Passenger Car Sales

1. Definition and Data Sources

Passenger car sales refers to the statistical metric tracking the volume of passenger cars sold by domestic manufacturers over a specified timeframe (typically on a monthly, quarterly, or annual basis), serving as a primary benchmark to gauge the vitality of the automotive consumer market. Passenger cars mainly comprise vehicles with 9 seats or fewer, including sedans, SUVs, and MPVs. This data is regularly published by the China Association of Automobile Manufacturers (CAAM, covering total industry sales) and the China Passenger Car Association (CPCA, covering retail sales of narrow passenger vehicles), serving as a crucial reference for assessing automotive industry trends.

2. Year 2025: Surpassing 30 Million Units for the First Time

In 2025, China's passenger car production and sales both breached the 30-million-unit mark for the first time, with annual sales hitting 30.103 million units, charting a 9.2% year-on-year growth. Sales of Chinese-brand passenger cars reached 20.936 million units, pushing their market share up to 69.5%, an increase of 4.3 percentage points year-on-year. The annual penetration rate of New Energy Vehicles (NEVs) stood at approximately 47.9%, signalling that the industry has firmly entered an NEV-dominated era.

3. First Half of 2026: Overall Volume Under Pressure, Structural Divergence

In the first half of 2026, the passenger car market exhibited a trend of "overall volume under pressure, structural divergence". Cumulative retail sales of narrow passenger cars reached 8.701 million units, representing a year-on-year drop of 20.2%. Domestic sales of conventional internal combustion engine (ICE) passenger cars totalled only 3.694 million units, down by 1.732 million units or a 31.9% year-on-year slump.

Domestic sales of new energy vehicles reached 5.09 million units, down 13.4% year-on-year, with passenger cars accounting for 4.594 million units. Nevertheless, the NEV penetration rate continued its upward trajectory, touching 62.9% in May and climbing further in June. Automotive exports emerged as a critical growth engine, with total vehicle export volume reaching 5.096 million units in the first half of the year—a 65.3% surge year-on-year, marking the first time half-year exports crossed the 5-million threshold.

4. Divergence Across Price Segments

The passenger car market in the first half of 2026 displayed sharp divergence across price brackets:

• Below RM50,000: Sales volume came in at 130,000 units, tumbling by a steep 55% year-on-year, with market share effectively halved from 2.8% to 1.4%

• RM100,000 to RM150,000: Sales volume stood at 2.66 million units, down 27% year-on-year

• NEVs above RM400,000: Sales volume hit 240,000 units, registering a robust 46% year-on-year surge as the only segment charting positive growth

Chinese domestic brands captured a dominant 59% share in the above-RM400,000 segment, up by 21 percentage points year-on-year.

5. July 2026 Market Performance

July is traditionally an off-peak period, with narrow passenger car retail sales projected at around 1.52 million units, marking a 16.8% year-on-year decline. Retail sales of new energy passenger cars are forecast at approximately 980,000 units, with the NEV penetration rate expected to hit a record-high of 64.5%. BYD's passenger car sales reached 411,000 units in July, continuing to lead the market.