China Autos & Shared Mobility: The summer product cycle reboot is gradually materializing, but differentiation is evident

Overview

This report is Morgan Stanley's weekly observation on the Asia Pacific China autos and shared mobility sector, centered on channel-feedback order trends from July 13 to 19, 2026. The report points out that the summer product cycle reboot highlighted last week is gradually being realized, but the improvement is not broad-based and synchronized across the industry; rather, it is concentrated in brands with new model launches and strong order-capture capability. The overall judgment is neutral: short-term elasticity driven by new vehicles is strong, while the rest of the industry is showing more of a steady recovery.

Core views

There are three core views: first, XPeng and Li Auto delivered the most notable week-over-week performance due to new model launches; second, BYD's stabilization and Leapmotor's continued growth provide relatively more durable signals of improvement; third, HIMA's week-over-week decline shows that the competitive landscape remains under pressure. The report believes that names driven by launch cycles are more attractive for trading in the short term ahead of earnings disclosures, but because competition remains fierce, it is still necessary to observe whether high order growth can translate into sustainable demand.

Analysis framework

The report mainly uses a weekly order-tracking method based on channel feedback, conducting horizontal comparisons across major Chinese new energy vehicle brands and related auto companies, with a focus on week-over-week, month-over-month, and year-over-year changes, while combining new model launches, brand order mix, and industry competitive conditions to assess short-term momentum and sustainability.

Methodology notes

• Industry TrackingWeekly Order Trend Tracking

  Observe each brand's order range and week-over-week, month-over-month, and year-over-year changes through channel feedback.

  This method is suitable for capturing short-term demand elasticity and brand differentiation after new model launches, but the order data still need to be validated by subsequent deliveries, pricing strategies, and the competitive landscape.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• BYD Company Limited (1211.HK/002594.SZ)

  Core industry automaker and order-tracking target

  Strengths

  It has the largest order volume, week-over-week recovery, and the report views its stabilization as a relatively durable signal.

  Weaknesses

  Month-over-month remains negative, indicating that short-term demand recovery is not accelerating in a one-sided manner.

  Comparison

  Compared with new vehicle-driven XPeng and Li Auto, BYD's growth is milder but more stable.

  Risks

  Intensifying competition, pricing pressure, and insufficient sustainability of order growth.

• Li Auto Inc. (2015.HK/LI.O)

  Beneficiary of new model launches

  Strengths

  Orders rose sharply week over week, month over month, and year over year, with the new L series contributing more than 75% of orders.

  Weaknesses

  Orders are highly dependent on the capture effect following new model launches.

  Comparison

  Like XPeng, it is among the brands with the strongest short-term elasticity from the launch cycle.

  Risks

  Cooling new-model momentum, weaker-than-expected order conversion, and peer competition.

• XPeng Inc. (9868.HK/XPEV.N)

  Beneficiary of new model launches

  Strengths

  Driven by the MONA L03 launch, orders were up 585% week over week, 497% month over month, and 287% year over year.

  Weaknesses

  The growth base and launch cadence of new models may amplify short-term volatility.

  Comparison

  Its order elasticity was the most prominent among major brands this week.

  Risks

  Sustainability of high growth, delivery execution, and competitive responses.

• NIO Inc. (9866.HK/NIO.N)

  Order rebound tracking target

  Strengths

  Order inflows for both the NIO and Onvo brands rebounded, with strong year-over-year growth.

  Weaknesses

  Month over month is still down 21%, indicating that the recovery foundation remains unstable.

  Comparison

  Its performance is weaker than the new-model launch elasticity of XPeng and Li Auto, but better than HIMA's week-over-week decline.

  Risks

  Sustainability of brand order recovery, product competition, and profitability pressure.

• Leapmotor

  A steadily improving new energy vehicle brand

  Strengths

  Orders were up 15% week over week and 58% year over year, and the report says it continues steady growth.

  Weaknesses

  Month over month dipped slightly by 2%, so there is still short-term volatility.

  Comparison

  Together with BYD, it is viewed as a more durable improvement signal rather than purely launch-driven.

  Risks

  Escalating competition and slowing order momentum.

• HIMA

  Order-tracking target among major brand groups

  Strengths

  The Aito sub-brand still grew 7% week over week.

  Weaknesses

  Overall HIMA orders were down 2% week over week and 33% month over month, making it the only major group to decline week over week.

  Comparison

  Relatively weaker than XPeng, Li Auto, BYD, and Leapmotor.

  Risks

  Weakening demand, internal brand divergence, and competitive pressure.

Key data

• BYD Orders76.7-77.2kWeek over week +4%, month over month -9%, year over year +7%; the report views its stabilization as a relatively durable positive signal.
• Geely Galaxy Orders19.8-20.3kWeek over week +16%, month over month +10%, year over year -6%.
• Li Auto Orders17.9-18.1kWeek over week +225%, month over month +196%, year over year +118%; the new L series contributed more than 75% of orders.
• NIO Orders11.8-12.0kWeek over week +27%, month over month -21%, year over year +127%; order inflows for both the NIO and Onvo brands rebounded.
• XPeng Orders41.8-42.0kWeek over week +585%, month over month +497%, year over year +287%; mainly driven by the July 16 launch of the MONA L03.
• Tesla China Orders1.0-11.2kWeek over week +22%, month over month +7%, year over year -15%; this name is covered by Andrew Percoco.
• HIMA Orders9.4-9.6kWeek over week -2%, month over month -33%; it was the only major group to decline week over week.
• Leapmotor Orders16.1-16.6kWeek over week +15%, month over month -2%, year over year +58%; continuing steady growth.

Impact & implications

For investment, the report implies that short-term focus should be on brands significantly boosted by new model launches and whose order elasticity can be verified, but in the medium term it is still necessary to watch out for price competition, order conversion rates, and fading new-model momentum. At the industry level, the In-Line view means Morgan Stanley has not yet interpreted this round of order recovery as the start of a broad industry upcycle, but instead places greater emphasis on structural differentiation.

Risks

• The high order growth driven by new model launches may be unsustainable.
• Competition in China's auto industry remains intense, which may pressure pricing, margins, and order conversion.
• There are still differences between weekly channel orders and final deliveries, revenue recognition, and profitability performance.
• Some brands are still negative month over month, indicating uneven demand recovery.
• The research report discloses that Morgan Stanley has business relationships with some covered companies, and investors should pay attention to potential conflicts of interest.

What to watch

• The sustainability of orders and delivery conversion after the XPeng MONA L03 launch.
• Whether Li Auto's new L series order share can remain at a high level.
• Whether BYD's order stabilization continues and translates into stronger delivery performance.
• Whether Leapmotor's steady growth is sustainable.
• Whether overall HIMA orders recover from the sharp month-over-month decline.
• Changes in industry price competition and promotional intensity.