- Morgan Stanley warns that electric vehicle sales in China are off to a moderate start in 2022 after a strong ending month in 2021. The slowdown comes just a few weeks before the anticipated pause in activity during the Chinese New Year and with COVID restrictions still tight.
- Analyst Tim Hsiao: "The industry is looking for a pre-holiday boost to rev up weekly sales until later in January, when store traffic/deliveries could fall substantially. This is especially the case given sporadic lock-downs amid resurgence of Covid cases in China. With easing chip shortage, we saw more resilient sales in ICEVs than EVs at the beginning of year, likely due to unleashing of pent-up demand from 2021."
- The firm is looking for a mid-to-high teens sequential sales decline in January for Nio(NIO+5.5%), XPeng(XPEV+5.1%)and Li Auto(LI+3.2%)collectively, which could create some selling pressure when the official numbers arrive in the first few days of February.
- The Chinese EV sector is having a strong day overall after Macquarie analyst Erica Chen started off coverage on Nio, XPeng and Li Auto earlier today with Outperform ratings.
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