New launches and facelifts drove improvement in EV blended retail prices in May

Overview

This is a research report on the China autos and shared mobility industry, focusing on tracking EV retail prices, discounts, and the impact of new models on brand blended ASPs in May. The report's conclusion points to marginal improvement: prices for most models were stable, and facelifts and new models helped support blended prices, but the overall industry view remains In-Line.

Core views

The core views include: first, retail prices for most models were stable in May, with larger discounts mainly appearing in models nearing facelifts; second, new launches and facelifts are improving blended retail prices for some brands; third, price improvement is driven more by product mix upgrades and contributions from new models rather than broad-based price increases; fourth, whether prices can remain stable in the coming months will depend on discount discipline, the pace of new model launches, and the degree to which low-priced models dilute average prices.

Analysis framework

The report uses a brand- and model-level retail price tracking approach, comparing month-over-month changes in blended retail prices across brands in May, and combining end-market discounts, facelift timing, new model launches, and product mix changes to assess price trends.

Methodology notes

• Industry price trackingMonth-over-month analysis of model retail prices and blended ASPs

  By tracking retail prices, discounts, and model mix changes for each model, the report assesses the month-over-month direction of overall brand blended retail prices.

  The report breaks down price changes for brands such as BYD, Li Auto, XPeng, NIO, and Geely Galaxy into specific model-level and new-model contributions, emphasizing the impact of facelifts, new model replacement, and low-priced launches on average prices.

• Event-driven analysisAssessment of the impact of new launches and facelifts

  Assess the impact of upcoming or newly launched models on brand average prices and discount discipline.

  The report focuses on models such as Great Tang, Great Han, the L8 facelift, MONA L03, ES9, and Geely Galaxy BEV models to judge their effect in lifting or diluting subsequent blended prices.

Asset mapping & comparison

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

• BYD Company Limited

  The report tracks its month-over-month change in blended retail prices in May.

  Strengths

  Price improvement in Han EV and Seagull, while Great Tang and Great Han are expected to lift subsequent blended prices.

  Weaknesses

  Dynasty-series models such as Tang and Han L saw declines of about Rmb5k month over month.

  Comparison

  Its May performance was weaker than Li Auto, XPeng, NIO, and Geely Galaxy.

  Risks

  Wider pre-facelift discounts or weaker-than-expected uplift from new models could continue to pressure blended prices.

• Li Auto Inc.

  The report tracks its blended retail prices in May and discount stability.

  Strengths

  Retail discounts were unchanged, L9 Ultra and Livis pushed the L9 price back above Rmb400k, and the L8 facelift could further improve average prices.

  Weaknesses

  Average price improvement depends on higher-priced variants and facelift timing.

  Comparison

  The +3% month-over-month improvement in May was stronger than BYD, NIO, and Geely Galaxy, but lower than XPeng.

  Risks

  If demand for higher-priced models is insufficient or the facelift contributes less than expected, blended price improvement could slow.

• XPeng Inc.

  The report identifies it as one of the brands with the most obvious improvement in blended retail prices in May.

  Strengths

  GX drove a 6.6% month-over-month increase in blended retail prices, while pricing for other models remained stable.

  Weaknesses

  The upcoming MONA L03 could lower the brand's average price.

  Comparison

  Its month-over-month improvement in May exceeded that of the other major brands mentioned in the report.

  Risks

  The launch of low-priced models in 3Q could dilute blended prices and weaken the current signal of price improvement.

• NIO Inc.

  The report tracks its post-facelift price stability and subsequent ES9 contribution.

  Strengths

  The 5566 facelift had already lifted blended prices last month, and ES9 could bring a slight increase next month.

  Weaknesses

  Blended retail prices were flat month over month in May, with limited near-term improvement.

  Comparison

  Its May performance was weaker than Li Auto, XPeng, and Geely Galaxy, but better than BYD.

  Risks

  If ES9 contributes less than expected or discounts widen, the expected price increase may fail to materialize.

• Geely Galaxy

  The report tracks the replacement of its older models and price changes in Starship 7.

  Strengths

  The gradual replacement of older models drove a modest 0.8% month-over-month increase in blended retail prices.

  Weaknesses

  Starship 7 declined about Rmb5k month over month ahead of the BEV launch.

  Comparison

  Its improvement in May was lower than Li Auto and XPeng, but better than BYD and stronger than NIO's flat performance.

  Risks

  The launch timing of BEV models and discount pressure on Starship 7 may affect subsequent average prices.

Key data

• Report date2026-06-07 19:43 GMTTimestamp on the report cover page.
• Industry viewIn-LineMorgan Stanley's industry view on the China autos and shared mobility sector.
• Overall price assessmentRetail prices for most models were stable in MayLarger discounts mainly appeared in models nearing facelifts.
• BYD-1.1% month over monthRetail prices for Han EV and Seagull improved, but Dynasty-series models such as Tang and Han L declined by about Rmb5k; the upcoming Great Tang and Great Han may help lift blended prices.
• Li Auto+3% month over monthRetail discounts were unchanged in May, while L9 Ultra and Livis helped bring the L9 retail price back above Rmb400k; the L8 facelift is expected to further lift blended prices by 0.5-1%.
• XPeng+6.6% month over monthThe increase in blended retail prices was mainly driven by GX, while pricing for other models remained stable; the report expects the next MONA L03 to potentially dilute blended prices in 3Q.
• NIOFlat month over monthLast month's 5566 facelift had already lifted blended prices, and the report expects ES9 contributions to drive a slight price increase next month.
• Geely Galaxy+0.8% month over monthBlended retail prices edged up as older models were gradually replaced; Starship 7 fell about Rmb5k month over month ahead of the BEV launch.

Impact & implications

For investors, the May data suggest signs of marginal easing in China's EV price war, but the improvement mainly comes from new models, facelifts, and model mix rather than a full recovery in industry-wide pricing power. If automakers maintain discount discipline and improve product mix through higher-priced models, brand average prices and earnings expectations may find support; if low-priced new models scale up or weaker demand triggers larger discounts, the improvement in average prices could be undermined.

Risks

• Price improvement mainly comes from product mix and contributions from new models and should not be directly equated with a full recovery in industry-wide pricing power.
• If end-market demand weakens, automakers may expand discounts, undermining the current signal of price stability.
• Larger discounts on models nearing facelifts may cause phased declines in blended prices.
• Launches of low-priced new models may dilute brand average prices, especially the report's cited potential impact from XPeng MONA L03 in 3Q.
• The report discloses that Morgan Stanley has or seeks investment banking and other business relationships with multiple covered companies, so the research conclusions should be used cautiously in conjunction with the disclosures.

What to watch

• Whether BYD's Great Tang and Great Han lift the brand's blended prices after launch.
• Whether Li Auto's L8 facelift delivers the 0.5-1% blended price increase expected by the report.
• The extent to which XPeng MONA L03 dilutes the brand's average price after its 3Q launch.
• Whether NIO ES9's contribution drives a slight price increase next month.
• Whether the launch of Geely Galaxy Starship 7 BEV can ease pricing pressure on existing models.
• Whether industry end-market discounts remain disciplined.