Daiwa analysts see China’s auto sector edging toward a modest rebound in April, with production and sales ticking up month‑over‑month while year‑on‑year growth stays uneven. Plug‑in hybrids remain weak, but new‑energy vehicle exports surge, buoyed by improving global competitiveness. Domestic demand stays muted, hampered by policy shifts and a high comparison base from last year.

Bernstein warns Volkswagen may book a first‑quarter write‑down of 60%‑75% on the $800 million tooling outlay for the ID.4 at its Chattanooga plant after U.S. sales faltered and the $7,500 federal EV credit vanished. While the loss dents quarterly earnings, shedding the unprofitable model could improve VW’s operating margin, and the stock nudged up 1.3%.

Citi cuts its 2026‑27 earnings outlook for Chongqing Changan Automobile by 16%‑21%, citing cost pressures that surfaced after 2025 expenses exceeded forecasts. The broker trims the target price to 11.10 yuan and halves the NEV price‑to‑sales multiple to 1×, aligning it with peers. Despite the downgrade, Citi still expects volume and revenue growth through 2027, leaving the stock marginally lower.

Investors eye the divergent trajectories: China’s export‑driven recovery offers upside, while Volkswagen’s write‑down and Changan’s margin squeeze underscore the sector’s volatility. Earnings pressure may prompt further strategic pivots as firms balance cost control with growth ambitions. Analysts will monitor policy shifts and global demand trends for clues on the next earnings cycle.