China NEV Sales Slide 38% in First Week of January 2026

Early January (Jan 1–11): China Passenger Car retail fell 32% YoY to 328K units; NEV sales dropped 38% to 117K, with penetration at 35.5%.

The China Passenger Car Association (CPCA) released its passenger car market report for the period of January 1-11, 2026, today.

The data shows that from January 1st to 11th, retail sales in the national passenger car market reached 328,000 units, a year-on-year decrease of 32%. During the same period, wholesales by manufacturers were 381,000 units, down 40% year-on-year.

In the new energy vehicle (NEV) market, retail sales from January 1st to 11th were 117,000 units, a 38% decrease year-on-year, with the penetration rate reaching 35.5%. For the same period, national NEV wholesales by manufacturers were 167,000 units, down 30% year-on-year, achieving a penetration rate of 43.9%.

The report points out that the three consecutive days off for the 2026 New Year’s Day holiday, coupled with the recent expiration of the vehicle purchase tax exemption policy, make the relatively weak retail performance in January entirely normal. As local subsidy details and application channels are fully activated nationwide, the market is expected to gradually recover.

Furthermore, due to the impact of the Spring Festival falling in February this year, a certain amount of wholesale volume has been shifted forward into January. Additionally, given the current market model of pre-sale orders, a number of companies still have a considerable backlog of orders awaiting delivery.

Looking back at the full-year market data for 2025, China’s automobile production and sales reached 34.531 million and 34.4 million units, respectively, ranking first globally for 17 consecutive years. Among these, the production and sales of new energy vehicles (NEVs) exceeded 16 million units, accounting for over 50% of domestic new car sales and becoming the primary growth driver of the Chinese automobile market.

In terms of the overseas market, automobile exports surpassed 7 million units in 2025, with NEV exports reaching 2.615 million units, which doubled year-on-year.

The China Association of Automobile Manufacturers (CAAM) forecasts that total vehicle sales in the Chinese market could reach 34.75 million units in 2026, representing a 1% year-on-year increase. Specifically, annual NEV sales are projected to hit 19 million units, up 15.2% year-on-year, while export sales are expected to reach 7.4 million units, an increase of 4.3%.