On January 2, Financial Associated Press reported (Editor Hu Jiarong) that yesterday, several car companies released their sales data for December 2024, and some brands achieved record high sales. Although these figures look impressive, they did not have a positive impact on the market performance of auto stocks.

As of the time of publication, Geely Autos (00175.HK), Peking Autos (01958.HK), BYD Company (01211.HK), Guangzhou Automobile Group (02238.HK), and LEAPMOTOR (09863.HK) fell by 4.59%, 3.33%, 3.30%, and 2.92% respectively.

Note: Performance of auto stocks.

Specifically, in December 2024, Li Auto delivered 58,513 new cars, a year-on-year increase of 16.2%; the total delivered for 2024 was 500,508.

Note: Historical delivery data of Li Auto.

In December 2024, Xiaopeng Autos delivered 36,695 new vehicles, an increase of 82% year-on-year and an increase of 19% month-on-month.

Note: Historical delivery data of Xiaopeng Autos.

In December 2024, NIO delivered 31,138 new cars, with monthly deliveries surpassing 30,000 units for the first time, a 51.3% increase month-on-month and a 72.9% increase year-on-year.

Note: Historical delivery situation of NIO.

In December 2024, LEAPMOTOR delivered 42,517 units, a 128% year-on-year increase, breaking the 40,000 units monthly delivery threshold for two consecutive months, achieving a historical monthly delivery record for seven consecutive months.

Note: Historical delivery situation of LEAPMOTOR.

In addition to the new forces, BYD also announced its December sales, with new energy vehicle sales at 514,800 units, and cumulative sales of new energy vehicles from January to December reaching 4,272,100 units, an increase of 41.26% year-on-year.

Note: Historical sales of BYD.

What is the outlook for the automotive market in 2025?

Cui Dongshu, the secretary-general of the Passenger Vehicle Market Information Joint Conference of the China Automobile Dealers Association, analyzed that the Chinese automotive market experienced U-shaped growth in 2024, especially in the second half of the year, thanks to strong subsidy policies for trade-ins and scrapping updates. Retail sales in the market are expected to reach 22.94 million units, a year-on-year increase of 5.7%. These policies significantly boosted sales, and if similar subsidy levels continue in 2025, the demand for subsidy funds for scrapping updates and trade-ins may exceed 200 billion yuan, setting a new historical high.

Based on the continuation of the 2024 policies, it is expected that the retail volume of the auto market in China will reach 23.4 million units in 2025, with a year-on-year growth of 2%. Among these, the retail volume of New energy Fund Passenger Vehicles is expected to be 13.3 million units, a year-on-year increase of 21%, with a market penetration rate of 57%. However, the global market environment in 2025 is expected to be quite complicated, with significant slowdowns in growth anticipated for the EU and Russian markets, potentially causing the growth rate of the global Passenger Vehicle market to drop to around 10%.

BOC International points out that with the recovery of market demand in 2025, the continued launch of new models, and the application of new technologies such as Asia Vets, connectivity, and fast charging, these factors, combined with policies supporting trade-ins, are expected to drive continuous growth in sales, with the sales of new energy vehicles in China likely to reach new heights.