CITIC Securities: Suggest focusing on high-end structural incremental growth in companies such as Huawei.

CITIC Construction Investment pointed out that the current price reduction and promotion of new energy vehicles and host factories have become the core support for domestic sales. Considering that the sales base in the second half of 2024 is relatively high, coupled with the start of purchase tax on new energy vehicles in 2026, this may suppress the growth rate of total production and sales of new energy passenger cars. The expectation of new cars from host factories and exports are becoming the core support of the fundamentals, and it is recommended to focus on the high-end structural increment such as the Huawei series and the Zunjie. Tesla will start testing Robotaxi in Austin and is scheduled to start providing Robotaxi services to the public on June 22, with the first batch of about 10 to 20 Model Y vehicles. Data, computing power, and cost are Tesla's core advantages in the layout of the transportation market, and close attention should be paid to the subsequent commercial operation progress.