Southwest Securities·2025-05-26 04:53Investment Rating - The report maintains an "Outperform" rating for the automotive industry as of May 25, 2025 [1] Core Insights - Retail sales of passenger vehicles from May 1-18 reached 932,000 units, a year-on-year increase of 12% and a month-on-month increase of 18%. Cumulatively, 7.804 million units have been sold this year, reflecting an 8% year-on-year growth. The Passenger Car Association expects a stable and positive retail trend for May [6][61] - Xiaomi launched its first SUV, the YU7, equipped with a self-developed intelligent driving system that integrates deep learning and neural network algorithms for precise operation in complex road environments. Dongfeng Motor signed a comprehensive strategic cooperation agreement with Huawei, focusing on smart assisted driving and digital upgrades in automotive R&D and production [6][64] - The report highlights investment opportunities in companies involved in technology R&D, market expansion, and those benefiting from policy subsidies and improved infrastructure in the new energy vehicle sector [6][61] Summary by Sections Passenger Vehicles - From May 1-18, retail sales of passenger vehicles were 932,000 units, up 12% year-on-year and 18% month-on-month. Cumulative sales for the year reached 7.804 million units, an 8% increase year-on-year. The Passenger Car Association anticipates continued positive retail trends for May [6][62] - Key companies to watch include BYD (002594), Geely (0175.HK), Xpeng Motors (9868.HK), SAIC Motor (600104), Changan Automobile (000625), GAC Group (601238), and Leap Motor (9863.HK) [6][62] New Energy Vehicles - Retail sales of new energy passenger vehicles from May 1-18 reached 484,000 units, a 32% year-on-year increase and a 15% month-on-month increase, with a retail penetration rate of 52%. Cumulative sales for the year reached 3.808 million units, a 35% increase year-on-year [6][63] - Key companies to focus on include BYD (002594), Geely (0175.HK), Huayu Automotive (600741), Xinquan Co. (603179), Doli Technology (001311), Chuanhuan Technology (300547), and Wuxi Zhenhua (605319) [6][63] Smart Vehicles - Xiaomi's YU7 SUV features a self-developed intelligent driving system that utilizes deep learning and neural networks for enhanced operational precision. Dongfeng Motor's partnership with Huawei aims to advance smart driving and digital upgrades in automotive production [6][64] - Companies with technological advancements in smart driving algorithms, sensors, and smart cockpit systems are recommended for investment, including BYD (002594), Geely (0175.HK), and SAIC Motor (600104) [6][64][65]