Automobile stocks saw their declines widen. At the time of writing, GAC GROUP (02238) fell 3.69% to HK$3.65; GWMOTOR (02333) dropped 2.66% to HK$13.19; and LI AUTO-W (02015) declined 2.58% to HK$65.95. A recent research report from HSBC indicated that the sharp increase in prices of upstream raw materials like metals and memory chips is expected to impose significant cost pressures on automakers in the short term. Due to the higher density of raw material usage in electric vehicles, producers in this segment are likely to face even greater headwinds. Notably, lithium prices have surged approximately 127% over the past three months. It is estimated that rising metal material costs could add between 3,000 and 5,000 yuan to the cost per vehicle, while memory chip price increases might contribute an additional 1,000 to 3,000 yuan in costs, directly impacting the cost structure of electric vehicles. The bank pointed out that this round of price increases is primarily driven by supply bottlenecks. It believes that, against the backdrop of a consumption downgrade trend and the traditional slow first quarter, automakers will find it difficult to pass these costs on to price-sensitive consumers. Consequently, companies will need to absorb the additional costs through vertical integration and technological upgrades, and may also have to rely on operational measures, including negotiating steeper annual price reductions with suppliers.
Comments