SMM News: As of March 20, 2026, the market price for Praseodymium-Neodymium (Pr-Nd) metal in China stabilized temporarily at 890,000–910,000 RMB/ton. This article utilizes the SMM Pr-Nd Terminal Demand Calculation Model to dissect the demand logic for 2026 across three core sectors—New Energy Vehicles (NEVs), Internal Combustion Engine (ICE) vehicles, and Wind Power—explaining the current supply-demand dilemma facing the NdFeB magnet and broader Pr-Nd markets.

Recently, Chengdu Xinyan Hydrogen Energy Technology Co., Ltd. completed the batch delivery of 48 hydrogen-powered heavy-duty trucks in the 49-mt class, marking not only a major breakthrough in the market-oriented deployment of the enterprise’s hydrogen-powered commercial vehicles, but also demonstrating its strength in large-scale operations and further accelerating Chengdu’s hydrogen energy industry toward commercialization and clustering. The delivered vehicles were manufactured by Sinotruk Chengshang and equipped with the large-power hydrogen fuel cell system independently developed by Chengdu Xinyan. With high reliability and strong load-bearing capacity, they are well suited to trunk logistics and bulk transportation scenarios. Combined with local hydrogen refueling network support and Sichuan’s expressway toll reduction and exemption policies, they can provide clients with a green, efficient, and low-cost transportation solution. As a core period of the “Chengdu-Chongqing Hydrogen Corridor,” Chengdu is accelerating the development of an ecological system spanning the entire industry chain of “production, storage, transportation, refueling, and application.” Multiple provincial- and municipal-level policies are supporting the promotion of hydrogen-powered vehicles. The operation of these heavy-duty trucks will further drive coordinated development across the upstream and downstream industry chain and foster a virtuous industrial cycle. As hydrogen energy has become a hot topic at this year’s national Two Sessions, with the industry focusing on the large-scale application of fuel cell vehicles, Chengdu Xinyan’s delivery responds to the national strategy with concrete action, supports Chengdu in building a highland for the hydrogen energy industry in western China, and injects new momentum into the region’s green transformation.

In mid-March 2026, CAAM and the China Automotive Power Battery Industry Innovation Alliance successively released relevant data on the auto and power battery markets for February 2026. According to CAAM’s analysis, auto production and sales declined YoY under the combined impact of multiple factors, including policy transition adjustments, front-load demand release, the timing shift of the Chinese New Year holiday, insufficient willingness to consume, and a high base in the same period last year. Among them, the passenger vehicle market and NEV market both declined YoY, while the commercial vehicle market continued to improve, and auto exports grew rapidly. .......SMM compiled the relevant data on the auto market and power battery market for February 2026 for readers’ reference. Automobiles CAAM: February Auto Output and Sales Reached 1.672 Million and 1.805 Million Units, Respectively In February, auto output and sales totaled 1.672 million and 1.805 million units, down 31.7% and 23.1% MoM, and down 20.5% and 15.2% YoY, respectively. From January to February, auto output and sales totaled 4.122 million and 4.152 million units, down 9.5% and 8.8% YoY, respectively. CAAM: February NEV Sales Reached 765,000 Units; January-February NEV Output and Sales Reached 1.71 Million Units In February, NEV output and sales totaled 694,000 and 765,000 units, down 21.8% and 14.2% YoY, respectively. NEV sales accounted for 42.4% of total new vehicle sales. From January to February, NEV output and sales totaled 1.735 million and 1.71 million units, down 8.8% and 6.9% YoY, respectively. NEV sales accounted for 41.2% of total new vehicle sales. CAAM: Auto Exports Continued to Grow in February; NEV Exports up 1.1x YoY In February, NEV exports were 282,000 units, down 6.6% MoM, up 1.1x YoY ; traditional fuel vehicle exports were 391,000 units, up 2.8% MoM and up 26.2% YoY . From January to February, NEV exports were 583,000 units, up 1.1x YoY; traditional fuel vehicle exports were 769,000 units, up 22.2% YoY . Regarding the auto market in February, CAAM said that this year’s Chinese New Year fell in mid-to-late February, and the holiday was extended. As a result, there were only 16 effective working days in February, which had a certain impact on enterprise production and operations, and overall market activity declined. Judging from industry performance from January to February, auto production and sales declined YoY under the combined impact of multiple factors, including policy transition adjustments, front-load demand release, the timing shift of the Chinese New Year holiday, insufficient willingness to consume, and a high base in the same period last year. Among them, the passenger vehicle market and NEVs declined YoY, while the commercial vehicle market continued to improve and auto exports grew rapidly. This year’s government work report explicitly proposed to stimulate the endogenous momentum of household consumption and advance consumption-promoting policies in parallel, continue to amplify the effect of the policy package, further rectify “involution-style” competition, and foster a sound market ecosystem. It is believed that, as detailed local subsidy measures are fully implemented after the holiday, spring auto show sales promotions begin, and automakers roll out new models one after another, this will help boost consumer confidence, energize the auto market, and promote the healthy and stable operation of the industry. Subsequently, the CPCA also released data on the passenger vehicle market for February 2026. From February 1 to 28, retail sales in China’s passenger vehicle market reached 1.034 million units, down 25.4% YoY and down 33.1% MoM. Cumulative retail sales since the beginning of the year totaled 2.578 million units, down 18.9% YoY. As market factors have become more complex, the pattern of “low at the beginning and high at the end” in annual sales has become more evident in recent years. Affected by disruptions such as Chinese New Year, February retail sales have seen wild YoY swings over the years, for example: 2019 (-19%), 2020 (-79%), 2021 (373%), 2022 (5%), 2023 (10%), 2024 (-21%), and 2025 (26%). Therefore, the -25.4% in 2026 was at the lower-middle end of the range of sharp fluctuations in February growth rates over the years. NEVs, retail sales in the passenger NEV market were 464,000 units in February, down 32.0% YoY; from January to February, retail sales in the passenger NEV market were 1.06 million units, down 25.7% YoY. Retail sales of conventional fuel passenger vehicles were 570,000 units in February, down 19% YoY. In February, passenger NEV producer exports were 269,000 units, up 124.7% YoY and down 7.0% MoM; from January to February, passenger NEV producer exports were 559,000 units, up 114.7% YoY, while exports of conventional fuel passenger vehicles were 290,000 units in February, up 21% YoY. NEV exports, as the scale advantages of China’s new energy vehicles become more apparent and market expansion demand grows, more and more China-made new energy brand products are going outside China, and their recognition outside China continues to improve. Among them, PHEVs accounted for 38% of NEV exports (38% in the same period last year). Although they have recently been affected by some disruptions from external countries, exports of independently developed PHEVs to developing countries have grown rapidly, with bright prospects. In February, passenger NEV exports were 269,000 units, up 124.7% YoY and down 7.0% MoM. They accounted for 48.5% of passenger vehicle exports, up 14.8 percentage points YoY; BEVs accounted for 58% of NEV exports (59% in the same period last year), and A00- and A0-class EVs, the core focus, accounted for 55% of BEV exports (56% in the same period last year). The CPCA stated that after the NEV purchase tax exemption policy, which had been implemented since September 2014, was formally phased out at the end of December 2025, the NEV market in 2026 entered a recovery period amid adjustments to tax subsidies. Some consumers brought forward purchases to 2025 to benefit from the policy, resulting in a certain pull-forward effect in January-February this year. This was an expected short-term fluctuation and does not represent the market’s long-term trend. However, with Chinese New Year falling later this year, making it a major consumption year, growth in the auto market diverged, and NEVs did not perform strongly, indicating that more policy support is still needed. Key features of the passenger vehicle market in February 2026: 1. In February, passenger vehicle producers’ daily average exports hit a record high for the month, fully demonstrating the steadily improving competitiveness of China’s automotive industry in the global market and continued robust demand outside China; 2. The retail pullback after the expiration of the vehicle purchase tax exemption was evident, but structural changes were also clear, namely a higher share of high-end NEVs and a lower share of entry-level consumption, which is conducive to the industry’s transition toward high-quality development; 3. New vehicle launches were steady in 2026, and together with the advance of anti-involution efforts curbing disorderly price cuts, NEV sales promotions stayed at 10.4% in February, remaining around 10% for six consecutive months. No vicious volume discount competition emerged, helping maintain market order; 4. The historical pattern of internal combustion engine vehicles outperforming NEVs before Chinese New Year continued again. In February, retail sales in China of internal combustion engine vehicles fell 19% YoY, while pure electric vehicle retail sales fell 35% YoY, range-extended vehicles fell 16% YoY, and PHEVs fell 31% YoY. As time goes by, consumers are expected to gradually adapt to the normalization of NEV taxation, and the NEV market is expected to return to a track of positive growth; 5. This February was still a pre-Chinese New Year consumption phase dominated by internal combustion engine vehicles. NEV penetration rate in retail sales in China was 44.9%, and export penetration rate was 48.5%, which was a relatively good performance; 6. In February 2026, exports of self-owned-brand internal combustion engine passenger vehicles reached 247,000, up 21% YoY, while exports of self-owned-brand NEVs reached 231,000, up 110% YoY. NEVs accounted for 48.4% of self-owned-brand exports. In particular, the high growth of NEV exports in Europe, Southeast Asia, and other regions marked the expanding influence of China’s NEV brands in the international market, laying a solid foundation for future export growth. Power Battery In February, China’s cumulative sales of power and ESS batteries reached 113.2 Gwh, up 25.7% YoY In February, China’s sales of power and ESS batteries reached 113.2 Gwh, down 23.9% MoM, up 25.7% YoY . Of this, power battery sales were 74.5 Gwh, accounting for 65.9% of total sales, down 27.4% MoM and up 11.4% YoY; ESS battery sales were 38.6 Gwh, accounting for 34.1% of total sales, down 16.2% MoM and up 67.3% YoY. From January to February, China’s cumulative sales of power and ESS batteries were 262 Gwh, up 53.8% YoY . Of this, cumulative power battery sales were 177.2 Gwh, accounting for 67.6% of total sales and up 36.5% YoY; cumulative ESS battery sales were 84.8 Gwh, accounting for 32.4% of total sales and up 108.9% YoY. From January to February, cumulative power battery installations were 68.3 Gwh, with LFP installations accounting for 77.9% In February, China’s power battery installations were 26.3 Gwh, down 37.4% MoM and down 24.6% YoY. Of this, ternary battery installations were 5.7 Gwh, accounting for 21.7% of total installations, down 39.1% MoM and down 11.4% YoY; LFP battery installations were 20.6 Gwh, accounting for 78.3% of total installations, down 36.9% MoM and down 27.5% YoY. From January to February, cumulative power battery installations in China were 68.3 Gwh, down 7.2% YoY. Of this, cumulative ternary battery installations were 15.1 Gwh, accounting for 22.1% of total installations and up 0.6% YoY; cumulative LFP battery installations were 53.3 Gwh, accounting for 77.9% of total installations and down 9.2% YoY. More Than 60% of A/H-Share Automakers Achieved YoY Growth, March Auto Market Production and Sales Will See Rapid MoM Growth Earlier, CLS compiled the January-February sales performance of 14 A/H-share listed automakers, of which 9 achieved YoY growth, accounting for more than 60%, and 3 automakers recorded February sales outside China exceeding those in the Chinese market. Among emerging EV makers, Leap Motor still firmly held the top spot in deliveries, with 28,067 units delivered in February, up 10.99% YoY; cumulative deliveries in 2026 reached 60,126 units, up 19.16% YoY. While releasing its February delivery figures, Leap Motor said its March car purchase incentives had gone live, with discounts of up to 46,000 yuan for in-stock vehicles. Li Auto delivered 26,421 units in February, up 0.6% YoY. Cumulative deliveries in 2026 reached 54,089 units, down 3.74% YoY. As of February 28, 2026, Li Auto’s historical cumulative deliveries totaled 1.594 million units. Li Auto said that as of February 28, 2026, it had 539 retail centers nationwide, covering 160 cities; 548 after-sales repair centers and authorized service centers, covering 223 cities. Li Auto had put into use 4,054 Li Auto supercharging stations nationwide, with 22,447 charging piles. NIO delivered 20,797 new vehicles in February, up 57.65% YoY. Cumulative deliveries in the first two months of 2026 reached 47,979 units, up 77.34% YoY. To date, NIO has delivered a total of 1,045,571 new vehicles. At 22:33:18 on February 6, NIO completed its 100 millionth battery swap; during the 2026 Chinese New Year holiday, NIO provided a cumulative 2,073,500 battery swapping services, with daily average services up 29.4% YoY versus the Chinese New Year holiday last year. From February 15 to February 23, NIO Energy's cumulative highway charging and battery swapping volume exceeded 25.28 million kWh, accounting for 15% of the national highway charging and battery swapping total. Starting from February 18 (the second day of the Chinese New Year), NIO battery swapping set new single-day service records for five consecutive days. XPeng Motors delivered a total of 15,256 new vehicles in February, bringing cumulative deliveries in the first two months of 2026 to 35,267 units, down 42% YoY. In February, the all-new XPeng G6 launched in the UK, with the entire lineup equipped as standard with an 800V high-voltage platform and a new-generation LFP battery, while introducing an all-wheel-drive performance black edition for the first time. The XPeng G6 has now been exported to more than 40 countries and regions worldwide, covering Asia-Pacific, Europe, the Middle East and North Africa, and Latin America, and continues to win favour among an increasing number of overseas consumers. As for Xiaomi Auto, its deliveries exceeded 20,000 units in February, while January deliveries exceeded 39,000 units, bringing cumulative deliveries in the first two months of 2026 to 59,000 units. Notably, the Xiaomi YU7 continued to rank first in sales in February and has now held the top spot for six consecutive months. In February 2026, Xiaomi YU7 sales reached 20,196 units, ranking among the top three passenger vehicle models nationwide for the month. As for BYD, China's "EV king," February sales reached 190,190 units, retaining its position as China's NEV sales champion. In January-February 2026, BYD Group's cumulative sales reached 400,241 units, while cumulative overseas sales of passenger vehicles and pickups totaled 200,160 units, and cumulative new energy vehicle sales exceeded 15.5 million units. On March 5, BYD unveiled the second-generation blade battery. Wang Chuanfu, Chairman of BYD Group, said that the second-generation blade battery can charge from 10% to 70% in 5 minutes, and from 10% to 97% in just 9 minutes. The second-generation blade battery offers 5% higher battery energy density than the first-generation blade battery. Car models equipped with the second-generation blade battery include the Yangwang U7, Denza N9, Fangchengbao Tai 3, Seal 07, Datang, Sea Lion 06, Song Ultra, Fangchengbao Tai 7, Denza Z9GT, and Yangwang U8L, among which the Denza Z9GT has a driving range of 1,036 km. Regarding auto industry sales in February 2026, Cailian Press quoted an executive at a new carmaker as saying, "Affected by the longest-ever nine-day Chinese New Year holiday in February, the auto industry's effective production and sales period was significantly shortened, making it a typical off-season for auto consumption. Combined with the phased reduction in the vehicle purchase tax incentive, the auto industry as a whole remained subdued and full of challenges.” Looking ahead to the passenger vehicle market in March, the CPCA said that March this year had 22 working days, one more than the 21 working days in March 2025. As industries across the board rapidly returned to normal operations after the Chinese New Year holiday, production and sales growth in March is expected to rise sharply MoM. The post-Chinese New Year period is an important window for new product launches, and many producers rolled out a large number of new vehicles. Driven by national pro-consumption policies, many provinces and cities introduced corresponding measures to stimulate consumption, while the full resumption of offline activities such as auto shows will also accelerate the return of foot traffic. As prices of lithium carbonate, copper, and other materials have remained high recently, coupled with the continued anti-involution trend, producers are expected to launch relatively few new energy car models offering better-than-expected value for money, leaving limited potential for an explosive rebound in auto consumption. Although the recent Middle East crisis caused some transportation disruptions, China’s complete vehicle enterprises shifted from “chartering vessels and waiting for shipping space” to “building ships and controlling transport,” with rapid expansion of their own fleets, greater autonomy and control over shipping capacity, and significant optimization in cost and efficiency. Our sales support capabilities are stronger than those of other international automakers, and if the crisis does not last long, export transportation will not be significantly affected. As the national trade-in policy is fully implemented, the consumer potential for replacement and upgrade purchases will be gradually released, helping the auto market strengthen steadily in March. In 2026, policy subsidies and structural optimization in the auto industry will become key factors in leveraging overall market prosperity and accelerating the premiumization of new energy vehicles. Although the 2026 consumer goods trade-in subsidy fund of 250 billion yuan was down 50 billion yuan from 2025, the 100 billion yuan in special fiscal and financial coordinated funding to boost domestic demand can reduce financing costs for residents’ car purchases and automakers through loan interest subsidies and financing guarantees, effectively stimulating endogenous consumption momentum and expanding new room for domestic demand. Huachuang Securities pointed out that since March, the passenger vehicle retail market has begun to improve, with foot traffic and transactions gradually recovering, mainly due to the digestion of deferred wait-and-see demand from last year and the launch of new models. Attention should be paid to market acceptance of new vehicles after price increases and to dynamic adjustments by automakers. Although the subsidy amount per vehicle declined this year, coverage may expand. Combined with the low base in H2 last year, industry retail sales growth in H2 is expected to turn positive, with full-year retail growth expected at 1%, including +5% for EVs. Export data for January-February exceeded expectations, and full-year exports are expected to surpass 7.1 million units, boosting wholesale growth by about 3%, including +8% for EVs. In February, due to weaker demand during the Chinese New Year, the new energy penetration rate remained firm at 48%. Current total channel inventory is about 3.4 million units, an increase of about 600,000 units compared to the same period last year. Rising Prices of Memory Chips and Precious Metals, Some Automakers Warn of Cost Pressure It is worth noting that as memory chip and precious metal prices have fluctuated upward recently, some automakers in the market have begun trying to respond to supply chain cost pressure through “price increases.”Monitoring data from TrendForce showed that since H2 2025, prices of DDR4 memory used in automotive-grade DRAM have risen by more than 150% cumulatively, while DDR5 memory prices have surged by 300%. Data provided by UBS showed that over the past three months, automotive-grade DRAM prices as a whole increased by 180%. According to incomplete statistics, since the start of 2026, multiple automakers, including NIO, Li Auto, VOYAH, Xiaomi, and Zeekr, have issued warnings or been reported to be facing cost challenges brought by chip price increases. In a livestream, Deepal Chairman Deng Chenghao said that current production costs have risen by several thousand yuan compared with earlier levels, with the pressure mainly coming from wild swings in power battery and in-vehicle memory chip prices; Li Auto Vice President of Supply Chain Meng Qingpeng even warned that the supply fulfillment rate for automotive memory chips in 2026 may be less than 50%; Xiaomi Chairman Lei Jun mentioned in a livestream in January that the new Xiaomi SU7 is facing memory cost pressure that is jumping quarter by quarter, with memory cost per vehicle expected to increase by several thousand yuan. However, according to the latest news from NIO on March 11, NIO founder and chairman Li Bin said that rising prices of memory and other raw materials have impacted the cost of high-end new energy car models by 3,000 to 5,000 yuan respectively, with the total impact nearing 10,000 yuan. At present, NIO’s existing system can support the pressure brought by rising costs, and the company currently has no plan to adjust prices. At the Q4 and full-year 2025 earnings call, Li Auto President Ma Donghui said that in response to the impact brought by the current increase in parts prices, Li Auto will strengthen coordination with supply partners and sign long-term LTA agreements with relevant suppliers to lock in prices or allocations in advance. If there is a price adjustment mechanism, it will be strictly implemented in accordance with the contract; where there is no price adjustment mechanism, the company will also share costs with suppliers. It will absorb as much of the pressure from external price increases internally as possible, including through its self-developed range extender and self-developed chips. “Li Auto will comprehensively consider parts costs and user value in determining the pricing of new car models, and is confident that through a series of measures it can keep the impact of raw materials within a reasonable range,” Ma Donghui said. UBS warned that chip shortages may begin disrupting global auto production as early as Q2 this year, with EV manufacturers that are highly dependent on advanced chips expected to be affected the most.

[SMM Cast Aluminum Alloy Morning Comment: Futures Rebound Lifted Sentiment, Spot Quotes Rose Across the Board] Spot market, boosted by the rebound in futures prices, ADC12 quotes rose across the board today, with the SMM average price of ADC12 raised by 300 yuan/mt. Driven by the cost side, producers actively recouped earlier losses, generally raising prices by 200-400 yuan/mt. However, affected by wild swings in prices during the week, downstream purchase sentiment remained cautious, with most buyers staying on the sidelines and only restocking to meet immediate needs, while the overall pace of market transactions was stable. In the short term, against the backdrop of cost support and a mild release of supply, ADC12 prices were expected to hold up well.

On March 9, Shacman Holdings and DST held a strategic partnership signing ceremony focused on the new energy commercial vehicle sector. Both parties agreed to prioritize user needs and will explore deeper collaborations in intelligent driving and aftermarket services.

On March 9, WeRide and Geely Farizon New Energy Commercial Vehicle Group signed an agreement to deepen their strategic partnership. They unveiled the upgraded mass-production Robotaxi GXR and announced plans to deliver 2,000 units globally in 2026, marking a shift towards large-scale commercial Robotaxi operations.

In mid-February 2026, CAAM and the China Automotive Power Battery Industry Innovation Alliance successively released relevant data on the auto and power battery markets for January 2026. According to CAAM’s analysis, in January 2026, the auto industry overall operated steadily, the passenger vehicle market declined somewhat, the commercial vehicle market continued its positive trend, the NEV market remained stable, and auto exports continued to grow....... SMM compiled the relevant data on the auto market and power battery market for January 2026 for readers’ reference. Automobiles CAAM: In January 2026, Auto Production and Sales Both Exceeded 2 Million Units, Production Edged Up YoY In January, auto production and sales totaled 2.45 million and 2.346 million units, respectively, with production up 0.01% YoY , while sales fell 3.2% YoY, down 25.7% and 28.3% MoM, respectively. CAAM: In January 2026, China’s NEV Production and Sales Reached 1.041 Million and 945,000 Units, Respectively, up 2.5% and 0.1% YoY In January, NEV production and sales reached 1.041 million and 945,000 units, respectively, up 2.5% and 0.1% YoY, respectively , with NEV sales accounting for 40.3% of total new vehicle sales. CAAM: Auto Exports Continued to Grow in January, NEV Exports Posted Rapid Growth In January, auto exports reached 681,000 units, up 44.9% YoY , down 9.5% MoM . NEV exports reached 302,000 units, up 100% YoY and 0.5% MoM ; traditional fuel vehicle exports reached 380,000 units, up 18.8% YoY , down 16.1% MoM. Regarding the auto market in January, CAAM said that the auto industry overall operated steadily in January, the passenger vehicle market declined somewhat, the commercial vehicle market continued its positive trend, the NEV market remained stable, and auto exports continued to grow. The main factors behind the market decline were: first, the transition and adjustment of the NEV purchase tax policy; second, car purchase subsidy policies in many regions were at the turn of the year; and third, some consumer demand was released ahead of schedule in 2025. In the first month of 2026, the country intensively introduced a series of policies benefiting both households and businesses to support livelihoods and economic development. Among them, the program of large-scale equipment upgrades and consumer goods trade-ins was smoothly and orderly carried forward, with various localities successively following up and issuing implementation details; the Work Plan for Accelerating the Cultivation of New Growth Drivers in Service Consumption focused on key areas such as automotive aftermarket services, stimulating market vitality. As relevant policies are further refined and implemented, this will help stabilize and rebound demand in the auto market and support the industry's steady operation. CAAM stated that the 15th Five-Year Plan period is a critical window for China's automotive industry to transition toward high-quality development, requiring the industry to improve quality and efficiency while maintaining stable market operations. Meanwhile, the CPCA also released January passenger vehicle market data. January retail sales in China's passenger vehicle market totaled 1.544 million units, down 13.9% YoY. Due to the complex market factors at play, the pattern of weaker sales in the first half and stronger sales in the second half has become more pronounced in recent years. Since 2020, low YoY retail growth in January has been relatively common, for example, -21% in 2020, 27% in 2021, -5% in 2022, -38% in 2023, 58% in 2024, and -12% in 2025. Therefore, the -13.9% reading in 2026 was a mid-range outcome amid the wild swings in January growth rates over the years. NEV side, January retail sales in the passenger NEV market were 596,000 units, down 20.0% YoY; January retail sales of conventional internal combustion engine passenger vehicles were 948,000 units, down 10% YoY. Export side, January passenger NEV exports reached 286,000 units, up 103.6% YoY . This accounted for 49.6% of passenger vehicle exports, up 12.5 percentage points compared to the same period last year. Of this, pure EVs accounted for 65% of NEV exports (67% in the same period last year), while A00+A0-class pure EVs, the core focus segment, accounted for 50% of pure EV exports (41% in the same period last year). As China's scale advantages in NEVs emerge and market expansion demand grows, more and more China-made new energy brands are going global, with their recognition outside China continuing to rise. Plug-in hybrids accounted for 33% of NEV exports (32% in the same period last year). Although they have recently faced some disruptions from external countries, exports of self-owned plug-in hybrids to developing countries have been growing rapidly, with bright prospects ahead. The CPCA stated that after the NEV purchase tax exemption policy, implemented since September 2014, officially ended at month-end December 2025, the NEV market entered a normal recovery period. Some consumers brought purchases forward to enjoy the policy dividend in December last year, resulting in a certain pull-forward effect in January. This was an expected short-term fluctuation and does not represent the market's long-term trend. Specifically, the characteristics of the January passenger vehicle market were as follows: First, January passenger vehicle producer exports hit a record high for the month, and passenger NEV exports also reached a historic January high, fully demonstrating the rising competitiveness of China's automotive industry in the global market and continued robust demand outside China; second, the retail pullback after the expiration of the vehicle purchase tax exemption was evident, while the share of high-end NEVs rose significantly, reflecting growing consumer demand for high-quality NEVs amid the consumption upgrade trend, which will help drive the industry's transition toward high-quality development; third, new vehicle launches in 2026 were steady, and with anti-involution efforts curbing disorderly price cuts, January NEV sales promotions remained at 10.1%, staying around 10% for five consecutive months. There was no vicious volume discount competition, which helped maintain market order; fourth, the historical pattern of internal combustion engine vehicles outperforming NEVs ahead of Chinese New Year continued again. In January, retail sales of internal combustion engine vehicles in China fell 10% YoY, pure EV retail sales fell 17.0% YoY, range-extended vehicles rose 0.8% YoY, and plug-in hybrids fell 31.2% YoY. As the pull-forward effect from last December weakens in the future, the NEV market is expected to return to a positive growth track; fifth, in January, the penetration rate of NEV retail sales in China was 38.6%, and the export penetration rate was 49.6%; sixth, in January 2026, exports of self-owned internal combustion engine passenger vehicles were 250,000 units, up 17% YoY, while self-owned NEV exports were 226,000 units, up 115% YoY. NEVs accounted for 47.5% of self-owned exports. In particular, the high growth of NEV exports in Europe and Southeast Asia marked the expanding influence of Chinese NEV brands in the international market, laying a solid foundation for future export growth. Power battery In January, China’s cumulative sales of power and ESS batteries reached 148.8 Gwh, up 85.1% YoY In January, China’s sales of power and ESS batteries totaled 148.8 Gwh, down 25.4% MoM , up 85.1% YoY . Of this, power battery sales were 102.7 Gwh, accounting for 69.0% of total sales, down 28.6% MoM and up 63.2% YoY; ESS battery sales were 46.1 Gwh, accounting for 31.0% of total sales, down 17.0% MoM and up 164.0% YoY. In January, China’s combined exports of power and ESS batteries were 24.1 Gwh, down 26.0% MoM and up 38.3% YoY , accounting for 16.2% of sales in the month. Of this, power battery exports were 17.7 Gwh, accounting for 73.3% of total exports, down 7.1% MoM and up 59.3% YoY; ESS battery exports were 6.4 Gwh, accounting for 26.7% of total exports, down 52.6% MoM and up 1.4% YoY. In January, China’s cumulative domestic power battery installations reached 42 Gwh, up 8.4% YoY In January, domestic power battery installations were 42 Gwh, down 57.2% MoM , up 8.4% YoY . Of this, ternary battery installations were 9.4 Gwh, accounting for 22.3% of total installations, down 48.6% MoM and up 9.6% YoY; LFP battery installations were 32.7 Gwh, accounting for 77.7% of total installations, down 59.1% MoM and up 8.1% YoY. In January, the performance of emerging automakers diverged in terms of YoY growth, with Leap Motor continuing to “lead the pack” and Xiaomi Auto’s January deliveries surpassing 39,000 units Statistics compiled by a CLS reporter on the January sales of 15 A/H-share listed automakers showed that 9 automakers achieved YoY growth, accounting for 60%. Higher NEV sales and expansion into overseas markets became important drivers supporting the overall growth of these automakers. SAIC’s January sales reached 327,000 units, up 23.94% YoY, returning to the top spot in sales. Its NEV segment continued to gain momentum. In January 2026, SAIC sold 85,000 NEVs, up 39.7% YoY, with sales volume ranking among the industry leaders. As for second-ranked Geely, its January sales reached 270,200 units, up 1.29% YoY and up 14.08% MoM, making it the only enterprise to achieve positive growth both YoY and MoM. Geely Automobile said, “2026 will be a major product year for Geely Automobile. The company will launch 1-2 brand-new products each quarter, covering multiple new hybrid car models and a new generation of methanol-hydrogen energy car models, in a full push toward its annual sales target of 3.45 million units.” On exports, Geely set its 2026 export sales target at 640,000 units, up more than 50% YoY. As for the NEV startup market in January, judging from the January delivery volumes released by major automakers, all major automakers saw delivery declines of varying degrees MoM versus December 2025. Among them, Leap Motor continued to lead in 2026, ranking first among NEV startups with deliveries of 32,059 units, up 27.37% YoY and down 46.94% MoM. To stabilize the market, Leap Motor accelerated channel development, recently adding 85 stores. As of January 5, its total number of stores nationwide reached 1,068, ensuring that more users could conveniently experience Leap Motor’s products and services. On February 2, Leap Motor announced new car purchase benefits for February: a New Year cash gift of 11,000 yuan in cash discounts, a New Year loyalty gift of up to 10,000 energy points, and a New Year financing gift of up to five years of zero interest. Li Auto regained momentum in January, ranking just behind Leap Motor with 27,668 units, down 7.55% YoY and down 37.47% MoM. As of January 31, 2026, Li Auto’s cumulative historical deliveries reached 1,567,883 units. On February 5, Li Auto Chairman Li Xiang said on a social media platform that Li Auto would launch the all-new Li L9 in 2026, “not just a car, but also a pioneering work of an embodied AI robot.” Cailian Press reporters learned that Li Auto had established an AI company organizational structure for this purpose, including teams for computing power and data, foundation models, and software and hardware bodies, to build system capabilities for “creating silicon-based humans.” As of January 31, 2026, Li Auto had 547 retail centers nationwide, covering 159 cities, as well as 547 after-sales repair centers and authorized service centers, covering 221 cities. Li Auto had put into use 3,966 Li Auto supercharging stations nationwide, with 21,945 charging piles. NIO delivered a total of 27,182 units in January, up 96.08% YoY and down 43.53% MoM. On the afternoon of February 1, NIO completed delivery of the 60,000th all-new ES8 in Guangzhou, taking 134 days. On the same day, the NIO brand launched seven-year ultra-low-interest car purchase plans for the new ET5, ET5T, ES6, and EC6, while the ONVO brand launched the same for the ONVO L60 and L90, featuring a 0.49% annualized rate for seven years, zero financial service fees, and zero penalties for early repayment. The firefly brand launched a seven-year ultra-low-interest car purchase plan, with buyers who place orders receiving a Year of the Horse Chinese New Year Adventure Gift Pack. XPeng Motors delivered 20,011 new vehicles in January, down 34.07% YoY and down 46.65% MoM. In January, the XPeng X9 continued to sell strongly, with monthly deliveries of 4,219 units, up 413.9% YoY. As of month-end January, its cumulative deliveries reached 51,897 units, making it the fastest car model among China's emerging MPV makers to surpass 50,000 deliveries. In the same month, pre-orders opened for the 2026 XPeng X9 BEV version. As the “world’s longest-range 5C pure-electric large seven-seater,” the new model was fully aligned with the hot-selling super extended-range version in terms of product competitiveness. From now until the new model goes on sale, a 2,000-yuan deposit can be used to offset 7,000 yuan of the car purchase price. In addition, according to data from Xiaomi Auto’s official Weibo account, Xiaomi Auto delivered more than 39,000 vehicles in January, even surpassing Leap Motor, which ranked first among emerging EV makers. On the same day, Xiaomi also announced car purchase benefits related to the Xiaomi SU7 and Xiaomi SU7 Ultra. All Xiaomi YU7 variants are eligible for “seven years of low interest”! A new low-monthly-payment option has been added, with down payments starting from 99,900 yuan and monthly payments from less than 2,000 yuan. Orders placed before 24:00 on February 28 also qualify for an optional “three years interest-free” plan, with down payments starting from 74,900 yuan and monthly payments as low as 4,961 yuan. At the same time, buyers can enjoy limited-time car purchase benefits of up to 66,000 yuan. Regarding store expansion progress, Xiaomi Auto said it added nine new stores in January, bringing its total to 484 stores across 139 cities nationwide; six more stores are expected to be added in February, with coverage expected to expand to two new cities, Jiangmen and Zhoukou; as of January 31, it had 270 service outlets nationwide, covering 159 cities across the country. As for BYD, the leader in EVs, its January sales reached 210,051 units, with cumulative NEV sales exceeding 15.3 million. BYD exported a total of 100,482 NEVs in January. Notably, there was also fresh news on BYD’s solid-state battery business. A CLS reporter learned from BYD’s Investor Relations Department that BYD is exploring multiple technology pathways in the solid-state battery field, taking sulphide solid-state batteries as an important technical direction, and has achieved breakthroughs in battery life and fast charging, with small-scale production expected in 2027. In the sodium-ion battery field, it is already at the development stage of its third-generation product technology platform and has developed sodium-ion battery products capable of 10,000 cycles. The mass-production period will be determined based on actual market conditions and client demand. Cui Dongshu, Secretary General of the CPCA, commented that the recent weakness in January auto retail sales was reasonable, given that the vehicle purchase tax exemption policy had just ended and only some provinces and cities had launched trade-in and renewal subsidy policies, while mid-January last year was a peak sales period before Chinese New Year, and the holiday timing shift also weighed on January auto retail performance. It was expected that as local detailed rules for replacement subsidies were gradually refined and subsidy application channels became smoother, together with the gradual release of potential car purchase demand before the Chinese New Year holiday, the auto retail market would gradually recover and improve. At the Beginning of 2026, National and Local Governments Across Many Regions Mentioned Policies to Promote Auto Consumption; More Than 20 Regions Introduced New Trade-in and Car Purchase Subsidy Policies After entering 2026, as national subsidies were scaled back, consumer-stimulus policies to promote consumption were being rolled out intensively at both the national and local levels through multiple measures. According to incomplete statistics, more than 20 provinces, municipalities, and autonomous regions, including Beijing, Shanghai, Chongqing, Zhejiang, and Sichuan, had issued detailed rules for activities such as automobile trade-in, retirement and renewal, or car purchase subsidies. On December 31, 2025, the general offices of eight departments including the Ministry of Commerce issued the Implementation Rules for Automobile Trade-in Subsidies in 2026, which officially took effect on January 1, 2026. It mentioned that in 2026, a one-time subsidy would be granted to individual consumers who retired gasoline passenger vehicles registered on or before June 30, 2013, diesel and other fuel passenger vehicles registered on or before June 30, 2015, or passenger NEVs registered on or before December 31, 2019, and purchased either a passenger NEV included in the Ministry of Industry and Information Technology’s Catalog of NEV Models Eligible for Vehicle Purchase Tax Reduction and Exemption or a fuel passenger vehicle with an engine displacement of 2.0 liters or below. For those who retired the above qualified old vehicles and purchased a passenger NEV, a subsidy of 12% of the new vehicle’s selling price (tax included, the same hereinafter) would be provided, with the subsidy amount (rounded up to the nearest yuan, the same hereinafter) capped at 20,000 yuan; for those who retired the above qualified fuel passenger vehicles and purchased a fuel passenger vehicle with an engine displacement of 2.0 liters or below, a subsidy of 10% of the new vehicle’s selling price would be provided, with the subsidy amount capped at 15,000 yuan. The CPCA analyzed that the key words for the 2026 trade-in policy were not “further escalation,” but “more sustainable, more balanced, and more supervisable.” Changing the subsidy amount to a proportion of vehicle price with a cap was intended to ensure more balanced use of subsidies and avoid situations in which quotas were consumed too quickly in the early stage, forcing subsidies to be suspended later. The adjustment to the calculation method would also have a certain impact on the structure of the automobile market, among which the stimulus for low-priced car models was significantly weakened, while car models priced at 160,000-200,000 yuan could fully enjoy the subsidy, making the policy more friendly to replacement purchases for upgrade demand. Producers needed to meet market demand through product competitiveness and financial solutions, with greater emphasis on “long-term value” such as driving range, intelligence, and recharging experience, rather than relying on one-off subsidies. The China Automobile Dealers Association also stated in an article that the 2026 automobile trade-in policy strengthened overall work coordination and promoted the efficient direct delivery of subsidy funds. This would allow limited funds to benefit more consumers, especially by meeting the needs of rigid-demand groups. The scope of eligible car owners is expected to be further expanded, with support more clearly focused on encouraging the phaseout of old vehicles and the purchase of energy-efficient vehicles and NEVs. Implementation is expected to emphasize the role of market mechanisms, making subsidies better aligned with actual demand. Procedures are clear and convenient, and supervision and management mechanisms are more robust. Overall, the policy is expected to continue stimulating consumer vitality and add new momentum to the transformation, upgrading, and high-quality development of the automotive industry. Since the beginning of 2026, according to incomplete statistics, multiple provinces and cities, including Shanghai, Beijing, Sichuan, and Shandong, have successively released detailed rules related to the automotive trade-in policy, continuously promoting local auto consumption: [Shanghai's 2026 Automotive Trade-In Policy Takes Effect, Maximum Subsidy 20,000 yuan] Shanghai's 2026 automotive trade-in policy has taken effect. Eight departments, including the Shanghai Municipal Commission of Commerce, jointly issued the Implementation Rules for the 2026 Shanghai Automotive Trade-In Subsidy Policy, officially launching subsidy programs for vehicle retirement and renewal and replacement renewal. Individual consumers can receive subsidies of up to 20,000 yuan. The policy has been implemented since January 1, 2026, and applications will be accepted until January 10, 2027. [Hubei's 2026 Detailed Rules for Automotive Trade-In Subsidies Take Effect, Maximum Subsidy 20,000 yuan] The Hubei Provincial Department of Commerce, together with eight departments including the provincial National Development and Reform Commission and the Department of Economy and Information Technology, officially issued the Detailed Rules for the Implementation of Hubei Province's 2026 Automotive Trade-In Subsidies. The rules specify that through two major approaches, retirement and renewal and replacement renewal, special subsidies will be provided to individual consumers purchasing NEV and small-engine gasoline passenger vehicles, with the maximum subsidy amount reaching 20,000 yuan. The policy has been formally implemented since January 1, 2026. [Xi'an's 2026 Detailed Rules for Automotive Trade-In Subsidies Take Effect, Maximum Subsidy for Retiring a Vehicle and Replacing It with a NEV Reaches 20,000 yuan] Xi'an issued the Detailed Rules for the Implementation of Xi'an's 2026 Automotive Trade-In Subsidies, clarifying that through two major models, retirement and renewal and replacement renewal, special subsidies will be provided for individual consumers purchasing new vehicles. The policy covers the entire year, and subsidy applications will be accepted until January 10, 2027, further reducing residents' car purchase costs and supporting the upgrading of the automotive consumer market. [Beijing's 2026 Automotive Trade-In Subsidy Program Starts on February 9, Maximum Subsidy 20,000 yuan] Beijing's 2026 automotive trade-in subsidy policy has been officially unveiled. Reporters learned on February 6 that Beijing had officially released the Implementation Plan for Beijing's 2026 Automotive Trade-In Subsidies and is about to launch two types of subsidies, "retirement and renewal" and "replacement renewal." The application system will open at 10:00 a.m. on February 9, and eligible car purchase consumers can receive subsidy support of up to 20,000 yuan. Among them, "retirement and renewal" refers to retiring an old vehicle and purchasing a new one. Consumers who purchase a passenger NEV can receive a subsidy of 12% of the new vehicle's selling price, with the subsidy amount capped at 20,000 yuan; those who purchase a fuel passenger vehicle with an engine displacement of 2.0 liters or below can receive a subsidy of 10% of the new vehicle's selling price, with the subsidy amount capped at 15,000 yuan. [Sichuan: Supporting Vehicle Replacement and Renewal, with Subsidies of up to 15,000 yuan] The Sichuan Provincial NDRC and Department of Finance issued a notice on printing and distributing the Policy Measures of Sichuan Province for Implementing Large-Scale Equipment Renewal and Consumer Goods Trade-in in 2026. The notice mentioned support for vehicle replacement and renewal. In 2026, individual consumers who transfer a passenger vehicle registered under their own name through sale and purchase a passenger NEV included in the Ministry of Industry and Information Technology's Catalog of NEV Models Eligible for Vehicle Purchase Tax Reduction and Exemption, or a fuel passenger vehicle with an engine displacement of 2.0 liters or below, will be granted a one-time subsidy. For those replacing with a passenger NEV meeting the above conditions, a subsidy of 8% of the new vehicle's selling price will be granted, with the subsidy amount capped at 15,000 yuan; for those replacing with a fuel passenger vehicle meeting the above conditions, a subsidy of 6% of the new vehicle's selling price will be granted, with the subsidy amount capped at 13,000 yuan. Cui Yan, Deputy Director of Guolian Minsheng Research Institute and Chief Auto Analyst, said that various regions had successively launched 2026 trade-in subsidies and, coupled with the gradual rollout of new models after Chinese New Year and ahead of auto shows, auto sales were expected to stabilize and rebound. Speaking of auto market sales in January, he said overall end-use demand was relatively mediocre in January, mainly because local subsidies on the policy side had not yet been officially launched, while on the supply side few new car models were introduced by automakers. "These two factors are currently improving. Since mid-to-late January, local governments have successively launched trade-in subsidies; supply side, after Chinese New Year and before auto shows, automakers will gradually launch new vehicles or begin pre-launch promotional campaigns." Auto demand is expected to stabilize and rebound after Chinese New Year. According to CCTV News, in 2026, the Ministry of Commerce, together with regional authorities and relevant departments, will further advance the consumer goods trade-in program, with a focus on further optimizing policy implementation in areas such as automobiles and continuously releasing consumption potential. Ministry of Commerce big data showed that as of February 5, 335,000 applications for 2026 auto trade-in subsidies had been filed, driving 53.77 billion yuan in new vehicle sales, strongly supporting the development of the auto market and the recycling and reuse of resources, while promoting industrial quality upgrading and green transformation. In January, the average price of new vehicles participating in trade-in exceeded 160,000 yuan, significantly higher than a year earlier; nationwide, 659,000 retired vehicles were recycled, up 50.2% YoY. On February 9, the Ministry of Commerce held a symposium with automakers to study work related to automobile circulation and consumption. Representatives from relevant automotive industry associations, research institutions, and enterprises attended the meeting. Vice Minister of Commerce Sheng Qiuping attended the symposium and exchanged views with participants. Sheng Qiuping pointed out that China’s ultra-large market had a solid foundation, the automotive consumption chain was long and had great potential, and the continued implementation of policies provided stable support, leaving much room for expanding automobile consumption across the entire value chain. In 2026, the Ministry of Commerce will work with relevant departments to pursue both policy support and reform and innovation, integrate existing measures with incremental policy, optimize the implementation of the automobile trade-in policy, launch pilot reforms for automobile circulation and consumption, improve industry management systems, and take multiple measures to promote both the expansion and upgrading of automobile consumption. On February 12, as Chinese New Year approached, the General Office of the Ministry of Commerce issued the Notice on Properly Carrying Out Trade-in Programs for Consumer Goods During the 2026 Chinese New Year Holiday. It stated that all localities should strengthen funding support for consumer goods trade-in subsidies during the Chinese New Year period, leverage the advantages of different channels, ensure effective policy implementation, and better meet consumer demand. In line with Chinese New Year customs and to create a stronger festive atmosphere, consumers were encouraged to go out for shopping and consumption. During the nine-day 2026 Chinese New Year holiday (February 15–23), consumers will be fully ensured access to apply through offline channels for trade-in subsidies for home appliances and subsidies for purchasing new digital and smart products. Consumers who purchase new cars during the nine-day Chinese New Year holiday will also be eligible to apply for automobile trade-in subsidies in accordance with policy requirements.

[SMM Cast Aluminum Alloy Morning Comment: Overnight Futures Slightly Lower, Spot Prices Hold Steady Amid Wait-and-See Attitude] On Wednesday, the A00 aluminum price edged down by 30 yuan/mt to 23,260 yuan/mt compared with the previous trading day, while the SMM ADC12 price remained stable at 23,650 yuan/mt. As the Chinese New Year approaches, upstream and downstream enterprises in the secondary aluminum industry chain have entered a concentrated holiday period, leading to a noticeable decline in market liquidity. Actual transactions continue to be sluggish, with spot quotations largely making minor adjustments around the futures market.

According to CAAM data, in January, automobile production and sales reached 2.45 million and 2.346 million units respectively. Production was up 0.01% YoY, while sales decreased by 3.2% YoY, down 25.7% and 28.3% MoM respectively. NEV production and sales reached 1.041 million and 945,000 units respectively, increasing by 2.5% and 0.1% YoY. NEV sales accounted for 40.3% of total new automobile sales. According to CAAM analysis, in January, the overall automobile industry operated steadily. The passenger vehicle market experienced some decline, while the commercial vehicle market continued its positive trend. The NEV market operated stably, and automobile exports maintained growth. The main factors contributing to the market decline were: first, the transition and adjustment of the NEV purch

On January 28, GAC Lingcheng and Remote New Energy Commercial Vehicles signed a strategic cooperation agreement in Guangzhou. Attendees included Qin Haining from Guangzhou Public Transport Group, Fan Xianjun from Remote Commercial Vehicles, and Zhang Zhiyong from GAC Lingcheng. The two parties will engage in comprehensive cooperation to jointly promote the green and intelligent transformation of commercial vehicles. Leveraging their respective strengths in R&D, manufacturing, and distribution channels, the two sides will deepen collaboration in areas such as technological development and market expansion. By complementing each other's advantages, they aim to accelerate technological iteration and market popularization, thereby enhancing industry competitiveness. This cooperation aligns with the "dual carbon" goals and the industry trends of new energy adoption and intelligent transformation. It represents a significant strategic move for both parties and is expected to inject new momentum into the new energy transition of commercial vehicles. Zhang Zhiyong stated that as a top-tier enterprise in the industry, Remote Commercial Vehicles possesses strong capabilities. He expressed anticipation that the collaboration would achieve a "1+1>2" effect, creating high-quality products and empowering users and industry development. Fan Xianjun pointed out that GAC Lingcheng has profound expertise in vehicle manufacturing. This cooperation is an important implementation of Remote's open strategy. The two sides will jointly build a green and intelligent transportation ecosystem to promote high-quality industry development. Qin Haining expressed high expectations for the cooperation, hoping that both parties would leverage the public transport scenarios in Guangdong to develop innovative products characterized by "Guangzhou R&D, manufacturing, and application," thereby contributing to urban green transportation construction and the realization of "dual carbon" goals. As the new energy transition of commercial vehicles enters a critical phase, this collaboration is expected to set an industry example in areas such as technological breakthroughs and shared infrastructure development. It will accelerate the large-scale application of commercial vehicles with multiple technological routes and support emission reduction in the transportation sector. This powerful alliance demonstrates the strategic foresight of the enterprises. It will break through technological bottlenecks, reduce costs, expand markets, enhance the level of China's new energy commercial vehicle industry, and lay a foundation for achieving the "dual carbon" goals.