Morgan Stanley wrote in a report that the outlook for internal combustion engine (ICE) automakers is under further pressure this year amid a price war for new energy vehicles (NEVs) on the mainland. DONGFENG GROUP (00489.HK) -0.120 (-3.883%) Short selling $4.99M; Ratio 2.431% had announced a loss in its preliminary results for 2023, sounding a warning for the industry, while investment in NEVs is expected to rise, worsening the profitability of ICE makers.At the same time, the broker believed that the transformation of smart EVs in the mainland may continue, and that profitability from ICEs will become more important as a reliable source of capital for investment in NEVs amid uncertainties in the industry and macro environment.Related NewsJPM Lifts GEELY AUTO TP to $19, Cuts TPs of NIO/ ZHONGSHENG HLDGMorgan Stanley is more favourable to ICE carmakers with sales or profitability in the traditional automotive supply chain and a clearer roadmap for the transition to NEVs. Given the competitive landscape in the more attractive ICE market, the broker highlighted that international players exited the mainland market and are now focusing on transforming into the NEV market, which may give local traditional OEMs, including CHANGAN AUTOMOBILE (000625.SZ) +0.140 (+1.116%) , a better chance of expanding their ICE market share.(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2025-02-05 16:25.) (A Shares quote is delayed for at least 15 mins.)