Changan Automobile 2025 Electrification Transformation and Investment Value Assessment

According to the provided data, Changan Automobile’s total sales in 2025 were 2.913 million units, with new energy vehicle sales reaching 1.109 million units, a year-on-year increase of 51%, hitting a nine-year high. Below is a comprehensive assessment from two aspects: the competitiveness of electrification transformation and investment value.

---

1. Market Performance and Growth Rate
   • New energy vehicle sales reached 1.109 million units, a year-on-year increase of 51%, ranking among the top in growth rate among domestic automakers. Compared with major competitors BYD (4.6 million units) and Geely (3.02 million units), Changan’s new energy sales share is increasing, and its market competitiveness has been enhanced [2].
   • Changan Automobile’s full-year sales in 2025 hit a nine-year high, with the share of new energy vehicles continuing to rise, indicating obvious transformation results [2].

2. Brand and Technology Layout
   • Changan has built a five-brand matrix including Avatr, Deepal, Qiyuan, classic models, and Kaicheng, covering multi-level needs from high-end, tech-sports to mainstream family and commercial markets, which is conducive to expanding market coverage and differentiated competition [3].
   • In terms of technology R&D, Changan has invested heavily. In the past three years, it has applied for more than 14,000 patents, with an average of 19 new patents per day, covering key areas such as batteries, intelligent driving, and large models. Technological accumulation provides a solid foundation for the competitiveness of its new energy products [3].

3. Supply Chain and Globalization Progress
   • The localization rate of the supply chain at Changan’s Rayong plant in Thailand has reached nearly 40%, and it plans to increase it to more than 70% by 2027-2028, showing its capabilities in overseas manufacturing and supply chain integration [3].
   • The company’s globalization strategy “Haina Baichuan” (Embracing All Rivers) is advancing steadily, with gradual expansion into Southeast Asian and European markets. Deepal plans to cover at least 10 European regional markets by the end of 2025, and the globalization strategy is gradually being implemented [4].

4. Competitive Challenges Faced
   • The domestic new energy market is highly competitive. Leading brands such as BYD and Geely have obvious sales and technological advantages. Although Changan’s growth rate is rapid, there is still a gap in overall market share.
   • Price wars continue, and the uncertainty of the 2026 purchase tax reduction and subsidy policy has increased profit pressure, testing Changan’s cost control and profitability [5].

---

1. Valuation and Financial Status
   • The current market capitalization is about $98.11 billion, with a P/E ratio of 17.19x, which is relatively reasonable. The net profit margin is 4.15%, ROE is 8.83%, and the current ratio is 1.22, indicating that the company has a stable financial status and low debt risk [0].
   • DCF valuation shows: conservative valuation of $36.73, base valuation of $45.71, and optimistic valuation of $67.51. Compared with the current stock price of $11.86, there is significant upside potential, and the valuation is attractive.

2. Profitability and Growth
   • The high growth of new energy vehicle sales will drive future revenue growth, while technology investment and brand matrix will help improve medium and long-term competitiveness and profitability.
   • However, the net profit margin is low, and there is a gap in profitability compared to leading enterprises. It is necessary to improve profit quality through scale effects and cost control.

3. Technical Analysis
   • Recently, the stock price has been in a sideways consolidation. The technical indicator MACD has not shown obvious crossovers, KDJ is weak, and the overall trend is unclear. Investors need to pay attention to changes in technical patterns in the short term [0].

4. Market Sentiment and Risks
   • Although the fundamentals have improved significantly, the stock price fell by 8.56% in 2025, and market confidence in the transformation still needs further verification.
   • Factors such as macro policies, industry competition, and price wars will pose uncertain risks to its future performance.

---

Changan Automobile has shown strong execution and growth potential in electrification transformation. The high year-on-year growth of new energy vehicle sales, accelerated technological innovation, and the advancement of globalization layout have all enhanced its competitiveness. However, in terms of overall market share and profitability, there is still a gap compared to leading enterprises. In terms of investment, the current valuation is relatively reasonable, and DCF valuation indicates significant upside potential, but it is necessary to closely monitor market competition and macro policy risks.

Given the improved fundamentals and attractive valuation, it is suitable for long-term value investors to pay attention to, but in the short term, it is necessary to guard against volatility risks brought by market competition and policy changes.

---

[0] Jinling API Data
[2] Sina Finance - Accelerating Global Layout! Changan Automobile Officially Announces (https://finance.sina.com.cn/stock/relnews/cn/2025-12-28/doc-inhekhim0960683.shtml)
[3] People’s Daily - Visiting Automakers: Looking at China’s Auto Industry’s “Three 30 Million” (In-depth Observation) (http://paper.people.com.cn/rmrb/pc/content/202512/31/content_30128296.html)
[4] Sina Finance - Avatr Races to IPO in Hong Kong: A Scarce New Energy Target of the “National Team”, Betting 11.5 Billion Behind Huawei (https://finance.sina.com.cn/stock/t/2025-12-23/doc-inhcvfac5070485.shtml)
[5] Phoenix Auto - 2025 Automaker Sales: BYD and Geely Rank Top Two, Leapmotor Becomes New Energy Sales Champion (https://auto.ifeng.com/c/8pZIljN6d2M)