China’s passenger car market softened in early December, with retail sales down 19% YoY in the first three weeks, but NEVs remained resilient.
According to the latest data from the China Passenger Car Association, retail sales in China’s passenger vehicle market reached 1.30 million units between December 1 and 21, down 19% year on year (YoY) and up 5% month on month (MoM).
Cumulative retail sales for the year to date totaled 22.783 million units, representing a 4% YoY increase.
As year-end approaches, the overall market has shown a clear cooling trend, with demand release lagging behind the same period in previous years.
Wholesale volumes also came under pressure. In the first three weeks of December, automakers wholesaled 1.302 million passenger vehicles, down 23% YoY and 13% MoM.
Year-to-date wholesale volumes reached 28.067 million units, up 9% YoY. Against the backdrop of a slower retail recovery, manufacturers have become more cautious in managing wholesale pace.
Despite the broader market downturn, new energy vehicles remain the core pillar of China’s passenger car market.
In the first three weeks of December, NEV retail sales totaled 788,000 units, up 1% YoY and 3% MoM, with penetration rising to 60.6%.
On the wholesale side, NEV passenger vehicle shipments reached 782,000 units over the same period, down 10% YoY and 12% MoM, while penetration remained at a relatively high 60.1%.
From a cumulative perspective, the structural advantage of NEVs remains evident. Year-to-date NEV retail sales reached 12.26 million units, up 18% YoY, while cumulative NEV wholesale volumes rose to 14.538 million units, up 25% YoY.
By contrast, pressure on traditional internal combustion engine vehicles continued to intensify. In the first three weeks of December, nationwide production of pure ICE light vehicles fell to 681,000 units, down 25% YoY.
Meanwhile, production of hybrid and plug-in hybrid models declined to 398,000 units, down 19% YoY, underscoring a broad-based contraction.
On a weekly basis, retail sales showed gradual improvement in December, though the pace of recovery remained slow.
Average daily retail sales in the first week stood at 42,000 units, down 32% YoY, rising to 67,000 units in the second week, down 17% YoY, and further increasing to 77,000 units in the third week, still down 11% YoY.
Wholesale momentum was similarly weak. Automakers’ average daily wholesale volumes were 43,000 units in the first week, down 40% YoY, rebounding to 62,000 units in the second week but still down 22% YoY, and climbing to 81,000 units in the third week, remaining 9% lower YoY.
The CPCA noted that slower wholesale activity at the start of the month was mainly driven by weaker earlier retail performance and consecutive increases in channel inventory over the past two months, making dealers more cautious about restocking.
Compared with early December 2024, when inventory clearance led to a higher wholesale base, performance this year was slightly lower, though the overall pace remained relatively stable.
While the domestic market faces mounting pressure, exports continue to serve as a key offset. Data show that from January to November, China exported a total of 7.33 million vehicles, up 25% YoY, including 3.01 million NEVs, representing a sharp 62% increase.
As the competitiveness of Chinese brands improves and overseas distribution networks mature, overseas sales are playing an increasingly important role in supporting the overall market.
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