HDT sales hit a wall from 2H21. We are negative on China heavy-duty truck (HDT) demand and believe the current market estimates have not priced in the full extent of the decline in sales volume. We forecast 1.10 mn / 1.05 mn / 1.00 mn HDT sales volume in2022/23/24E, down 21%/5%/5% YoY. We believe that as the regulation disruptions from 2016-21 have largely taken place, HDT sales would be driven by the overall economy again. The key drivers behind our bearish view are: (1) real estate market is on its way to a prolonged trough; (2) total registered HDTs might be more than needed, indicating weak future demand; and (3) the fleet age is very young compared to HDT’s service life, meaning HDT owners can afford to age their fleet for a few years