GF Securities released a research report stating that the core competitive factors in the two-wheeler industry have shifted from price competition to product upgrades. The competitive landscape has evolved from fully fragmented competition to increased consolidation among leading players. Currently, the stock prices of major companies such as Yadea, Aima, and Ninebot have significantly retreated from their 2025 highs, with market expectations fully pricing in the demand pressures from the transition to new national standards. The competitive advantages held by leading firms like Yadea, Aima, and Ninebot are not yet fully reflected in their valuations, which are expected to rise through sustained market share gains and steady earnings growth. The report recommends Yadea Holdings, Ninebot, and Aima Technology Group Co., Ltd.
The industry's development can be divided into four phases: initial growth in the 1990s, rapid expansion from 2001 to 2014 driven by motorcycle bans, a bottleneck period from 2014 to 2019, and a secondary growth phase post-2019 spurred by replacement demand under new national standards, with annual sales stabilizing at around 50 million units. Sales typically surge in the year following policy implementation.
The new national standards have reshaped the competitive landscape. Since 2019, compliance requirements have squeezed out smaller players, leading to higher market concentration. By 2025, the top six companies, including Yadea, Aima, Tailg, and Ninebot, accounted for 71.7% of shipments, with replacement demand becoming the dominant market driver, representing over 50% of sales. Leading companies exhibit higher return on equity compared to second-tier players, attributed to superior net profit margins and asset turnover rates resulting from their manufacturing scale and distribution efficiency.
The industry's competitive logic has transitioned from price-based rivalry to product innovation, with leading firms expected to accelerate their dominance. Before 2019, the industry was characterized by homogeneous price wars. Since then, leaders have improved per-unit profitability through supply chain cost reductions, channel reforms, and economies of scale. For instance, Yadea's net profit margin increased from 5.8% in 2015 to 8.6% in the first half of 2025, benefiting from economies of scale, upstream integration, and enhanced sales structures.
Between 2020 and 2025, the share of premium electric two-wheelers in the domestic market rose from 2% to 14%, with the 3,000–5,000 yuan price segment becoming a key battleground. Leading companies are emphasizing smart features, with Ninebot positioning itself in the differentiated mid-to-high-end smart vehicle segment, while Yadea and Aima are adopting software subscription models and investing in new technologies such as sodium batteries and intelligent driving systems.
The report concludes that the industry's core competitive factors have shifted from pricing to product upgrades, and the competitive environment has moved from broad-based rivalry to consolidation around leaders. Companies like Yadea, Aima, and Ninebot are leveraging their profitability advantages to secure stable demand in essential markets while expanding into the growing smart vehicle segment through technological upgrades and brand building. Future competition will focus on the mid-to-high-end market, with leading firms reinforcing a virtuous cycle of scale benefits, product innovation, market consolidation, and expanding profit advantages, further widening their relative market share and earnings lead.
Risks include weaker-than-expected industry sales, intensified competition, and slower-than-anticipated adoption of new technologies.