Auto Export

[Intro: Chinese auto market shows divergent trends, domestic sales hit by a cold wave, exports are booming. In the domestic sales trough of June and July, auto exports have exceeded one million vehicles for two consecutive months. Based on this trend, can China's auto exports break 10 million vehicles for the first time in 2026?]

Li Suwan

In 2026, can China's auto exports break 10 million for the first time? The answer will be revealed in a few months.

In the past, China's annual auto export volume hovered around one million vehicles for many years; now, China's single-month auto export volume can exceed one million vehicles, entering an "explosion period". Behind this is the transformation from auto exports to systematic global expansion.

Following the first single-month break of one million in June, China's auto exports continued a strong growth trend in July. According to the latest data from the China Association of Automobile Manufacturers, in July this year, auto exports reached 1.043 million vehicles, up 0.6% month-on-month and 81.3% year-on-year; from January to July this year, auto exports totaled 6.14 million vehicles, up 66.8% year-on-year. In stark contrast, statistics from the China Association of Automobile Traders show that in July 2026, national passenger car market retail sales were 1.461 million vehicles, down 20.9% year-on-year and 8.8% month-on-month; cumulative retail sales from January to July this year were 10.173 million vehicles, down 20.3% year-on-year.

One rise and one fall reflect the intensifying changes in the structure of China's auto industry. The domestic car market has become increasingly crowded, exports continue to play a bottoming-out role, effectively stabilizing auto company wholesale and capacity, alleviating pressure from weak domestic retail, and China's automotive position in the global market is on an upward trend.

Can exports break 10 million vehicles for the first time this year?

In early July this year, a brand new AION V sped along the coastal road in Swansea, Wales, UK. The owners were Mr. and Mrs. Kim, purchasing a Chinese car brand for the first time. In a market like the UK where the auto industry is mature and brand competition is fierce, it is not easy for a new car brand from China to win local consumers' favor. Mr. and Mrs. Kim finally chose the AION V, due to product appearance design, specifications, as well as an 8-year warranty and after-sales service factors.

Stories of overseas owners of Chinese brands are becoming more common. The UK, Belgium, Brazil, Germany, Australia, Thailand, South Korea, etc., are gradually becoming major export markets for China's new energy vehicles. In the first half of this year, thanks to the doubling of exports by independent brands like Aion, GAC Group achieved a year-on-year growth of 2.35% despite weak sales of joint ventures. It's not just GAC Group; even BYD, which ranks first in China's auto sales, relies on export growth to alleviate the pressure of declining domestic sales. BYD RACCO Otter and other models are entering the K-Car light automatic vehicle market which accounts for 1/3 of the Japanese auto market. In July this year, BYD new energy vehicle exports were about 180,000 vehicles, creating a new single-month historical high, and its export scale approaches that of China's auto export champion brand, Chery.

In July 2026, Chery Group's export volume was 202,500 vehicles, up 70.1% year-on-year, also setting a new single-month export historical high, and becoming the first domestic car enterprise to break 200,000 vehicles in a single month; cumulative exports for the first 7 months of this year were 1.1464 million vehicles.

Unlike BYD's AII IN new energy vehicles, Chery adopts a dual-track strategy of fuel + new energy, its export volume has led for a long time, deepening into markets such as Southeast Asia, South America, Russia, with extensive overseas KD factory layouts. BYD is catching up, adopting a dual track of complete vehicle exports + overseas factory building, laying out factories in Thailand, Brazil, Hungary, Turkey, covering developed countries and emerging markets. Under the SAIC Group, the MG brand has long been the highest-selling Chinese brand in Europe; its subsidiaries SAIC-GM-Wuling and SAIC Passenger Cars are also accelerating the increase in CKD export proportions. Chery, BYD, and SAIC Group form the first echelon of going global, staging a race of chasing and being chased.

Independent brands such as Geely, Changan, and Great Wall are also accelerating overseas expansion; Geely relies on Lynk & Co and Polestar to challenge the European high-end market; Great Wall uses Thailand and Brazil factories as pivot points, focusing on Southeast Asia and Latin America; Changan focuses on the ASEAN new energy market. At the same time, new forces such as Xpeng, NIO, and Li Auto are accelerating their internationalization pace, successively landing in European, Southeast Asian and other overseas markets. Xpeng MONA L03 was officially launched globally in Munich, Germany on July 16 this year. This is Xpeng Auto's first time placing a new product global premiere overseas, marking an important step in its globalization strategy.

Under the joint efforts of multiple auto companies, China's auto exports have entered a fast lane. According to China Passenger Car Association data, passenger car exports (including complete vehicles and CKD) accounted for 41% of passenger car manufacturer sales in July this year (37% in June, 21% in the same period of 2025). The surge in exports is inseparable from new energy vehicles. From January to July this year, new energy passenger car manufacturer exports reached 2.771 million vehicles, up 128.5% year-on-year; among them, July new energy passenger car manufacturer exports were 540,000 vehicles, up 147.8% year-on-year and 8.1% month-on-month, accounting for 58.8% of passenger car exports.

Following the first surpassing of fuel vehicle exports in June, new energy vehicle exports continued to improve in July.

With the shrinking domestic car market, numerous auto companies will inevitably increase the bottoming-out role of exports in the coming months, not only independent brands but also joint ventures. Based on the current trend, if no unexpected issues arise, the cumulative auto exports in China from August to December are expected to exceed 4 million vehicles. A full-year export volume breaking 10 million for the first time is highly likely to happen.

The transformation from auto exports to systematic global expansion

In 2012, China's auto exports crossed the one-million vehicle threshold for the first time, followed by nearly a decade where export volume fluctuated around one million vehicles. Until 2021, China's auto exports broke through 2 million vehicles for the first time, reaching 2.015 million vehicles, officially saying goodbye to the one-million level fluctuation area and achieving leapfrog growth; in 2022, surpassing Germany with 3.111 million vehicles, it became the world's second-largest auto exporting country; in 2023, surpassing Japan with 4.91 million vehicles, China topped the list of the world's largest auto exporting country; continuing to rise, in 2025 export scale broke through the 8 million vehicle milestone.

By this year, China's auto exports are even expected to reach the 10 million level. This is not just a superficial data change, but a profound reform of the export system. Over these years, China's auto industry has moved from the pure fuel vehicle complete vehicle export of the Export 1.0 stage into the Export 2.0 stage and even towards the 3.0 stage. Besides setting up KD assembly factories overseas, driven by the industrial dividend of electrification and intelligence, while iterating export models, not only using three-electric technology, smart cockpits, and smart driving capabilities to build product power advantages to replace the original low-price competition model, but also accelerating the integration of R&D, supply chain, energy replenishment, after-sales, and brand ecosystems in overseas markets. Head auto companies are setting up R&D centers, battery supporting factories, charging/swapping networks, etc. overseas, accelerating the "paving of the road" for Chinese smart electric vehicles to drive global.

Cui Dongshu, Secretary-General of the China Passenger Car Association, stated in an interview with the media that these four core advantages—significant scale advantages, overseas demand dividends, vast incremental space, and a complete supporting system—complement each other, bringing explosive growth to China's auto exports. China's annual auto production and sales have exceeded 30 million vehicles. The huge industrial volume dilutes R&D and production costs, achieving economies of scale to reduce costs and increase efficiency. Plus, China possesses the most complete industrial chain globally, forming extremely strong cost-performance ratios and supply stability. At the same time, high international oil prices drive up fuel vehicle usage costs, providing an opportunity for Chinese new energy vehicles to explode globally. Additionally, global emerging markets also provide space for China's auto export growth.

Although China's auto exports welcome a golden age, while rapid growth continues, one must also be vigilant about risks ahead. Currently, in the global auto market with annual sales nearing 100 million vehicles, China's autos account for 1/3 of the market share. Especially, China's new energy vehicles account for over 60% of the global new energy market, and in niche segments such as plug-in hybrids, it even exceeds 70%. In this situation, the space for China's auto exports will gradually become limited, and future uncertainties will continue to increase. International trade protection barriers will continue to be built higher. For example, after the EU levied countervailing duties on China's pure electric vehicles, it is also moving to swing the trade baton against China's plug-in hybrids. In addition, countries may continue to raise local parts procurement rates and localization production thresholds in the future, increasing the difficulty for Chinese cars going global.

At the same time, constructing new systems overseas for China's autos, building well-known international brands, and laying overseas service networks still require a certain time and process. Also, emission standards, charging standards, autonomous driving regulations, etc. vary by country, and geopolitical and public opinion risks persist. To some extent, the future difficulty in the international market will not decrease but increase. Chinese auto companies both at home and abroad will have to enter a new stage of "value-driven, structure optimization".

Commentary

In 2026, the probability of China's auto exports breaking 10 million for the first time is very high. However, the true test of globalization has just begun. How to strengthen the going-global system, how to establish a complete value chain overseas, how to enhance brand value, how to convert current scale into sustainable global operation capability, and how to fully clash with top multinational auto companies like Toyota, Volkswagen in the international market, these are all internationalization challenges that urgently need further answers.

(This article is an original work of Heyan Yueche. Unauthorized reproduction is prohibited.)