Understanding the Market | Automotive stocks collectively declined as three departments issued new regulations on the exemption of purchase tax for new energy vehicles, raising the technical threshold for tax exemption
Automobile stocks collectively declined, with XPeng down 4.51%, Li Auto down 2.91%, Brilliance China down 3.12%, and Great Wall Motor down 0.42%. On October 9th, the Ministry of Industry and Information Technology, the Ministry of Finance, and the State Administration of Taxation issued new regulations on the purchase tax exemption for new energy vehicles, clarifying the technical standards for the next two years, stating that plug-in hybrid vehicles must have an electric-only range of no less than 100 kilometers. Shenwan Hongyuan pointed out that starting next year, the new energy vehicle purchase tax will be halved, increasing the cost of purchasing vehicles, and the market may see a rush to buy
According to Zhitong Finance APP, automotive stocks collectively fell. As of the time of publication, XPeng-W (09868) dropped 4.51% to HKD 86.75; Li Auto-W (02015) fell 2.91% to HKD 91.85; Brilliance China (01114) decreased by 3.12% to HKD 4.04; Great Wall Motor (02333) declined 0.42% to HKD 16.65.
In terms of news, on October 9th, the Ministry of Industry and Information Technology, the Ministry of Finance, and the State Administration of Taxation jointly issued a notice regarding the technical requirements for the exemption of vehicle purchase tax for new energy vehicle products from 2026 to 2027, clarifying the specific technical standards for the purchase tax exemption policy for new energy vehicles in the next two years. The new policy proposes updated technical requirements for pure electric passenger vehicles and plug-in hybrid passenger vehicles, with particular attention to the requirement that plug-in (including range-extended) hybrid passenger vehicles must have an electric range of no less than 100 kilometers.
Shenwan Hongyuan recently released a research report stating that the fourth batch of "trade-in" funds has been allocated, and automotive subsidies are gradually coming to an end; starting next year, the exemption policy for new energy vehicle purchase tax will end, to be replaced by a 50% reduction in tax, with an additional tax payment of up to 15,000 yuan per vehicle. Consumers purchasing models over 300,000 yuan will see a significant increase in purchase costs, which may lead to a wave of market rush for installations entering the fourth quarter
