HK Stock Market Move | Car stocks continue to fall, the price war in the car market this year may be even more fierce, and there is still uncertainty in the automotive export environment.

Car stocks continue to fall, as of the dispatch, XPENG-W (09868) fell by 3.8% to 55.65 Hong Kong dollars; LI AUTO-W (02015) fell by 3.25% to 87.75 Hong Kong dollars. On the news front, Cui Dongshu, the secretary-general of the China Passenger Car Association, previously analyzed that the scale of new energy vehicles is experiencing explosive growth, with a significant increase in batch volume per vehicle and a noticeable decrease in per vehicle costs, and the competition among top players is still unsettled. Therefore, in such a high-growth market, the "price war" in 2025 will continue and be extremely fierce. BOCOM INTL recently stated that, benefiting from the trade-in program, the automotive industry in Shanxi Guoxin Energy Corporation is showing strong growth momentum in 2024. The penetration rate of new energy vehicles reached 47% in the first eleven months of 2024. With more extended-range/hybrid models being released, the bank expects the penetration rate of new energy vehicles in 2025 to further increase. However, caution is needed as after the December 2024 sales sprint, the auto market enters a slow season, intensifying competition and leading to a price war. In addition, Caitong pointed out that under Trump's tariff policy, the import of American cars may be significantly affected, involving a scale of over two trillion US dollars, with significant impacts on China, the EU, and Mexico. It is worth mentioning that China, Germany, and Japan have all invested in building car production factories in Mexico, and the automotive trade among China, Germany, and Japan may all be affected by the imposed tariffs. For China, in terms of exports, Europe and the United States remain the main markets for electric cars, facing tariff obstacles in the future, while emerging markets are a potential source of growth; in terms of going global, investing in factories in Europe and the United States or exploring new paths may be the way forward, but the uncertainty of risks in the United States is high.