January Auto Sales +0.9% YoY New Energy Sales +136% YoY

　　In January 2022, auto production and sales achieved modest growth year-on-year. Overall auto production was 2.242 million units, +1.4% YoY; of which, passenger car production was 2.077 million units, +8.7% YoY, and commercial vehicle production was 345,000 units, -28% YoY.

　　In the same month, the overall sales volume of automobiles was 2.531 million units, +0.9% year-on-year; among them, passenger car sales were 2.186 million units, +6.7% year-on-year, while commercial vehicle production was 344,000 units, -25% year-on-year.

　　Passenger car production and sales performed well, providing strong support for the recovery and development of the auto market.

　　In January 2022, car/SUV production reached 962,000/1,007,000 units, up 7.3%/11.1% YoY, and sales reached 101.8/10.057 million units, up 4.1%/8.7% YoY; crossover passenger car production and sales achieved 29.3%/78% YoY growth respectively, with a large increase; MPV production and sales declined YoY.

　　In January, SAIC, Changan, GAC and Dongfeng achieved 10%+ sales growth, with SAIC Volkswagen and Changan Mazda performing well in their respective brands. In addition, sales of new energy brands grew significantly, with BYD (+125%), GAC EAN (+118%), Great Wall Ola (+29%), and new power brands such as Xiaopeng (+115%), Azera (+34%), Ideal (+128%), Nezha (+402%), and Zero Run (+434%) all achieving significant year-over-year growth.

　　In January 2022, new energy vehicle production and sales were 452,000/ 431,000 units, +133.2%/135.8% year-on-year. Among them, new energy passenger cars contributed to the main production and sales, with production and sales reaching 437,000/ 419,000 units in the month, +134.6%/138.7% year-on-year.

　　Among the new energy passenger car sales, plug-in models grew most prominently, +203% year-on-year and continued to grow sequentially, with sales reaching 84,000 units; pure electric models sold 352,000 units, 122.6% year-on-year. new energy penetration reached 17.03% in January 2022, +9.87 pcts year-on-year, and new energy passenger car penetration reached 19.16%, +10.76 pcts year-on-year.

　　We expect that new energy passenger car sales will reach 5.6 million units in 2022, with a penetration rate of 24%.

　　Industry rating and investment strategy: alpha of industrial change, beta of the wave of the times. new energy vehicle penetration rate increased to 19% in December 2021, automotive industry change, Tesla, the new power of the gross margin continues to improve, Tesla domestic suppliers generally rapid growth in performance; Tesla wave brings revaluation of the whole car, NOA function redefines the intelligent car triggered arms race, hardware pile material, domestic replacement Large space. Maintain the "Recommended" rating in the automotive industry.