Guosheng: Domestic and foreign demand drives the performance of the automotive parts industry, and the trend of power shortages opens up development space for Siasun Robot & Automation+.

Guosheng released a research report stating that the acceleration of domestic substitution in automotive components + overseas layout benefits driving performance, and Siasun Robot&Automation + the shortage of electricity opens up development space. Looking ahead to industry development, automotive component companies are expected to benefit from: 1) Global layout: the European and American passenger car markets have vast potential, domestic component companies enter the supply chain of foreign-funded car companies through overseas layout; 2) New track: Tesla Siasun Robot & Automation is about to enter the stage of large-scale production, while data center infrastructure is expanding significantly, driving demand for generators and liquid cooling, thereby opening up new development space for component companies. Guosheng's main points are as follows: Increased tariffs drive domestic car companies to build factories overseas, driving the localization of the supporting supply chain The market share of overseas sales of domestic new energy passenger cars will increase from 16% in 2025 to 22% in Q1 2026, and global competitiveness will continue to strengthen. BYD Company Limited's exports will soar to 1.05 million vehicles in 2025 (up 145% year-on-year), Great Wall exports 510,000 vehicles (up 12% year-on-year), and Changan exports 640,000 vehicles (up 19% year-on-year). Export regions show differentiation: Mexico's exports reached 625,000 vehicles in 2025 (up 41% year-on-year), making it the largest single market; the Middle East (United Arab Emirates) exported 572,000 vehicles (up 73% year-on-year), with strong growth; Russia declined by 50% due to geopolitical factors, but the absolute volume still exceeds 500,000 vehicles; the development of the European market is still in its initial stage, and with the completion of localized factories, there is potential for growth. Trade barriers and vast market space drive Chinese car companies to "project production capacity overseas, localize production in the future, and leverage the cost advantages of domestic car companies (lower tariffs & transportation costs). At the same time, component companies follow suit, forming a new global pattern of globalized industrial chain coexistence. Increased subsidies in Europe + intensive launch of new vehicles drive overseas factory dividends for domestic component companies According to marklines, European EV sales will increase from 710,000 vehicles in 2020 to 2.85 million vehicles in 2025, with a CAGR of 32%; PHEV sales will increase from 550,000 vehicles in 2020 to 1.38 million vehicles in 2025, with a CAGR of 20%. The European new energy vehicle market is driven by both policy and product, with significant growth momentum. On the policy side, Germany's single-car subsidy is up to 4,000 euros, focusing on middle- and low-income families; the UK has restarted subsidies, giving up to a 3,750-pound discount for models priced at no more than 37,000 pounds. On the product side, the five major car companies will launch more than 30 new models in 2026. Against this backdrop, domestic component companies are closely following the pace of host manufacturers going overseas, successfully entering the supply chains of European carmakers such as BMW, Mercedes-Benz, and Volkswagen after establishing factories in Europe. With cost advantages and efficient response capabilities, they have secured sufficient orders, and foreign customers will bear some of the tariff costs, reducing operational pressure. This is expected to drive related companies' core businesses into the fast lane of growth. Looking ahead to AI domain layout, liquid cooling and intelligent driving become new growth drivers for companies AI drives the continuous upgrade of computing infrastructure and intelligent terminals, and the high-power density scenario of AIDC has led to the necessity of liquid cooling systems as a match, while the accelerated penetration of intelligent driving is driving the demand for core components such as domain controllers and sensors. Leveraging technological synergies and manufacturing coordination advantages, domestic component companies have expanded from heat management to data center liquid cooling, and from precision manufacturing to core components of Siasun Robot & Automation, successfully opening up new growth curves for the future. Component industry leaders with technological synergies, system integration and cost reduction capabilities, and global capabilities are expected to become core beneficiaries of the AI mainstream wave. In addition, domestic component companies are accelerating financing through various means such as H-share listings and private placements to lay out liquid cooling, intelligent driving, and other forward-looking areas, creating future performance growth points. Risk warning: Industry demand falls short of expectations; fluctuations in raw material prices; fluctuations in exchange rates.