The Zhitong Finance App learned that Dongwu Securities released a research report saying that the wholesale sales volume of heavy trucks in November was 0.068 million vehicles, -3.7%/+3.2%, respectively. Heavy truck terminals sold 0.057 million units in November, +16.9%/+27.8%, respectively, compared with the same period last month, which slightly exceeded expectations. Heavy truck export sales in November were 0.023 million units, +9.5%/+0.5%, respectively, compared with the same period last month, which slightly exceeded expectations. Total industry inventory - -0.018 million vehicles, current total industry inventory 0.125 million vehicles. The effects of the national three policies have been shown, and the rebound at the end of the year arrived as scheduled. The effects of the current trade-in policy continue to show. Heavy truck sales are expected to reach 0.07 million units or more in December, +13%/+23% and above, respectively.

The main views of Dongwu Securities are as follows:

November sales volume: total volume slightly exceeded expectations, and the performance of new energy sources continued to be impressive

Total industry volume: November terminals and exports slightly exceeded expectations: 1) Production: 0.062 million vehicles in November, -19.9%/+6.2% year-on-month; 2) Wholesale: wholesale sales volume of heavy trucks in November was 0.068 million vehicles, -3.7%/+3.2% year-on-month; 3) Shanghai Insurance: Heavy truck terminal sales volume in November was 0.057 million, +27.8% year-on-year, respectively. 4) Exports: In November, the heavy truck industry exported 0.023 million vehicles, +9.5%/+0.5% year-on-month, slightly exceeding expectations. 5) Inventory: Heavy truck companies' inventory in November - -0.007 million vehicles, channel inventory - -0.012 million vehicles, inventory continued to be removed.

Industry structure: Heavy natural gas trucks have rebounded slightly, and new energy sources continue to shine

In November, the sales volume of new energy heavy trucks was 9,963 units, +116.4% /+21.9% year-on-month, respectively. The penetration rate of new energy was 17.45%, and +8.02/-0.84pct, respectively. In November, the sales volume of heavy natural gas trucks was 0.011 million vehicles, -25.1%/+27.9%, respectively, and the penetration rate of heavy natural gas trucks was 19.9%, -11.15/+0.02pct, respectively. The average oil and gas price difference in November was 1.8 yuan, and +0.3 yuan compared to October.

November pattern: Jiefang terminal share rebounded month-on-month, Sinotruk exports increased month-on-month, Dongfeng terminal share declined month-on-month

Vehicle pattern: Jiefang Terminal's share rebounded month-on-month, and Sinotruk exports increased significantly month-on-month. 1) Terminals: In November 2024, China Jiefeng/Dongfeng/Heavy Truck/Shaanxi Heavy Truck/Foton terminals had a market share of 27.4%/19.7%/16.2%/9.2%/11.4%, compared with +4.3/-3.7/-0.8/-1.2/+0.5pct for the full year of 23, and +3.6/-0.7/+0.3/-1.0pct compared to October, respectively. 2) Exports: Domestic Liberation, Dongfeng/Heavy Duty Truck/Shaanxi Heavy Truck/Foton's export market share in November 2024 was 18.6%/5.6%/43.8%/22.5%/5.1%, +2.4/-0.3/-0.1/+2.0/ -2.2pct for the full year of 23, respectively, and -2.8/+0.1/+6.7/-2.8/-0.4pct from October, respectively.

Engine pattern: Weichai's terminal share declined year on year and increased month-on-month, and both diesel/natural gas engines improved

1) Overall: Weichai/Cummins/Xichai/Sinotruk/Yuchai had a share of 20.9%/18.0%/19.5%/8.9%/12.6% in November, -10.6/-2.4/+6.1/+1.0/-0.9pct compared to the full year of 23, and +1.4/-3.2/+2.3/+0.6/+0.8pct from October; 2) Weichai: Weichai terminal support volume in November was 0.012 million, -18./ +36.9%, respectively.

Looking at car companies, Weichai had 61.4%/43.8%/22.2% support rates in Shaanxi Heavy Truck/Heavy Truck/Jiefang in November, +0.0/-1.6/+1.1pct compared to October, respectively, and -18.2/-8.0/ -19.7pct for the full year of '23, respectively. By fuel type, Weichai's diesel/natural gas engine market share in November was 15.62%/55.8%, respectively, compared to -6.6/-8.9pct for the full year of '23, and +0.6/+3.8pct compared to October, respectively.

Target aspects: The 24Q4 heavy truck sector invests in Sinotruk (000951.SZ) + Weichai Power (000338.SZ) + FAW Jiefang (000800.SZ) + Foton Motors (600166.SH), which has an undervalized+strong export standard, and Sinotruk (03808) with strong export.

Risk warning: The recovery of the domestic heavy truck industry fell short of expectations, and the rise in natural gas prices exceeded expectations.