In the case of the slowdown in the growth of the home projection market, projection companies are actively exploring the vehicle track. On the evening of November 14, XGIMI Technology (688696. SH) and Guangfeng Technology (688007.SH) both announced that they have received new orders for the automotive business. As of 14 o'clock on November 15, XGIMI Technology fell 0.69% to 75.03 yuan / share, and Guangfeng Technology rose 3.12% to 17.87 yuan / share.

Liu Dingkun, a senior analyst at Lotu Technology (RUNTO), told the first financial reporter that the vehicle will be the key direction for the projection industry to achieve a breakthrough. The in-vehicle scene is considered to be the "third space" of projector products after home appliances and commercial use, and it is also a new growth point with great potential in the future.

According to the announcement on the evening of the 14th,Yibin XGIMI, a wholly-owned subsidiary of XGIMI Technology, has recently received a notice from a well-known domestic automobile OEM factory for the development of a designated designation,Yibin XGIMI will become the designated supplier for the development of the OEM's on-board projector,Supply intelligent cockpit display products for its project,It is expected that the project life cycle will have a positive impact on the performance of XGIMI Technology。

Guangfeng Technology also revealed in the announcement on the evening of the 14th that it has recently received a development fixed-point notice issued by an international head brand car company, and will become its supplier of on-board optical components, providing dynamic color pixel lamps for its multiple international models, and is expected to be mass-produced and shipped in 2025, which will have a positive impact on the performance of Guangfeng Technology during the project life cycle.

Previously, Guangfeng Technology has created the first vehicle-grade projection giant screen product in the intelligent automotive industry in China, and has become a fixed-point automotive optical supplier for laser projection intelligent headlights. According to the third quarterly report of Guangfeng Technology, the revenue of its vehicle optics business in the third quarter of this year was 217 million yuan, a new high in a single quarter, and the cumulative revenue in the first three quarters was 458 million yuan, accounting for 26.63% of the total revenue of 1.72 billion yuan in the first three quarters of Guangfeng Technology. The on-board optical business has become a new performance growth point of Guangfeng Technology.

XGIMI Technology has completed the establishment of a production line for on-board products in its manufacturing base in Yibin this year, and is fully engaged in the pre-research and production of on-board related products.

In contrast to the projection companies' increase in vehicle business, the downward pressure on the home projection market.

According to data from Lotu Technology, in the first three quarters of 2024, the omni-channel retail volume of China's smart projection market was 4.16 million units, down 0.9% year-on-year, and sales were 6.71 billion yuan, down 8.3% year-on-year. After a good start in the first quarter and a cold promotion in the second quarter, the decline in sales volume has further expanded in the third quarter, which has dragged down the market. In the fourth quarter, with the entry of smart projection into the "trade-in" national subsidy catalog, superimposed on the double 11 promotion activities, it is expected that the sales volume of the smart projection market will reach 6.02 million units in 2024, a year-on-year increase of 2.6%.

Liu Dingkun recalled that from 2018 to 2022, China's smart projection industry has experienced explosive growth, with an annual increase of about one million units, with a compound growth rate of 28.7%. Entering 2023, the market will decline for the first time, mainly due to the impact of consumer confidence and the downturn in the real estate market, in addition, e-commerce platforms have become the main battlefield of sales, accounting for more than 85% of sales, and enterprises are deeply trapped in the dilemma of difficult balance between price and sales.

In the first three quarters of this year, projection companies are under downward pressure on profits. Guangfeng Technology's revenue in the first three quarters of this year was 1.72 billion yuan, a year-on-year increase of 4.17%, and the net profit attributable to the parent company was 42.9466 million yuan, a year-on-year decrease of 66.59%; XGIMI Technology's revenue in the first three quarters of this year was 2.281 billion yuan, a year-on-year decrease of 5.79%, and the net profit loss attributable to the parent was 40.33 million yuan, compared with the net profit attributable to the parent company of 86.1662 million yuan in the same period last year.

In this case, projection companies have significantly strengthened their efforts to develop vehicle scenes this year. According to the China Association of Automobile Manufacturers, China's passenger car sales are expected to reach 31.05 million units in 2024, a year-on-year increase of 3%. Liu Dingkun said that the application of projection technology in the vehicle scene is gradually increasing, including vehicle-grade curtains, laser lights, laser headlights, canopy projection, smart surfaces, transparent display of windows and other types of solutions. Guangfeng、XGIMI、Hisense and other companies are speeding up the layout of vehicle scenarios,Among them, Guangfeng has obtained a total of 10 vehicle business designations,XGIMI has also received 3 vehicle business designation notices。

"The integration of on-board lighting and display is a development trend of car lights", Guangfeng Technology related people told the first financial reporter, such as car laser headlights can project images on the road, such as projecting crosswalks on country roads, left or right turn symbols, etc., making the interaction between cars and people more convenient. In the long run, the lamps have both lighting and projection display functions, which can better adapt to the future needs of unmanned vehicle interaction. "In the first three quarters of this year, Guangfeng Technology's automotive optics business revenue has jumped to more than a quarter of the company's total revenue, and our automotive business will be further expanded in the future."

XGIMI technology related people also revealed to reporters that XGIMI has obtained three on-board fixed-point projects, two of which are fixed-point projects to make intelligent cockpit display products for automobile companies, and the other fixed-point project is to provide intelligent headlights to automobile suppliers.

At present, on the one hand, the fierce price competition of automobiles, on the other hand, more and more projection companies are joining the track of vehicle applications, how to maintain the profit level of the vehicle projection and lighting business will be a new challenge. Guangfeng Technology said at the third quarter of 2024 results briefing that the company has recognized the importance of cost reduction, so it is constantly exploring technology cost reduction and supply chain cost reduction.