Zhongyuan Securities: High export growth supports structural optimization and continues to maintain the automobile industry's “simultaneous market” rating

The Zhitong Finance App learned that Zhongyuan Securities released a research report stating that it maintains the automobile industry's “simultaneous market” investment rating. Automobile exports remained the core engine of the industry in July. Driven by rising international oil prices and the full cost advantage of new energy vehicles, external demand continued to be booming. The NEV penetration rate reached a new high of 60%, compounded by healthy inventory removal, and the industry was undergoing phased structural adjustments. Positive policies continue to be implemented. Politburo meetings set the tone for expanding domestic demand to provide bottom support for domestic demand in the second half of the year. In terms of intelligence, the mandatory national standard “Safety Requirements for Autonomous Driving Systems for Intelligent Connected Vehicles” was officially released and is scheduled to be implemented on July 1, 2027, establishing a bottom line for entry and safety.

The proposal focuses on two main lines: one is the main line of going overseas, embracing the certainty of external demand brought about by the acceleration of passenger car going overseas and the resilience of commercial vehicle exports, selecting automakers with a high share of overseas sales and continuous improvement in profitability and parts leaders with global competitiveness; the second is to segment the main line of racetrack leaders, choose component segments with a stable competitive pattern and the ability to expand across borders, and focus on smart driving, AIDC power generation, liquid cooling, etc.

The main views of Zhongyuan Securities are as follows:

Automobile production and sales fall seasonally in July 2026

In July, automobile production and sales completed 2.573 million units and 2.584 million units, respectively, -6.8% and -8.0%, respectively. Production and sales declined month-on-month, with a slight year-on-year decline. Affected by the traditional off-season, the combined half-year impulse released consumer demand ahead of schedule. Automobile sales declined seasonally in July, and the decline in the industry's cumulative production and sales narrowed further. Automobile exports continued to hit a new monthly high in July and surpassed 1 million units for two consecutive months. The export volume reached 1.043 million vehicles, +0.6% month-on-month, +81.3% year-on-year, and continued to grow.

Passenger car production and sales declined slightly year over year

In July 2026, passenger car production and sales reached 2.246 million units and 2.268,000 units respectively, -5.4% month-on-month, -2.1% and -0.9%, year-on-month decline, with a slight year-on-year decline. Among them, own-brand passenger car market share reached a record high of 77.3%, an increase of 1.9 percentage points over the previous year, and an increase of 7.2 percentage points over the previous year.

Commercial vehicle production and sales declined month-on-month

In July 2026, production and sales in the commercial vehicle market reached 328,000 units and 317,000 units, respectively, -15.4% and -22.5% month-on-month, and +10.0% and +3.5% year-on-year respectively, declining month-on-month and maintaining year-on-year growth.

The penetration rate of new energy vehicles reached a record high

In July 2026, production and sales of new energy vehicles reached 1.576 million units and 1.561 million units respectively, with a year-on-year increase of 60.4% and +23.7%, respectively. The penetration rate of new energy vehicles reached 60.4%, an increase of 1.94 percentage points over the previous year, and the penetration rate exceeded 60% for the first time.

Risk warning: 1) Risk of policy implementation falling short of expectations; 2) risk of industry demand falling short of expectations; 3) risk of increased industry competition; 4) risk of falling short of expectations in intelligent connectivity