Huachuang Securities released a research report stating that wholesale sales of passenger vehicles in October reached 2.93 million units, up 7% YoY and 4% MoM. Estimated retail sales for October were approximately 2.34 million units, rising 3% YoY and 6% MoM. The vehicle replacement policy continued to show significant effects, while exports maintained strong growth, driving October wholesale sales to a record monthly high.
In October, NEV wholesale sales hit 1.62 million units, up 18% YoY and 8% MoM, with penetration reaching 55%, up 5 percentage points (PP) YoY and 2 PP MoM. As the year-end approaches, automakers are gradually rolling out order-lock policies ahead of the purchase tax subsidy phase-out. Q4 sales tailwinds or demand pull-forward effects are expected to be milder than previously anticipated. Once the subsidy phase-out impact fades, the sector may see a valuation recovery.
Key takeaways from Huachuang Securities: 1. **October Wholesale Growth Slows to Single Digits, NEV Penetration >55%** - Wholesale sales: 2.93M units (+7% YoY, +4% MoM). - Retail sales (est.): 2.34M units (+3% YoY, +6% MoM). - Strong exports and replacement policy drove record wholesale, but high base led to modest retail growth.
- **NEVs**: 1.62M wholesale (+18% YoY, +8% MoM), 55% penetration (+5 PP YoY, +2 PP MoM). Top automakers’ NEV sales: - BYD (01211): 437K - Geely (00175): 178K - Wuling: 114K - Chery: 105K - Changan: 99K - Leapmotor: 70K - Tesla: 61K - Seres: 49K - Xiaomi: 49K - Great Wall: 46K - Dongfeng: 42K - XPeng: 42K
- **Domestic Brands**: 2.14M wholesale (+12% YoY, +8% MoM), 73.1% share (+3.1 PP YoY, +2.6 PP MoM). - **Discounts**: Late-October industry discount rate edged up (mainly ICE vehicles) to 9.6% (+0.1 PP MoM, +1.1 PP YoY). - **Inventory**: October exports hit 570K units (+23% YoY, +3% MoM), with ~30K units added to channels vs. seasonal norm of 100K–150K. Total inventory ~3.1M units (ICE: ~850K), higher YoY but ICE stock flat.
2. **2025 Outlook** - The replacement policy extension in Q1 2025 may sustain double-digit wholesale growth, with sequential acceleration. - Note: Strong Q3 2024 replacement policy led to a high base, limiting Q3 2025 retail growth to ~3% YoY. - OEMs’ inventory buildup in 2024 exceeded historical averages, even during Q3’s traditional off-season. - Q4 marks the transition to subsidy phase-out, likely triggering inventory drawdowns. October’s stock buildup already lagged seasonality. - Projections: - Q4 retail: 7.73M units (+6% YoY) - Q4 wholesale: 8.67M units (-1% YoY) - 2024 retail: 24.23M units (+6.7% YoY) - 2024 wholesale: 29.61M units (+8.6% YoY)
3. **Investment Recommendations** - Post-subsidy phase-out, sector recovery is expected, with catalysts including: - Better-than-expected post-Lunar New Year retail; - Stronger exports; - Favorable policies. - **OEMs**: Focus on valuation rebound plays like Geely Auto (00175) and BYD (01211), with Geely trading at single-digit 2025 P/E. Jianghuai Automobile (600418.SH) also offers a compelling product cycle. - **Components**: 1. Robotics: Minth Group (00425), Ningbo Joyson (600699.SH), Top Group (601689.SH), Yinlun (002727.SZ), etc. 2. AI/ADAS: Horizon Robotics-W (09660) (catalyst: November HSD launch), Black Sesame (02533), Hesai (02525), RoboSense (02498). 3. Liquid cooling: Yinlun (002727.SZ), Lingyun (600480.SH).
**Risks**: Weaker macro/consumption, auto exports, NEV sales, or raw material volatility.