the establishment of the Hainan Special Economic Zone, the four major strategic positionings assigned to Hainan Province by the central government are "comprehensively deepening reform and opening up pilot zone, national ecological civilization pilot zone, and international tourism consumption center" , National Major Strategic Service Guarantee Area”.
Many people interpret these positionings to mean that Hainan is not allowed to engage in industry, which is obviously wrong. Hainan's resource endowment is naturally not suitable for heavy industry, because it is unique in both tropical and subtropical regions, and it has been determined that it will "close the border" in 2025 and establish a free trade port, which also determines Hainan's industrial focus, which is the development of zero-carbon industry and its industrial chain.
In terms of automobiles, in addition to electric vehicles, hydrogen energy meets zero-carbon requirements, provided that the source of hydrogen energy meets carbon emission requirements.
At the end of September last year, Hainan Province issued a "Hainan Province Carbon Peak Implementation Plan", which specified which clean energy sources should be developed, including natural gas (for ships), capturing carbon dioxide to produce methanol, and ecological carbon sinks. and hydrogen energy utilization. To Kaiba's dismay, not much is written about hydrogen energy - it does not gain prominence.
There is only a general plan, which is to establish a full industrial chain of hydrogen production, hydrogen storage, transportation and hydrogen use, and create a zone (a pioneer demonstration zone for the hydrogen energy industry) and a ring (the whole island scenario application demonstration zone). , multi-point (hydrogen energy industry development landing platform) hydrogen energy development path.
This type of policy is also framework-based. It is almost impossible to expect government funds to be allocated under this policy. However, the government will give the green light to the "hydrogen industry chain" and allow it to be rolled out on a large scale (island-wide). The current hydrogen industry is characterized as a “demonstration”, which implies that the commercial value is not optimistic for the time being.
As a downstream application link, hydrogen fuel vehicles must be driven by investment by enterprises to stimulate the development of upstream infrastructure. At the same time, enterprises must also invest part of their funds to participate in the upstream infrastructure construction of the three links of "production, storage and transportation".
Based on past experience, the only hydrogen vehicle application that allows local governments to spend money is the bus project. A small number of fixed energy replenishment points can support a scenario service model with fixed lines and relatively fixed mileage. Moreover, such public utilities are generally money-losing projects supported by the government and are essentially public welfare. The government can accept a little more compensation.
But in the private car scenario, if it is just an island, the application is too narrow. The "production, storage, and transportation" of hydrogen energy cost a lot of money.
Why Toyota chose Haima
Toyota has proven that the hydrogen industry is a capital- and technology-intensive industry with huge initial investment. In the later stage, it is necessary to increase the scale, continue to expand the user base, and operate for a long time in order to dilute the cost. When profits are not high, it is difficult to win hydrogen energy projects based on quantity.
Small countries are powerless to invest at this level. Relying on foreign investment and foreign technology, it is difficult to scale up. With such high costs and high unit prices, it is difficult to be competitive.
So, the location of investment is more important than the technology itself. Toyota has invested for many years, and even took the lead in developing the entire hydrogen industry chain technology group (leaving aside the economics), and has painstakingly opened up thousands of patents conditionally and for free, but it has always been high-key and low-key. As a result of the complete withdrawal of German and American brands, the only hydrogen-playing passenger car brands in the world are Toyota and Hyundai.
Toyota has always hoped to expand its circle of friends and find partners from major countries. At the end of 2022, Toyota released the second-generation Mirai at the Guangzhou Auto Show, and GAC Toyota introduced 50 units as pure imports. As a result of Toyota's own subsidies, the price was 750,000 yuan. Nothing more happened after this batch of cars passed. GAC, which has long decided to go electric, seems to have little interest in this potential project.
Toyota therefore found its third Chinese partner, Haima.
Haima is based in Hainan to develop hydrogen energy. The problem arises. Hainan is becoming more and more like a semi-isolated island economy. Even if the customs are not closed yet, the size of the automobile market will not increase. Hainan's new car sales in 2022 will be 162,000 units, of which 74,000 new energy vehicles will be sold, accounting for 45.6%. The penetration rate is already very high.
Haima's new model will fully use the second-generation Mirai, and it is difficult to do better than Toyota in terms of cost. The only hope is to obtain hydrogen. Haima is cheaper than Toyota, but this is already the cost of the user, and the price is difficult to reduce. Haima's financial situation makes it difficult to provide subsidies like Toyota.
In this way, the forward loop is difficult to unfold. This agreement framework is valid for 10 years. Not to mention whether Haima can live for 10 years, even at the current level (protecting the shell), Haima has no plan to deal with it. Although Jingzhu is good at finding funds for the loss-making Haima, maintaining a project that requires long-term blood transfusion may not be a good idea for a car company that has been losing money for years.
Hainan’s endowment problem
Hainan Province has no other choice. Haima is the only local enterprise. Hainan Province has taken measures to gradually secure upstream sources of hydrogen energy.
In December 2021, the "Photovoltaic electrolysis water hydrogen production and high-pressure hydrogenation integrated station" built by Haima in Haikou was officially completed. Photovoltaics generate electricity and then split water to obtain hydrogen, which is a proper "green hydrogen". 95% of the hydrogen on the market comes from by-products of petrochemicals and coal smelting, that is, "gray hydrogen".
There is also "blue hydrogen" in the middle, which is hydrogen produced from fossil energy using carbon capture measures, and the carbon emission intensity is greatly reduced.
The advantage of the integrated station is that it avoids transporting hydrogen and reduces the storage pressure to a relatively small level (production is determined by sales, and sales follow production). Haima did not say the hydrogen production capacity of this integrated station, but it is not optimistic about how many vehicles it can actually serve (Toyota's second-generation Mirai has three 70MPa storage tanks, which can only hold 5.6kg of liquid hydrogen).
In this regard, some areas with relatively abundant wind and light energy in Inner Mongolia, Shanxi, and Hebei have natural advantages. In Inner Mongolia's photovoltaic/wind power hydrogen production, the cost of hydrogen per kilogram has dropped to about 10 yuan, which is actually a cost advantage compared with fossil energy such as natural gas.
Hainan has dense vegetation, many mountains and little open space. Even if offshore wind power is deployed on a large scale to produce hydrogen in the future, the cost will not be comparable to places like Inner Mongolia.
In 2021, Sinopec invested and built the "Qionghai Boao Yinfeng Hydrogenation Station" in Hainan, with a daily hydrogen supply capacity of 500 kilograms. This is also a demonstration project, which was built to ensure the annual meeting of the Boao Forum. In 2022, Sinopec will build the Hainan Refining and Chemical No. 1 hydrogen production equipment in Danzhou. The method used is to produce hydrogen from residual oil, which is also gray hydrogen. Even with this kind of “grey hydrogen” production capability, Hainan is still lacking.
Zhanjiang and Huizhou in Guangdong and Zhangzhou and Quanzhou in Fujian all have super petrochemical projects. If they rely on these projects to build hydrogen production capacity, the scale can easily meet the hydrogen needs of Guangdong, Guangdong, Fujian and Hainan in the next 20 years.
In the end, we chose Hainan, a palm-sized place. If Toyota wants to apply its series of hydrogen patents more widely, it would be better to rely on mainland China rather than relying on Hainan. The selection of Hainan and Haima was based on the wishes of the partners, not on the basis of industry rules.
What Hainan Province needs to do is not directly allocate funds to the project, but provide some subsidies to replace some taxis with hydrogen energy to support Haima’s plan.
The way out for Haima’s hydrogen project is to: handle the upstream and downstream, create complete application scenarios on time, and accumulate it to a certain amount (planning to reach an operating scale of 2,000 vehicles in 2025).
If these operational frameworks are put up and can run for one or two years, Guangdong and even Guangzhou Automobile Group may be interested, so that they can be rolled out. It is expected that Haima will come ashore, and Toyota will be able to realize its carbon reduction vision and recoup its investment over the years.
This is just the beginning. It will be difficult to make money even if you invest for several years, so you need to persevere. Haima's current task is, of course, to find funds, on the one hand to preserve the shell; on the other hand, there is still a lot of pressure to invest more in the project. Copyright Statement: This article is an original manuscript of "Autobot" and may not be reproduced without authorization.
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