Central China: Car sales have seen a significant increase year-on-year, with a period of intensive new car releases.

Central China released a research report stating that it has lowered the investment rating of the automotive industry to "synchronous with the overall market". Recently, there have been frequent policy measures in the field of smart connected vehicles, signaling the standardization and normalization of autonomous driving technology, which will provide clear research and development direction and product iteration momentum for related companies. Since 2026, the policy of trading in old vehicles for new ones has driven sales of new cars to exceed 1.67 million units, with sales revenue reaching nearly 270 billion yuan, demonstrating the continuous release of market demand potential; the intensive release of new cars drives market vitality and consumer upgrades, forming an industry trend of competing for high-quality segmented markets. Guided by smart driving policies, the implementation of the policy of trading in old vehicles for new ones, and the joint promotion of new products and technologies, it is recommended to focus on two main themes: first, whole vehicle companies with global and leading intelligent driving technology capabilities; second, continue to focus on high-growth tracks, including intelligent driving, Siasun Robot & Automation, and liquid-cooled core component companies. Key points from Central China are as follows: Market review As of the close of April 21, the automotive (CITIC) industry index rose by 4.59%, underperforming the Shanghai and Shenzhen 300 index by 2.56 percentage points, ranking 13th among CITIC's 30 primary industries. The top 5 stocks with the highest gains this month are Shanghai Xinpeng Industry, Xiangyang Changyuandonggu Industry, Wuhan Lincontrol Automotive Electronics Co., Ltd., HMT (Xiamen) New Technical Materiasls Co., Ltd., and Ningbo Shenglong Automotive Powertrain System. Significant increase in automobile production and sales in March 2026 Automobile production and sales reached 2.917 million and 2.899 million respectively, with a month-on-month increase of +74.4% and +60.6%, and a year-on-year decrease of -3.0% and -0.6% respectively. Production and sales have significantly increased month-on-month, while slightly decreasing year-on-year. The domestic market performance has been relatively sluggish due to factors such as policy changes and high base numbers in the same period last year, with strong export performance driving production and sales. Narrowing decline in passenger car market In March 2026, passenger car production and sales reached 2.446 million and 2.412 million respectively, with a month-on-month increase of +74.8% and +57.1%, and a year-on-year decrease of -5.0% and -2.3%. The sales of independent brand passenger cars accounted for 67.66%, still at a high level, with a decrease of 2.52 percentage points month-on-month and an increase of 1.66 percentage points year-on-year. Commercial vehicle market maintains growth In March 2026, the commercial vehicle market produced and sold 471,000 and 487,000 units respectively, with a month-on-month increase of +72.5% and +80.7%, and a year-on-year increase of +9.1% and +8.9%, showing a significant month-on-month improvement and positive year-on-year growth. Improvement in the month-on-month performance of the new energy vehicle market In March 2026, the production and sales of new energy vehicles reached 1.231 million and 1.252 million units respectively, with a year-on-year decrease of -3.6% and an increase of +1.2%. The penetration rate of new energy vehicles reached 43.2%, an increase of 0.83 percentage points month-on-month. Risk warning: 1) Risks of policy implementation falling short of expectations; 2) Risks of industry demand falling short of expectations; 3) Risks of intensified industry competition; 4) Risks of progress in intelligent and connected networking falling short of expectations.