Chinese automakers' overseas sales improved month over month in May, with standout performance in Brazil and Thailand

Overview

This report tracks changes in overseas sales and market share of Chinese automakers in May. Morgan Stanley notes that major OEMs generally achieved month-over-month growth in key overseas markets, with Brazil and Thailand showing the strongest performance, while Australia was relatively stable overall. European sales remained strong and may continue to advance before EU tariff risks intensify again.

Core views

The core view is that Chinese automakers still have momentum in overseas expansion: BYD, Geely, and GWM gained share in Brazil, BYD's share in major European markets edged up, and XPeng recorded notable growth in Thailand. However, market divergence is evident: GWM's share declined in Australia, Geely's share in Mexico remained stable, and the overall industry rating remains In-Line rather than being explicitly upgraded.

Analysis framework

The report uses a comparative framework of monthly sales, month-over-month growth, year-over-year growth, and market share changes, assessing overseas sales momentum by company and region, while also providing individual stock context through Morgan Stanley's coverage rating table.

Methodology notes

• Monthly sales trackingOverseas market sales and share comparison

  Compare overseas sales, month-over-month growth, year-over-year growth, and market share changes of Chinese automakers by region

  The report focuses on Brazil, Australia, Mexico, Thailand, and Europe, using sales growth and share changes to assess the quality of overseas expansion.

• Equity rating frameworkMorgan Stanley relative rating system

  Overweight, Equal-weight, Underweight, and In-Line are used to express relative performance expectations

  Morgan Stanley states that its stock ratings typically measure performance relative to the average return of the covered industry over the next 12-18 months, while an In-Line industry view indicates expected industry performance broadly in line with the relevant benchmark.

Asset mapping & comparison

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

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

  One of the core beneficiaries of improving overseas sales and market share

  Strengths

  Brazil sales rose 19% month over month to 21.5k units, Australia sales rose 6% month over month to 8.7k units, Europe sales more than doubled year over year, and UK sales rose 70%+ year over year.

  Weaknesses

  Brazil and Australia remain the main overseas markets, and the report did not disclose absolute sales scale for more regions.

  Comparison

  Compared with other automakers, BYD has a larger scale in Brazil and Australia, while its share in Europe edged up slightly.

  Risks

  EU tariff risks are re-emerging, and overseas market policy and competition may affect subsequent growth.

• Geely Automobile Holdings (0175.HK)

  A beneficiary with strong momentum in overseas expansion

  Strengths

  Brazil, Australia, and Mexico all posted month-over-month growth, while European sales rose 130%+ year over year.

  Weaknesses

  Although Mexico sales rose 5% month over month, market share remained at 3.6%.

  Comparison

  Geely's market share in Australia increased by 0.6ppt, a stronger improvement than BYD's stable performance in Australia.

  Risks

  Share gains in some markets are limited, and growth in Europe also faces tariff and policy uncertainty.

• Great Wall Motor Company Limited (2333.HK/601633.SS)

  An overseas sales name with divergent regional performance

  Strengths

  Brazil sales rose 46% month over month to 7.2k units, with market share up 0.7ppt to 3.3%.

  Weaknesses

  Australia sales fell 1% month over month, and market share declined 0.4ppt to 6.1%.

  Comparison

  GWM's month-over-month growth in Brazil exceeded that of BYD and Geely, but its performance in Australia lagged peers.

  Risks

  The decline in Australia share shows uneven overseas market performance; in the coverage table, 601633.SS is rated U and 2333.HK is rated E.

• XPeng Inc. (9868.HK/XPEV.N)

  A name to watch for overseas growth in Southeast Asia and Europe

  Strengths

  Thailand sales rose 83% month over month, with market share above 1%.

  Weaknesses

  The report did not disclose absolute sales scale in XPeng's main overseas markets, and Thailand share remains at a relatively low level.

  Comparison

  Compared with BYD, Geely, and GWM, XPeng's overseas focus is more concentrated in Europe and Southeast Asia.

  Risks

  Overseas sales may be affected by a low base, market penetration, and regional competition.

Key data

• BYD Brazil sales21.5k units, +19% month over month, 10% market share, up 0.3pptBrazil and Australia remained BYD's largest overseas markets in May.
• BYD Australia sales8.7k units, +6% month over month, about 11% market share, broadly stableAustralia market share remained stable.
• BYD Europe salesMore than 100% year-over-year growth; UK sales +70%+ year over yearThe report says BYD's share in major European markets rose slightly.
• Geely Brazil sales5.2k units, +29% month over month, 2.4% market share, up 0.3pptBrazil share continued to improve.
• Geely Australia sales3.7k units, +22% month over month, 4.8% market share, up 0.6pptMarket share improvement in Australia was notable.
• Geely Mexico sales4.6k units, +5% month over month, 3.6% market share, stableSales grew but share did not improve.
• Geely Europe sales130%+ year-over-year growthEurope was one of Geely's overseas growth highlights.
• GWM Brazil sales7.2k units, +46% month over month, 3.3% market share, up 0.7pptStrong performance in Brazil.
• GWM Australia sales4.7k units, -1% month over month, 6.1% market share, down 0.4pptAustralia performance was weaker than Brazil.
• XPeng Thailand sales+83% month over month, market share above 1%Europe and Southeast Asia remain XPeng's main overseas markets.
• Industry viewIn-LineThe report discloses an In-Line view on the China Autos & Shared Mobility industry.

Impact & implications

Improved overseas sales support the globalization narrative for Chinese automakers, especially the growth of BYD, Geely, and GWM in Brazil and XPeng in Thailand. From an investment perspective, companies with the ability to expand across multiple regions and gain share deserve more attention, but the industry view remains In-Line, indicating that the report does not equate monthly data directly with an overall industry inflection point.

Risks

• EU tariff risks are re-emerging, which may affect Chinese automakers' sales expansion in Europe.
• Performance across overseas markets is diverging, and GWM's sales and share in Australia have already declined.
• Some companies posted sales growth in certain markets without gaining share, for example Geely's share in Mexico remained stable.
• Morgan Stanley disclosed investment banking, service, shareholding, or market-making relationships with multiple covered companies, so the research conclusions should be used cautiously in light of conflict disclosures.
• Stock ratings may change, and the report advises referring to the latest research on each company.

What to watch

• Subsequent monthly sales and market share changes in Brazil, Thailand, and Australia.
• Whether BYD's year-over-year growth in major European markets and the UK can be sustained.
• The impact of changes in EU tariff policy on Chinese automakers' exports to Europe and market share.
• The sustainability of Geely's 130%+ year-over-year growth in Europe and its market share gains in Australia.
• Whether GWM's market share decline in Australia widens, and whether high growth in Brazil is sustainable.
• Whether XPeng's market share in Thailand can continue to rise from above 1%.