China Heavy-Duty Truck Sector "Key takeaways from conference calls with ..."

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China Heavy-Duty Truck Sector "Key takeaways from conference calls with ..."

Global Research

18 June 2026ab

China Heavy-Duty Truck Sector Equities

ChinaKey takeaways from conference calls with Foton

and Sinotruk Automobile Manufacturers

Wei Shen

Analyst

wei.shen@ubs.com

Overall message positive for China truck exports +86-21-3866 8897

We hosted calls with Foton Motor and Sinotruk this week. The key messages from both Paul Gong

companies included: 1) total overseas addressable market for commercial vehicles (CVs) Analyst

for Chinese brands, including buses, trucks and vans, is 7m. China's CV exports totalled paul.gong@ubs.com

1m last year, representing a market share of 15%; 2) electric share of Chinese CV +852-2971 7868

exports remains low, suggesting there is significant upside to penetration; 3)

competition between Chinese brands is expected to be mild over the next 2-3 years; 4)

Europe's upcoming Industrial Accelerator Act (IAA) has had a limited impact on Foton

and Sinotruk so far, as their European exposure is low. Longer term, Foton and Sinotruk

have plans to build plants in markets, such as Europe and Brazil, to shield against tariff

wars.

Foton: Solid export growth & potential in European van market

In our call with Foton Motor, management indicated total sales rose 10% YoY in 5M26,

with exports up 38% YoY. Key takeaways from the call include: 1) sales guidance for

2026 remains intact at 722k units, implying 11% YoY growth, driven by strong heavy-

duty truck (HDT) and light-duty truck (LDT) sales; 2) export sales target for 2026 was

raised 10% to 200k units, with risks relating to the Strait of Hormuz closure seen as

limited; 3) visibility into long-term electrification export growth appears clear; the