Core Viewpoint - The article discusses the upcoming launch of five new vehicles from Hongmeng Zhixing in September, highlighting the challenges faced by the Zhijie brand and the performance of the Wanjie series, which significantly influences the overall sales trajectory of Hongmeng Zhixing [2][4][7]. Group 1: Upcoming Vehicle Launches - Hongmeng Zhixing will launch five new models in September, including the all-new Wanjie M7, Xiangjie S9T, Shangjie H5, and updated Zhijie R7 and S7 [2][3]. - The updated Zhijie R7 is expected to align its intelligent driving hardware with the Wanjie M8, featuring Huawei ADS 4 and zero-gravity seats for both front seats [3][4]. Group 2: Sales Performance and Challenges - The Zhijie brand has faced fluctuating sales, with the Zhijie R7 experiencing a peak monthly sales of 16,000 units in December last year, but dropping to around 2,000 units by June this year [4]. - In June, Hongmeng Zhixing achieved a record monthly delivery of 52,700 vehicles, with Wanjie accounting for over 80% of sales at 46,000 units, while both Xiangjie and Zhijie sold less than 5,000 units each [4][11]. Group 3: Wanjie Series Performance - The Wanjie series, particularly the M8 and M9, has shown a rebound in sales after model updates, with the M8 pure electric version set to launch in August [7][8]. - The new Wanjie M7, based on the Seres Magic Cube platform, will feature a family design language and is expected to offer both pure electric and range-extended versions [8][9]. Group 4: New Model Features and Market Positioning - The upcoming Xiangjie S9T will be the first travel car from Hongmeng Zhixing, launching both pure electric and range-extended versions simultaneously, with a focus on high-end features [11]. - The Shangjie H5 is positioned as the lowest-priced model in the Hongmeng Zhixing lineup, expected to be priced between 150,000 to 250,000 yuan, and will feature the latest ADS 4 driving assistance system [12].

Investment Rating - The automotive industry is rated as "Overweight" with expectations of outperforming the market in the next six months [45]. Core Insights - The automotive sector saw a 3.28% increase from July 14 to July 18, 2025, outperforming the CSI 300 index by 2.19 percentage points [9][19]. - The retail sales of passenger vehicles in the first two weeks of July 2025 increased by 7% year-on-year, with a total of 571,000 units sold [6][36]. - The expansion of the luxury car consumption tax to vehicles priced above 900,000 yuan is expected to benefit domestic luxury brands [3][36]. Summary by Sections Industry Overview - The automotive sector's performance included a 1.76% increase in the passenger vehicle segment and a 5.98% increase in the commercial vehicle segment during the same period [9][19]. - The overall performance of the automotive parts sector rose by 4.05%, while the automotive services sector increased by 4.53% [9][19]. Valuation Levels - As of July 18, 2025, the automotive industry's PE-TTM was 26.69, up by 0.86 from the previous week [10][35]. - The valuations for sub-sectors are as follows: passenger vehicles at 25.55, commercial vehicles at 38.23, and parts at 25.33 [10][35]. Market Trends - The automotive-related concept sectors showed overall positive performance, with smart cars and new energy vehicles increasing by 2.93% and 3.19%, respectively [17][35]. - The price changes for raw materials as of July 18, 2025, included a decrease in aluminum and an increase in battery-grade lithium carbonate [23][35]. Key Company Developments - Foton Motor's net profit is expected to increase by 87.5% in the first half of 2025, driven by a rise in commercial vehicle sales [29]. - Great Wall Motors reported a 10.21% decline in net profit for the first half of 2025, despite a slight increase in revenue [32]. New Vehicle Launches - A total of 22 new and updated vehicle models were launched during the week of July 14-18, 2025, including the Roewe iMAX8 and the Beijing X7 [34].

Investment Rating - The report maintains a "Recommendation" rating for the automotive industry, indicating a positive outlook for the sector [4]. Core Insights - The automotive industry experienced an overall increase of 3.2% from July 13 to July 19, with notable new vehicle announcements from companies like Huawei and Tesla [1][2]. - The adjustment of the consumption tax for ultra-luxury vehicles is expected to significantly impact the market, lowering the tax threshold from 1.3 million yuan to 900,000 yuan [27][28]. - Key companies recommended for investment include BYD, Seres, Great Wall Motors, and Jianghuai Automobile, with a focus on those with strong sales performance or potential blockbuster vehicles [7][28]. Market Performance - The automotive sector's performance was highlighted by a 3.2% increase, with the commercial vehicle segment showing the most significant weekly rise of 6.0% [2][11]. - Individual stocks within the automotive sector saw substantial gains, with Shanghai Wumart rising by 40.1%, followed by Fosa Technology at 31.2% and Zhejiang Rongtai at 28.0% [15][18]. Recent Industry Developments - New vehicle launches include Huawei's first travel car, the Enjoy S9T, and Tesla's Model Y L, both expected to hit the market in the fall [23][24]. - The report notes that the Zun Jie S800 has achieved over 8,000 pre-orders within 50 days of its launch, indicating strong market interest [25][26]. - Geely has signed a merger agreement with Zeekr Technology, further consolidating its position in the market [27]. Investment Recommendations - The report suggests focusing on companies with cost and product advantages in the auto parts sector, recommending firms like Fuyao Glass and Top Group [7][28]. - It also highlights the importance of low-altitude economy-related core targets, recommending Zongshen Power [7].

Investment Rating - The industry rating is "Outperform the Market" [7] Core Insights - The report discusses the expansion of the consumption tax on ultra-luxury cars and the regulation of the competitive order in the new energy vehicle (NEV) sector, which is expected to enhance the tax system in the automotive industry [11][12] - The NEV market in China is rapidly growing, transitioning from a fuel-based vehicle market to one dominated by electric vehicles, with recent policy adjustments aimed at guiding this transition [12][13] Summary by Sections Investment Highlights - On July 17, 2025, the Ministry of Finance and the State Administration of Taxation announced adjustments to the consumption tax policy for ultra-luxury cars, lowering the taxable price threshold from 1.3 million yuan to 900,000 yuan and including electric and fuel cell vehicles in the tax scope [11][12] - A meeting on July 18, 2025, involving key automotive enterprises and regulatory bodies, aimed to address irrational competition in the NEV sector and promote sustainable development through enhanced supervision, long-term mechanisms, standardization, and industry self-discipline [13] Market Performance - From July 14 to July 18, 2025, the automotive sector increased by 3.3%, outperforming the CSI 300 index by 2.2 percentage points, ranking third among 31 sectors [17][22] - Year-to-date, the automotive sector has risen by 11.3%, ranking tenth among the sectors [17] Key Data - Retail sales of passenger cars from July 1 to July 13, 2025, reached 571,000 units, a 7% increase year-on-year, while NEV retail sales were 332,000 units, up 26% year-on-year [35][36] - Wholesale figures for the same period showed passenger car sales at 555,000 units, a 34% increase year-on-year, with NEV wholesale sales at 316,000 units, a 37% increase year-on-year [36] Industry News - The report highlights significant developments in the automotive industry, including new vehicle launches and financial performance updates from major companies like North Vehicle Blue Valley and Jianghuai Automobile, which reported substantial losses due to competitive pressures [74][75]

Investment Rating - The report maintains a positive investment rating for the automotive and automotive parts industry, highlighting key companies such as Geely, BYD, Li Auto, and Xpeng as core investment opportunities [4][8]. Core Insights - The upcoming Tesla earnings call and the World Artificial Intelligence Conference are expected to catalyze advancements in robotics and the automotive sector, with significant developments anticipated from Tesla [2][9]. - The report emphasizes the positive impact of new vehicle launches on the passenger car market, driven by government policies aimed at reducing competition and enhancing quality [3][10]. - The report suggests a shift in competition from price wars to value-based competition, which is expected to improve the overall market structure [3][10]. Summary by Sections Weekly Data - In the second week of July 2025, passenger car sales reached 370,000 units, a year-on-year increase of 4.0% but a month-on-month decrease of 8.7%. New energy vehicle sales were 207,000 units, up 11.7% year-on-year and down 4.0% month-on-month, with a penetration rate of 55.8% [1][36]. Market Performance - The automotive sector outperformed the market, with a 3.41% increase in A-share automotive stocks from July 14 to July 18, ranking third among sub-industries [1][25]. Investment Recommendations - The report recommends focusing on high-quality domestic brands that are accelerating in smart technology and globalization, specifically naming Geely, BYD, Li Auto, Xiaomi, and Xpeng [4][11]. - For automotive parts, it highlights companies involved in smart driving and new energy vehicle supply chains, such as Berteli, Horizon Robotics, and Top Group [4][12]. Passenger Car Market - The report notes that the Ministry of Industry and Information Technology's policies to combat "involution" in the automotive industry will alleviate cash flow pressures on parts suppliers and enhance industry collaboration [3][10]. - Upcoming vehicle launches, including models from Li Auto and Geely, are expected to improve market fundamentals [3][10]. Robotics Sector - The report highlights the acceleration of leading players entering the robotics market, with Tesla's advancements in humanoid robots expected to significantly impact the sector [14][15]. Motorcycle Market - The report indicates a strong performance in the motorcycle segment, particularly in the mid-to-large displacement category, with sales showing significant year-on-year growth [17][18]. Heavy Truck Market - The heavy truck market is projected to recover due to expanded government subsidies for replacing older vehicles, with a notable increase in sales observed in June 2025 [19][20]. Tire Industry - The tire industry is experiencing growth driven by high demand and improved manufacturing capabilities, with leading companies expected to benefit from global expansion [21][22].