According to the research report released by Bocom Intl, based on the sales data of some car companies in July that have been publicly announced, car sales performance varied. Among them, the sales of 10 car companies increased by 27.3% year-on-year, and remained the same on a month-on-month basis. The effect of market-oriented price reduction in July weakened, and some car companies entered the new car release period in the second half of the year, which made the car market relatively stable.
The bank stated that the Development and Reform Commission and the Ministry of Finance jointly issued a document titled 'Several Measures to Promote Large-scale Equipment Upgrades and Old-for-New Replacement of Consumer Goods'. The subsidy amount for scrapping National III and below emission standard fuel-powered vehicles to purchase new energy vehicles has been increased from 0.01 million yuan to 0.02 million yuan, which will accelerate the replacement of old fuel-powered passenger vehicles. The preferred company in the industry is BYD Company Limited (01211/buy). The delivery of vehicles with DM5.0 new technology is expected to drive BYD's sales growth by more than 20% beyond market expectations this year. The sales growth brought by new car models in the second half of the year may stimulate the stock price rebound of new forces, supporting the valuation repair of Ideal (02015/buy) and NIO Inc (09866/buy).