Guosen: The number of subsidies for the application of the trade-in policy continues to increase. Keep an eye on new car releases and third-quarter financial reports.

Guosen released a research report stating that the number of subsidy applications for the old-for-new policy continues to increase; attention is focused on the third quarter market. In August 2024, China's automobile dealer inventory warning index was 56.2%, a year-on-year decrease of 0.7 percentage points, above the boom and bust line. Since the beginning of this year (1.1-9.8), the number of domestic passenger cars insured has reached 13.832 million, a year-on-year increase of +3.1%; the cumulative number of domestic new energy passenger cars insured has reached 6.18 million, a year-on-year increase of + 40.3%. Guosen's main points are as follows: Monthly production and sales: In August 2024, automobile production and sales were 2.492 million and 2.453 million respectively, an increase of 9% and 8.5% month-on-month, and a decrease of 3.2% and 5% year-on-year. Passenger car production and sales were 2.221 million and 2.181 million respectively, with a 9.4% increase month-on-month and a 2.3% and 4% decrease year-on-year; commercial vehicle production and sales were 271,000 and 272,000 respectively, with a 5.7% and 1.4% increase month-on-month and a 9.8% and 12.2% decrease year-on-year; in August, the production and sales of new energy vehicles were 1.092 million and 1.1 million respectively, with year-on-year increases of 29.6% and 30% respectively. Weekly data: According to the insured data, the weekly (9.2-9.8) passenger car registrations in China were 405,300, a year-on-year increase of +12.8% and a month-on-month decrease of -19.2%; the registrations of new energy passenger cars were 222,400, a year-on-year increase of +57.3% and a month-on-month decrease of -12.4%. Since the beginning of this year (1.1-9.8), the number of domestic passenger cars insured has reached 13.832 million, a year-on-year increase of +3.1%; and the cumulative number of domestic new energy passenger cars insured has reached 6.18 million, a year-on-year increase of +40.3%. Market this week: This week (2024/09/16-2024/09/20), CS Automobile rose by 2.31%, CS Passenger Car rose by 1.18%, CS Commercial Vehicle rose by 4.34%, CS Automobile Parts rose by 2.68%, CS Automobile Sales and Services rose by 1.85%, CS Motorcycles and Others rose by 2.63%, electric vehicles fell by 0.05%, smart vehicles rose by 2.19%, while the Shanghai and Shenzhen 300 Index rose by 1.32%, and the Shanghai Composite Index rose by 1.21%. CS automobiles outperformed the Shanghai and Shenzhen 300 Index by 0.99 percentage points and the Shanghai Composite Index by 1.1 percentage points, with a decline of 7.23% since the beginning of the year. Cost tracking and inventory: As of September 10, 2024, the prices of float glass, aluminum ingots, and zinc ingots were -37.4%/-0.4%/+8.1% compared to the same period last year; a month-on-month change of -9.6%/+2.2%/+4.3%. In August 2024, China's automobile dealer inventory warning index was 56.2%, a year-on-year decrease of 0.7 percentage points, above the boom and bust line. Market focus: 1) Progress in autonomous driving (FSD V12 and its introduction to China, FSD subsequent versions, HW5.0 and Siasun Robot&Automation developments); Tesla plans to launch FSD in China in the first quarter of next year; 2) Model-related: XPeng MONA M03 increased production twice in 10 days, over 10,000 vehicles were taken offline 22 days after listing; NIO Ledian L60, Denza Z9GT listed; 3) Regarding Huawei, Hongmeng Zhihang's vehicle models will achieve full standardization with Huawei's autonomous driving; 4) Other: the number of subsidy applications for the old-for-new policy continues to increase; attention is focused on the third-quarter market. Risk warning: Risks include a tight automobile supply chain, economic recovery falling short of expectations, and lower-than-expected sales.