China's Auto Demand to Slow Next Year — Market Talk

Sime Darby's Malaysia motors division may see continued on-year growth, supported by strong demand for BYD models after a 99% jump in 3Q sales driven by active launches, Affin Hwang IB analyst Afifah Ishak says in a note. This should help offset weaker BMW sales volumes, which fell 16.3% on-year, she says. However, average selling prices may soften as BYD's mass-market models dilute BMW's premium offerings, she reckons. Associate UMW Toyota's modest 3.3% sales increase points to steady demand, but she cautions that intensifying competition and heavy promotions could pressure margins ahead. Affin Hwang maintains a sell rating on Sime Darby as its earnings outlook may remain pressured, and keeps the target price at MYR1.59. Shares are 1.0% higher at MYR1.96. (yingxian.wong@wsj.com)

Sime Darby's Malaysia motors division may see continued on-year growth, supported by strong demand for BYD models after a 99% jump in 3Q sales driven by active launches, Affin Hwang IB analyst Afifah Ishak says in a note. This should help offset weaker BMW sales volumes, which fell 16.3% on-year, she says. However, average selling prices may soften as BYD's mass-market models dilute BMW's premium offerings, she reckons. Associate UMW Toyota's modest 3.3% sales increase points to steady demand, but she cautions that intensifying competition and heavy promotions could pressure margins ahead. Affin Hwang maintains a sell rating on Sime Darby as its earnings outlook may remain pressured, and keeps the target price at MYR1.59. Shares are 1.0% higher at MYR1.96. (yingxian.wong@wsj.com)

By Nina Kienle

Chinese automaker BYD again logged higher new-car registrations in Europe last month, as it continues to expand in the continent amid pressure in its home market.

New-car registrations for BYD models, a reflection of sales, increased to 17,470 vehicles from 5,695 vehicles in October 2024, according to the European Automobile Manufacturers' Association, an industry body also known as ACEA.

The figure includes data from the European Union as well as the U.K., Iceland, Liechtenstein, Norway and Switzerland. In the EU alone, BYD registrations rose to 13,350 vehicles from 4,525 vehicles.

While China's largest automaker is continuing its streak of logging higher sales, absolute sales remain far below those of established domestic carmakers like Germany's Volkswagen or Stellantis, the owner of the Jeep and Dodge brands. Both companies respectively sold 308,508 and 157,350 vehicles in Europe last month, according to ACEA.

Meanwhile, registrations for Elon Musk's Tesla fell 48% in the EU last month, according to ACEA data, continuing the streak of disappointing monthly sales for the company this year. Tesla has been dealing with the fallout from Musk's involvement with the Trump administration that came to an end a few months ago.

In the year to date, battery-electric cars reached 16.4% of the EU market share, up from 13.2% in the same period of the prior year. In the first ten months of the year, battery-electric vehicle sales jumped 39% in Germany. Registrations of hybrid-electric cars increased 16%, while plug-in-hybrid models increased by 32%.

ACEA said EU car registrations increased 5.8% in October to 916,609 vehicles, up 7.8% in Germany and up 2.9% in France but down 0.5% in Italy.

Write to Nina Kienle at nina.kienle@wsj.com

By Nina Kienle

Chinese automaker BYD again logged higher new-car registrations in Europe last month, as it continues to expand in the continent amid pressure in its home market.

New-car registrations for BYD models, a reflection of sales, increased to 17,470 vehicles from 5,695 vehicles in October 2024, according to the European Automobile Manufacturers' Association, an industry body also known as ACEA.

The figure includes data from the European Union as well as the U.K., Iceland, Liechtenstein, Norway and Switzerland. In the EU alone, BYD registrations rose to 13,350 vehicles from 4,525 vehicles.

While China's largest automaker is continuing its streak of logging higher sales, absolute sales remain far below those of established domestic carmakers like Germany's Volkswagen or Stellantis, the owner of the Jeep and Dodge brands. Both companies respectively sold 308,508 and 157,350 vehicles in Europe last month, according to ACEA.

Meanwhile, registrations for Elon Musk's Tesla fell 48% in the EU last month, according to ACEA data, continuing the streak of disappointing monthly sales for the company this year. Tesla has been dealing with the fallout from Musk's involvement with the Trump administration that came to an end a few months ago.

In the year to date, battery-electric cars reached 16.4% of the EU market share, up from 13.2% in the same period of the prior year. In the first ten months of the year, battery-electric vehicle sales jumped 39% in Germany. Registrations of hybrid-electric cars increased 16%, while plug-in-hybrid models increased by 32%.

ACEA said EU car registrations increased 5.8% in October to 916,609 vehicles, up 7.8% in Germany and up 2.9% in France but down 0.5% in Italy.

Write to Nina Kienle at nina.kienle@wsj.com

BYD's entry into the Kei-car market in Japan is unlikely to pose an immediate or significant threat to the dominance of Japanese automakers like Suzuki, Bernstein analysts write in a note. However, if BYD offers a substantially lower price than traditional ICE Kei-cars, it could help the BYD strengthen its presence in the Japanese market to some degree, they note. In the Japanese automobile market, imported vehicles have consistently held only about 4% of total sales on average over the past 30 years, they say. The conditions in Japan could be inherently challenging for BYD to replicate the rapid growth it has experienced in other markets, they say. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

XPeng is expected to break even in 4Q, supported by strong monthly sales, HSBC analysts say in a note. They also highlight the carmaker's physical AI strategy across autonomous driving, robotaxis, and humanoid robotics. "While monetization remains distant, we believe XPeng's physical AI capabilities will gradually unfold, unlocking more growth potential as key milestones are delivered", they add. However, the analysts lower their 2025 earnings estimate by 19% mainly due to a slightly softer volume outlook from a weaker than expected ramp up of the G7 SUVs and higher expenses from upcoming model launches, though 2026-2027 earnings estimates remain largely unchanged. HSBC maintains a buy call on XPeng but lowers its target price to $28.60 from $29.60. Its ADRs last closed at $22.62.(jason.chau@wsj.com)