China’s passenger car exports surged by 80% in June compared to the same month last year, driven primarily by strong demand for electric vehicles, while domestic sales fell by 26%.
According to the China Association of Automobile Manufacturers, exports of Chinese passenger cars in the first half of this year rose by 72%, surpassing 4.4 million units. Domestic sales in China remained robust, with nearly 8.3 million vehicles sold from January to June, including about 1.5 million passenger cars in June. In that month, China exported approximately 905,000 passenger cars, an increase from 809,000 in May.
Pressure on the Domestic Market and Forecasts
The domestic automotive market in China is facing pressure from oversaturation and intense price competition. A prolonged downturn in the real estate sector has negatively affected family budgets, leading to decreased demand. Additionally, a reduction in government support for electric vehicle purchases has also contributed to the decline.
The consulting firm AlixPartners projects that passenger car sales in China may drop by 10%, as potential buyers are likely to postpone purchases in anticipation of further price reductions.
Chinese automakers, including BYD, are expanding their footprint in international markets and establishing factories in key regions. This strategy could enhance their profitability but may also heighten tensions with trading partners.
According to Stephen Chan, an analyst at S&P Global Ratings, exports of passenger cars from China could increase by 30-50% for the entire year of 2026 compared to the previous year. Automotive analysts also expect that rising gasoline prices due to the conflict in Iran will boost global interest in electric vehicles.
Source: AP
