China's Largest Commercial Bank Predicts NEV Boom, Names 3 Top Picks: Nio, Li Auto and BYD
BOCOM International, China's leading commercial bank and the fifth largest overall in the country, has released a research note predicting a boost in the development of new energy vehicles (NEVs) due to recent government measures.
In the note, the bank highlights initiatives by the Ministry of Finance and the National Development and Reform Commission, including enhanced policies for scrapping and replacing passenger vehicles and offering a subsidy of 5,000 yuan (USD696.70) more for pure electric plug-in hybrids compared to conventional fuel vehicles.
BOCOM expects these measures to drive growth in the NEV sector over the next months, as initially reported by China's media outlet Zhitong Finance.
Additionally, China's bank says the wave of new model launches in Aug could help short-range NEV products re-qualify for tax-exempt status after technical adjustments.
The firm expressed optimism about the prospects of major NEV players, including BYD, Li Auto, and the pure EV maker No = which is gearing up to start delivering the Onvo L60 SUV as soon as next month.
Last month, both BYD and Li Auto set new monthly sales records. Li Auto delivered 51,000 NEVs, registering a growth of 49.4% year over year while year-to-date deliveries from the Beijing-headquartered company reached 239,981 units.
BYD sold 342,383 vehicles in Jul, up 30% from Jul 2023 and over its previous record of 341,658 NEVs. In terms of battery electric vehicles (BEVs), the company delivered 130 thousand units.
Analysing the sales from last month, the bank noted a slight decline in domestic retail sales of passenger vehicles attributing this to promotional activities that had accelerated demand in the prior months.
BOCOM sees the decline as an indicator that the automotive market may be entering a period of adjustment in China.
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