Morgan Stanley Says China Auto Sector Is in a Post-Launch Lull
Morgan Stanley said China’s automakers are entering an order digestion period after recent model launches.
Morgan Stanley said China’s automakers are entering an order digestion period after recent model launches. The note said most OEMs saw weekly and July month-over-month order growth normalize to weaker levels, while XPeng’s MONA L03 and Li Auto’s L6 were the only models to post month-over-month growth after recent launches.
The report said the industry is facing pressure in the gap before the next new-car cycle. It pointed to upcoming launches such as BYD’s Great Han and Qin MAX, and Geely’s Cruiser 700, as potential catalysts. Morgan Stanley also said the short-term backdrop is negative for the sector, while BYD and Geely could offer a medium-term setup given their stronger new-model pipelines. The note added that some of the current gap-period pressure is already reflected in share prices.
The report said the industry is facing pressure in the gap before the next new-car cycle. It pointed to upcoming launches such as BYD’s Great Han and Qin MAX, and Geely’s Cruiser 700, as potential catalysts. Morgan Stanley also said the short-term backdrop is negative for the sector, while BYD and Geely could offer a medium-term setup given their stronger new-model pipelines. The note added that some of the current gap-period pressure is already reflected in share prices.