New models lift order conversion, but quarter-end promotions may have pulled forward July demand

Overview

This report is Morgan Stanley's weekly EV order update from the China auto and ride-hailing team, focusing on weekly order performance of Chinese EV brands during June 15-21, 2026. The main conclusion is that orders further diverged: new model launches or facelifts drove clear conversion, while brands lacking product catalysts saw weaker orders; meanwhile, heavier quarter-end promotions pulled demand forward into late June, which may create a short-term demand gap in July.

Core views

The market is not strengthening broadly; rather, it is being driven by product cycles and promotion intensity. BYD saw a notable rebound in orders thanks to Great Tang booking conversion, Leapmotor stood out on C-series facelifts, and Aito was supported by a lower-priced M6 variant. By contrast, Li Auto was pressured by weaker L-series sales and waiting ahead of a new model launch, NIO eased after the Onvo L60 launch peak, and XPeng improved slightly on a WoW basis but is still awaiting the Mona LO3 catalyst.

Analysis framework

The report mainly tracks weekly orders using channel feedback and measures each brand's marginal momentum through WoW, MoM and YoY changes. The analytical framework also focuses on the impact of new model launches, facelifts, price promotions, booking conversion and quarter-end order pulling on order pace.

Methodology notes

• high-frequency order trackingweekly channel feedback order monitoring

  Uses channel order feedback from June 15 to 21 as a short-term demand proxy.

  This method is suitable for capturing the immediate impact of new launches, promotions and quarter-end volume push on orders, but orders are not the same as final deliveries and may be affected by demand pull-forward.

• product cycle analysisnew model and facelift catalysts

  New launches, presale conversion and model facelifts can improve short-term order conversion rates.

  BYD's Great Tang booking conversion, Leapmotor's C-series facelift and Aito's lower-priced M6 variant were all viewed by the report as important drivers of order improvement.

• demand pacing analysisquarter-end promotions and demand pull-forward

  More aggressive quarter-end promotions may bring future demand forward into the current period.

  The report believes late-June orders were amplified by promotions, and July may see a temporary demand gap, so true demand improvement should be distinguished from promotion-driven pull-forward.

Asset mapping & comparison

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

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

  One of the key beneficiaries; orders were boosted by new model booking conversion.

  Strengths

  Weekly orders of 104.5-105k, with significant growth WoW, MoM and YoY; Great Tang booking conversion provided momentum.

  Weaknesses

  Some demand may have been pulled forward by quarter-end promotions and concentrated booking conversion, so sustainability still needs to be verified.

  Comparison

  Compared with most brands, BYD has the largest order scale and the broadest growth.

  Risks

  A July demand gap, margin pressure from more promotions, and weaker-than-expected order-to-delivery conversion.

• Li Auto Inc. (2015.HK/LI.O)

  Covered name; orders were affected by the product transition period.

  Strengths

  Weekly orders rose 16% WoW, and there is still a catalyst from the new L8 launch.

  Weaknesses

  MoM orders fell 44% and YoY orders fell 28%; L-series sales were under pressure ahead of the new launch.

  Comparison

  Near-term momentum is weaker than BYD and Leapmotor.

  Risks

  Weaker-than-expected conversion of new models, continued pressure on legacy model demand, and competitive promotion pressure.

• NIO Inc. (9866.HK/NIO.N)

  Covered name; order performance is influenced by subsidiary-brand launch timing.

  Strengths

  YoY growth of 190%, and June deliveries for ES9 could exceed 7k.

  Weaknesses

  Weekly orders fell 10% WoW, and Onvo sales eased after the L60 launch peak.

  Comparison

  Strong YoY performance, but weaker near-term WoW momentum than most peers.

  Risks

  Order pullback after the launch peak, uncertainty in delivery pace, and intensifying market competition.

• XPeng Inc. (9868.HK/XPEV.N)

  Covered name; the next catalyst comes from Mona LO3.

  Strengths

  Weekly orders increased 6% WoW, and the market is watching the Mona LO3 debut on July 2.

  Weaknesses

  MoM orders fell 58% and YoY orders fell 18%; current order momentum remains weak.

  Comparison

  Short-term performance is weaker than BYD, Leapmotor, Aito and ZEEKR.

  Risks

  Weaker-than-expected conversion from new launches, promotion pressure, and an industry demand pullback in July.

• Leapmotor

  A high-beta representative of new model and facelift catalysts.

  Strengths

  Weekly orders of 19.3-19.5k, up 43% WoW and 93% YoY, with a clear lift from C-series facelifts.

  Weaknesses

  The report does not provide rating or price table information, and the sustainability of order strength still needs to be monitored.

  Comparison

  Order growth is significantly stronger than most peers, with scale second only to BYD.

  Risks

  Fading facelift catalysts, promotional competition, and uncertainty in order-to-delivery conversion.

• Tesla China

  An industry comparison sample; the report notes coverage by Andrew Percoco.

  Strengths

  Weekly orders of 10.5-10.7k, up 5% WoW and roughly flat MoM.

  Weaknesses

  YoY orders fell 13%, and there is no obvious growth elasticity.

  Comparison

  Performance is relatively stable but not as strong as BYD and Leapmotor, which have new model catalysts.

  Risks

  Intensifying competition in China, pricing pressure, and slowing demand growth.

Key data

• BYD orders104.5-105k; +61% WoW, +94% MoM, +30% YoYSupported by Great Tang booking conversion.
• Geely Galaxy orders19-19.5k; +12% WoW, -6% MoM, -12% YoYImproved sequentially but still down YoY.
• Li Auto orders6.5-6.7k; +16% WoW, -44% MoM, -28% YoYL-series sales were pressured ahead of the 2026 L8 launch.
• NIO orders14.2-14.7k; -10% WoW, +11% MoM, +190% YoYOnvo eased after the L60 launch peak; June deliveries for ES9 could exceed 7k.
• XPeng orders7.2-7.4k; +6% WoW, -58% MoM, -18% YoYThe market is watching the Mona LO3 debut on July 2.
• Leapmotor orders19.3-19.5k; +43% WoW, +40% MoM, +93% YoYBoosted by C-series facelifts.
• Tesla China orders10.5-10.7k; +5% WoW, roughly flat MoM, -13% YoYThe report notes coverage by Andrew Percoco.
• Aito orders9.1-9.3k; +12% WoW, +63% MoM, +40% YoYDriven by the lower-priced M6 variant with a starting price of Rmb229.8k.
• ZEEKR orders6.4-6.6k; +28% WoW, -22% MoM, +78% YoYStrong WoW and YoY growth, but still down MoM.
• Xiaomi orders7-7.2k; +8% WoW, -13% MoM, +75% YoYThe report notes coverage by Andy Meng.

Impact & implications

For investors, the short-term order data supports focusing on brands with clear new model catalysts, booking conversion and pricing competitiveness, but it also suggests that the strong orders in late June may partly reflect quarter-end promotion pull-forward. If there is no sustained new model catalyst in July, industry orders may soften, and investors should watch both the quality of order-to-delivery conversion and the impact of promotions on margins.

Risks

• Quarter-end promotions may pull demand forward, leading to an order gap in July.
• Order data comes from channel feedback and may differ from final deliveries and revenue recognition.
• Price promotions can boost orders, but they may also compress automaker margins.
• Brands without new model or facelift catalysts may continue to see weak orders.
• Intensifying industry competition may lead to further price wars.
• Morgan Stanley discloses potential conflicts of interest with multiple covered companies through investment banking relationships, holdings or market making, and investors should make independent judgments.

What to watch

• Whether July orders indeed show a demand gap as the report suggests.
• Whether BYD's Great Tang booking conversion can continue through delivery.
• The sustainability of Leapmotor orders after the C-series facelift.
• Recovery in the L-series after the launch of the 2026 L8 by Li Auto.
• Whether NIO's ES9 June deliveries exceed 7k and whether Onvo orders stabilize.
• Order conversion after XPeng's Mona LO3 launch on July 2.
• Changes in promotion intensity and their impact on gross margin.