Car Sales Growth Slows in China
Car sales growth in China has stabilized at 3.9% for the year 2025, marking the slowest pace in three years despite a shift towards electric vehicles and ongoing export recovery.
The China Association of Automobile Manufacturers reported that sales of electric and plug-in hybrid vehicles surpassed those of traditional models for the first time over the year. However, this momentum has clearly declined, with the growth rate of registrations dropping to 17.6% compared to over 40% recorded in 2024.
This slowdown was particularly evident in the last quarter of the year, as many cities and provinces cut or suspended financial support aimed at upgrading old vehicles due to tightening financial margins.
Faced with pressures in the domestic market, manufacturers have intensified their expansion into foreign markets, boosting car exports to 5.79 million units in 2025, an increase of 19.4%. Meanwhile, shipments of fully electric vehicles surged by nearly 49%, reaching 1.52 million units.
Observers indicate that maintaining this export dynamic, which is becoming challenging, is expected to lose momentum in 2026 due to the need to clear inventories, uncertain prospects in the electric sector, and less favorable energy conditions.
In terms of distribution networks, forecasts are cautious, with many car dealers anticipating downward revisions of their targets for the upcoming year, even as some players continue to express growth ambitions that run counter to the overall trend.
