德银-中国汽车及汽车科技：在2026年下半年行业风暴中寻找避风港

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DeutscheBank

Research

ChinaAutos&AutoTechnologyFindingShelterintheSector-wideStormin2H2026

BinWang

+852-2203-5496

wang.bin@

September2026

IMPORTANTRESEARCHDISCLOSURESANDANALYSTCERTIFICATIONSLOCATEDINAPPENDX1.DeutscheBankdoesandsekstodobusinesswithcompaniescovereinits

researchreports.Thus,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreport.Investorsshouldconsiderthisreportas

onlyasinglefactorinmakingtheirinvestmentdecision.

ExecutiveSummary-Overseas-ExposedAutoPartsMakersOfferShelter

fromSectorHeadwinds

Sectorweaknesstopersistin2H2026despiterobustoverseasexpansion

—China'spassengervehiclesector-widePBTdeclined20%YoYin1H2026despite1.4%revenue

growth,reflectinga4%YoYdeclineinwholesalevolumeandcontinuedmarginpressure

—Sector-widewholesalevolumeisestimatedtodecline4%YoYto15.7millionunitsin2H2026,

withdomesticretailvolumedown15%YoYto10.5millionunits,partlyoffsetbyoverseassalesvolumeincreasing61%YoYto5.6millionunits

Automakermarginsremainunderpressurefrompromotions,sourcingcostsandpolicyrisks

—Automakersareexpectedtofacecontinuedmarginpressurefromincreasedpromotionalactivitiesandrisingsourcingcostsforlithiumbatteriesandsemiconductormemory

—Thepotentialremovalofthe13%vehicleexportVATrebaterepresentsakeydownsiderisk,

particularlyasoverseassalesareprojectedtoaccountfor36%ofsector-widewholesalevolumein2H2026

Preferautopartsmakerswithoverseasexposureandlowersourcing-costsensitivity

—OverseasmarketsgenerallyofferChinesevehicleandautopartsmakersstrongervolumegrowthandhigherprofitability,withEuropeprovidinganimportanthigh-valuemarketamidweakdomesticdemand

—WepreferautopartsmakerswithsignificantEuropeanexposureandlimitedrelianceonlithiumbatteriesandsemiconductormemory,whichshouldberelativelyinsulatedfromsector-widevolumeandmarginheadwinds

DeutscheBank.Research

|

BinWang

|

ChinaAutos&AutoTechnology

September2026

1

ContinuedHeadwindsExpectedin2H2026;PreferAutoPartsMakerswith

OverseasExposure

WemaintainaconservativeoutlookonChina'spassengervehiclesector,ascontinuedvolumedeclinesandsourcing-costpressureareexpectedtoweighonautomakermarginsin2H2026

—Sector-widePBTdeclined20%YoYin1H2026despite1.4%revenuegrowth,asa6%YoYdeclineinpassengervehiclesalesvolumewaspartlyoffsetbyan8%increaseinblendedASP,drivenbya

higheroverseassalesmix

—Weexpectpassengervehiclewholesalevolumetodecline4%YoYin2H2026,followinga6%YoYdeclinein1H2026,withcontinuedpromotionalactivityandhigherbatteryandsemiconductormemorycostslikelytodrivefurthermargindeterioration

—Overseasmarketsgenerallyofferstrongervolumegrowth,higherASPsandmarginsthatare

typically5-10pptsabovethedomesticmarket,supportingourpreferenceforautopartsmakerswithsignificantoverseasexposure

Chinaautosector-wideprofitbeforetax(PBT)trendChinapassengervehiclesemi-annualvolumegrowthoutlook

Chinapassengervehiclesectorwholesales——YoY

RMBBillion

462

413

376

336

304

273

10%

250

0%

-10%

104

-20%

-30%

-40%

Feb-Apr-Jun-Aug-Oct-Dec-Mar-May-Jul-Sep-Nov-Feb-Apr-Jun-

2424242424242525252525262626AutosectorYTDprofitbeforetax(PBT)——YoY

500

450

400

350

300

200

150

100

50

50%

40%

30%

20%

4461

205

348

389

304

144

143

59

0

DeutscheBank.ResearchBinWangChinaAutos&AutoTechnologySeptemberSource:Wind,Thinkercar,DeutscheBank2

||2026estimates

SlowingVolumeGrowthandRisingBatteryCoststoWeighonAutomakers

Automakers'sharepriceperformancehashistoricallytrackedsalesgrowth,whilerisingsourcingcostsareexpectedtointensifymarginpressure

—Historically,deceleratingsalesgrowthhasresultedinlowercapacityutilization,higherfixedcostspervehicleandmoreintensepricecompetition,consequentlyweighingonautomakers'marginsandsharepriceperformance

—BYD'ssharepriceweakenedin1Q2024assalesgrowthdecelerated,beforerallyingasgrowth

acceleratedoverthefollowing12months;thesharepricesubsequentlyweakenedfrom2Q2025amiddeterioratingsalesgrowthandbegantorecoverin2Q2026asvolumegrowthreturnedtopositiveterritory

—Batterycostshaveincreasedmaterially,withNCMbatterycellpricesrising22%fromRMB0.49/WhinDecember2025toRMB0.60/WhinJune2026,whileLFPbatterycellpricesincreased11%fromRMB0.35/WhtoRMB0.39/Whoverthesameperiod

BYDvolumegrowthYoYandsharepriceLithiumbatterycellpricetrend

Rmb/wh

0.65

0.600.550.500.450.400.35

0.30

Jan-Feb-Mar-Apr-May-Jun-Jul-Aug-Sep-Oct-Nov-Dec-Jan-Feb-Mar-Apr-May-Jun-

252525252525252525252525262626262626

——NCMbatterycell(xEV)——LFPbaterycell(xEV)

24242424242425252525252526262626

DeutscheBank.Research

BinWang|ChinaAutos&AutoTechnology

September2026

Source:Companydata,Wind

3

ContinuedDomesticWeaknesstoBeOffsetbyRobustOverseasExpansion

in2H2026

Weexpectpassengervehiclewholesalestodecline4%YoYin2H2026,asrobustoverseas

growthpartlyoffsetsweakdomesticdemandandcontinuedinventoryreduction

—Domesticpassengervehicleretailsalesareforecasttodecline15%YoYto10.5million

unitsin2H2026,representingaYoYvolumereductionof1.8millionunits,or11%of

wholesalevolume.Themodestimprovementfromthe18%YoYdomesticretaildecline

in1H2026mainlyreflectsdemandnormalizationfollowingthepull-forwardintoQ4

purchasetaxforNEVs

2025aheadoflowervehicletrade-insubsidiesandtheintroductionofa5%vehicle

—Overseaspassengervehiclesalesareforecasttoincrease61%YoYto5.6millionunitsin2H2026,representingaYoYvolumeincreaseof2.1millionunits,or13%ofwholesalevolume.Overseasgrowthshouldbesupportedbyfourkeydrivers:newplants,new

markets,newbrandsandnewproducts,includingadditionalmodelsandpowertrainoptionstailoredtooverseasdemand

—Dealerinventoryisforecasttodeclineby0.33millionunitsin2H2026,comparedwithanincreaseof0.69millionunitsin2H2025,representinganegativeYoYswingof~1.0millionunits,or~6%of2H2026wholesalevolume

2025

(Unit)

2026e

2025YoY

2026YoY

Retail

22,714,127

19,000,000

0%

-16%

Export

6,037,959

10,000,000

22%

66%

Inventory

change1,007,926

(700,000)

-350%

-169%

Wholesale

s29,760,012

28,300,000

9%

-5%

Chinapassengervehiclewholesalevolumeoutlookin2026

1H2025

1H2025

1H2026

2H2026

1H

2026YoY

2H2026YoY

10,444,189

12,269,938

8,522,295

10,477,705

-18%

-15%

2,581,336

3,456,623

4,432,115

5,567,885

72%

61%

322,818

685,108

(371,647)

(328,353)

13,348,343

16,411,669

12,582,763

15,717,237

-6%

-4%

DeutscheBank.ResearchBinWang|ChinaAutos&AutoTechnology|September2026Source:Thinkercar,DeutscheBankestimates

AugustSAARTrendsBroadlySupportOur2026VolumeForecasts

WholesaleSAARof28.2millionunitsandretailSAARof18.0millionunitsarebroadlyinlinewithour2026forecasts

—TheAugustwholesaleSAARimpliesanannualizedvolumedeclineof5.3%YoY,with

28.2millionunitsrepresenting94.7%ofthe29.8millionunitsrecordedin2025.

—TheAugustretailSAARimpliesanannualizeddeclineof21%YoY,with18.0millionunits

representing80%ofthe22.7millionunitsrecordedin2025.

China'spassengervehiclewholesaleSAARtrendChina'spassengervehicleretailsalesSAARtrend

36,000

34,000

32,000

30,000

28,000

26,000

24,000

22,000

20,000

'000Unit

'000Unit

25,000

23,000

21,000

19,000

17,000

15,000

Feb-Mar-Apr-May-Jun-Jul-Aug-Sep-Oct-Nov-Dec-Jan-Feb-Mar-Apr-May-Jun-Jul-Aug-

27,000

Source:Thinkercar,DeutscheBankestimates

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2026

DeutscheBank.ResearchBinWangChinaAutos&AutoTechnologySeptember

AutomakersFacePersistentMarginPressurein2H2026fromRising

SourcingCostsandPotentialPolicyHeadwinds

Weanticipateautomakerswillexperiencefurthermargindeclinein2H2026,drivenprimarilybypersistentandintensifyingcostpressuresfromkeycomponents.

—Firstly,theescalatingcostofsemiconductormemory,particularlyDRAM,isprojectedtobeasignificantheadwind;followinganalreadysubstantial~50%QoQincreaseinQ22026DRAMcontractprices,theoutlookforQ32026suggestsanadditionalsurgeof13-18%QoQ.

—Secondly,anewfiscalpolicyfromtheChinesegovernmentispoisedtoaddfurtherstrainonbatterycosts;effectiveSeptember1st,2026,a2%consumptiontaxwillbeleviedonlithiumbatteries,withaplannedincreaseto4%fromSeptember1st,2027.

Thepotentialremovalofthe13%vehicleexportVATrebatecouldsignificantlyweighon

sector-wideprofitability,withoverseassalesprojectedtoaccountfor36%ofwholesalevolumein2H2026

Chinaautosector-widemargintrend

16.1%15.9%15.6%15.4%

14.6%14.1%

13.2%

12%

7.8%7.3%

6.3%

5.0%

3.8%

2%

0%

20172018201920202021

一PBTmargin

2022202320242025

一Grossmargin

10%

8%

6%

4%

11.9%11.2%

18%

16%

14%

2026

Memory(DRAM)spotpricetrend

DeutscheBank.Research

BinWang

ChinaAutos&AutoTechnology

September2026

Source:Wind

6

DefensivePositioningin2H2026:FavoringEuropeanExposureandCost

Beneficiaries

WemaintainaconservativeoutlookonChina'spassengervehiclesectorin2H2026,favoring

vehicleandautopartsmakerswithsignificantoverseasexposure

—Europeanexposure:OverseasmarketsgenerallyofferstrongervolumegrowthandhigherprofitabilitythanChina,whileEuropeprovidesahigh-valuedestinationtooffsetweak

domesticdemandandestablishglobalbrandcredibility.

—Europeanmarketgrowth:Europeancarregistrationsincreased6.1%YoYto7.2millionunitsin1H2026,supportedbymarketincentives,risingoilpricesandrobustdemandfor

electrifiedvehicles.

—Electrificationmomentum:EuropeanBEVandPHEVregistrationsrose35.1%and24.8%YoY,respectively,in1H2026,creatinggrowthopportunitiesforChineseNEVandautoparts

makerswithcompetitivetechnologies.

ChinaAutoMakers'TotalOverseaSalesVolumeBreakdownin1H2026

Chery

20.6%

GreatWall

5.8%

BYD

Chn'n

Geely

10.7%SAIC

Leporel

Others

13.9%

17.4%

16.6%

ChinaAutoMakers'EuropeSalesVolumeBreakdownin5M2026

Others,5.7%

Chery,25.4%

GreatWallMotor,10.1%

Geely,10.3%

SAIC,19.1%

BYD,18.8%

5.7%

Ch2an9g%'an,Leapmotor,

XPeng,1.9%

DeutscheBank.Research

BinWang

|

|ChinaAutos&AutoTechnology

September2026

Source:Wind,Thinkercar7

TopPicks-Minth(425HK)andNexteer(1316HK)

8

|

September2026

BinWang

DeutscheBank.Research

|ChinaAutos&AutoTechnology

BYD(1211HK)

-WemaintainourhighlyconstructiveinvestmentthesisonBYD,drivenbyitsrevolutionarysecond-generation"Blade

Battery"and"FlashCharging"technologyalongsiderapid,high-margininternationalmarketexpansion.Undernormal

temperatures,theGen-2BladeBatterychargesfrom10%to70%infiveminutesandupto97%innineminutes,

maintainingexceptionalextremelow-temperatureperformance(-30℃)witha20%to97%chargeinjust12minutes-

advancementsbackedbya2.5%batterywarrantyextensionandaplanned90,000-stationsuper-fastchargingnetworktobebuiltoutthrough2028(beginningwith20kbyend-2026).Whilenear-termdomesticvolumegrowthistemporarilybottleneckedbyaGen-2cellsupplyshortage-causingone-to-two-monthdeliveryleadtimesandzerodealer

discounting-managementexpectsthistobefullyresolvedin1Q27,pavingthewayforstrongsequentialdomestic

acceleration.ThisiscomplementedbyahighlyprofitableoverseascampaignwhereBYDtargets1.9-2.0millonvehiclesalesinfull-year2026,representingamassive90%YoYincrease,andaimstoexceed2.5millionunitsin2027asits

dedicatedshippingcarrierfleetscalesandlocalizedassemblyplantsinIndonesia,Brazil(rampingto300,000unitsof

annualcapacity),andHungary(commencinglate2026)comeonline.Crucially,theseinternationalvolumescommandfarsuperiorpricingpower-generatingapproximatelyRMB20kinprofitpervehiclein1H2026despiteforeignexchange

headwinds-whichwillheavilyinsulateBYD'soverallmarginsfromdomesticpricecompetition.

Minth(425HK)

-Consideringtheanticipatedpersistenceofdecliningsector-widevolumesandmarginsin2H2026and2027,we

maintainaconservativetop-downoutlookonChina'spassengervehiclesector,preferringnameswithsignificant

overseasexposurewherehighervolumegrowthandsuperiorpricingpowerinsulatemargins.Consequently,wehighly

favorMinth,whichisexpectedtocontinuedeliveringdouble-digitrevenueandearningsgrowthduetoits68%overseasrevenueexposurein1H2026anditspositionastheworld'slargestbatteryhousingmanufacturer.Thisresilientbaseis

supportedbyMinth'sambitious2030strategictargettoachievetotalrevenueofRMB82billion-representinga26%

CAGRfromRMB25.7billionin2025-drivenbyadual-enginestrategywherecoreautopartsscaleata23%CAGRto

RMB72billion(comprisingRMB30billionfrombatteryhousing,RMB20billionfromplastics,RMB11.5billionfrom

aluminum,andRMB10.5billionfrommetalsandtrims)todelivera20%netprofitCAGRanda15%RoE.Simultaneously,itshigh-potentialemergingsectorsareprojectedtoscalerapidlyfromRMB0.3billionin2026toRMB1.4billionin2027beforereachingRMB10billionby2030-ledbyHumanoidRobotics(RMB5billion),AIServerLiquidCooling(RMB4

billion),andeVTOLcomponents(RMB1billion)-securingahighlydiversified,high-marginpipelinethatunderpinsrobustgrowthprospectsfarbeyondtraditionalautomotivecycles.

Source:DeutscheBank

Peervaluationcomparisontable

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9

DeutscheBankResearch

September2026

BinWang

ChinaAutos&AutoTechnology

12.88.19.5

10.1

16.27.16.25.9

5.4

8.2

3606

425

HKHK

HKDHKD

55.925.0

20,851

3,740

1316HKHKD4.81,547

NexteerAutomotiveGroupLtd

TraditionalAutomakers

SegmentAverage

BYDCoLtd

GeelyAutomobileHoldingsLtdCheryAutomobileCoLtd

GreatWallMotorCoLtd

GuangzhouAutomobileGroupCoBrilianceChinaAutomotiveHoBAICMotorCorpLtd

1211HK

175HK9973HK2333HK2238HK1114HK1958HK

HKDHKD

HKD

HKD

HKDHKD

HKD

82.116.625.07.62.21.80.7

108,138

22,844

18,502

15,974

6,481

1,181

731

SegmentAverage

P/B(x)

2027E

Market(USD

ROE(%)2026E2027E

CapMN)

ListingPrice

BBGticker

Company

Price/sales

2028E

2028E

Currency(Latest)

2026E2028E2026E

AutoPartsSuppliers

FuyaoGlassIndustryGroupCoMinthGroupLtd

2026E2027E2028E

2.8

2.5

2.1

0.9

0.7

0.6

0.3

0.3

0.3

1.3

1.2

1.0

0.8

0.7

0.7

0.4

0.3

0.3

0.4

0.3

0.3

0.4

0.4

0.4

0.4

0.4

0.3

6.1

5.7

5.3

0.04

0.04

0.04

1.2

1.1

1.0

3.0

1.00.7

1.5

2.31.4

1.80.6

0.20.4

0.1

1.0

10.79.37.06.08.06.9

8.67.4

12.6

5.9

4.9

4.8

5.0

6.6

10.5

5.0

4.1

4.2

4.5

5.7

25

13

8

15.5

16

21

34

11

-4

7

-3

11.9

24

12

7

14.6

15

20

35

10

-6

7

-4

10.9

26

13

9

15.9

17

21

32

12

-1

8

-2

12.3

2.62.20.90.80.60.6

1.41.2

2.0

1.2

1.3

0.5

0.2

0.4

0.1

0.8

1.7

1.0

1.1

0.5

0.2

0.4

0.1

0.7

NewEnergyVehicleMakers

XiaomiCorp

1810HK

HKD

26.3

86,517

1.3

1.1

1.0

22.4

17.1

13.7

2.0

1.8

1.6

9

10

12

LiAutoInc

2015HK

HKD

47.4

12,567

0.7

0.6

0.5

33.0

16.2

1.8

1.6

1.6

-4

2

6

XPengInc

9868HK

HKD

42.3

10,340

0.8

0.6

0.5

358.3

25.6

2.5

2.5

2.4

-11

1

8

NIOInc

9866HK

HKD

29.4

9,393

0.5

0.4

0.4

37.1

14.7

8.0

7.0

4.6

-10

25

1157

ZhejiangLeapmotorTechnology

9863HK

HKD

35.3

6,084

0.4

0.3

0.2

14.2

8.0

5.9

2.4

1.8

1.4

18

25

26

SegmentAverage

0.7

0.6

0.5

18.3

90.7

15.2

3.3

2.9

2.3

0.4

12.7

241.8

Source:BloombergFinanceLP(PricedSeptember9,2026)

Appendix1

Disclosures

Important

*Otherinformationavailableuponrequest

*PricesarecurrentasoftheendoftheprevioustradingsessionunlessotherwiseindicatedandaresourcedfromlocalexchangesviaReuters,Bloombergandothervendors.OtherinformationissourcedfromDeutscheBank,subjectcompanies,andothersources.Fordisclosurespertainingtorecommendationsor

estimatesmadeonsecuritiesotherthantheprimarysubjectofthisresearch,pleaseseethemostrecentlypublishedcompanyreportorvisitourglobal

disclosurelook-uppageonourwebsiteat

/Research/Disclosures/EquityResearchDisclosures.Asidefromwithinthisreport,important

riskandconflictdisclosurescanalsobefoundat

/Research/Disclosures/Disclaimer.Investorsarestronglyencouragedtoreviewthis

informationbeforeinvesting.

AnalystCertification

Theviewsexpressedinthisreportaccuratelyreflectthepersonalviewsoftheundersignedleadanalyst(s).Inaddition,theundersignedleadanalyst(s)has

notandwillnotreceiveanycompensationforprovidingaspecificrecommendationorviewinthisreport.BinWang

DeutscheBank.Research

|

BinWang

|

ChinaAutos&AutoTechnology

September2026

10

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11

September2026

DeutscheBank.Research

BinWang

ChinaAutos&AutoTechnology

CompanyRatingandDispersionKey:Thetableprovidesasnapshotof

DeutscheBank'scompanyresearchratingdistributionacrossourcoveredcompanies.WealsopresentthepercentageofcompanieswhereDeutscheBankhasprovidedInvestmentBankingServicesinthepast12months

and/orMIFIDInvestmentandAncillaryservices,inthepast12months.Pleaseseethekeyanddefinitionofourratingbelow.

Note-percentagesareroundedsomaynottotal100%.

Covered:Theoverallratingdistributionacrossallcompaniesundercoveragewitharating.

w/Bankingrelation:Percentageofcompaniesundercoveragewitharatingwithineachofthe"buy","hold"and"sell"categoriesforwhichDeutsche

BankhasprovidedInvestmentBankingServiceswithintheprevious12months.

w/MiFIDservices:Percentageofcompaniesundercoveragewitharatingwithineachofthe"buy","hold"and"sell"categoriesforwhichDeutscheBankhasprovidedMIFIDInvestmentandAncillaryserviceswithinthe

previous12months.

Buy/Hold/SellPercentages:Thesepercentagesreflecttheproportionof

companieswithineachcategorythathavebeenassignedthecorrespondingrating,basedonour12-monthviewofTotalShareholderReturn(TSR).

Ratingdefinitions:

Buy:Basedonacurrent12-monthviewofTSR,werecommendthat

CompanyRatingDispersionandBankingRelationships

DBSICompaniesunderCoverage

Buy

Hold

Sell

Covered

58%

42%

0%

w/Bankingrelationship

43%

35%

0%

w/MiFIDservices

64%

52%

67%

GlobalCompaniesunderCoverage

Buy

Hold

Sell

Covered

58%

40%

2%

w/Bankingrelationship

46%

32%

31%

w/MiFIDservices

75%

68%

91%

investorsbuythestock.

Sell:Basedonacurrent12-monthviewofTSR,werecommendthatinvestorssellthestock.

Hold:Wetakeaneutralviewonthestock12-monthsoutand,basedonthis

timehorizon,donotrecommendeitheraBuyorSell.

TSR:TotalShareholderReturn.Percentagechangeinsharepricefromcurrentpricetoprojectedtargetpriceplusprojecteddividendyield.Newlyissuedresearchrecommendationsandtargetpricessupersedepreviouslypublishedresearch.

|

September2026

12

BinWang

DeutscheBank.Research

|ChinaAutos&AutoTechnology

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andcanbefoundonthegeneralcoveragelistandalsoonthecoveredcompany

'

s

page.ACatalystCallideareresentsahigh-convictionbeliefbyananalystthatastockwilloutperformorunderperformthemarketand/oraspecifiedsectoroveratimeframeofnolessthantwoweeksandnomorethanthreemonths.InadditiontoCatalystCallsideas,analystsmayoccasionallydiscusswithourclients,andwithDeutscheBanksalespersonsandtraders,tradingstrategiesorideasthatreferencecatalystsoreventsthatmayhaveanear-termormedium-termimpactonthemarketpriceofthesecuritiesdiscussedinthisreport,whichimpactmaybedirectionallycountertotheanalysts'current12-monthviewoftotalreturnorinvestmentreturnasdescribedherein.DeutscheBankhasnoobligationtoupdate,modifyoramendthisreportortootherwisenotifyarecipientthereofifanopinion,forecastorestimatechangesorbecomesinaccurate.Coverageandthefrequencyofchangesinmarketconditionsandinbothgeneralandcompany-specificeconomicprospectsmakeitdifficulttopdateresearchatdefinedintervals.UpdatesareatthesolediscretionofthecoverageanalystoroftheResearchDepartmentManagement,andthmajorityofreportsarepublishedatirregularintervals.Thisreportisprovidedforinformationalpurposesonlyanddoesnottakeintoaccounttheparticularinvestmentobjectives,financialsituations,orneedsofindividualclients.Itisnotanofferorasolicitationofanoffertobuyorsellanyfinancialinstrumentsortoparticipateinanyparticulartradingstrategy.Targetpricesareinherentlyimpreciseandaproductoftheanalyst'sjudgment.Thefinancialinstrumentsdiscussedinthisreportmaynotbesuitableforallinvestors,andinvestorsmustmaketheirowninformedinvestmentdecisions.Pricesandavailabilityoffinancialinstrumentsaresubjecttochangewithoutnotice,andinvestmenttransactionscanleadtolossesasaresultofpricefluctuationsandotherfactorsIfafinancialinstumentisdenominatedinacurrencyotherthnaninvestor'scurrency,achangeinexchangeratesmayadverselyaffecttheinvestment.Pastperformanceisnotnecessarilyindicativeoffutureresults.Performancecalculationsexcludetransactioncosts,unlessotherwiseindicated.Unlessotherwiseindicated,pricesarecurrentasoftheendoftheprevioustradingsessionandaresourcedfromlocalexchangesviaReuters,Bloombergandothervendors.DataisalsosourcedfromDeutscheBank,subjectcompanies,andotherparties.Artificialintelligencetoolsmaybeusedinthepreparationofthismaterial,includingbutnotlimitedtoassistinfact-finding,dataanalysis,patternrecognition,contentdraftingandeditorialcorrectionspertainingtoresearchmaterial.

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September2026

BinWang

DeutscheBank.Research

|ChinaAutos&AutoTechnology

TheDeutscheBankResearchDepartmentisindependentofotherbusinesdivisiosoftheBank.Detailsregardingourorganizationaarangementsandinformationbarrierswehavetopreventndaoidconflictsofinterestwithrespecttoourresearchareavailableonourwebsite(

/Research/)underDisclaimer.

Macroeconomicfluctuationsoftenaccountformostoftherisksassociatedwithexposurestoinstrumentsthatpromisetopayfixedorvariableinterestrates.Foraninvestorwhoislongfixed-rateinstruments(thusreceivingthesecashflows),increasesininterestratesnaturallyliftthediscountfactorsappledtotheexpectedcashflowsandthuscausealoss.Thlongerthematurityofacertaincashflowandthehigherthemoveinthediscountfactor,thehigherwillbetheloss.Upsidesurprisesininflation,fiscalfundingneeds,andFXdepreciationratesareamongthmostcommonadversemacroeconomicshockstoreceivers.Butcounterparyexpoure,issuercreditworthiness,clientsegmentation,regulation(includingchangesinassetsholdinglimitsfordifferenttypesofinvestors),changesintaxpolicies,currencyconvertibility(whichmayconstraincurrencyconversion,repatriationofprofitsand/orliquidationofpositions),andsettlementissuesrelatedtolocalclearinghousesarealsoimportantriskfactors.Thesensitivityoffixed-incomeinstrumentstomacroeconomicshocksmaybemitigatedbyindexingthecontractedcashflowstoinflation,toFXdepreciation,ortospecifiedinterestrates-thesearecommoninemergingmarkets.Theindexf