JPMorgan released a research report stating that its China auto export tracker continues to show resilient overseas momentum for Chinese automakers.

Chinese brands' share of European passenger car registrations rose to a new high of 12% in August, with year-to-date share through the first eight months at approximately 10%, compared to 6% in 2025; new energy vehicle market share reached about 21% in August, with the first eight months at 19%, above 2025's 12%.

The latest registration data shows that market share gains are becoming broader, covering more Chinese OEMs, while leading exporters continue to develop differentiated regional and localization strategies.

The report noted that EV plus plug-in hybrid penetration in the five major EU markets rose to a new high of 39% in August, with EV plus plug-in hybrid sales growing 53% year-on-year, while overall passenger car sales grew only 6% year-on-year; year-to-date penetration rose to 32%, compared to 26% in 2025.

By comparison, China's penetration rate remained as high as 65% in August and 57% year-to-date, while the US has roughly stagnated at 7%.

JPMorgan believes that accelerating electrification in Europe benefits Chinese automakers, given their strong positioning in pure electric and plug-in hybrid segments, and the still significant penetration gap relative to China indicates room for further electrification growth.

The report said that NEV market share gains have extended beyond BYD Company Limited (ASX: 01211), with Chery Auto (ASX: 09973) becoming another important contributor.

BYD remains Europe's largest Chinese NEV maker, with 7.6% market share in August and 7.5% in the first eight months, compared to 4.9% in 2025; Chery Auto's three brands Chery, JAECOO and OMODA combined held 3.6% market share in August and 3.5% in the first eight months, versus only 1.6% in 2025; Leapmotor (ASX: 09863)'s market share rose from 0.9% in 2025 to 2.4% in the first eight months of this year; XPeng Inc. (ASX: 09868) and Geely Automobile Holdings Limited (ASX: 00175) also continued to improve from lower bases.

Facing a more challenging domestic and policy backdrop, JPMorgan maintains a selective stance on the sector, preferring OEMs that can sustainably gain market share and possess overseas scale and localization capabilities, with Chery Auto as its top pick among Chinese passenger car OEMs, rated "Overweight" with a target price of HK$35, supported by differentiated overseas operations, local-to-local strategies and attractive valuation.

JPMorgan noted that Chery Auto's overseas production capacity, including owned, joint venture and contract capacity, is expected to reach approximately 800,000 units by 2027, equivalent to about one-third of total capacity, helping regionalized production and addressing trade barriers such as tariffs and local content requirements.