Jun. 26 at 2:33 AM
Chinese automakers may be nearing a demand bottom after a difficult second quarter, though Morgan Stanley expects any meaningful recovery to be delayed until late summer. Channel checks suggest vehicle sales have stabilized despite weak consumer confidence and limited near-term earnings catalysts.
The bank said June sales should outperform official data thanks to extended midyear promotions, government subsidies, Second-quarter passenger vehicle wholesale volumes are projected at 6.7 million-6.9 million units, down 3%-5% year over year, improving from the 8% decline in the first quarter.
Morgan Stanley expects July to remain seasonally weak before stronger demand emerges in August and September, supported by new model launches, policy support, and seasonal factors. The bank favors BYD and Geely for a recovery, while viewing Xpeng as an event-driven story. It also sees the mass-market EV segment around 150,000 yuan regaining momentum.
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