JPM_China_Auto_Drivers_O_2016-11-01_1248017.pdfVIP

Asia Pacific Equity Research 01 November 2013 China Auto Drivers October still in holiday sales mode  Seemingly slow sales, but truly rising discount: Our analysis of Automobile Manufacture preliminary sales in Oct suggests that PV sales growth might decelerate Nick Lai AC to 9% YoY after sharp growth of 20% YoY in Sep. The seeming (852) 2800 8543 deceleration is due more to an extremely high base in 4Q13 than to any nick.yc.lai@ fundamental deterioration. On the other hand, we do see a widening Bloomberg JPMA LAI GO discount in selective models and brands, implying that dealers still need J.P. Morgan Securities (Asia Pacific) Limited to sell cars at some discount in exchange for better volume during this peak season. Relative share price performance of  Our key findings on the discount in 2H-Oct vs. 1H-Oct include: China auto companies (1-Nov) 1) The premium segment widened markedly to ~9.6% in 2H-Oct Company 1M 3M YTD from ~8.2% in 1H-Oct, driven mainly by Benz and BMW select (rating) Brilliance 11% 30% 35% models following their launches or facelifts in Sep or Oct. As a China (OW) result, the pricing honeymoon didn’t last long for those ne