Investment Rating - The report maintains a "Recommended" rating for the automotive industry [1] Core Insights - The automotive sector is expected to benefit from the continuation of the vehicle replacement policy, which is anticipated to support consumer demand and boost sales in 2025 [16] - The report highlights a significant increase in the first-quarter performance of Geely, with revenue reaching 72.5 billion yuan, a year-on-year increase of 38.6%, and a net profit of 5.67 billion yuan, up 263% [27] - The report emphasizes the strategic integration of Geely and Zeekr Technology Group under the "One Geely" strategy to enhance resource allocation and improve competitiveness in the market [12][27] Summary by Sections Industry Performance - From May 12 to May 16, the automotive sector outperformed the Shanghai Composite Index, with the automotive index rising by 2.4% compared to the index's 0.8% increase [17] - The performance of individual segments during this period showed passenger vehicles up by 4.4%, while commercial vehicles declined by 1.7% [17] Key Company Developments - Geely launched its 2026 C10 model, priced between 122,800 to 142,800 yuan, featuring a maximum range of 605 km for the pure electric version [13] - Great Wall Motors introduced the new high-end MPV, the Wei brand Gao Shan, starting at 309,800 yuan, equipped with advanced driving assistance systems [14] - NIO's new ES6 and EC6 SUVs were launched with starting prices of 338,000 yuan and 358,000 yuan, respectively, showcasing significant performance metrics [15] Market Outlook - The report anticipates a recovery in heavy truck demand in 2025 after three years of low performance, recommending leading companies in the commercial vehicle sector [16] - The report suggests that companies with high-quality supply in the automotive sector are likely to benefit significantly, recommending stocks such as Li Auto, BYD, and Great Wall Motors [16][6] Stock Recommendations - The report lists several companies with strong earnings forecasts and investment ratings, including: - Li Auto (buy) with an expected EPS of 5.03 in 2025 - BYD (buy) with an expected EPS of 18.15 in 2025 - Great Wall Motors (increase) with an expected EPS of 1.63 in 2025 [54]