Hong Kong Stock Market Update: Automotive stocks rebounded in early trading. The February car sales volume may hit an absolute low for the year, with the potential for a boost in car consumption through trade-ins.

In the early trading session, automotive stocks rebounded. As of the time of writing, XPENG-W rose by 5.72% to HKD 38.8, BYD COMPANY increased by 4.41%, GWMOTOR rose by 4.04% to HKD 9.27, and NIO-SW went up by 3.93% to HKD 9.27. On the news front, according to data recently released by the China Passenger Car Association's WeChat official account, retail sales of passenger cars in February totaled 1.095 million units, a year-on-year decrease of 21.0% and a month-on-month decrease of 46.2%. The cumulative retail sales for the year reached 3.133 million units, a year-on-year increase of 17.0%. The China Passenger Car Association previously predicted that February's car market sales volume would hit an absolute low for the year. CITIC Securities pointed out that encouraging and promoting the replacement of old vehicles with new ones and boosting car consumption has gradually become the policy focus of the industry, which is generally conducive to stimulating the release of demand for scrapping and replacing cars. Southwest Securities stated that in the short term, with the Beijing Auto Show approaching, industry sales will recover under the stimulation of increased new car supply and price reductions. Looking at the medium to long term, with the stimulus of cost reduction for electric vehicles, consumption promotion, and the combination of policies such as trading in old vehicles for new ones, on the one hand, the sales volume of the car market is worth looking forward to, and on the other hand, the industry's competitive landscape may undergo reshaping this year.