Auto stocks in Hong Kong continued their downward trend. At the time of writing, XPENG-W (09868) fell 3.73% to HK$71, LI AUTO-W (02015) dropped 1.91% to HK$64.35, and GWMOTOR (02333) declined 1.62% to HK$14.6.

Industry data revealed mixed signals for China's auto market in November. While the China Association of Automobile Manufacturers reported a 5.1% month-on-month increase in production and a 3.2% rise in sales, totaling 3.532 million and 3.429 million units respectively, the Passenger Car Association indicated persistent weakness in retail sales. Passenger vehicle retail sales fell 8.1% year-on-year and 1.1% month-on-month, reflecting subdued consumer demand.

A JPMorgan research report noted that November's passenger vehicle sales in mainland China grew only 3% month-on-month, below seasonal levels. The bank attributed the soft demand to the early depletion of government subsidies, which led to cautious consumer sentiment. Additionally, major EV makers' conservative Q4 sales guidance and weak early December figures suggest the sluggish trend may persist.

JPMorgan further projected that new energy vehicle demand in Q1 next year could drop around 30% sequentially and remain below seasonal norms.