China's automobile electrification: 2Q monthly stories are similar, exports and new energy are still the main themes (Nomura)
Nomura Securities pointed out that China's electric vehicles showed a similar story every month in 2Q: competition in the domestic market was fierce, but the export market continued to advance rapidly.
Nomura Securities pointed out that China's electric vehicles showed a similar story every month in 2Q: competition in the domestic market was fierce, but the export market continued to advance rapidly. This further verifies the dual-track development model of China's automobile industry. Data shows that the proportion of overseas revenue of car companies represented by Geely and BYD is rapidly increasing, effectively hedging the pressure caused by domestic price wars. The market may have focused more on the “involution” of the domestic market and underestimated the huge growth space driven by overseas exports and new energy sources. One sentence conclusion: The future of China's automobile industry lies in globalization. Export has become the core growth engine beyond "involution". The success of leading independent brands in overseas markets will be the biggest investment theme in the next two years. Positive/negative: Positive for BYD (1211.HK), Geely Automobile (0175.HK), Great Wall Motor (2333.HK) and other leading export automakers. The market's pessimism about domestic competition may be excessive, while a consensus on the premium for overseas trends has not yet been fully formed. Catalysts: 1) Monthly export data, especially penetration into European and Southeast Asian markets; 2) Progress in localization of overseas factories; 3) Final results of EU tariff negotiations.