The global new energy industry is transitioning from volatile growth patterns toward stable expansion, entering a new phase of high-quality development following cyclical adjustments. This shift is driven by accelerated energy transition and technological advancements worldwide.
Market performance has shown sustained improvement since the second quarter of 2025, supported by growing energy storage orders and accelerated industrialization of solid-state batteries. Institutional investors have been increasing positions in core assets, with new energy sectors in A-shares and Hong Kong stocks demonstrating independent market trends.
Industrial Bank Global Funds has leveraged its comprehensive investment research coverage across the entire industrial chain and team-based management approach to deliver outstanding performance through its new energy thematic products. These have become important tools for investors seeking to capture long-term industry benefits.
The new energy vehicle sector has completed a full cycle of "rapid expansion - valuation correction - structural recovery" over the past five years. The 2019-2021 period saw supply shortages driving substantial profit growth and elevated valuations, followed by necessary adjustments during 2022-2024 that brought expectations back to reasonable levels.
Current recovery trends stem from improved fundamentals, policy support, and technological breakthroughs. Global new energy vehicle penetration rates continue to show growth potential, with China's new energy vehicle sales exceeding 16 million units in 2025, representing over 50% of domestic new car sales. Globally, electric vehicle sales reached 20.7 million units in 2025, providing expansion opportunities for Chinese companies abroad.
China accounted for 68.4% of global new energy passenger vehicle sales during January-November 2025, reaching 73.7% in November alone. Chinese manufacturers contributed 68% of global new energy growth during this period, demonstrating strengthening global competitiveness.
The industry has transitioned from subsidy-driven to market-and-policy dual-driven growth. Under China's dual-carbon goals, policies supporting renewable energy integration and energy storage infrastructure continue to improve, while consumption stimulus measures like trade-in programs provide additional support.
Technological breakthroughs are accelerating across multiple fields. Intelligent driving features have seen widespread adoption, with end-to-end models and vehicle-road-cloud integration technologies advancing rapidly. Solid-state batteries are moving toward industrialization, while fast-charging technologies capable of adding 400 km range in 15 minutes are addressing consumer range anxiety.
As the industry enters this new development phase, investment logic requires restructuring. Valuation system changes and accurate risk identification have become crucial for investment decisions. Industrial Bank Global Funds has established competitive advantages through professional research teams and scientific management mechanisms.
The company's new energy battery ETF achieved a 63.92% return over the past year, while its new energy vehicle fund returned 56.88% as of December 31, 2025. The investment team consists of experienced professionals covering upstream materials, midstream manufacturing, downstream vehicles, and automotive electronics.
Dynamic allocation strategies and strict volatility control have been key to sustaining excess returns. The team adjusted sector allocations based on cycle judgments, underweighting pressured upstream materials in 2023-2024 while overweighting competitive segments like batteries and vehicles. Since 2025, they have increased exposure to smart driving and solid-state battery sectors showing early recovery signs.
The new energy industry has entered its second half, shifting from broad growth to structural differentiation. Investment logic has transformed in three key aspects: transition from policy-driven to market-driven growth, focus on high-barrier segments and emerging directions, and expansion from domestic competition to global布局.
With intelligentization, solid-state battery commercialization, and globalization deepening, the industry may enter a 5-10 year high-growth cycle. For individual investors, thematic funds offer efficient exposure to this complex, rapidly evolving sector. Investors can choose active funds for structural opportunities or ETFs for broad industry exposure based on their investment horizons and risk preferences.
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